Government 'Help' Actually Hurts Delaware Small Businesses More Than It Helps

Delaware Governor Matt Meyer took the stage with fanfare, touting the relaunch of the State Small Business Credit Initiative as a lifeline for local entrepreneurs. He spotlighted two companies, Carbon Reform and WhipFlip, as shining examples of how state support fuels success. It’s a feel-good story, no doubt. But beneath the applause lies a troubling reality: government programs like SSBCI often promise more than they deliver, leaving taxpayers footing the bill for bloated, inefficient schemes.

The narrative is seductive. Small businesses, the backbone of America’s economy, get a boost from federal dollars, creating jobs and sparking innovation. Yet the numbers tell a different story. While Meyer celebrates, over half of U.S. small businesses struggle to secure affordable loans, with only 14.6% of applications approved by large banks. Why? Because government meddling distorts markets, tightens credit, and buries entrepreneurs in red tape.

This isn’t about denying the grit of Delaware’s business owners. Carbon Reform and WhipFlip may well thrive. But their success doesn’t justify a system that funnels billions into programs rife with waste and fraud. The SSBCI, reauthorized with nearly $10 billion under the American Rescue Plan, claims to leverage private investment. Yet conservatives know better: when government picks winners, markets lose.

The real question is whether Delaware’s entrepreneurs need a government crutch or a freer market to stand tall. History suggests the latter. Let’s peel back the curtain on Meyer’s pet project and see what’s really at play.

Since its inception in 2010, the SSBCI has been sold as a game-changer, channeling federal funds to states for tailored small business programs. By late 2024, it’s supported over 3,600 businesses, creating or retaining 46,200 jobs. Impressive, at first glance. But dig deeper, and the cracks appear. The program’s $3.1 billion in new financing, including $2.6 billion from private sources, sounds robust. Yet it’s a drop in the bucket compared to the $50 billion states spend annually on economic incentives, often with questionable returns.

Conservatives have long warned against such initiatives. The Paycheck Protection Program, a crisis-era lifeline, showed government’s knack for mismanagement, with billions lost to fraud. The Economic Injury Disaster Loan program fared no better, plagued by ineligible recipients. SSBCI’s defenders claim it’s different, with tight oversight and a focus on underserved communities. But targeting specific groups risks distorting markets, favoring some businesses over others based on political priorities, not merit.

Meyer’s cheerleading ignores these red flags. He touts Delaware’s support for minority- and women-owned businesses, but the data is less rosy. Underserved entrepreneurs face higher loan denial rates, even with similar risk profiles. Programs like SSBCI may patch holes, but they don’t fix the root issue: a financial system choked by regulation and government overreach. Streamlining the Small Business Administration and cutting red tape would do more than any federal handout.

Then there’s the leverage argument. SSBCI claims to catalyze $10 in private investment for every federal dollar. But if private capital is so eager, why does it need government nudging? The truth is, these programs often crowd out genuine market solutions, creating dependency instead of resilience.

Small businesses don’t need bureaucrats playing venture capitalist. Since the pandemic, America has seen a historic surge in entrepreneurship, with 21 million new business applications filed between 2021 and early 2025. Small businesses now employ 61.7 million Americans, driving 70% of net new jobs since 2019. This boom, fueled by minority- and women-owned firms, proves entrepreneurs thrive when markets are free, not when government pulls the strings.

Contrast that with state-led incentives. New York’s Employee Training Incentive Program and Texas’ economic strategies offer tax breaks and infrastructure support, but studies show mixed results. Many jobs created are low-wage or short-term, costing states dearly. Delaware’s SSBCI push risks the same fate, funneling cash to a select few while ignoring broader barriers like rising costs and regulatory burdens.

Advocates for government intervention argue it levels the playing field, especially for underserved communities. They point to SSBCI’s focus on seed-stage ventures and minority-owned firms. But good intentions don’t guarantee results. By prioritizing certain groups, these programs risk alienating others, creating resentment and inefficiency. A rising tide lifts all boats, and market-driven solutions, like tax cuts and deregulation, benefit everyone, not just the politically favored.

Delaware’s entrepreneurs deserve better than government handouts dressed up as progress. The state’s small business owners, like those across America, want freedom to innovate, not bureaucratic strings attached to every dollar. Conservatives have a clear vision: slash regulations, lower taxes, and let markets work. These policies, proven by decades of economic growth, empower businesses without distorting competition.

History backs this up. The post-World War II boom, sparked by deregulation and tax relief, unleashed American ingenuity. The Small Business Administration, created in 1953, was meant to support, not supplant, private markets. Today, it’s bloated, with programs like SSBCI straying far from that mission. Reforming the SBA to focus on core functions, like loan guarantees, would deliver real results without the waste.

Delaware could lead the way. Instead of doubling down on federal programs, Meyer could champion policies that cut compliance costs and simplify lending. Community banks, which provide most small business loans, are stifled by regulation. Easing those burdens would unlock capital faster than any SSBCI relaunch.

The choice is stark. Cling to government-driven schemes that pick winners and breed inefficiency, or unleash the market’s power to lift all businesses. Delaware’s future, and America’s, depends on choosing wisely.