Linda McMahon in Washington, re-imagining the SBA
Washington – Linda McMahon, the highest-ranking member of the Trump administration from Connecticut, has had a trial-by-fire first year as head of the Small Business Administration.
A successful entrepreneur whose name became synonymous with professional wrestling, McMahon, 69, had never worked in government before.
She was tested when her agency, a key responder to natural disasters, was dispatched to aid the victims of three major hurricanes last year. She said that when she accepted the job, she didn’t know about the SBA’s vital role in offering disaster victims low-interest loans to rebuild their businesses.
McMahon also is a key player in promoting the new GOP tax plan among the nation’s small businesses.
The SBA provides loan guarantees to small business that might not otherwise qualify for a bank loan. Those SBA-guaranteed loans offer lower payments, longer terms and looser criteria to qualify. The SBA also makes direct, low-interest loans to those businesses impacted by disasters.
Unlike other cabinet officers who have been scorched by the white-hot light of media scrutiny and Democratic criticism, McMahon has largely avoided negative publicity.
With a trace of a cadence from her native North Carolina, she told The Connecticut Mirror that she identifies with the entrepreneurs she tries to help. Like those businessmen and businesswomen, McMahon considers herself and her husband Vince risktakers who have “had plenty of ups and downs.”
The downs included filing for bankruptcy as a young couple in 1976 and briefly receiving food stamps.
Eventually the couple founded the Stamford-based World Wrestling Entertainment.
Other failures may include two losing campaigns for a Connecticut seat in the U.S. Senate, which cost her personally more than $100 million.
She has “no plans” to run for office again and said she took the top job at the SBA because President Donald Trump asked for her help. McMahon had donated about $7 million to political action committees that helped Trump get elected.
Although she was born and raised in New Bern, N.C., she has lived in Greenwich since 1982 and considers Connecticut her home. She commutes there from Washington every weekend.
But McMahon is now firmly a member of the Washington, D.C., power structure and spoke to us about her work.
What surprised you most upon coming to Washington?
I think what I didn’t expect was, although I was coming in to run a federal agency and to be part of the president’s cabinet, I think I was surprised about the lack of understanding about the full breath and scope of the SBA in the marketplace. SBA is kind of thought about as guaranteeing loans … and the fact that SBA provides counseling and mentoring through different partners around the country, has women’s business centers… so what I realized is that we really needed to launch what I call “SBA re-imagined,” and we spent the last year putting it together. We’re going to roll out our new logo, our new marketing messages over the next couple of months. I really want the general public, especially small business owners, to know about the opportunities they have with the SBA.
A higher profile?
A higher profile.
What is the toughest thing you’ve encountered so far?
Well, it was a little bit like drinking from a fire hose when I first started. Learning the agency, learning the different aspects of government relative to being in the private sector. One of the things I wanted to look at with SBA … was to be effective and efficient. So, we started to take a look, peeling back the onion, looking through all the different program offices here within SBA to see how they were staffed, what are our programs, what are our metrics for measuring outcomes, not just output. I wanted to measure success.
You had two big events in your first year, hurricanes and the tax bill.
Until shortly before I went through my Senate confirmation hearing for SBA, I did not realize that disaster response and disaster recovery was part of SBA.
So, when I came on board, I met with James Rivera, who is the associate administrator for that office and I said, ‘Okay James, I want you to tell me exactly how prepared are we for a disaster and what is the worst one that has ever come through?’ And he said that’s when we had Katrina, Rita and Wilma, which were all pretty much in close proximity.
And I said, ‘Has anything come close to that?’ And he said, ‘Not in terms of overall economic impact but Sandy was, for other reasons, harder.’ So I said, ‘How prepared are we for that?’ And he said, ‘Well, we’re in pretty good shape.’ And I said, ‘Well you have to show me. You have to pretend that three storms, three Sandys have come through all at one time and show me how well we are prepared to respond to that.’ And he said, ‘Well, it will never happen.’ And I said, ‘Well it might happen.’
So, we did tabletop exercises. I went to the Dallas-Fort Worth [disaster relief center] area, looked at how we could hire more people… So three storms hit… We actually ramped up to 5,000 employees. We processed as many loans in half the time as they did with Katrina.
The other thing is the federal tax overhaul. Is there some confusion among small business owners on how it would impact them?
I’ve not found confusion. What I found and… I started out visiting small businesses in May. What I found was with the anticipation of the tax reform bill and the regulatory reform that was already in place, that they were already feeling positive. So, the first quarter of the fiscal year this year, our 7(a) [loan guarantee] program is up almost 20 percent than what it was last year, which shows continuing enthusiasm and optimism, more businesses starting or growing.
I’m out talking to these people. I’m listening to what they have to say. And they are saying, without fail, they will take any tax cut and put it into their businesses. They want to grow their businesses. That’s the nature of entrepreneurs.
You pledged to visit all 68 SBA district offices….
This week I will actually have gone to half. Since last May I’ve been to 29 states. I am hopeful to visit all of them before the end of this calendar year. Because I want those field offices… to make them all feel part of the whole.
You support SBA reforms proposed by Congress…
I think SBA is the least partisan agency in government. I work incredibly well on the House side and the Senate side with both the chairmen and ranking members… So one of the things the Small Business Committees on both sides wanted to give us the ability to do is to give us the oversight of the 7(a) program, and to increase the limit in lending if we got to a certain point…
You say the president chose you to head the SBA because you are an entrepreneur like him.
He wanted somebody who actually built a business, who knew both successes and failures.
What about your husband Vince’s decision to revive the XFL football league?
It’s a challenge.
Your transition from Connecticut to Washington, has that been tough?
Coming to Washington was exciting. Greenwich is a small town. Washington is a big city.
The toughest part for me is that I’m away from my family. I come to Washington on Monday mornings early and I come back on Friday evenings. So, I now try to crunch my grandchildren, my husband, my mom, everybody into a weekend. I miss being able to watch my granddaughters or my grandson in a local play, which always happens during the week, not the weekend. That was the most difficult for me. I think that was the hardest part in leaving Connecticut and coming to Washington. But I’m enjoying doing what I’m doing. It’s a challenge; it’s an opportunity, and I’m grateful to be able to be in this position.
This interview was edited for length and clarity.
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