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The U.S. Healthcare System is Already Mostly Socialized
Now that Abdul El-Sayed is the Democratic nominee for Michigan’s open Senate seat, the outcome of this crucial race will depend mainly on two things: Whether Republicans succeed in demonizing El-Sayed because he’s brown and a Muslim, and whether they succeed in demonizing him as a left-wing radical. I will defer for the now the question of whether bigotry will be effective this year, although I will address it another day. What I want to address instead is El-Sayed’s signature issue — healthcare. Yes, El-Sayed advocates Medicare for All, a position the usual suspects denounce as “socialism.” I will get to the politics of his stance soon. Today, however, I want to talk about the substance. We should be clear that El-Sayed doesn’t even call himself a socialist. On the contrary, he explicitly disavows the label, saying “I’m a capitalist who just knows about capitalism”. In fact, as I explained in a previous post, the policies that El-Sayed advocates qualify him as a social democrat, not a socialist. Still, El-Sayed advocates a system under which the government would pay almost all medical expenses. Isn’t that socialism? Well, if that is the criterion then much of U.S. healthcare is already socialist. In fact, the government’s role is so large that U.S. healthcare is better described as partially privatized socialism than as anything resembling a free market. Let’s start with the raw numbers on health insurance, which pays the bulk of Americans’ medical expenses. Americans receive health insurance either from private companies or from public programs, overwhelmingly Medicare and Medicaid. Here’s what the breakdown of coverage and spending between private and public looked like in 2024: While a majority of Americans with health insurance get it from private companies, well over 100 million of us are covered by government programs instead. And these government programs pay more total dollars for medical bills than the private insurers do. Why do government programs that cover a minority of the population account for a majority of health insurers’ outlays? Mainly because Medicare covers seniors, and we’re expensive. Also, while Medicaid covers many younger Americans, disabled and elderly beneficiaries account for most of its spending. Even by the raw numbers, then, U.S. health insurance looks as much public as private. But that understates the government’s role: Private health insurance in the U.S. is both highly regulated and heavily subsidized. This is obviously true for the insurance coverage purchased by tens of millions of Americans through the exchanges established by the Affordable Care Act. But employment-based health insurance, which covers 161 million Americans, is far more of a government creation than most people realize. For employment-based insurance exists largely because of huge implicit government subsidies that come with major strings attached. Here’s how that works. If your employer pays you $10,000, that’s taxable income. But if your employer pays $10,000 toward a company health insurance plan that meets certain criteria, it isn’t taxable. That’s a huge effective subsidy, running at more than $300 billion a year. Take that subsidy into account, along with the more than $100 billion per year spent subsidizing policies purchased under the ACA, as well as the outlays on Medicare and Medicaid, and net effect is that the government pays for more than two-thirds of Americans’ health insurance. Granted, there are strings attached. Roughly speaking, employment-based health plans can’t discriminate based on medical history — that is, they can’t deny coverage to employees with pre-existing conditions — and they also can’t offer the plans only to highly compensated employees — a health plan that is only for the C-suite is considered taxable income. So given the restrictions of the federal tax code, employer-based health insurance is a lot like Obamacare, which also prohibits discrimination based on medical history and provides subsidies to make insurance affordable to lower-paid workers. The fact is that virtually all of private healthcare insurance is already well under some form of government control through regulation and tax subsidies. How should we think about this system? First of all, is Medicare socialist? Don’t tell anyone, but the way Medicare operates — it covers every senior’s medical expenses, whatever they turn out to be, while being funded by taxes that depend on one’s income — could be summarized by the old Marxist slogan “From each according to his ability, to each according to his need.” And back in 1961, when Ronald Reagan was the face of a last-ditch effort by the American Medical Association to block the creation of Medicare, he denounced Medicare as “socialized medicine” and warned that it would destroy our freedom. In reality, American freedom survived until Jan. 20, 2025, while Medicare is immensely popular, with an 82 percent favorable rating in the most recent KFF survey. Medicaid, government health insurance for lower-income Americans, comes in at 73 percent. This is in sharp contrast to public views about private insurers, who are widely disliked if not hated and accused of denying essential care. Furthermore, if Medicare is socialism, then the whole U.S. health insurance system, with the government paying most of the bills and placing conditions on private insurers, is almost equally socialist. If you insist on calling any program the government pays for and regulates socialist, then U.S. healthcare would best be described as a partially privatized form of socialism. And one must ask, what is the point of the part that is privatized? Do private insurers add anything positive? Or are they simply parasites, skimming off money that could have been paying for care? The case for viewing insurers as parasites is strong. Many Medicare benefits are now delivered via Medicare Advantage, that is, plans paid for by the government but run through insurance companies. MedPAC, an independent advisory commission, estimates that last year Medicare Advantage plans were overpaid by $84 billion, thanks to practices such as “upcoding,” in which patients’ health problems are overstated to get larger sums from Medicare. Assessing the waste from employer-based insurance is harder, but most evidence suggests that private insurers have substantially higher administrative costs than Medicare does. Furthermore, the complexity of private insurance, with multiple payers all trying to deny care when they can, is a huge burden both on providers — doctors, nurses, and hospitals — and on patients. What do private insurers offer to compensate for these costs? One must go through intellectual contortions to avoid the conclusion that they are, in fact, parasites. Which brings me back to El-Sayed. In supporting Medicare for All, he’s basically calling for an end to the partial, parasitic privatization of a healthcare system that is already hugely dependent on public funding. When one looks at it that way, it’s not at all a radical proposal. Admittedly, the political lift requires overcoming the opposition to higher taxes to pay for Medicare for All. Political realism rather than economics was the reason I and many other progressives supported Obamacare, with all its complexities, rather than demanding an immediate move to Medicare for All. But the political calculus may very well have shifted since the 2000s, as Americans are fed up with a system of unaffordable premiums, rampant claim denials, and byzantine claim administration. Moreover, funding healthcare insurance through taxation would allow for a much more progressive distribution of the cost. That is, compared to the present system, middle-income households would pay less as high-income households would pay more. And the U.S. would stop wasting large sums on pointless administrative costs. So let’s be clear: El-Sayed’s healthcare platform is perfectly reasonable on the merits of cost, fairness and health efficacy. And with private insurers never more hated, while millions of Americans are losing their health insurance, 2026 may be its time. MUSICAL CODA
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Dr. Abdul El-Sayed on Historic Michigan Win: “People Are Sick and Tired of This Politics of Hatred”
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http://democrats-energycommerce.house.gov/media/press-releases/republican-health-care-cuts-continue-devastate-american-families
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If Not AOC, Then Who?
What do we do if Alexandria Ocasio-Cortez decides not to run for president in 2028? It makes sense that many leftists are currently focused on calling on her to take the plunge. But the absence of a Plan B, or even much discussion about one, is worrisome. The US Left can’t afford to sit out the 2028 Democratic primary. Doing so in 2024 was a disaster: our abstention self-marginalized anti-billionaire politics from the national conversation and thereby gave space for Harris to pivot to the “center” (i.e. the policy preferences of corporate donors, establishment hacks, and AIPAC). Abstaining again in 2028 would be especially counterproductive since democratic socialists now have so much wind in our sails after our big electoral wins in NYC and across the country. It’s time to deepen our momentum, organization, and profile — not to retreat to the margins during America’s single most important political battle. Even more urgently, keeping Trump’s heir out of the White House may depend on whether leftists and the party’s unprecedentedly disenchanted base can force the Democrats in 2028 to take meaningful steps towards a very angry electorate and away from the corporate-consultant blob that has helped get us into this mess. If AOC (or Abdul El-Sayed) decides to run, we should enthusiastically go all in — DSA, fighting unions, progressive organizations, anybody who wants to see a better country and world. But, as far as I can tell from the outside, there’s a real chance that she doesn’t run. And we can’t just wait and see where she lands before discussing alternatives, since AOC’s decision might not come for quite a while, giving us little time to scramble at the last minute for an alternative. So we should start working now on getting a Plan B into motion, and recruiting a good candidate for the role. Here’s one idea. A Worker Candidate — Healthcare Not Warfare 2028 Run a union worker Leftists don’t need to always run experienced, well-known socialist politicians for high-profile contests. Lula, the current president of Brazil, began his political career as a metalworker militant who ran for governor of São Paulo in 1982. Especially in an era of institutional distrust, it’s possible to lean hard into making a virtue out of a working-class comrade’s distance from traditional politics. Experience abroad shows this clearly. Rachel Kéké — an immigrant hotel housekeeper — ran as the candidate of the leftist La France Insoumise for the National Assembly in 2022, defeating a former minister in the Macron government. The Belgian Workers’ Party in 2024 won its first Flemish seat in the European Parliament by running Rudi Kennes, a three-decade veteran of the Opel Antwerp auto factory. And the South Korean left in 2024 elected auto factory militant Yoon Jong-oh to the National Assembly. If a tiny French Trotskyist organization could make such a big splash in 2002 and 2007 by running a well-spoken postal worker cadre for office — the LCR’s Olivier Besancenot received about 1.5 million first-round votes — it’s not far-fetched to expect that a much larger organization like DSA, together with a broader coalition of the willing, could run this playbook to much greater effect. This is especially the case now that almost everything DSA does immediately becomes a national news story. We don’t need someone famous. We just need a charismatic, well-vetted comrade who works in a relatable working-class occupation — e.g. a nurse, or a worker in auto or construction, or at Amazon. Ideally, they have a compelling personal story or have been part of a significant strike or organizing campaign, but even those criteria don’t necessarily have to be deal-breakers. The main lesson of the Graham Platner fiasco isn’t that we should never run outsiders for office (the momentum he generated proves the exact opposite), but that they need proper vetting and roots in democratic membership organizations like DSA or a union. In any case, there are plenty of ways to signal working-class authenticity without resorting to Platner’s or Fetterman’s performative macho white dude affect. Better to have someone of any gender or race who is actually working class, with firm socialist politics, who can speak from experience about the day-to-day realities of trying to make it in America. There are surely at least a dozen such worker leaders in our movement nationwide; we just need to sit down and convince one that their personal sacrifice for the greater good (i.e. running for president) will be worth it. If we don’t have a frontrunner with a clear path to victory like AOC (or El-Sayed, were he to win Michigan), it’s better to embrace someone whose decision to run in itself tells an important story about US politics: workers have been iced out of our political system and are now fighting hard to break back in. The novelty factor, in itself, would generate press. And it would help democratic socialists signal to the American public that our movement’s defining characteristic is that we represent workers vs. bosses, not that we’re “the furthest left” force in American politics — a framework that suggests we’re extremists and that helps our opponents isolate us from non-college-educated voters by highlighting extremely minoritarian (and misguided) stances included in DSA’s platform like prison abolition. We don’t get many opportunities to speak to tens of millions of Americans; we need to use these opportunities to broaden our appeal beyond those already in our orbit. Run to polarize the 2028 primary and general election around “Medicare for All” and “End All Aid to Israel” Why should democratic socialists use our scarce time and volunteer energy to run in a race we’re unlikely to win? Running in the 2028 primary will not only recruit us scores of members (imagine having a DSA member intervening in eleven nationally televised primary debates!), but — more importantly — it has the potential to be a decisive leap forward towards an America that finally starts meeting the needs of working people instead of HMO and AIPAC billionaire donors. Polarizing litmus tests are good, actually — as long as they’re fought for around popular demands in a thoughtful and strategic way. Democratic socialists have an opportunity and responsibility to make the 2028 primary about two of the most widely and deeply felt issues of our moment: domestically, America’s unaffordable, family-breaking private healthcare system; internationally, America’s bankrolling of the genocidal Israeli government. A candidacy relentlessly demanding Medicare for All and No Aid to Israel would pose a sharp question to the American public, the Democratic Party, and other 2028 contenders: Why can’t working-class Americans afford their healthcare bills at the same time that our government is spending at least $3.8 billion yearly to fund an Israeli regime eager to keep dragging us and the world into more forever wars? Our candidate can agitate around a clear message: I’m running to give voice to all those working-class Americans who are struggling to get by. No matter what state you live in, who you voted for in 2024, or your background, it’s just plain common sense that we should make healthcare more affordable instead of spending billions to enable the Israeli government’s crimes against humanity. Every American who agrees with me when I say ‘Medicare for All — Not a Dime for Israel’ should make their voice heard through our campaign. Racking up a high number of votes for this agenda is a crucial way to show the Democratic Party and the country as a whole that we can’t keep supporting a life-destroying status quo in our healthcare system and in the Middle East. If we want to defeat Trump’s handpicked crony this coming November, we need to speak to ordinary people’s frustrations with the status quo — we can’t keep running the same tired establishment playbook and expecting a different result. For those highly engaged voters (or skeptical media pundits) who raise concerns about wasting votes, the candidate can take the time to explain why this isn’t the case: It's true I'm a long shot. But Zohran showed anything can happen — and voting for me is a pragmatic decision, not a wasted vote. In a heavily divided primary with a large number of candidates and a very discredited establishment, my campaign and the democratic socialist movement I’m part of are positioned to be the balance of power if we can get a large enough number of voters to loudly demand Healthcare Not Warfare. Since there’s a high chance no candidate will get to 50% in the 2028 primaries, the Democrats could very well be heading towards a brokered convention, where a disciplined, principled current committed to breaking from corporate donors can play an outsized role in making sure whoever ends up with the nomination raises the banner of single-payer healthcare and cutting aid to Israel. How exactly could running this sort of primary campaign be translated into actual leverage? The candidate replies: I’m aiming to win the nomination, but if I don’t achieve that goal, my delegates and I will pledge our support in the primary only for a candidate who agrees in the general election to call for ending US aid to Israel and establishing Medicare for All at home. These are both winning planks for November against the Republicans, and the only reason I can see that other candidates haven’t yet raised these is that they’re still more scared of the donor class than they are of the people. That needs to change. If Democratic leaders want young people, workers, and those sick of the status quo to show up in big numbers this November, they need to meet us halfway. In this way, whether or not we win the nomination, democratic socialists could still play a decisive role in 2028. The approach outlined here is similar to what radical left parties periodically do in parliamentary democracies like Denmark or Sweden when they find themselves as a junior partner electorally: they dictate to center-left allies what their terms would be for enabling, from the outside, the formation of a new government. Running a Healthcare Not Warfare candidate will make it significantly more likely that the 2028 Democratic candidate stands with ordinary people instead of donors on these two pivotal planks — a shift that will, in turn, make it easier to achieve the existentially important task of defeating MAGA’s heir in November. Look at how much popular traction the Uncommitted movement got with a similar strategy in 2024 with so little on-the-ground organization — surely we can go much further with a working-class candidate, a much bigger DSA, and a Democratic Party base that has turned against Israel, billionaires, and the hacks in the party who prop them up. Objections and Responses There are quite a few objections to this proposal, many of which are very reasonable. Let me briefly address each here. Socialists shouldn’t waste their scarce time and resources on a candidate unlikely to win. This is a good rule in general, but there are important exceptions, and presidential elections are the main one. There’s no other political contest that gets anything like this level of attention and engagement in the US, so if you want to be a serious force in nationwide politics, you basically can’t afford not to have a candidate. Far from being an overall drain on our resources, running a dynamic 2028 campaign would likely result in a major net increase in members and capacity. In that spirit, the very pragmatic Milwaukee sewer socialists — who mostly ran to win at home in Wisconsin — supported Eugene Debs’s propagandistic presidential campaigns, which they correctly saw as a crucial means of recruiting to the Socialist Party. And now that the (post-1972) Democratic Party gives more weight to voters than party operatives in determining its presidential nomination, it’s become feasible to run as a socialist in primaries without risking a split in the vote against the Republicans in November. We should just support Ro Khanna, who also supports M4A and ending aid to Israel. I like Ro Khanna and would enthusiastically vote and canvass for him for president were he to get the nomination. But there’s a real chance that Khanna’s bid for office doesn’t catch on; he lacks the grassroots organizational apparatus of DSA, and, because he’s not really of the Left or labor (despite his current very good positions), he’s unlikely to generate the type of buy-in and enthusiasm that a DSA candidate would. Moreover, Khanna would be running as an individual, not as someone emerging from and building an organized movement — his campaign would not likely focus on building sustained power from below, nor would it likely polarize the 2028 primary around M4A and Israel aid. Also, and not inconsequentially, the poor electoral results for Tom Steyer and Saikat Chakrabarti this spring suggest that there’s perhaps not much of a popular appetite in the Democrats’ base to support multi-millionaire class traitors. Much better, then, to run a democratic socialist worker. If by Super Tuesday it’s clear that our campaign has captured the main left lane in the primary, Khanna should drop out and endorse us; conversely, if he’s managed to capture this lane, DSA could at that point transform its Healthcare Not Warfare campaign into an independent campaign to elect Ro Khanna focused on winning (and holding him accountable to) those two critical planks. An openness to consolidating an anti-corporate candidate by Super Tuesday is a necessary component of the strategy I’m proposing, because otherwise we risk splitting the primary votes (per DNC rules, you need at least 15% to get any delegates to convention). We should convince Shawn Fain or Sara Nelson to run for president instead. I agree it’d be great if either ran for president, but my impression is that there’s basically no chance that will happen in 2028, because both are firmly focused on their union leadership duties (and, in the case of Fain, beating back a federal witch-hunt). This plan could have DSA end up endorsing a non-socialist, non-DSAer for president. That’s against our principles. It’s a myth, and bad politics, that socialists can’t ever support candidates who aren’t members of their organization and/or who don’t call themselves socialists. Bernie, after all, was not a DSAer. And socialists abroad regularly make tactical decisions about if and when supporting a non-socialist candidate makes sense from the standpoint of promoting working-class interests, defending democracy, and building a socialist current in the process. If your “principles” prevent you and DSA from helping achieve the momentous stride forward of having a Democratic candidate in 2028 run on Medicare for All and ending aid to Israel, those “principles” are not very good. In fact, they actively undermine the causes they’re aiming to support. We shouldn’t confuse principles (working-class independence) with tactics (the best way to advance this in a given context). In my recent article in Catalyst on Milwaukee sewer socialism (I’ve uploaded the full text here), I have a section showing how similarly rigid rules about endorsements had to be eventually discarded in the old Socialist Party nationwide after WWI because they tended to lead socialists towards a sectarian abstention from broader anti-corporate electoral insurgencies beyond their party’s control. For what it’s worth, Lenin’s current under Tsarism frequently backed bourgeois candidates in the second round of elections and Lenin himself advocated that British Communists support Labour Party candidates; for his part, Kautsky in 1912 defended the German Social Democracy’s electoral pact with the Progressives in the runoffs. If our predecessors could be that tactically flexible in an era before the limits of their underlying strategic assumptions about intransigent class politics in capitalist democracies were made clear, then there’s no need to insist on being more tactically rigid today, after a century’s worth of accumulated experience. As long as you maintain your own political profile and organization while engaging in broader coalitional efforts, there’s zero inherent contradiction with the principle of political independence. More specifically: DSA and allied organizations should enthusiastically back Michigan’s Abdul El-Sayed if AOC declines to run and he throws his hat in the presidential ring. (I have no idea whether he’s even considering this path, but there’ll surely be chatter about it if he wins his Senate race this November.) Though he doesn’t call himself a socialist, El-Sayed is a principled Berniecrat, a consistent fighter for Palestine, and would have a clear path to victory. Using the “s” word is far less important than whether a campaign fights for the interests of working people at home and abroad — and whether actively participating in it can grow the organized working class and the Left. And the same holds true if a less anti-corporate candidate were, under pressure, to adopt our two Healthcare Not Warfare planks. Why focus only on M4A and ending US aid to Israel? There are so many other important issues to fight for! Obviously there are many pivotal issues beyond healthcare and Israel, and our candidate — and especially our organizations involved in the campaign — should be prepared to speak on all of these. But one of the crucial lessons of the Zohran campaign is that you have to relentlessly stay on message if you want to cut through the noise. CNN and Fox News will want to talk about DSA’s views on Venezuela and abolishing the police; we need to polarize the debate on the widely and deeply felt issues that are most favorable for growing the Left, isolating our opponents, and winning urgently needed changes. One recent poll found 63% of Americans support M4A, even after respondents were told it would raise taxes and eliminate most private insurance. Another found that 74% of Democrats opposed “providing additional economic and military support to Israel.” And focusing on two demands sets the campaign up to be able to leverage its mandate to make clear demands upon other candidates (which we can’t do if we run with a laundry list of demands). Talking about a Plan B is a distraction from the more urgent work of building a groundswell of calls on AOC to run. It’s good for DSAers, fightback unionists, and progressive organizations to try to convince AOC to run. This proposal is meant as an addendum to pushes to get AOC to run and to line DSA up for that eventuality, not as a substitute for those efforts. But I’m worried that, like in 2024, we might eventually find ourselves with no time to find a viable alternative unless we start now. DSA, with its abundant deliberative processes, moves slowly. The approach you’re suggesting seems risky. If a DSA candidate runs but doesn’t receive a lot of votes, it’ll undercut our current national momentum. This is a reasonable worry. All big initiatives always carry risks, and the path I’m advocating is certainly not free of these. That said, if a Healthcare Not Warfare campaign doesn’t catch on like we envisioned, it’s a pretty simple pivot in March 2028 to explain that in the future we really need our standard-bearers like AOC, or our growing bench of national electeds, to step up in presidential primaries. Moreover, it’s worth noting that the risk of my Plan B proposal is on the whole significantly less than the risk entailed by an AOC run. We should all back her if she runs, since she’d fire up the base, provide huge openings for organizing, have a real shot at defeating a Republican (especially given MAGA’s unpopularity), be a great standard-bearer for our issues, particularly M4A and ending aid to Israel, and be less willing than mainstream candidates to capitulate to any anti-democratic machinations from Trump and co. But it’s also true that AOC could lose, which would be a devastating setback to the country and the Left. Or she could win and find herself unable to pass much, if any, of her (and our) program, a demoralizing prospect. So if we’re willing to take these risks with AOC (and we should), it follows that we should be able to take lower-level risks if she doesn’t throw her hat in the ring. What’s Your Plan B? The US Left is facing its biggest opening for growth and influence since the 1930s. Initiatives that would have been impossible a few months ago are now potentially feasible. A President AOC is now easier to imagine, but if she ultimately assesses that the risks aren’t worth the potential reward in 2028, we can’t be left flat-footed. So even if you’re not convinced by the specifics of my Plan B, I hope you can at least agree that it’d be a disaster for us not to have one — and not to start getting a Plan B into motion. Hopefully other organizers and political currents will put forward their responses and alternative ideas ASAP. The stakes are too high to just wait and see. More As always, please share this article widely. This newsletter depends on all you lovely people to get the word out. Thank you! I uploaded the full text of my Catalyst article on Milwaukee sewer socialism here (it’s updated and 3x as long as the version published earlier on this substack). If you haven’t yet, please make sure to subscribe to Catalyst here; I read every issue front to back, highly recommend. 🌹🎵 Ivan Lins (arranged by Arthur Verocai) — “General da Banda” 🌹🎵
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Bicameral resolution would rescind Trump administration policy banning green card holders from accessing SBA loans Resolution Text (PDF) | One-Pager (PDF) (Washington, July 23) – Ranking Member Edward J. Markey (D-Mass.) and House Small Business Committee Ranking Member Nydia M. Velázquez (D-NY-7) today introduced a Congressional Review Act (CRA) resolution to rescind the Trump administration’s policy that bans green card holders from accessing essential Small Business Administration (SBA) loans to start and grow their businesses and invest in Main Streets nationwide. Trump’s SBA restrictions buck decades of precedent, attacking immigrant small business owners who are lawfully in the U.S. with no justification. The Trump administration’s green card holder ban is the most recent escalation of SBA’s draconian citizenship restrictions that are killing jobs and putting the American Dream further out of reach for entrepreneurs. In Fiscal Year 2025, the SBA made an estimated $5.7 billion in loans to green card holders, which supported more than 80,000 American jobs. Ranking Member Markey’s introduction of the CRA resolution follows his introduction of the Investing in the American Dream Act alongside Ranking Member Velázquez earlier this year. The Investing in the American Dream Act would roll back the SBA’s draconian lending restrictions and restore previous SBA lending policies for immigrant entrepreneurs lawfully in the U.S., including green card holders, refugees, and asylees. More than 100 organizations have called for the passage of the legislation and over 60 Massachusetts state legislators have raised concerns about the impact of the citizenship restrictions in their local communities. “Once again, Donald Trump is shutting hardworking immigrants out of the American Dream with his discriminatory and dangerous policies, fear tactics, and violent rhetoric. The anti-small business lending requirements implemented by Trump’s SBA won’t Make America Great Again—they are Making America Hate Again,” said Ranking Member Markey. “I am fighting every single day to roll back Trump’s brazen attempt to steal the American Dream from entrepreneurs in Massachusetts and across the country who enrich our communities, strengthen our Main Streets, and create jobs in the United States.” “Starting and owning your own business is one of the pillars of the American Dream. Under the Trump Administration, the SBA has sought to deny immigrant small business owners and entrepreneurs that dream by preventing them from accessing the capital they need to grow and scale their businesses. Not only is this policy cruel, but it is also self-defeating and holds our country back economically. As Ranking Member of the House Small Business Committee, I will do everything in my power to reverse this terrible policy,” said Ranking Member Velázquez. Massachusetts state legislators applauded Ranking Member Markey’s actions and emphasized the critical contributions of green card holders to Bay State communities and the Commonwealth’s economy. "Green card holders are our neighbors, workers, entrepreneurs, and taxpayers,” said Massachusetts State Senator Adam Gómez (D-Springfield), Senate Chair of the Joint Committee on Community Development and Small Businesses. “They open restaurants, launch small businesses, create jobs, and contribute every day to the economic strength of Massachusetts. Denying lawful permanent residents access to SBA loan programs doesn't make our economy stronger—it makes it harder for small businesses to succeed. I support this resolution because opportunity should never be limited by unnecessary barriers that prevent hardworking people from investing in their communities and pursuing the American dream." “Senator Markey’s CRA Resolution provides a valuable moment for our federal leaders to show their commitment to small businesses and the American Dream,” said Massachusetts State Representative Andy X. Vargas (D-Haverhill), House Chair of the Joint Committee on Community Development and Small Businesses. “The SBA’s recent policy restricting lawful residents from accessing the popular 7(a) and 504 programs has shut out some of the most entrepreneurial and hard-working members of our community from much-need capital. In Massachusetts, these programs have invested millions of dollars into small businesses owned by green card holders, supporting thousands of jobs. This should not be a partisan issue. People who worked hard, have legal status, and contribute so much to their communities via employment and economic impact don’t deserve to be in the crosshairs for political purposes. The Senator’s resolution is a step forward in restoring access to the American Dream that small business owners across the country deserve.” Several small business advocates and stakeholders voiced their support for Ranking Member Markey’s efforts to roll back Trump SBA’s discriminatory lending rules. “Immigrant-owned businesses are the foundation of the American economy. They power our neighborhoods, provide essential services, and employ our loved ones. Yet, systemic hurdles like the Small Business Administration’s citizenship restrictions unfairly block their path to prosperity," said Elizabeth Sweet, Executive Director of the Massachusetts Immigrant and Refugee Advocacy (MIRA) Coalition. "We applaud Senator Markey’s continued leadership and look forward to a future where immigrant entrepreneurs can share their ingenuity without arbitrary restrictions that hold us all back.” “Independent restaurants have always been built by people willing to work hard, take risks, and invest in their communities. When lawfully authorized entrepreneurs lose access to the financing they need to start or grow a business, we all lose. These are the businesses creating jobs, filling storefronts, and strengthening our neighborhoods. Access to capital should help good businesses succeed, and that’s exactly what restoring these SBA loan programs would do,” said Jen Ziskin, Executive Director of Massachusetts Restaurants United. “At the Latino Economic Development Corporation, we see firsthand that access to capital transforms lives, creates jobs, and strengthens neighborhoods. Many of the entrepreneurs we serve are lawful permanent residents who have invested their savings, opened businesses, and employ local residents. Restricting access to SBA financing doesn’t just impact business owners, it limits economic opportunity for entire communities. Main Street succeeds when every qualified entrepreneur has a fair chance to grow,” said Andrew Melendez, CEO and Founder of the Latino Economic Development Corporation. "Immigrants and immigrant-owned businesses are the heart and soul of small business communities in cities and towns throughout the Commonwealth, and across America. Limiting access to these SBA loans not only sends the wrong message about immigration, it will have significant negative economic impact on our small business ecosystem,” said Keith Mahoney, Vice President of Public Affairs at the Boston Foundation. “The SBA’s recent policy changes that prevent Legal Permanent Residents, and other non-citizens from participating in any of the SBA’s valuable programs are changes that are unwelcome, immoral, and antithetical to our purpose, our mission, and our vision for Massachusetts communities and businesses. Immigrant entrepreneurs and others have expressed concern that Common Capital will ‘report them to ICE,’ so loan demand has decreased. There is no valid reason for excluding Legal Permanent Residents and other noncitizens who are lawfully present in the U.S. from accessing the SBA’s programs. Immigrant entrepreneurs start businesses, they create jobs, they support their families and their communities. Our government should be in the business of encouraging their full participation in our economy,” said Raymond Lanza-Weil, President of Common Capital. "ECCHO-Latino now represents over 400 educators and 300 microbusinesses across Massachusetts, where immigrants make up 60% of the childcare workforce. When a green card holder is ready to grow her business—from expanding her home child care to opening a center—she shouldn't be turned away by local banks simply because of federal citizenship rules. Blocking access to SBA loans kills opportunity and deepens our state's childcare crisis. ECCHO-Latino strongly supports Senator Markey and Representative Velázquez in passing this resolution to put Main Street first," said Harold Antonio Blanco, Co-Founder & Executive Director of ECCHO-Latino Inc. "This is exactly how political ideology ruins an economy. Washington has taken lawful, tax-paying entrepreneurs who live in our communities, invest in America, and hire American workers, and declared their businesses ineligible for critical financing simply because a green card holder owns even a fraction of the company. Using policies ostensibly aimed at illegal immigration to punish lawful permanent residents is nothing short of ideological overreach and economic self-sabotage. The SBA exists to help viable small businesses grow, rather than imposing nativist tests that ignore an entrepreneur’s credit history, business plan, or ability to create jobs. When the federal government closes the door on qualified entrepreneurs, they’re also closing the door on American entrepreneurship and on American workers, while handing future companies, jobs, innovation, and investment to our competitors. America should be competing to attract people who want to invest and build here, not creating arbitrary barriers that drive their talent and capital elsewhere,” said Javier Palomarez, President and CEO of the United States Hispanic Business Council (USHBC). "The U.S. Small Business Administration's decision to prohibit legal permanent residents, including green card holders, from accessing SBA-backed loans has the potential for disastrous consequences that could reverberate throughout America's economy for years to come. After all, immigrants are twice as likely to start small businesses as U.S.-born individuals. Congress must overturn rules requiring the SBA to block legal permanent residents from accessing lending resources because so many of the entrepreneurs who drive job creation in this country were born outside the United States," said John Arensemeyer, Founder and CEO of Small Business Majority. “NCRC supports the Congressional Review Act resolution to overturn SBA’s citizenship restrictions that bar green-card holders from receiving the 7(a) and 504 loans. When qualified entrepreneurs are denied access to SBA loans, all of Main Street gets hurt. Communities lose jobs. Neighborhoods lose services. Local economies lose the opportunity to build wealth and shrink disparities,” said Jesse Van Tol, President & CEO of the National Community Reinvestment Coalition (NCRC). “We cannot afford to have the American Dream out of reach for hard-working, immigrant small business owners.” “Asian Americans and Asian immigrants have been integral in building local economies. They create businesses, jobs, and opportunities in communities across the country that benefit everyone. Lawful permanent residents pay taxes, invest in their communities, and strengthen Main Street, yet the SBA's discriminatory citizenship restrictions unfairly deny them access to the same tools that help small businesses grow and succeed. We applaud congressional leaders for advancing this resolution to overturn the latest restrictions on SBA lending for green card holders, and we urge lawmakers to also pass the Investing in the American Dream Act to fully restore access to SBA loan programs for all eligible people in the United States. Ensuring that immigrant-owned small businesses have a fair opportunity to access capital is essential to building a stronger, more inclusive economy that works for all,” said Joanna Derman, Director of Anti-Profiling, Civil Rights and National Security at Asian Americans Advancing Justice (AAJC). "Immigrant-owned businesses often turn to SBA 7(a) and 504 loans because they face higher denial rates from traditional lenders,” said Imani Augustus, Director of the Center for Entrepreneurial Opportunity. "These programs provide the capital they need to expand operations, hire workers, and invest in their businesses. Reversing the ban on lawful permanent residents is a critical first step toward ensuring these financing tools are accessible to everyone strengthening their communities through entrepreneurship. We applaud this action and urge Congress to fully restore access by passing the Investing in the American Dream Act.” "Last year, nearly 5,700 SBA loans worth $5.7 billion went to businesses owned by green card holders, supporting more than 80,000 jobs. These are entrepreneurs who have put down roots here, hired their neighbors, and invested in the communities they call home. Barring them from capital doesn't protect Main Street—it starves it. What should matter is the strength of a business and its potential to grow, not the immigration status of its owner. This resolution doesn’t eliminate all the citizenship restrictions in SBA’s policy change, but it’s a step toward restoring a commonsense principle that stood for more than 30 years," said Howard Wial, Director of Research at ICIC. "I'm encouraged to see Congress moving to reopen access to capital for green card holders, a key tool for small business survival. Green card holders accounted for an estimated 5,700 SBA loans in Fiscal Year 2025, worth $5.7 billion and supporting more than 80,000 jobs across the country. That capital is often what keeps a business operating through its toughest stretches when cash flow gets tight. When qualified entrepreneurs lose access to that capital over their immigration status rather than their ability to repay a loan, it's the local economy that pays the price,” said Small Business for America's Future Co-Chair Shaundell Newsome, Founder of Sumnu Marketing. “Small businesses are the backbone of the American economy, and entrepreneurs —including green card holders — take risks every day to build businesses, create jobs, and strengthen communities. SBA loan programs should be administered with clear, consistent standards that safeguard public resources while ensuring these programs remain focused on supporting eligible entrepreneurs and job creators. This resolution responds to the opportunity to support all entrepreneurs and preserve the integrity of federally supported lending programs. We applaud the introduction of this resolution and remain committed to policies that strengthen small businesses, promote economic growth, and maintain confidence in these vital lending programs,” said Carolina Martinez, CEO of CAMEO Network. “National CAPACD wholeheartedly supports the introduction of this resolution aimed at overturning the SBA's misguided policy prohibiting immigrants from accessing the 7(a) and 504 loan programs. As a coalition, we are committed to creating systems, organizations, and societies that are fair and just. We believe we and our economy are stronger when we uplift our rich and diverse communities. Access to capital helps small businesses create jobs, build wealth, and strengthen neighborhoods. Restoring this pathway is an important first step toward ensuring immigrant entrepreneurs can continue to grow their businesses and contribute positively to our economy as a whole. We urge Congress to build on this momentum by passing the Investing in the American Dream Act, which would fully restore fair access to safe and affordable credit and uphold our commitment to a fair economy that works for everyone,” said Seema Agnani, CEO of National CAPACD. Ranking Member Markey is fighting for small business owners and immigrants that rely on SBA loans to start and run their businesses, create jobs, and contribute to their communities. In May, Ranking Member Markey highlighted the significant contributions of immigrant entrepreneurs in Massachusetts and across the country and condemned the Trump administration’s repeated attacks on immigrant communities at a Small Business Committee hearing. MIRA’s Elizabeth Sweet, who participated in Ranking Member Markey’s listening session earlier in May, provided testimony at the hearing. Also in May, Ranking Member Markey hosted a listening session at the Urban College of Boston to hear directly from several Massachusetts immigrant small business owners, lenders, and chambers of commerce how President Trump’s cruel and callous anti-immigrant policies are hurting Main Streets in the Bay State. Earlier in May, Ranking Member Markey hosted a press conference alongside Ranking Member Velázquez, Democratic lawmakers, and stakeholders to condemn the Trump administration’s harmful anti-immigrant lending policies and to introduce the Investing in the American Dream Act. In March, Ranking Member Markey released a comprehensive report detailing the harms to small business owners, workers, and consumers caused by the Trump administration’s ICE raids in communities across the country. In February, Ranking Member Markey introduced the Small Business ICE Disruption Fund Act, which would provide grants to small businesses that have been impacted by the Trump administration’s violent immigration enforcement actions on Main Streets across the United States. Earlier in February, Ranking Member Markey, Ranking Member Velázquez, Congressional Black Caucus Chair Yvette Clarke (D-N.Y.), Congressional Hispanic Caucus Chair Adriano Espaillat (D-N.Y.), and Congressional Asian Pacific American Caucus Chair Grace Meng (D-N.Y.) sent a letter urging the SBA to rescind their lending rule change that bars legal permanent residents from receiving SBA loans. Previously, Ranking Members Markey and Velázquez released a statement condemning the actions of the SBA after it announced that small businesses with legal permanent residents will be barred from receiving SBA loans. In December 2025, Ranking Member Markey and all Democratic members of the Senate Small Business Committee sent a letter to the SBA reiterating concerns with the SBA’s citizenship requirements and highlighting a drop in SBA lending volume. In September 2025, Ranking Member Markey heard directly from SBA lenders about the issues with the citizenship verification requirements. In July 2025, Ranking Members Markey and Velázquez sent a letter to the SBA expressing serious concerns with the agency’s new, draconian citizenship verification requirements that require small businesses seeking SBA loans to be 100% owned by U.S. citizens, nationals, and legal permanent residents. SBA has not responded to the letter. ###
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