The Veterans Entrepreneurial Transition (VET) Act – Re-Evaluation and Reconsideration Highly Recommended
Yesterday the U.S. House of Representatives passed the new “Forever GI Bill.” The following article was submitted as a counterpoint to a discussion concerning the use of G.I. Bill benefits for business start-up funding in lieu of education benefits. It’s important to note that NaVOBA officially supported the measure. Our friend Woody Wollesen respectfully disagrees and outlines his argument below. We always welcome opposing viewpoints. Feel free to share your comments.
By Woody Wollesen
Recently there has been a revived interest and some degree of advocacy to re-introduce The Veterans Entrepreneurial Transition (VET) Act – allowing veterans as an alternative to use of their G.I. Bill to start a business instead of investing in their own higher education. This proposal was originally and rather vigorously opposed by Student Veterans of America and the Veterans of Foreign Wars. Both groups labeled the measure as a potentially problematic erosion of a clearly defined program. Whatever the original good intentions (helping veterans always being a worthy cause) far too often legislative proposals can become vehicles instead to advance perceived popular political narratives and/or further invested special interest agendas. Too often good intentions neither create desired positive outcomes instead producing the complete opposite.
This is one instance where considering compelling objective facts might be highly advisable. Consider for example the following: What could possibly be more important than advancing veteran knowledge empowerment and access to higher/expanded educational levels (college, technical or trade schools, etc.) especially under current conditions and challenges? Never before has veteran access to and delivery of quality higher education systems been more important. If genuine veteran economic benefits be the goals, there is no substitute for educational empowerment to attain those ends. A few simple, straightforward facts to consider:
- 70% to 80% of the jobs we recognize today will disappear in the next 10 years. There will be a lot of new jobs created, but there will not be enough new jobs to absorb our growing population. And the new jobs will require more advanced technical skills that probably are not even imagined today. Our educational system is not prepared to train candidates for the entry level jobs of today, much less the entry level jobs of tomorrow. As I have mentioned before, employers are complaining that they cannot find enough qualified candidates to fill their jobs.
- What should be obvious to our politicians is that the skill sets required for jobs in the economy has changed but the skill sets of the labor force have not. As a result, America has a lot of people available to work, but not enough qualified people for the jobs available. That is a systemic problem in our education system. Lets hope our politicians wake up to the issue and start putting resources into channels that will qualify our workforce for available jobs.
- Knowledge is power. Information is liberating. Education is the premise of progress, in every society, in every family. Kofi Annan An investment in knowledge pays the best interest. Benjamin Franklin
It should be beyond controversy that small business and a thriving entrepreneurial climate are the driving engines of our economy producing the bulk of quality long term employment opportunities. One of the reasons advanced for the VET Act is that lack of access for startup capital and funding. Think about the paradoxical irony within the renewed interest in the VET Act – a veteran has not the technical or requisite skills/knowledge sets for a job within any particular business niche yet the proposition advanced is to encourage use of the education funds instead to start and own a business in that same field of interest?
Certainly access to capital has been a long standing proverbial issue for all entrepreneurial and business ownership efforts (veteran and non veteran). However it is only one factor amid a host other adverse influences. The simple fact is that having access to timely and adequate financing is not even at the top of the causes of business failures list. Statistics clearly reveal that for every alleged brilliant new idea, impassioned start up, or early stage business venture (at least up to five years) that anywhere from 36% to 50% will fail depending upon industry area (e.g., pick your poison). Only about half of all new establishments survive five years or more and only one-third survive 10 years or more.
The number one cause of business failures (not access to financing or capital, although related) is the lack of requisite knowledge for best business practices and financial acumen – incompetence. The leading causes of small business failure: *Incompetence: 46 percent; *Unbalanced experience or lack of managerial experience: 30 percent; *Catchall category (includes neglect, fraud, and disaster): 13 percent; and *Lack of experiences in line of goods or services: 11 percent. Suggested for Congressional and Administration focus: Abandon entirely any use of veteran educational funding support for anything other than higher educational knowledge empowerment; Instead refocus to radically change and create wholesale reformation of our educational systems to in fact produce/deliver graduates with the requisite skills and knowledge to match private industry demands for today and most importantly for tomorrow; Instead refocus to radically restructure and reform all existing educational systems/programs related to veteran entrepreneurial and business ownership competencies.
Why? Just look at the cold statistics on business failures. Whatever and however it has been done in the past and to date, it has not and does not work (all facets and problem areas) and it will continue to fail; and If capital access and funding is the prime issue, then deal with it directly. Create and encourage platforms, vehicles and/or programs that in fact deliver those results, efficiently and cost effectively. Insanity: doing the same thing over and over again and expecting different results,” — Albert Einstein.
Woodrow Wollesen – Military veteran, nationally recognized small business financing expert, author “The Ultimate Financing Guide” Founder/Chairman Operation Veteran Empowerment, Former co-partner national law firm, serial entrepreneur, former graduate school of business professor, 2006 SBA Small Business Financing Champion, Board Member/Executive Officer/Instructor (8 years) National Women’s Business Center, Washington, DC.