V. Next Battlefield – Rule of Two & APA Adherence
The immediate and crucial battleground for preserving small business protections and fair competition in federal procurement revolves explicitly around the rigorous enforcement of the Rule of Two and adherence to the Administrative Procedure Act (APA). Both represent foundational bipartisan commitments that ensure federal contracting remains competitive, fair, transparent, and accessible to small businesses. The Deviation Doctrine directly threatens these critical protections, making this the central battlefield in defending America's economic future.
Understanding the Rule of Two and Its Bipartisan Legacy
The Small Business Act, originally enacted in 1953, explicitly directs federal procurement to ensure that a "fair proportion" of all federal contracts and purchases go to small businesses.18 This foundational commitment recognizes the essential role small businesses play in innovation, economic strength, and job creation across communities nationwide.
To strengthen enforcement of this core statutory commitment, the "Rule of Two" was formally incorporated into the Federal Acquisition Regulation (FAR) in 1984. The Rule of Two operationalizes the statutory requirement by mandating that federal agencies must set aside procurement opportunities exclusively for small businesses whenever market research identifies at least two responsible small firms capable of performing the work at fair market prices.18
By incorporating the Rule of Two into the FAR, Congress explicitly reinforced its longstanding bipartisan intent: ensuring equitable small business access to federal contracts, preserving robust market competition, and safeguarding local economic vitality.
The APA: Transparency, Accountability, and Public Oversight
The Administrative Procedure Act (APA) mandates that significant regulatory changes undergo a transparent, accountable public process. This involves public notification, opportunities for meaningful public comment, agency response, and thorough documentation of decisions.14 These are not merely procedural formalities but core legal mechanisms ensuring government accountability and regulatory legitimacy.
By circumventing the APA through non-public class deviations and unpublished regulatory revisions, federal agencies are not only violating clear statutory mandates—they are effectively disenfranchising American small businesses, industry stakeholders, and the general public from participating in the regulatory decisions directly impacting their economic livelihoods.
The Urgency of Immediate Action
As the FAR Council systematically redlines all 53 FAR Parts, critical safeguards established by the Rule of Two and APA compliance are actively and continuously being erased or weakened. Each passing week without intervention deepens the damage, diminishes transparency, and further entrenches market concentration among fewer large contractors, to the severe detriment of small businesses and economic equity.17
This erosion creates an increasingly complex and non-uniform regulatory environment, substantially increasing compliance costs for businesses, especially small firms lacking the resources to decipher and navigate agency-specific deviations and non-transparent procurement policies.17
Expert and Political Recognition
Procurement experts such as Ralph Nash, Vern Edwards, and Jim Nagle have expressed deep concern, warning explicitly that continued deviation-driven deregulation fundamentally undermines fair competition, transparency, and accountability in federal procurement.13
Despite bipartisan congressional recognition of the critical importance of small business protections—historically emphasized by influential lawmakers including Senator Joni Ernst and former Senator Marco Rubio, now serving as Secretary of State—current regulatory actions directly contradict these longstanding commitments and threaten permanent economic harm to districts nationwide.16
Call to Action
The immediate restoration and rigorous enforcement of the Rule of Two, coupled with strict adherence to APA compliance, must become a top congressional priority. Congress must explicitly legislate these protections into mandatory law and demand immediate transparency and accountability from federal agencies, reversing the dangerous trajectory set by the Deviation Doctrine.
Without immediate, decisive action, the integrity and fairness of federal procurement processes face permanent damage, with profound economic implications for small businesses, local economies, and American competitiveness.