What do you think the SBA could do for small businesses if it had $25 billion to work with?

That’s how much the government loaned to the Big Three automakers — General Motors, Chrysler and Ford.

Presumably, it didn’t work. They are back at the trough, looking for another $50 billion bailout and rumor has it that the incoming Obama Administration is inclined to give it to them.

The U.S. economy used to be famous for something called creative destruction. That’s the process by which large marketplace incumbents that failed to adjust to changes in said marketplace eventually disappeared, to be replaced by a new set of businesses that eventually grew to become our current large marketplace incumbents.

But it’s pretty hard for those feisty little upstarts to start up and get anywhere if the government steps in and refuses to let creative destruction clear the underbrush.

As the latest research into large and small firm innovation shows, we are probably not going to get the technological solutions we need to address our most pressing problems from the GMs of the world. But, if the federal government is blowing its fiscal wad on the dinosaurs, where does that leave tomorrow’s giants?

This is not a question of shoring up faltering companies to save jobs. If they are worried about the workers, policy makers can always put programs into place to assist displaced workers (including the ones who want to start their own businesses).

This is not about keeping the world’s economies from collapsing by saving its fundamental financial system. Americans won’t be without cars if the Big Three go under. If anything, those three corporate giants will be replaced by companies that build cars people actually want to buy.

The American taxpayer does not owe it to any one of those three companies to keep them going even as they wheeze in their final death throes.

It’s too bad the federal government would never even consider using all those billions of dollars to support small and microbusinesses. They’d rather plug a finger in the dike of faltering and badly mismanaged, but politically well-connected, automakers.

Those elderly dinosaurs need to come off life support so that creative destruction can do its thing. That would be better for the economy.

It would be better for small businesses, too.