Thursday

Cutting Vital Programs May Thwart Job Growth

For those who believe government can provide solutions and improve the lives of everyday Americans, it is worth noting the Cabinet members President Donald J. Trump has selected to help lead the United States. It is in these selections we may find some insight into what cuts will be made to government programs. 

Where the Cabinet Selections Started 

Heritage Foundation is a Washington, D.C. based conservative think tank. Any person with the inclination to do so can read their website and will quickly understand their intention is to shrink government as quickly as possible. Interestingly enough, Heritage Foundation has been a leading force in helping Donald J. Trump fill his cabinet. This should concern anyone who believes some issues need to be dealt with by the federal government. 

Most Can Get Behind Shrinking Expenses But... 

Whether you lean left or lean right, most people can get behind reducing bureaucracy. The problem is there are differences in opinion in where and how those cuts may be made. For example, one of the proposals floated by Heritage Foundation which may now be considered is cuts to the U.S. Commerce department. Overall these cuts would reduce federal government expenses by some $900 million dollars this year alone. The cuts could include eliminating these four programs: 
  • Minority Business Development Agency 
  • Economic Development Administration 
  • International Trade Administration 
  • Manufacturing Extension Partnership 
The problem with these cuts is they seem diametrically opposite the President's pledge to help spur new jobs. Let's take a look at what each of these agencies mission statement is and see what cutting these divisions could mean in the long-run. 



Minority Business Development Agency 
This agency matches needs of minority business owners with access to capital, contracts, and markets so they can sell their products and services. This is done primarily through serving as advocates and working with policy-makers and decision-makers to help minority business owners all across the United States. Minority-owned businesses are responsible for more than 7 million jobs and more than $1 trillion in economic output. 

Economic Development Administration (EDA) 
Established more than 50 years ago, the goal is to help communities generate jobs, retain existing jobs, and stimulate industrial and commercial growth. During 2015, $238 million was invested by EDA. The net result of this investment was 35,000 jobs saved or created, and an additional $4.2 million in new investments. Let's face it, more of our communities need these influxes of capital to help generate jobs and promote growth. 

International Trade Administration 
The purpose of this group is to promote economic growth and ensure companies are compliant with fair trade laws when working with U.S. businesses. This agency provides small and medium-sized business owners opportunities to export their goods and services. One would think, given the President's goal of increasing jobs, this would be a good division to keep. After all, small businesses accounted for 40 percent of the “new” jobs over the last two decades, an impressive number by any measure. 

Manufacturing Extension Partnership (MEP) 
During the 1980's when Japan was causing the U.S. to lose ground in manufacturing, MEP was created as a way to provide expertise to manufacturing facilities to help them streamline operations, improve technology usage and other growth-related assistance. The funding for this partnership is a combination of public and private funding and the assistance offered to manufacturers in the United States is invaluable. Nearly every state has benefited from this partnership in varying degrees. 

While employment rates are at the lowest they have been since 2006, there is still much work to be done. Without these important agencies, we may see a decrease in new businesses among minority communities, a slowdown in economic improvement in communities where needed and worse yet, a slowdown in manufacturing jobs which is exactly opposite what President Trump offered on the campaign trail.  Finding ways to cut governmental red tape is always a good idea, regardless of your politics. However, when it is clear your first cuts are to agencies that have clearly helped spur economic growth and jobs, it leads one to wonder what your priorities really are when it comes to job growth.
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Sources: 
Heritage Foundation 
Minority Business Development Agency 
Economic Development Administration (EDA) 
EDA 2015 Report 
International Trade Administration 
Small Business Statistics 

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