The new Trump budget calls for the axing of several federal agencies that the president feels are costing taxpayers too much money and not providing benefits that make having the agencies worthwhile. Plus, the supposed benefits could be provided better from another agency or the private sector.
One of those agencies slated to be discontinued has been around since the Nixon era and its usefulness negated by other government programs that do virtually the same thing.
The Minority Business Development Agency (MBDA) was created for the purpose of providing business loans and counseling services to minorities for business startups, but has become too costly to maintain. President Trump’s trim down and shape up program for the federal government will eliminate the corporate welfare agency.
The Trump administration’s first budget would shutter the fifty-year-old Minority Business Development Agency (MBDA). The MBDA hands out grants and runs federally funded “management consulting operations” around the country. It has long been targeted by conservatives as a form of corporate welfare.
The agency has also been criticized for encouraging a “flight from white.” Since it offers aid only to business owned by officially recognized minorities, it creates an incentive for Americans to seek to have themselves recognized as non-white minorities. In 1977, Americans Indians successfully had their classification changed from white to Asian. More recently, some Americans of Middle Eastern descent have been lobbying to be recognized as minorities as well.
One effect of designating more Americans as officially recognized minorities has been to dilute the benefits of affirmative action and the MBDA to the originally intended recipients, African Americans.
The MBDA was created by Richard Nixon with a 1969 executive order under its original name of the Office of Minority Business Enterprise. The idea was that the agency would work to remedy the effects of past discrimination. It was a precursor to a series of programs that what would later be labeled “affirmative action” policies.
At its creation, the MBDA was tasked with the mobilization of federal and local resources for the promotion of minority business efforts in the United States with a focus on Black, Hispanic, and Native Americans. In more recent years, this group was expanded to include Hasidic Jews, Asian Americans, and Pacific Islanders.
The agency currently maintains approximately forty walk-in centers across the US, designed to provide consultation to minority businesses. These centers assist walk-ins with loan acquisitions, grant applications, and the navigation of forms and certifications for the purpose of securing government procurement contracts. In addition to their walk-in centers, the MBDA establishes guidelines for all federal agencies in attracting and selecting minority enterprises for the purpose of procurement contracts.
Though the details of this agency’s closure are still up for approval by the House and Senate, it is expected that the Small Business Administration (SBA) will continue to support a subset of the functions that the MBDA currently provides.
Eliminating the MBDA is more like pruning the dead limbs off a tree than actually taking away something living and useful. The agency has become redundant and unnecessary. There are more government programs to aid minorities than just about any other group. Trump cutting this particular agency is one of the most cost-efficient things he could do!