Scott stays silent as his minority business legacy crumbles under Trump
Senate Banking Chair
Tim Scott
(R-S.C.) has spent years boosting a federal program to support minority-owned businesses. President Donald Trump's administration dismantled it in a matter of weeks.
Scott, along with other Republicans, was integral to congressional efforts to permanently authorize the Commerce Department's Minority Business Development Agency, expand its services into rural areas and leverage the program to help minority-owned businesses during the Covid-19 pandemic.
Now, the program, which funds grants to business owners and provides technical assistance, support and mentorship, has had 100 percent of its staff, about 50 people, placed on administrative leave or redistributed within the Commerce Department, according to a Commerce employee and a Democratic staffer granted anonymity to discuss personnel matters.
For years, Scott has prioritized efforts to expand access to capital and economic mobility for underserved communities, like the one he says he grew up in, and minority businesses, like his own Main Street insurance agency. The MBDA dates back to the Nixon administration and was one outlet for this mission. But Scott has stayed silent publicly about the gutting of the agency.
'They are watching this happen, and they are doing nothing. That's cowardice. And it cuts especially deep when the people you once believed were your champions turn their backs in silence,' the Commerce Department employee said of Scott's and other Republicans' silence on cuts to the program.
Scott campaigned for Trump and at one point was vying to run as his 2024 vice presidential pick. His silence underscores the fine line he and other Black conservatives have to walk between their own interests and loyalty to the party as the administration wages a broader war against the government's diversity-focused initiatives.
A spokesperson for the lawmaker highlighted his record of working with Trump to deliver 'life-changing results for minority communities around the nation.' They pointed to Scott's efforts under Trump's first term to secure permanent funding for historically Black colleges and universities, creating 'opportunity zones' under the 2017 Tax Cuts and Jobs Act, and cutting taxes for single mothers.
'Their vision of America is one that allows every American, no matter their background, to have the necessary tools and resources to achieve their American dream. Senator Scott and President Trump are undoubtedly working to make sure our country works for all hard-working Americans,' the Scott spokesperson said in a statement.
Scott and other Republican lawmakers have told minority businesses they are supportive of the minority business program's mission but wish the agency would change its name to avoid political attention, said one of the Commerce Department employees.
The gutting of the agency counters Scott's recent efforts to improve access to economic tools for underserved communities and minority business owners. His Empowering Main Street in America Act sought to improve access to capital for small businesses, including minority, women-owned and rural small businesses. The bill failed to advance in Congress last year, but Scott said last month that he will continue pushing the legislation forward.
Scott and other senators championed bipartisan legislation which passed as part of a 2021 infrastructure and jobs bill that permanently authorized the Minority Business Development Agency and expanded it to establish rural business centers at historically Black colleges and universities. Scott said at a 2020 U.S. Chamber of Commerce fireside chat that 'by having more MBDAs located around the country especially in the rural areas, you'll bring expertise to those would-be entrepreneurs and you'll better equip them for success.'
And during the pandemic, Scott pointed out he secured an additional $10 million in a Covid-19 relief bill to help the MBDA connect minority-owned businesses to the Paycheck Protection Program, which provided financial aid to companies during the crisis.
'Small businesses — barber shops and beauty salons and landscapers — are in abundance in the African-American community. They are some of the hardest working people you know and they need to understand and know that the resources are there,' Scott said in a 2020 interview on ABC's The View.
Under the current cuts, the MBDA will be unable to deliver core programs, like the Capital Readiness Program, which offers assistance accessing capital and provides technical assistance services. A national network of business centers are now being shuttered and contractors have been released. Those awarded grants by the MBDA have not been notified about the status of their grants and are left without guidance, according to two Commerce Department employees.
Only a deputy secretary, an acting under secretary and a DOGE employee remain, according to one of the Commerce Department employees.
The U.S. Department of Commerce, U.S. Department of Labor and the Department of Government Efficiency did not respond to requests for comment.
Trump has long supported shuttering the MBDA. During his first term, he proposed closing or significantly reducing the agency in his budget proposals all four years.
On March 14 he issued an executive order requiring the MBDA to shrink its work and personnel to the minimal amount possible under the law.
What's unfolding at the MBDA is 'unprecedented,' the Commerce Department employee said. 'A lawful federal agency being functionally eliminated through verbal instruction, without public transparency, process or regard for its statutory basis.'
Congressional Democrats, led mostly by Financial Services Ranking Member
Maxine Waters
(D-Calif.), have argued the dismantling of the agency 'represents yet another unlawful and dangerous attempt to undermine a congressionally established institution vital to our nation's economy.'
Meanwhile, Scott's allies say he will continue to support minority-owned enterprises but may have to adjust his strategy in the new Trump era.
Stephen Gilchrist, chair of the South Carolina African American Chamber of Commerce and a Trump appointed commissioner of the U.S. Commission on Civil Rights said Scott 'will work with the administration to find a path to make sure that this work continues' to allow 'African American and other minority businesses to really be able to gain access to capital and to get the resources that they need.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Axios
24 minutes ago
- Axios
Amid backlash, Tesla remained resilient in Texas
Even as Tesla deliveries plunged nationally this year amid Elon Musk's very visible (if short-lived) alliance with President Trump, there was at least one state where Tesla registrations were up: Texas. Why it matters: The registration data, obtained by Axios through public information requests, indicates loyalty to the brand in its home base, including Texas' large urban and suburban counties. The depth of conservatives' enthusiasm for Musk's automobiles now faces a major test amid the absolute meltdown last week between the Tesla CEO and the president. By the numbers: Texans registered 12,918 new Teslas in the first three months of 2025, a period when Musk, who contributed more than $250 million to a pro-Trump super PAC during the 2024 election campaign, was enmeshed in the Trump administration as the overseer of DOGE, the president's cost-cutting initiative. Over the same period in 2024, Texans registered 10,679 Teslas. That's a 21% increase year over year. The intrigue: The spike in Texas registrations came as Tesla was flailing elsewhere. Tesla's vehicle deliveries plunged 13% globally in the first quarter of 2025 (336,681 electric vehicles) compared with Q1 2024 (386,810). Tesla vehicles were torched at showrooms and the brand's reputation cratered. Zoom in: Tesla saw year-over-year improvements in its sales in some of the most populous Texas counties. In Travis County, new Tesla registrations grew from 1,369 in the first quarter of 2024 to 1,424 during the first quarter of 2025. In Harris County, they grew from 1,526 to 1,837 during the same period. Tesla registration grew from 1,316 to 1,546 in Collin County and from 990 to 1,146 in Dallas County. In Bexar County, registrations grew from 631 to 664. What they're saying:"It's homegrown pride," is how Matt Holm, president and founder of the Tesla Owners Club of Austin, explains the car company's resilience to Axios. "And regardless of all the drama going on these days, people can differentiate between the product and everything else going on, and it's just a great product." "Elon has absolutely and irreversibly blown up bridges to some potential customers," says Alexander Edwards, president of California-based research firm Strategic Vision, which has long surveyed the motivations of car buyers. "People who bought Teslas for environmental friendliness, that's pretty much gone," Edwards tells Axios. Yes, but: The company had been enjoying an increasingly positive reputation among more conservative consumers. Musk was viewed favorably by 80% of Texas Republicans polled by the Texas Politics Project in April — and unfavorably by 83% of Democrats. In what now feels like a political lifetime ago, Trump himself even promoted Teslas by promising to buy one in support of Musk earlier this year. "In some pockets, like Austin, you have that tech group that loves what Tesla has to offer, can do some mental gymnastics about Musk, and looks at Rivian and says that's not what I want or might be priced out," Edwards says. Between the lines:"Being in the state of Texas, you're naturally conditioned to think you're better than everyone else in the U.S. And when you buy a Tesla" — a status symbol — "that's what you're saying. It doesn't surprise me that there's an increase in sales" in Texas, Edwards says. Plus: Tesla's resilience in Texas could have practical reasons as well, Edwards says. Texas homes — as opposed to, say, apartments in cities on the East Coast — are more likely to have a garage to charge a car in, he adds. What's next: Musk said late last month that Tesla was experiencing a "major rebound in demand" — without providing specifics. But that was before things went absolutely haywire with Trump and Tesla stock took a bath last week.
Yahoo
27 minutes ago
- Yahoo
This AI Company Wants Washington To Keep Its Competitors Off the Market
Dario Amodei, CEO of the artificial intelligence company Anthropic, published a guest essay in The New York Times Thursday arguing against a proposed 10-year moratorium on state AI regulation. Amodei argues that a patchwork of regulations would be better than no regulation whatsoever. Skepticism is warranted whenever the head of an incumbent firm calls for more regulation, and this case is no different. If Amodei gets his way, Anthropic would face less competition—to the detriment of AI innovation, AI security, and the consumer. Amodei's op-ed came in a response to a provision of the so-called One Big Beautiful Bill Act, which would prevent any states, cities, and counties from enforcing any regulation that specifically targets AI models, AI systems, or automated decision systems for 10 years. Senate Republicans have amended the clause from a simple requirement to a condition for receiving federal broadband funds, in order to comply with the Byrd Rule, which in Politico's words "blocks anything but budgetary issues from inclusion in reconciliation." Amodei begins by describing how, in a recent stress test conducted at his company, a chatbot threatened an experimenter to forward evidence of his adultery to his wife unless he withdrew plans to shut the AI down. The CEO also raises more tangible concerns, such as reports that a version of Google's Gemini model is "approaching a point where it could help people carry out cyberattacks." Matthew Mittelsteadt, a technology fellow at the Cato Institute, tells Reason that the stress test was "very contrived" and that "there are no AI systems where you must prompt it to turn it off." You can just turn it off. He also acknowledges that, while there is "a real cybersecurity danger [of] AI being used to spot and exploit cyber-vulnerabilities, it can also be used to spot and patch" them. Outside of cyberspace and in, well, actual space, Amodei sounds the alarm that AI could acquire the ability "to produce biological and other weapons." But there's nothing new about that: Knowledge and reasoning, organic or artificial—ultimately wielded by people in either case—can be used to cause problems as well as to solve them. An AI that can model three-dimensional protein structures to create cures for previously untreatable diseases can also create virulent, lethal pathogens. Amodei recognizes the double-edged nature of AI and says voluntary model evaluation and publication are insufficient to ensure that benefits outweigh costs. Instead of a 10-year moratorium, Amodei calls on the White House and Congress to work together on a transparency standard for AI companies. In lieu of federal testing standards, Amodei says state laws should pick up the slack without being "overly prescriptive or burdensome." But that caveat is exactly the kind of wishful thinking Amodei indicts proponents of the moratorium for: Not only would 50 state transparency laws be burdensome, says Mittelsteadt, but they could "actually make models less legible." Neil Chilson of the Abundance Institute also inveighed against Amodei's call for state-level regulation, which is much more onerous than Amodei suggests. "The leading state proposals…include audit requirements, algorithmic assessments, consumer disclosures, and some even have criminal penalties," Chilson tweeted, so "the real debate isn't 'transparency vs. nothing,' but 'transparency-only federal floor vs. intrusive state regimes with audits, liability, and even criminal sanctions.'" Mittelsteadt thinks national transparency regulation is "absolutely the way to go." But how the U.S. chooses to regulate AI might not have much bearing on Skynet-doomsday scenarios, because, while America leads the way in AI, it's not the only player in the game. "If bad actors abroad create Amodei's theoretical 'kill everyone bot,' no [American] law will matter," says Mittelsteadt. But such a law can "stand in the way of good actors using these tools for defense." Amodei is not the only CEO of a leading AI company to call for regulation. In 2023, Sam Altman, co-founder and then-CEO of Open AI, called on lawmakers to consider "intergovernmental oversight mechanisms and standard-setting" of AI. In both cases and in any others that come along, the public should beware of calls for AI regulation that will foreclose market entry, protect incumbent firms' profits from being bid away by competitors, and reduce the incentives to maintain market share the benign way: through innovation and product differentiation. The post This AI Company Wants Washington To Keep Its Competitors Off the Market appeared first on
Yahoo
27 minutes ago
- Yahoo
California City Terminates 'Divisive' ICE Contract Amid L.A. Protests
Glendale, California, which is located just minutes from Los Angeles where anti-ICE protests erupted this weekend, has decided to end a contract with Immigration and Customs Enforcement to hold detainees in its jail. In a press release Sunday, city officials said that 'public perception of the ICE contract—no matter how limited or carefully managed, no matter the good—has become divisive.' 'And while opinions on this issue may vary—the decision to terminate this contract is not politically driven. It is rooted in what this City stands for—public safety, local accountability, and trust,' the statement said. Ahead of the unrest in Los Angeles, Glendale had come under some scrutiny over a 2007 contract to house ICE detainees despite a 2018 sanctuary state law ensuring that no local law enforcement resources are used for the purpose of immigration enforcement. In one year, the city collected $6,000 to house ICE detainees, and The Los Angeles Times reported that the city receives $85 per detainee per day. In the last week, two ICE detainees were held in Glendale's detention center, leading to an outcry over the city's potentially unlawful compliance, as the Trump administration has moved to increase the number of daily ICE arrests. But it seems that Glendale will no longer be complicit in the Trump administration's immigration crackdown. The statement continued, emphasizing that local law enforcement was not responsible for enforcing immigration law, and that the city would remain in compliance with the law. 'The Glendale Police Department has not engaged in immigration enforcement, nor will it do so moving forward,' the statement said. Just a few miles away in downtown Los Angeles, massive anti-ICE protests are still ongoing after immigration authorities arrested at least 44 immigrants Friday. In response to the protests, Donald Trump bypassed California Governor Gavin Newsom to deploy the National Guard, which has used tear gas, flash grenades, and rubber bullets against the protesters and journalists. The decision on behalf of Glendale is a victory for the protestors, and a clear response to the ongoing direct action in Los Angeles, as well as the Trump administration's escalating efforts to conduct mass deportations of undocumented immigrants.
