Small Businesses vs. Trump: The Looming Funding Crisis and Its Impact on California Jobs

California’s small businesses are feeling the heat from Trump’s recent executive orders, giving them plenty to sweat about. If you didn’t already realize, these businesses are responsible for more than half of the jobs in our beloved state. So when the former President decided to freeze funding and go on an anti-diversity rampage, small business owners, particularly in communities of color, looked at each other wide-eyed, wondering how the heck they would survive this mess.

The funding freeze, initiated in January, threatens to cut off hundreds of billions of dollars earmarked for programs that help keep our local economies thriving. Sure, Trump’s administration insists that funding for small businesses won’t feel the pinch, but tell that to Liz Perez, owner of a promising general contracting firm in San Diego County. She claims the freeze sent shockwaves through her Native American community, shutting down projects and freezing opportunities at a time when stability is sorely needed.

“I’ve never seen tribal leaders , the most organized folks , looking this frazzled,” she quipped, as uncertainty has left small business owners reeling and unsure of what’s next. In California, businesses with fewer than 20 employees account for nearly a third of jobs in the state. If they’re hit by a funding freeze, we might as well just write an obituary for economic growth.

California is the top recipient of Small Business Administration loans, raking in a cool $1.15 billion just this year. But those investments are now in jeopardy. With other federal funds like the $25 million earmarked for the State Small Business Credit Initiative also on the chopping block, the ripple effects could be catastrophic across several industries, particularly for the under-resourced and underrepresented.

Experts like Simon Brown from Small Business Majority are worried sick that any funding choked off from the Small Business Administration could strike a death blow to countless businesses trying to build themselves from the ground up.

And where does that leave our economy? Flailing. As the funding freeze lowers investor confidence and halts crucial infrastructure projects, we watch the clock tick down on our local job market.

As for the so-called plan to address “Marxist equity and social engineering,” California Attorney General Rob Bonta shot back, arguing it could jeopardize nearly one-third of the state’s budget. More importantly, this isn’t just about numbers; it’s about lives.

When you kick diversity, equity, and inclusion initiatives to the curb, you aren’t just stalling small businesses , you’re rolling back vital support systems for marginalized groups. From economic empowerment to simple survival, these programs serve as lifelines. Let’s face it: any erosion of support for small businesses is an open invitation for discrimination and inequality to run wild.

So, as we brace ourselves for the full fallout of Trump’s funding freeze, one thing is clear: if we want a thriving economy that propels everyone forward and not just the wealthy elite, we can’t afford to sit on our hands. It’s time to fight back, support local businesses, and ensure that all our community members have a chance to succeed.

AUTHOR: mpp

SOURCE: CalMatters