Trump Budget Hurts the Working Poor: ODA Calls on White House to Reinstate Funds for Manufacturing Extension Partnership (MEP)

Word out of Washington on March 16 that the Trump Administration is calling for "discontinuing federal funding for the Manufacturing Extension Partnership (MEP) program" (see page 14, bullet 2) comes as devastating news for the working poor clients of organizations like Open Door America.  By any measure, this is wrongheaded and shortsighted public policy that offers little in budgetary relief while eliminating a proven partnership with a 29-year track record of positively impacting the employment, public assistance, and criminal justice sectors.  The MEP program was signed into law by President Ronald Reagan and has been supported by every successive President from George Herbert Walker Bush to Barack Obama.

Since November 2016, Open Door America has placed one impoverished Marylander a month -- including five ex-offenders -- in living-wage jobs through our partnership with Maryland MEP.  Thanks to MD MEP, manufacturing firms have hired folks other high-end employers will not even interview.

These are the good jobs that offer a poor family a pathway out of poverty, dependency, and failure.

These are the good jobs with healthcare and retirement benefits that open up the American dream to disadvantaged households.

This is a program that makes sense . . . and saves cents.

In terms of cost savings, cutting MEP's $124 million from the 2018 federal budget does little to offset the $54 billion increase in defense spending that is driving the Trump Administration's budget strategy. And, it most certainly guarantees future increases in dead-end public assistance and incarceration spending.  Make no mistake: without MEP's training programs, reputation with employers, and advocacy for entry-level workers, these jobs do not become available to the working poor.

In our 13th year, here's what we know about the chronically unemployed, the under-employed, and the working poor:

• There are no shortcuts to solving America's working-poor poverty crisis.  
• Building a national consensus to help the working poor is virtually impossible until more voters and government officials understand the direct connection between too few living-wage jobs and the growth of poverty, public assistance, and incarceration.
• Finding living-wage employers who hire entry-level workers with challenging backgrounds is harder than finding a haystack needle.
• Organizations like the Maryland Manufacturing Extension Partnership are critical to finding the needle.

Through MD MEP, Open Door America is linked to a constellation of Maryland manufacturing companies willing to pay living wages to entry-level workers:

• MEP employers understand the connection between wage fairness and growing a successful business.
• In many cases, MEP companies start workers at wages 30 to 40 percent higher than Maryland's current minimum wage.
• On a case-by-case basis, MEP employers are willing to hire certain ex-offenders.
• ODA believes MEP employers are community heroes. 

Consider the following when assessing the value of MEP when it comes to reducing the costs of poverty, public assistance, and incarceration:

• Of the 28 million Americans currently working at the minimum-wage level, the average age is 35 and one-quarter are parents.  Low wages are not a teenage worker issue as is commonly believed.  Low wages are the single biggest contributor to American families living in poverty and depending on public assistance.
• When entry-level workers are confined to minimum-wage jobs, their uncovered living expenses are often passed on from employers to taxpayers.  Americans for Tax Fairness reported in 2013 that Walmart's low-wage workers cost taxpayers an estimated $6.2 billion in public assistance including food stamps, Medicaid, and subsidized housing.
• Today, there are at least 126 federal anti-poverty programs that cost the U.S. Treasury $700 billion a year.  Since 1965, the U.S. has spent over a trillion dollars battling poverty and yet the poverty rate persists at approximately 15 percent. 
• A 2013 study by the CATO Institute reveals that "welfare currently pays more than a minimum wage in 35 states."
• This same CATO analysis finds the average welfare benefits package in Maryland to be over $35K.
• The Governor's Office for Children in Maryland recently reported that "on any given day, approximately 90,000 children in Maryland have a parent under some form of correctional supervision -- parole, probation, jail or prison."  The report adds:
• "In Baltimore City, three-quarters of the incarcerated residents come from 25 communities where 47% of the residents are unemployed, 17% are on public assistance, 26% did not complete high school . . . . Incarceration overall costs Maryland taxpayers approximately $38,000 per inmate annually . . . approximately $300 million each year is spent on incarcerating people from Baltimore City alone."

Yes, there is a government spending problem in Washington D.C.  And, yes, there are government programs that need to be eliminated.  MEP is not one of those programs.  MEP works.  MEP delivers.  We see it in the lives of our clients and their families. 

We need your voice to be heard.  Now.