Jewish World Review Feb. 12, 2003 / 10 Adar I 5763

Thomas Sowell

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Big business and quotas

http://www.NewsAndOpinion.com | Anyone who thinks that business is gung ho for the free market has just not been paying attention to business. Adam Smith knew better, back in the 18th century.

Although he was the patron saint of capitalism, Smith was no fan of capitalists. Any policy advocated by businessmen, he said, "ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention."

In our own time, as in Adam Smith's time, businesses have not hesitated to advocate government interference with free markets. Tariffs on steel and other import restrictions are obvious examples. Many, if not most, antitrust cases begin with some business complaining because a competitor is gaining market share by charging lower prices or offering an improved product.

While businesses will use the rhetoric of the free market when it suits their purpose, they will dump it in a minute when it does not. Against this background, it is not surprising that big business is filing briefs in favor of affirmative action in the University of Michigan case that the Supreme Court will be hearing this spring.

Big business has long been in favor of racial quotas. When an effort was begun back in the 1980s, within the Reagan administration, to get rid of affirmative action, the influence of corporate America helped squelch this effort.

Why does big business want racial quotas? Because it is in their own self-interest.

If a corporation does not have enough minority employees to satisfy government agencies, that can lead to racial discrimination lawsuits. But if they hire by quotas and quotas are outlawed, they can be sued by whites for reverse discrimination. Keeping affirmative action legal solves their problem.

But that is not how it was presented in the January 27th issue of BusinessWeek, where columnist Roger O. Crockett portrayed corporations as courageously "sticking out their necks" for the sake of that mystic thing called "diversity."

Sticking their necks out? Just who is going to do what to them for supporting quotas? It is safer than playing checkers with your maiden aunt.

If there is anything more ridiculous than endlessly repeating the magic word "diversity," it is trying to come up with plausible arguments in favor of the racial quotas that this euphemism really means.

According to BusinessWeek, corporate CEOs "believe that as minorities' share of the U.S. population has mounted, diversity has become a critical workforce requirement." They get this diversity by hiring graduates of "a campus where diversity thrives" because that is where "students develop an understanding of different cultures." And that, in turn means that these graduates know how to "appeal to a variety of consumers" as well as how to get along with "colleagues and clientele from many ethnic backgrounds."

How do companies in Japan manage to sell everything from cars to cameras, in countries around the world, without having that mystic "diversity"? How does a country with such a racially homogeneous population even manage to educate its young people if "diversity" is such an essential factor in education?

Yet big business CEOs "rightly worry," according to BusinessWeek, that without racial quotas the result would be "a smaller supply of minority college grads, which would damage the economy and the society alike."

Actually, the result of getting rid of racial quotas in college admissions is likely to be a larger supply of minority college graduates, because minority students will be attending colleges where they meet the same standards as others and are more likely to be able to do the work and graduate, instead of punching out as often as they do when they are admitted under lower standards.

The end of affirmative action in state colleges and universities in California and Texas has not led to declining enrollments of minorities, but to their redistribution among academic institutions. But facts carry no such weight as the "diversity" mantra.

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JWR contributor Thomas Sowell, a fellow at the Hoover Institution, is author of several books, including his latest, "Controversial Essays." (Sales help fund JWR.)

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