How Sandra Day O’Connor Warped Government Contracting

Roger Clegg and John Sullivan, Wall Street Journal, January 26, 2014

In a landmark case 25 years ago this month, the Supreme Court struck down a municipal contracting program that gave preferential treatment to companies owned by racial and ethnic minorities. City of Richmond v. J.A. Croson Co. was a welcome decision for equality under the law—but Justice Sandra Day O’Connor’s 1989 opinion unfortunately left the door ajar for state and local governments to justify such discrimination.

Six years later, in Adarand Constructors Inc. v. Pena, Justice O’Connor ruled against the federal government with regard to a preferential federal contracting program but again left the door ajar for the federal government. She did the same thing—that is, limiting but not ending racial preferences—for university admissions in 2003 (Grutter v. Bollinger).

The problem with this line of Supreme Court decisions is that many politicians find a racial spoils system advantageous—and if the door is left even slightly ajar they will muscle through it. And so, while race-based preferential contracting programs remain legally vulnerable when they are challenged, these programs continue. There are more than 1,400 preferential programs for government contracts in the Transportation Department alone. The overall number throughout the federal, state and local governments would no doubt total several thousand.

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Courts have struck down some state and local programs—in cities (Baltimore, Chicago, Columbus, Jackson and Philadelphia), school districts (Atlanta and Memphis), counties (Cook County, Ill., Dade County, Fla., and Fulton County, Ga.), and states (Ohio and New Jersey). They also have struck down or limited the use of some preferential contract programs at the federal level. And if the violation of civil-rights laws is clear enough, courts in a few cases have held officials personally liable if they continue to enact them.

But with a single sentence in Croson, Justice O’Connor created a loophole and launched a new industry: “Where there is a significant statistical disparity between the number of qualified minority contractors willing and able to perform a particular service and the number of such contractors actually engaged by the locality or the locality’s prime contractors, an inference of discriminatory exclusion could arise.”

It did not take governments long to seize upon this language. By the early 1990s this newspaper headlined a story “Court Ruling Makes Discrimination Studies a Hot New Industry.” It reported that Miami had commissioned an accounting firm to undertake a disparity study to justify its set-aside program. When the firm concluded that the needed statistical evidence of discrimination was lacking, “angry city commissioners refused to accept the conclusion.” The vice mayor “railed at the stunned consultants: ‘The whole purpose of this study was for you to prove that there was a disparity.’ ”

In the past quarter century more than $100 million of taxpayers’ money has paid for more than 200 disparity studies, according to research conducted by John Sullivan and a colleague in the years since Croson. These disparity studies may well represent the biggest expenditure of social science research in this country’s history.

It is mostly money wasted. It is a huge leap from a statistical disparity, which can have all kinds of explanations, to a conclusion of discrimination. And it is a further leap to concluding preferences are the right—and the Supreme Court rulings indicate that they must be the only—remedy for any discrimination that does occur.

The Government Accountability Office reviewed 14 disparity studies in June 2001 and found their methodological flaws “create uncertainties about the studies’ findings.” The United States Commission on Civil Rights in May 2006 issued a report criticizing disparity studies for, among other things, using obsolete or incomplete data; failing to test for nondiscriminatory explanations for differences; and relying on anecdotal information that had not been collected scientifically or verified. Last year, Leila Atassi of the Cleveland Plain Dealer revealed—to the city’s great consternation—that Cleveland had spent $758,000 on a no-bid contract for a disparity study that was largely a cut-and-paste job from other studies.

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  • D.B. Cooper

    Question: The president who appointed this…thing; WHAT political party was he a member of?

    As for O’Connor, “swing” vote basically means a conservative who has a liberal record.
    Never forget Grutter v. Bollinger, the case that upheld Affirmative Action. I’m sure you can guess how she voted.

    • Pro_Whitey

      When I think of Sandra Dee O’Connor, I think of the process of trying to stop the spread of cancer and kill off the existing tumors. One lost opportunity to take action, and further efforts can become useless. Her opinions tend to be loads of crap, playing politics she has no constitutional warrant to play, and with absolutely no competence in the making the rules she makes. What a disaster. And yes, I realize Uncle Ronnie nominated her. However, I’d like to get some machete whacks at those who presented her to Uncle Ronnie. That nomination has the stench of the Bush family.

      • Rhialto

        The fundamental point is the vast power of the nine, appointed for life, Supreme Court justices. By simple majority, they can rewrite the Constitution. The Constitution should be a solid foundation for American government, not a beach wagon for Liberal joy rides.

        Also, you might consider the wisdom of creating a public and permanent record of your advocating violence against your political enemies.

        • Pro_Whitey

          Good point in that I ought to avoid idle threats. When it comes to the Bush family, however, I’d have to get in line, a long line.

  • Spartacus

    Give a bunch of useless vermin free money… In the name of equality.

  • Luca

    I had to work with programs like this and could write volumes.

    To be concise, I can say in almost all instances these minority preferences are a waste of taxpayer money, ripe with waste, fraud, abuse and corruption.

    BTW… Minority business is code word for black owned business

    • bigone4u

      In south Texass, minority owned is a code word for Mexican owned, but often there is a sharp YKW putting a Mexican face on a business that is owned de facto by YKW.

      • Luca

        I guess it’s a regional thing, but in LA it was black. I’m sure that will change shortly.

        The big scam was appointing “consultants.” Black consultants who gave classes on the wonders of doing bidness wif minority bidnesses. We had consultants falling out of the windows. Every time we’d see a homeless black guy walking the streets we’d wonder if that was our new consultant.

    • dukem1

      Not really…I’d say that fed contracting-wise, white chicks have the ball in their court.

  • bigone4u

    Tens of millions of dollars wasted locally. Several of the greedy, corners-cutting, corrupt-minded Mexican professors at the local university formed “minority-owned businesses” to take advantage of the preferences. Henry Cisneros was Mayor of San Antonio then and a professor at the univerisity too. It made for a racial spoils system that forever made me hate government at all levels–local, state, and federal. Most of these businesses did a bunch of nothing that existing businesses could not do more efficiently, but my Mexican professor friends earned hundreds of thousands of dollars from the corruption. I consider it my patriotic duty to avoid paying taxes, which funds this criminal system.

    • WR_the_realist

      If I thought I could get away with it I wouldn’t pay my taxes. I would love to defund the most criminal and un-American organization in the country — the U.S. federal government.

      • bigone4u

        Start a home based business and take the home office deduction. There are other legal ways to avoid taxes, but I better not say them here. You can find them in some of the more radical writings on tax avoidance.

        • Einsatzgrenadier

          Nothing wrong with not paying taxes, especially when they’re used by the U.S. federal government to finance your own ethnic cleansing and dispossession.

  • willbest

    None of these laws and agencies solved the intended problem, they have invited abuse and fraud, and they are paying a lot of people money to pretty much do nothing. We could save ourselves billions a year by ending it.

  • r j p

    In the past quarter century more than $100 million of taxpayers’ money has paid for more than 200 disparity studies …

    How do I get one of these $500K+ checks?

  • gregCall

    I worked for a major building contractor in Miami in the mid 90s and he had a second company owned on paper by a monkey who couldn’t run a business if his life depended on it, but his skin color got my boss the government contracts he wouldn’t have gotten otherwise and from what I understood he only gave the black front man around 25% so I guess it was a win/win situation for all involved.
    I imagine this arrangement is very common also, really how many black could actually keep a company running even with government handouts?