REPUBLICANS DO BEST IN THE DEBATE over racial preferences when they spotlight the least defensible aspects of the civil-rights industry — not its lofty intentions but the grubby reality of race politics. Thus, the defenders of affirmative action fell silent at a House hearing last month when a witness recounted his treatment by a Federal Communications Commission administrative law judge. One J. Thomas Lamprecht read from the judge’s decision informing him that he would not be granted a radio license because he suffered from the “birth defect” of being born a “white Anglo-Saxon male.”
Such everyday outrages are the predictable result of policies that Republicans should be fighting to eliminate. As it turns out, they have an opportunity at hand. The gigantic 1991 Intermodal Surface Transportation Efficiency Act (ISTEA, known as “Ice-Tea”) must be reauthorized by September 30 in order for billions in federal highway funds to flow to the states over the next six years. ISTEA contains a huge racial set-aside (and a few minor ones) that Congress could do away with now, while continuing to debate a broader rollback of affirmative action.
By taking a stand on the racial provisions of ISTEA, Republicans could call President Clinton’s bluff about “mending” affirmative action. In his famous July 1995 speech, the president said affirmative action “does not mean numerical quotas.” Yet the biggest racial set-aside in ISTEA is a fiat requirement that “not less than 10 percent” of highway funds go to minority- owned businesses. Congress could not ask for a clearer instance of the type of quota the president said he opposes.
In order to meet this quota, federal transportation agencies and states employ a host of setasides and bid preferences. In some cases, states offer a financial incentive or “bounty” to prime contractors who pass over low- bidding subcontractors in favor of firms owned by listed racial minorities (including Aleuts, Samoans, and Bhutanese — against whom there is scant evidence of discrimination in the highway industry). This bounty is paid automatically, regardless of the prime contractor’s costs in hiring minority- owned subcontractors.
In practice, the 10 percent set-aside has been both expensive and unfair. Far from benefiting “socially and economically disadvantaged individuals” as Congress envisioned, the set-aside has come to benefit a handful of wealthy minority business owners. With the federal government as their silent partner, these firms are able to get federal highway contracts time after time even though they are neither economically nor socially disadvantaged and regardless of whether they are the low bidder on the contract.
Applying the 1995 Supreme Court decision in Adarand Constructors, Inc. v. Pena, last month a federal district court declared unconstitutional ISTEA’s rigid presumption that all members of listed minority groups — and no members of any other group — have suffered economic or social disadvantage. Other courts have been troubled by ISTEA’s postulate that in the absence of such disadvantage, minority groups would “naturally” come to occupy 10 percent of all highway contracting. Congress can hardly complain about Clinton bureaucrats who refuse to abide by federal court decisions if it merrily reauthorizes racial preferences the courts already have ruled unconstitutional.
Nor are the infirmities of ISTEA’s set-aside repaired by Attorney General Janet Reno’s recent effort to “mend” racial preferences in government contracting. The guidelines her department issued in response to Adarand apply only to the federal government’s own direct procurement. They do, however, require some showing of statistical disparity. If Congress reenacts ISTEA unchanged, it will reauthorize a set-aside requirement even cruder than what is now acceptable to Clinton’s own Justice Department.
Two years ago, Congress ended a similarly egregious set-aside, an FCC broadcasting preference that benefited a handful of wealthy broadcast-station owners. One beneficiary, for example, was Viacom, which used the preference to escape $ 600 million in taxes by selling its cable TV properties to a black entrepreneur. The entrepreneur in question was largely financed by the nation’s largest cable operator, making him hardly economically or socially disadvantaged or even the sole beneficiary of the preference. To this day, the elimination of this FCC program has been the only tangible Republican victory in the effort to do away with federal racial preferences.
The ISTEA set-aside is no less a quota than the FCC’s now-defunct racial preference, and it is no less a handout to the wealthy. Congress ought to act decisively to end it.
Terry Pell is senior counsel at the Center for Individual Rights, which represented J. Thomas Lamprecht in his challenge of FCC preferences.
