Forget Oil-for-Food! What About the Minority-Owned Business Scam?
Read these three stories about the corruption that's rampant in the City of Chicago's program to use minority-owned businesses.
Such programs are an absolute crock. As with these cases, it's easy enough for anyone to run a business that qualifies for "minority-owned" status. Indeed, it seems that, like Oil-for-Food, they often become a conduit for enriching the well-connected.
But even if we assume all the businesses that are certified as such truly are owned by minorities, exactly what purposes do such programs serve? Are they eliminating present racism? I'd say the willingness of buyers to set up such programs puts any allegation of rampant racist "freezing out" of minorities from the marketplace to lie. Are they making up for past bigotry? Well, unless you believe this is accomplished by steering more cash into the hands of present-day well-heeled people who by accident of birth share the sex or skin color of someone who was at some time discriminated against, no (see my "Corporate Thoughts #1" for more about this concept).
And there's this complication: such programs aren't free. Oh, I'm sure some of them on paper are about merely identifying, and sourcing bids from, relevant businesses owned by minorities. But the programs never, ever stop there. Whether they say so explicitly or not, they come with goals -- goals for money spent, or for the number of businesses employed, or for the number of transactions completed. And the only way to meet these goals is to pay more for the services of minority-owned businesses than you otherwise would. This is simple economics; too many dollars are chasing too few minority-owned businesses, so prices must rise. (Plus, since such businesses are usually sourced without bidding, there is no competition at all to make them "sharpen their pencils.")
So what we have are government and corporate entities paying more than market price for goods and services, to serve no other ends than to satisfy liberal white guilt, and to keep corrupt race-baiting "activists" off their backs. And the sole identifiable outcome is the kind of corruption revealed in the articles at the link. But at least all it costs is that we, the taxpayers and shareholders, are left holding the proverbial bag.
Such programs are an absolute crock. As with these cases, it's easy enough for anyone to run a business that qualifies for "minority-owned" status. Indeed, it seems that, like Oil-for-Food, they often become a conduit for enriching the well-connected.
But even if we assume all the businesses that are certified as such truly are owned by minorities, exactly what purposes do such programs serve? Are they eliminating present racism? I'd say the willingness of buyers to set up such programs puts any allegation of rampant racist "freezing out" of minorities from the marketplace to lie. Are they making up for past bigotry? Well, unless you believe this is accomplished by steering more cash into the hands of present-day well-heeled people who by accident of birth share the sex or skin color of someone who was at some time discriminated against, no (see my "Corporate Thoughts #1" for more about this concept).
And there's this complication: such programs aren't free. Oh, I'm sure some of them on paper are about merely identifying, and sourcing bids from, relevant businesses owned by minorities. But the programs never, ever stop there. Whether they say so explicitly or not, they come with goals -- goals for money spent, or for the number of businesses employed, or for the number of transactions completed. And the only way to meet these goals is to pay more for the services of minority-owned businesses than you otherwise would. This is simple economics; too many dollars are chasing too few minority-owned businesses, so prices must rise. (Plus, since such businesses are usually sourced without bidding, there is no competition at all to make them "sharpen their pencils.")
So what we have are government and corporate entities paying more than market price for goods and services, to serve no other ends than to satisfy liberal white guilt, and to keep corrupt race-baiting "activists" off their backs. And the sole identifiable outcome is the kind of corruption revealed in the articles at the link. But at least all it costs is that we, the taxpayers and shareholders, are left holding the proverbial bag.
posted by Steady Earl at 4:54 PM
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