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  • Antidiscrimination Law (or, the Dropout Anti-Employment Act)

    Posted by ken on July 21st, 2004 (All posts by )

    Recently, a discussion of a hate crimes post on this site included a discussion of anti-discrimination law. I would like to focus on anti-discrimination law specifically, and point out pernicious effects that I rarely see addressed.

    Let’s take the “ideal” anti-discrimination law, one that doesn’t involve any affirmative action requirements. The idea is that the government is making it illegal to refuse to hire/promote/retain a person if you’re doing it because he’s a “minority”. If you do the exact same thing for some other reason, then in theory you are complying with the law.

    This goes even further than “hate crimes” law or any other law. In the “hate crimes” case, an act that is already wrong, when it’s motivated by “hate”, is an even worse offense than that act usually is. In the case of employment discrimination law, an act that is morally neutral (refusing to trade with a given person) becomes wrong when the act is motivated by a “wrong” reason, but remains morally neutral when the act is not motivated by such a reason.

    How on Earth do you enforce such a law? Without a mind-reading device, such a law cannot be properly enforced, except in a few cases where the law is lucky enough to find a damning paper trail or recording. For the rest of the cases, you have to look at hiring activity, and divine the employer’s intention from that.

    Now anyone who offers employment will have a (nearly) constant number of positions to offer, a set of people he hires, a set of people he refuses to hire, and a set of people (more than a quarter-billion strong) who never present themselves for his consideration. Assuming that applicants outnumber jobs, every time he hires a person A, he must simultaneously reject some other person B. That means that punishing him for refusing to hire person B for whatever reason is logically equivalent to punishing him for hiring some other person who is not B.

    Now remember that there are no mindreading devices. To even come close to enforcing the law properly, the employer must now be held to account for every hiring decision he makes, for every person he brings on board. Regardless of what is taken as evidence of his motivation for hiring A or for not hiring B, the result is that the employer will have to be ready at all times to prove to a jury that A was in fact the most qualified person available.

    How do you prove such a thing to strangers who can’t read your mind, weren’t there for the interview, and in any event will never lose or gain any money based on whether your evaluation of everyone’s qualifications was correct? A good way to prove it is with documentary evidence. If person A has a generally recognized credential stating that he is qualified for the position and person B does not, the employer can prove his case and have a verdict in his favor. If person A does not have such a credential and person B does, regardless of whether the employer had another perfectly good reason for choosing A that isn’t so good at convincing a jury, his odds of a favorable verdict go down considerably.

    Thus, any possible anti-discrimination law will strongly discourage employers from hiring people without the requisite credentials, regardless of whether they are capable of doing the job. In the case of the actual anti-discrimination law that we are saddled with, subsequent judgements have even eliminated IQ tests as admissible documentary evidence, except insofar as applicants take, at their own expense, a substitute IQ test (never, of course, called by that name) costing many thousands of dollars and requiring four years to complete (also known as a college curriculum). Thus we see situations where employers who offer jobs that no existing college curriculum covers any aspect of will still sometimes require a college degree, so that they can convince a jury if needed that they had a good reason for choosing the individual they end up choosing.

    For jobs where the curriculum is unrelated, the entire cost of the course of study, in time and money, is a complete deadweight loss imposed by this law. And the taxpayers often bear a significant portion of the monetary cost as well in our system.

    Now since the juries that are judging the worth of this credential aren’t actually gaining or losing any money regardless of the hired and rejected employees’ actual (potential) profit that they (might) generate for the employer, they will not tend to be as good at judging the actual worth of the credential as the actual employer will. This opens up an opportunity for colleges and potential employees to profit by offering (on the one hand) and pursuing (on the other hand) “dumbed-down” degrees. The employer would have a vested interest in knowing perfectly well that the degree is less useful than it should be in certifying a potential employee, but the jury isn’t going to have the same reason to learn this. As long as it isn’t blatantly obvious that the degree is completely bogus by existing standards, it still can be useful to the unscrupulous worker in encouraging the employer to pass up the greater potential profit generated by some other uncredentialed potential employee and hire the one with the paper that will keep the law off his back.

    As time goes on, knowledge of what’s going on filters out, employers and juries alike figure out that bogus degrees are flooding the market, and (because that law is still in place) employers turn to requiring further certification that is functionally equivalent to the previous value of the previous certification and allows the employer to get away with hiring people with it and rejecting people without it. That is what happened to the high school diploma and what is beginning to happen to bachelor’s degrees.

    Which means that everyone who wants a decent job is forced to waste more time than previous job-seekers did pursuing degrees that mean the same thing as the ones that their forebears presented. And all these people have a vested interest in insuring that their course of study never gets harder, since that would net you a degree that does require more effort and talent to get but doesn’t show any promise of convincing juries of that qualification and talent, or at least of convincing employers that juries can be convinced of that qualification and talent. Thus, undoing the damage is problematic at best, and the progression is generally one-way.

    All that wasted time is causing other problems. Some people fail to get a good credential, not because they aren’t capable of passing, but because they’ve had children in the meantime (and some, of course, abort rather than suffer such derailment…) – and getting everyone to remain childfree (much less celibate) until the age of 18-22 is something we’ve been trying with relatively little success for decades, and I’ve never heard of a society that actually succeeded in such an endeavor. Everyone who wants a decent job must remain single and childfree for longer and longer periods of time, wasting more and more of their prime childbearing years pursuing certifications that offer less and less actual qualification per unit time. Since a high school diploma now barely qualifies you for a job that allows you to support yourself (if you live like a pauper), everyone who wants to stay out of poverty must remain legally children until they finish high school, at which point they’ve already wasted at least half a decade of their physical, cognitive, and sexual maturity playing the role of children. (They tend to lack behavioral maturity because there’s no incentive left to practice it… and people with the strength and intelligence of adults without the maturity can get into a lot of trouble.) Those who want something better must usually continue being at least partially supported by parents while they spend at least four years of their (theoretically adult) lives getting that second certification with which they can begin their career, and begin supporting themsevles and a family in at least middle-class style. This is, to my mind, a travesty, even if it were possible to somehow prevent everyone from dropping out along the way, which it isn’t as far as I can tell.

    Another problem is that as the cost, in time and money, of qualifying for a particular job increases, the renumeration required to make that investment worthwhile also increases. This means that the cost of an employee with a given skill and native talent will tend to go up over time, until it exceeds the value of that employee’s work, at which point, substitutes will be found and the market for that employee’s work disappears. Sometimes the substitutes come from overseas; an American programmer would lose his shirt if he charged the same rates that Indian programmers realize a handsome profit from. Other times, we end up doing without, and new products and services we could otherwise be enjoying never appear on the market. Even before either one of these things happens, the cost of the work to the employer and to that employer’s customers will tend to go up over time, leaving us all poorer than we otherwise would be.

    You can see this relative impoverishment even if you follow a simpler line of reasoning. As people’s productive lifetimes are shortened, the total wealth they can produce goes down. The longer that people must support their own unproductive children, the fewer resources that are left to consume in other ways or to invest. Add in the monetary cost of all those credentials, and our available resources go down even further below what they should have been.

    You may concede all these points, but continue to insist that eliminating discrimination is worth these considerable (and ever-increasing) costs. But anti-discrimination law is not necessary to accomplish that. Anti-lynching laws, yes. Laws against discriminatory provision of government services, particularly police protection, definitely. If gangs are selectively permitted by law to terrorize not only “uppity” blacks but also whites that deal with them in a non-discriminatory fashion, this is logically equivalent to a law requiring discrimination (it’s an unwritten law, enforced by unpaid police officers with the blessing of the state). Removing these injustices is absolutely necessary in order to put a stop to discrimination. But profit-seeking individuals who are not forced to discriminate will tend not to – they’ll lose potential profit by doing so, and nondiscriminating competitors will have an opportunity to whip them in the marketplace. If somehow every single local employer were absolutely committed to discrimination regardless of lost potential profit (which they weren’t, anywhere), that would simply present an opportunity for outsiders to either move in or export to the area and pick up that profit and start whipping the misguided locals in the marketplace. It was Jim Crow and its unofficial lynch-mob-enforced counterpart that prevented people from taking advantage of that opportunity to profit by practicing non-discrimination; remove them and nothing further needed to be done. If you don’t believe me, just ponder how many Irishmen are discriminated against these days, or even in 1964. Where was the earlier anti-discrimination law that made all the “no Irish need apply” signs disappear? It never existed, and it wasn’t needed.

     

    20 Responses to “Antidiscrimination Law (or, the Dropout Anti-Employment Act)”

    1. Glenn Brown Says:

      There will be more on this shortly but one of the main reasons for the end of the “no Irish need apply” signs is that they, by and large Didn’t exist in any signifigant fashion nor is there any evidence that irish discrimination in america was any higher than discrimination against other immigrants. In other words what discrimination there was drained away, not by the opening of the market but by the further assimilation of subsequent generations into american culture.

    2. Glenn Brown Says:

      In addition, you, like everyone else fail to provide evidence for your large assumptions. Please do so, As I will be doing when I get home from work today.

    3. Glenn Brown Says:

      The primary line of your argument seems to be this:
      1) Civil Rights law requires proof that a person was hired based on superior qualifications .
      2) In order to do this, a certain level of education will inevitably be required for hiring just to set a standard – even if it’s not necessary for the job.
      3) This will inevitably lead to an upward qualifications spiral keeping more disadvantaged people and not less out of competitive jobs.

      Aside from the fact that the court specifically held that companies could not apply arbitrary certification requirments with Griggs v. Duke Power Co. I can see your point that the possibility exists that some requirements might be added that seem reasonable for the job. In doing so this adds “wasted time” before a person can start the job and additional costs to the employer for requiring higher job standards. My only question is: have they done this?

      Proving this would be somewhat difficult because, with the transition of private sector from a manufacturing focus to an information focus a higher education requirement for employees pretty much comes with the territory. But we can look at employment costs – have employment costs risen substantially since the 1960’s? When adjusted for inflation and increased costs for roughly the same or worse healthcare benefits, the answer is no. Cost of employment gone up less than one percent a year.

      The other possible way to prove this is to ask the question if minorities have not penetrated into the ranks of the skilled workforce, or at least that Affirmative Action and other antidiscriminatory hiring practices have not helped them. On this score the answer also appears to be no. Minorities have done so and not only that, have done so in accelerated fashion in workplaces where affirmative action practices are strictly enforced (the public sector, government contractors, and corporations that have been found to have discriminatory practices, AT&T is a good example) not only that, government contractors that have the requirement to allow minority subcontractor firms to bid on their subcontracting jobs not only do so but generally, without government intervention, are signifigantly more diverse in their other hiring and contracting practices. (a link will be coming on this)

    4. Jonathan Says:

      Glenn,

      The employment cost index stats in the BLS doc you link to shows that inflation-adjusted employment costs have risen typically 20-35%, depending on employment category, since 1981. That’s substantial. Also, the stats don’t show costs in jobs lost due to bad governmental policies. And there is no way to know, merely by looking at the stats, which variable(s) caused the cost increases. I don’t think you’ve proved anything here.

      The fact that minority employment has increased in uncompetitive sectors like government, and in heavily regulated private big businesses that have been forced to institute race-baced hiring quotas, doesn’t prove anything either — except that businesses hire more minority employees if the government forces them to. At best you are asking questions rather than answering them.

      And you still haven’t addressed the question of how it’s possible reliably to infer hostile discrimination from statistical outcomes. That’s a crucial question in this debate, and if there’s no good way to answer it it becomes even more difficult to justify group-based remedies for past discrimination.

      Ken’s argument may be flawed, but I don’t think you have successfully demonstrated that it is.

    5. Glenn Brown Says:

      Jonathan,

      Are you asking if I am arguing that pattern=intent? I think that one can infer it from, as I have said, broad patterns. I don’t think one can, or should, win a case that simply involves, say, he hired 3 guys and they all were white, therefore he is being discriminating.

      I am not sure I can throw numbers out that says if it reaches a threshold of say, 8 layoffs (as was one of my cases from previous section) = discrimination. This fact is precisely why I advocate for the courts system or some other form of mediation. My argument is this – when there appears to be patterns of discrimination, injured parties deserve a day in court or some other forum to air their grievences – and very likely be told, sorry it doesn’t hold water.

    6. Ken Says:

      “I don’t think one can, or should, win a case that simply involves, say, he hired 3 guys and they all were white, therefore he is being discriminating.”

      Well, then what’s a reasonable standard of proof? How do you prove that the employer is or is not applying “unreasonable” criteria in an effort to make money, rather than an effort to exclude people he doesn’t like? How do you reliably defend against a charge of “discrimination” other than to apply by rote standards decided upon by lawmakers and juries whether or not they are the most profitable? And if the value of a certification is ultimately arbitrated not by profit-seeking individuals but by juries who do not profit from correct evaluation, what incentive does anyone have to maintain the real value of the certification?

      “My argument is this – when there appears to be patterns of discrimination, injured parties deserve a day in court or some other forum to air their grievences – and very likely be told, sorry it doesn’t hold water.”

      Damnit, no they don’t. No one deserves a day in court or any official action on his behalf whatsoever just because someone would rather buy from his competitor. Not American programmers or autoworkers, not Pennsylvania steelmill owners, and not minority applicants for jobs. You should not have to justify any purchases or investments you make with your own money to anyone. Even if you’re a jerk and you’re bound and determined not to buy from someone just because you don’t like his looks, he shouldn’t get to haul you into court over it.

      How would you like it if you had to answer, in court, for your choice of a plumber, a contractor, a lawyer, or a doctor?

    7. Ginny Says:

      As someone who teaches at an open admissions junior college, I would like to confirm the “perniciousness” Ken describes; the truth is that freshman comp and American lit are seldom that applicable to the jobs many want. They are necessary to get them into a 4-year school, but, again, it is the paper they want more often than mastery of the subject, an open mind, an understanding of, well, thought. That’s okay. I like teaching and some of them that see it as pointless begin to read works that challenge them, that help them understand themselves. That’s my job. But some just care about that piece of paper, I have to keep on top of their work to make sure they don’t plagiarize (why not when what they are doing is getting the paper and not learning?). And how much that piece of paper is worth is drummed into them – demeaning the learning that theoretically that piece of paper symbolizes.

      Okay, this is off the subject but I’d like to observe that public service is not always best done by a staff who intimidates their bosses through fear of litigation. This theory that everyone deserves a day in court if they are not hired and certainly if they are fired is not likely to reward the qualities of service personnel – and I respect service personnel, I respect a life spent serving others. But someone whose first thought is that he deserves the job is not someone who is going to look at the customer and think, how can I best serve him, how can I get him to come back, how can I make this day a good day for him. Nor is that a person likely to view work in terms of what can I do, what kind of ideas can I bring to the next meeting that will make my co-workers’ lives easier, my customers’ lives more pleasant. This attitude rewards unpleasant, me-first, ugly, lazy behavior. It rewards the kind of legalistic thinking that brings up “that is not in my job description” rather than the kind that looks at a job and comes up with the best way to do it, cooperating with others.

      As an owner of a small business, I dreaded hiring and retaining someone who might sue me, drag the name of my business through the mud, and generally drain my emotions, resources, and reputation. This leads to a less civil and less respectful society. I respect people who work at McDonalds. I listen to people of the “left” diss them – acting as if the job was demeaning. Those of the left seem to think they speak for such people. It is my impression that they diss them as well as the job (and this impression is reinforced by the attitudes of some academics of such a persuasion and the way some treated my staff, often being paid minimum wage but some with degrees that could trump those of the tenured faculty before them and all of whom had worked harder that day).

      Okay, this is off the subject. Thanks for the post Ken.

    8. Jonathan Says:

      Glenn,

      I am asking how you can know that pattern=intent. I don’t mean guess it or infer it, I mean know it with a high enough degree of confidence as to justify punishing someone.

      (Note that I don’t think such punishments are justified, except in the case of discrimination by government or by private parties acting as agents of government. I am asking how you can know intent for the purpose of implementing the anti-discrimination measures that you yourself advocate.)

      And even if you think private discrimination is wrong, it’s still an open question whether the courts are the best means to address the issue. I think that Ken is attempting to show that the legal approach is fraught with problems.

      Ethnic and racial patterns that have nothing to do with discrimination are everywhere. And even for such patterns that may be caused by hostile discrimination, it is far from obvious that government action is the best response from the perspective of the people who are discriminated against.

    9. Glenn Brown Says:

      “Well, then what’s a reasonable standard of proof? How do you prove that the employer is or is not applying “unreasonable” criteria in an effort to make money, rather than an effort to exclude people he doesn’t like?”

      I think that the 2 existing standards are a pretty good start – the Griggs decision on the one hand stating that standards that are clearly artificial can be understood as intentionally exclusionary. On the other hand, the Bakke decision, ruling out a quota system, seems to provide adequate protection against reverse descrimination.

      “How would you like it if you had to answer, in court, for your choice of a plumber, a contractor, a lawyer, or a doctor?”

      I would hate it, but it does happen. If I allow my sewer pipe to drain into the ground water my choice (or lack thereof) of a plumber will be questioned – and one will be made for me with me footing the bill. The same is true with a contractor if the state of my house construction affects public safety. If I become a danger to myself or others, the state will not only demand I be assigned a doctor but a hospital as well.

      This is precisely my point. Discriminatory hiring practices are the civil rights equivilent of sewage in the water table. It creates artificially high levels of crime and poverty, not to mention justifiable anger on the part of those being discriminated against leading to poor civic relations and possible insurrection. It is something we pay the bills for every day of our lives.

    10. MatyaNoBaka Says:

      I find it … challenging … to discuss anti-discrimination without discussing affirmative action. If i step over the line, please jump on me and bat me over the head.

      This is going to be a long post. I don’t apologize; it’s a hard topic and there is a lot to say. If there is a way to put a “continue reading” on this reply, please do so?

      The Governent’s involvement

      Does the government have a stake in discrimination?

      It’s pretty hard to say no. That someone who is good at what they do should be denied employment based on something other than their skills, experience and price offered is pretty contemptible.

      However, the Constitution does not guarantee you a job. OK, the pre-amble says to “promote the general welfare”. And discrimination hurts the general welfare (see economics below). The Constitution does guarantee right of free association (Amendment I) and disposition of personal property (Amendment IV). Thus it would seem at the very least, that supporters for anti-discrimination laws must show the harm of discrimination outweighs the harm of restricting free association and personal property.

      But of course that ain’t the whole story. Because the business of those in government is … To stay in Government!

      When a member of the legistlature supports a law, it may be purely for reasons of conscience. But at least in some cases it is to support their re-election. This is not bad. The members of the legislature are supposed to represent their constituents.

      However, a consequence of this is that, for a legislator, it is almost always a good idea to “rescue” a group in “distress”. The group in question will view you favorably (have “obs” to pay off at the next election). Other folk not directly involved will see that you are a “good sort”, who will rescue them if they become distressed. This is true even if they are worse off for the “rescue”, so long as they do not see themselves as a lot worse off, or if the problem is delayed in its appearance. Only the folk immediately worse off for the “rescue” will be opposed. (And Jonathan G ewirtz, because he knows better.)

      So the pressure on the government to “do something” is pretty fierce.

      The economics of discrimination

      This section is taken from Gary Becker’s (may Allah keep him from error) The Economic Approach to Human Behavior, U of Chicago Press 1976 “Effective Discrimination”. It is an article adapted from The Economics of Discrimination, 1957 which was in turn built from Becker’s thesis in 1955. Note that this means the theory existed before the 1964 Civil Rights Act was enacted (But does anyone mind?).

      I will use two class variables here:
      U refers to the Ubermenschen, some of whom discriminate.
      V refers to the victims of discrimination.

      These are different from the variables used by Becker.

      Becker’s insight was to analyze this as if U and V were different countries, engaged in trade. The assumptions are that U provides capital to V (people who are U hire people who are V), V provides additional labor to U, and that V has insufficient capital to hire everyone in V.

      This is a pretty key assumption, and it’s why the analysis works for both the US and South Africa ca 1955. The U group does not have to be the majority. It can be the minority if it has sufficient economic clout (excess capital) vis a vis the V group.

      We can see immediately that discrimination harms both U and V. This is not unexpected. Thinking of discrimination as a tariff on labor from V, we know that total output of U and V must be lower than if the tariff did not exist:

      Some laborers of V will not be employed, when they could be producing value from capital from U.
      Some capital from U will be under utilized, as the higher cost of U laborers means that less labor will be applied to the excess U capital than it could absorb.

      But in fact discrimination is not a tariff, and there are counter intuitive forces at work here.

      The standard Marxist / Socialist / Krugman / ABC news interpretation would be that the benefactors of discrimination are the holders of capital (the employers) in U who discriminate. Not So! They could make a better return on their capital if they swallowed their pride and hired laborers from V. They are paying extra to discriminate, and so their profits are down.

      The standard NY Times / Hollywood interpretation would be that if only discrimination disappeared, per person income for U and V would be equal. Not So! Gary cranks the numbers using V at 10% of the population and U having 150 times the capital of V, which seemed to him arbitrary but not unreasonable in 1955. Income per person for V will still be only 66% of U. Capital earns money as well as labor. A statistical test on per person income will not indicate that discrimination has disappeared until capital per person also equalizes. There actually is a theoretical backing for the idea that historical discrimination holds back the whole V class. But it means using a statistical test on per person income will punish innocent people until the capital is equalized.

      Intuitively, the people who are worst off are the laborers of V. You’re right! Holders of capital in V and laborers in U make out like bandits. Holders of capital in U are not as well off as the could have been, but owning capital means they aren’t that badly off until they go bust. Laborers in V have no fall back capital and distinctly lower wages.

      So we see in this context Ken was wrong. Two groups have a financial stake in discrimination continuing or not. The laborers of U benefit if it continues. The laborers of V benefit if it does not. The U laborers may not think of it that way, because modern myths say otherwise. But note that there are a lot of laborers of U available for juries. This may be an origin of Glen Brown’s points about the system’s failures.

      So this is a nice theory. If government leaves alone, the problem will go away. Bad U owners of capital who discriminate will go out of business. Is there any reason to believe that?

      Discrimination left alone

      Let’s look at two cases:

      South Africa
      The US before WWII

      Of course in South Africa discrimination was not only practiced. It was the law. Yet even with that powerful incentive, we find people breaking through discrimination for economic reasons. From Thomas Sowell’s Basic Economics, 2nd edition, Basic Books 2004 pg 154, sources from pg 417:

      Even in South Africa during the era of apartheid, where racial discrimination was required by law, white employers in competitive industries hired more blacks and in higher occupations than they were permitted to do by the government, and were often fined when caught doing so. This was because it was in the employers’ economic self-interest to hire blacks. Similarly, whites who wanted homes built in Johannesburg typically hired illegal black construction crews, often with a token white nominally in charge to meet the requirements of the apartheid laws, rather than pay the higher price of hiring a white construction crew as the government wanted them to do. Landlords likewise often rented to blacks in areas where only whites were legally allowed to live.

      Violations of apartheid laws by employers in South Africa are discussed on pages 152 and 153 of Capitalism and Apartheid by Merle Lipton. Violations of these laws by home builders in Johannesburg are discussed on page 164 of Apartheid: A History by Brian Lapping. Violations of the residential aspects of the apartheid laws are discussed on pages 112 and 113 of South Africa’s War Against Capitalism by Walter E Williams – a black American economist who himself violated these laws by living in an area set aside for whites.

      In the US, we can look at the issue in a couple of ways. For example, if the economic model of discrimination doesn’t work, we would expect discrimination to be similar between profit making organizations, non-profits and the government. Actually, profit making organizations discriminated less, as predicted by the model. From Sowell, op. cit., pgs 386-7, sources pg 431:

      Before World War II, hospitals were among [the] most racially discriminatory of American employers, even though their avowed purposes would have been better served by hiring the best-qualified doctors, even when those doctors happened to be black or Jewish. Non-profit foundations were also among the most racially discriminatory institutions at the time.

      The same was true of the academic world, where the first black professor was not hired at a major university until 1940, not long after the first Jewish professor received tenure at Columbia University, which was already more than 150 years old at the time.

      Pre-World War II discrimination against blacks and Jews by non-profit organizations is discussed on pages 695 and 705 of “Through the Back Door, Academic Racism and the Negro Scholar” by Michael R. Winston in the Summer 1971 issue of Daedalus, on page 480 of American Democracy by Harold J. Laski and on page 323 of An American Dilemma by Gunnary Myrdal.

      Sowell gives other examples of this kind of restriction, including licenses for taxi medallions in the northeastern cities and ICC trucking permits.

      We can also try to look at other forces affecting employment. For example, what about unionization? The minimum wage laws? As the cost of employment increases, it should heavily affect the laborers of V. From Thomas Sowell, Civil Rights: Rhetoric or Reality? Quill, 1984 pg 89, source pg 155:

      In the railroad industry, the combination of regulation and unionization has proven catastrophic for blacks. In 1910, one-fourth of all locomotive firemen in the South were black. By 1960 that was down to 7 percent. This also sheds further light on the role of racism. In the South, where racism has been strongest, blacks remained better represeented in the railroad industry (as well as the construction industry and other well-paid occupations) longer than in the North, because the South was more resistant to unionization. Blacks in the midwest, northeast or far west were never even 2 percent of the locomotive firement in those regions.

      Walter E. Williams, The State Against Blacks, McGraw Hill 1982, pg 104-5.

      In fact, Blacks of that time recognized the problem. In Jim Powell’s FDR’s Folly Crown Forum 2003 pg 119:

      Moreover, by sanctioning compulsory unionism, the NRA labor codes effectively excluded blacks from many jobs. As the NAACP’s publication The Crisis reported in November 1934: “Daily the problem of what to do about union labor or even about a chance to work, confronts the Negro workers of the country … Seeking to avail itself of the powers granted under 7A of the NRA, union labor strategy seems to be to form a union in a given plant, strike to obtain the right to bargain withthe employees as the sole representative of labor, and then to close the union to black workers, effectively cutting them off from employment.”

      The same thing happened with minimum wage laws in the textile industry. Powell, op. cit. pg 118:

      “Because of the NRA, wages in the South’s largest industry, textiles, increased by almost 70 percent in five months,” reported law professor David E. Bernstein. “Employers responded to such massive wage increases by investing in mechanization and dismissing their unskilled workers.” … Some 500,000 black workers were estimated to have lost their jobs because of the NRA minimum wage law.

      Certainly this is not to say that there was no discrimination back then. However, the prediction from Becker’s model seems borne out. Restricting the labor market disproportionately shuts out laborers of V.

      Evidence of discrimination

      While there may indeed be a tendency of discrimination to limit itself over time, can’t we help it along? After all, can’t we use statistics to show a pattern of discrimination and punish the wrongdoers?
      Probably not. There are two big problems:

      Demographic differences in groups.
      Variance in random results.

      This section roughly follows Sowell, op. cit. chapter 2. The demographic problem means that you cannot look at the percentage of U vs. V in the society (or even local community) and predict a reasonable proportion of V laborers for a particular job. The most obvious differences are age and preparation.

      A particular job, say database architect or manager of IT, has level of expertise and experience associated with it. But different groups have different age distributions. For example, Blacks in the US tend to be a relatively young community. So a much smaller proportion of the Black community have the time to develop their skills for these positions. Their representation in these positions should be lower than their representation in the full community would suggest.

      And of course education matters as well. Not just having a degree, but what kind of a degree and from where? Blacks are much less likely to study a quantitative field (mathematics, science, engineering) and much more likely to study education than Whites. This lower numeracy exists all up and down the education chain, to the extent that Blacks even have problems with the level of arithmetic required on civil service exams for postal workers etc.

      But let’s assume for a moment that, unlike today’s results, the courts and defense lawyers were sophisticated enough to find the relevant demographic slices to compare. Would statistics provide the evidence we want?

      No, because of the variance of results. A variance must be statistically significant based on the size of the sample to show any correlation. Well, let’s assume the standard 95% confidence level. But remember that there is more than one V population. If we think about Blacks, Hispanics and Women as V groups then under this standard of evidence 14% of businesses will be out of compliance on at least one of the three groups. Even if all discrimination in the community were completely eliminated.

      So we see that statistical patterns of discrimination are in fact not an acceptable standard of evidence. We will be convicting a large number of innocent employers. In fact, the only standard that i can see that might stand up is direct comparison of the qualifications of the defendant with the qualifications of the person who actually got the position. And even then, how do you handle subjective statements, like “She fit our work ethic better and had the Informix experience we needed. He had some Informix, but was basically a DB2 guy.”

      Is there role for government?

      OK, we have seen that economic theory says that discrimination should eventually die in a free society. But discrimination is awful! “Eventually” can be a very, very long time! Can’t government do something?

      Evidence from the 30’s United States says yes. Here are two things you want to do:

      Lower unemployment.
      Don’t discourage people from hiring.

      Lowering unemployment means that the same amount of capital looking for a smaller group of unemployed laborers. From the economics part of this post, that means that the cost to U owners of capital is higher. That means that they will go out of business sooner compared to owners of capital in V and owners who do not discriminate. Allah is Compasionate, Great. The market punishes the unjust.

      Laws that restrict hiring (union shops, minimum wages etc.) restrict the ability of the laborers in V to punish the discriminatory owners of capital in U. They can’t provide an advantage to the Just in U who do not discriminate, as they cannot offer their services at a lower rate than the discriminatory capital owners in U offer to laborers in U. “Rescuing” the unfortunate has, well, unfortunate consequences.

      Hot DAMN! This means that Jonathan G ewirtz was right all along! The key is that freedom of association should take precedence over the evils of discrimination. Will everything be all better then? No. But it would be better than it is now.

      Matya no BAKA!

    11. Glenn Brown Says:

      Jonathan/Ginny,
      I was not ignoring you with my previous post. I had my post up for a while and yours must have come in between beginning to type and hitting “post”. I have been in a class.
      Jonathan/Ginny/Matya,
      It’s gonna take me a bit to digest all of this, I just got back, It may not be until this weekend but there will be something.

    12. Glenn Brown Says:

      I have taken some time to think about this and the whole discussion in general. I see the logic in many of your arguments. I have just one problem.

      I dont buy it. I am sorry, I cant throw out any statistics, I think we have both provent that those arent coing to convince each other anyway. My experience simply tells me that, in real life, the marketplace is too driven, not by profit, but by petty motives, dysfunctional people and self-imposed beuraucracies even before the government steps in to honestly anticipate it will enact meaningful social change on its own. I’m not saying it couldn’t but I would not be willing to bet my childrens future in a more tolerant society on it.

      I know this though, and this may sound like a hallmark card but what the hell. The civil rights act was more than further bureaucratic intervention into the marketplace. It was an important cultural artifact that, probably for the first time since they were dragged here against their will in the first place told african americans that the system was going to be on their side. That alone made it worth the price of admission.

      I’m done here folks. Thank you for the lively debate. I apologize if I offended anyone. I encourage you, if you run up against others like me, to think about persuasion rather than rhetoric and understanding rather than labels. I found that a little bit here but not often enough to make further discussion worth my while.

      Peace.

    13. Jonathan Says:

      Glenn, thanks. You are welcome back any time.

    14. chris Says:

      “..nor is there any evidence that irish discrimination in america was any higher than discrimination against other immigrants…”

      haha…yeah…they all just decided on a whim to join the chinese working on the railroads in Pac NW, eh?

    15. Blaine Says:

      A growing problem with the right today is, they think it’s more important to be able to discriminate than it is to be free from discrimination.

      I wonder if the Founding Fathers would approve. They allowed slavery on one hand, but they certainly had the persecution of the Puritans on their minds too.

      “The fact that minority employment has increased in uncompetitive sectors like government, and in heavily regulated private big businesses that have been forced to institute race-baced hiring quotas . . ” And here I thought the Bakke case made quotas illegal! Well, Rush Limbaugh et al always say there are quotas. I guess if you repeat lies often enough they do become the truth.

    16. Jonathan Says:

      We still have de facto if not de jure quotas in many employment and academic environments. Our current rules say that racial quotas are forbidden, but that it’s OK for college administrators et al to take race into account if they want to prevent some racial groups’ being “underrepresented.” That’s essentially the same as allowing quotas as long as they’re not explicit.

      If Bakke had really put an end to racial quotas, I doubt that the anti-racial-preferences referendum proposals that we continue to see at the state level would exist.

    17. Ken Says:

      “A growing problem with the right today is, they think it’s more important to be able to discriminate than it is to be free from discrimination.”

      What’s the problem there? We think people ought to be free to do lots of dumb things and even lots of rude things.

      “I wonder if the Founding Fathers would approve. They allowed slavery on one hand, but they certainly had the persecution of the Puritans on their minds too.”

      Because that persecution went far beyond people refusing to hire them.

    18. Jim English Says:

      Blaine,

      Explain to me how affirmative action, where race is at best given weight in formulas that select candidates and at worst imposes race based qouta systems, is not racial discrimination. It would seem that those on the left who favor these programs prefer a world where they are free to discriminate and those on the right who oppose them prefer a world free from racial discrimination. Feel free to dispute this point before retracting your rude and prejudiced statement. Good day.

      Jim English
      Chicago

    19. Blaine Says:

      “We still have de facto if not de jure quotas in many employment and academic environments.”

      A quota is when I tell you your paycheck as a salesman is going to be REAL small next month if you don’t sell X subscriptions.

      When a college (or business), under no threat of law, decides it wants to recruit more of anything, that’s not a quota. There’s no threat, no mandate anywhere. The government had nothing to do with it. And if they *don’t* meet their goal, nobody gets fired. Nothing happens to anybody, bad or good. And if they decide to stop recruitment drives on their own, nothing bad happens there, either. Where’s that much freedom, there’s no ‘quota’.

      “Explain to me how affirmative action, where race is at best given weight in formulas that select candidates and at worst imposes race based qouta systems, is not racial discrimination. It would seem that those on the left who favor these programs prefer a world where they are free to discriminate and those on the right who oppose them prefer a world free from racial discrimination.”

      No, as I said, the right would rather people be free to discriminate (only against blacks, it would seem) than be free from discrimination. I find it amusing that a country founded on freedom from religious discrimination would lower itself to allowing racial discrimination.

      There’s only one real place where AA can be iffy, and that’s hiring among government contractors.

      In college admissions, this newfound objection to racial discrimination seems to be disingenous. Most admissions policies obviously continue to favor white students, otherwise George W. Bush would have never graduated from Harvard. Rather, I suspect that they want an admissions policy that seems race neutral, but in reality favors whites.

      I’m all about progress. If you can tell me about a race-neutral admissions policy, I’d love to hear about it. If you can tell me about a more race-neutral hiring policy than AA, we can discuss that too.

      “Feel free to dispute this point before retracting your rude and prejudiced statement. Good day.”

      No need to retract anything here. People toss the word quota around where it is clearly not applicable and I call them on it.

    20. Jim English Says:

      Blaine,

      You wrote:
      “No, as I said, the right would rather people be free to discriminate (only against blacks, it would seem) than be free from discrimination.”

      You fail to offer any evidence other than you own prejudice. Since demonstating you ignorance seems to be your mission, you are correct. No retraction necessary.

      Jim English
      Chicago