For Affirmative Action, Richmond Decision Is a Detour, Not a Dead End

The Supreme Court’s action in striking down a program for minority business contracts in Richmond, Va., has been called a disaster for affirmative action. We disagree. The court did not prohibit affirmative action generally or minority-business programs specifically. Rather, it spelled out steps that a state or local government must follow to establish a bona fide program of minority-business access to contracted work. The decision will not harm affirmative action in the long run. In the short run, it will result in another round of unnecessary hearings and litigation, and may very well discourage many minorities and women from starting their own firms.

Minority-business enterprise programs, like other affirmative-action plans, are voluntary efforts by public or private institutions that earmark benefits for minorities or women. While often justified as a means of overcoming past discrimination, they also serve the beneficial purpose of closing the divisive gap between minorities and white males in our society. The Supreme Court has upheld affirmative-action programs in cases involving private employment, teacher hiring, state job promotion and university admissions--the latter in part because students learn better in an environment of cultural diversity. None of these rulings are called into question by the Richmond decision.

Government efforts in this area began with the Nixon Administration’s effortsto develop minority-owned business. Congress enacted a 10% minority set-aside requirement for federally funded public-works contracts in 1977, which the Supreme Court upheld in 1980. Chief Justice Warren E. Burger’s majority opinion cited congressional findings of disparities between the significant minority population and the minuscule number of public contracts given to minority firms, and held that race-conscious legislation was appropriate.

The minority-contract program in Richmond was modeled on the federal statute affirmed in the 1980 decision. The Richmond City Council had relied on the congressional findings of a national problem and did not hold hearings specifically concerning Richmond. The only statistical evidence was in this startling disparity: Minority contractors had received less than 1% of Richmond’s public contracts, although the population was more than half minority.

The court’s majority opinion, consistent with the approach of earlier affirmative-action opinions, set forth formal steps that would result in a valid set-aside program. While deferential to federal legislation, the court announced that it would strictly scrutinize state and local programs. These would survive strict scrutiny if there was a strong factual basis that the program was needed and if the program was narrowly tailored.

The court found that in Richmond there was no proper evidence of local need for the program. There was no statistical evidence of the availability of qualified minority contractors or the number of minority firms that received subcontracts from white prime city contractors. As to narrow tailoring, the lack of statistical evidence of a shortfall between minority firms available and those awarded subcontracts meant that there was no evidence of any fit between the program’s requirements and the conditions that gave rise to it.

The opinion, although formalistic, is unexceptional in light of the court’s earlier cases. The need for a proper factual predicate is not new or unique. States and cities with such programs must now follow the decision and hold the necessary hearings.

The decision’s failing is more fundamental. The court ignores that the problem Richmond addressed was not local, but national. As the Burger court recognized in 1980, minorities and women throughout the nation have been excluded from the construction industry for years. The Richmond program was only a local version of the program upheld in 1980. It has long been recognized that state and local governments have a role in enforcing national policies.

In the Richmond case the majority itself observed that Congress, under the 14th Amendment, may authorize “state action that would be foreclosed to the states acting alone.” Richmond was not acting “alone”; the statute that the earlier court upheld established a national policy in favor of programs to encourage minority-business enterprise. Moreover, the city of Richmond, like almost every other state or local government, operates programs with federal grants that require conducting such programs alongside locally funded programs. Under the court’s overly strict analysis, these must be unnecessarily justified on a local basis.

There is a way to avoid the cumbersome city-by-city, state-by-state proceedings that the court now requires. Congress has ample authority (under the 14th Amendment and the Commerce Clause) to permit states and localities to adopt minority-business enterprise programs without the restrictions of the Richmond decision. Congress should address the failure of the court to recognize the national scope of the specific evil to which these programs are directed. Congress should expressly declare that state and local governments are empowered to establish minority-business enterprise programs on the same terms as the federal government itself.