North Carolina governor Roy Cooper (D) announced yesterday a statewide goal of 10 percent for government contracting with minority-owned firms (defined by race, ethnicity, sex, and disability). He’s not alone with such nonsense; indeed, New York governor Andrew Cuomo (D) has set a goal of 30 percent in his state.
Now, it’s good to make sure public contracting programs are open to all, that bidding opportunities are widely publicized beforehand, and that no one gets discriminated against because of skin color, national origin, or sex. But that means no preferences because of skin color, etc. either — whether it’s labeled a “set-aside,” a “quota,” or a “goal,” since they all end up amounting to the same thing, and courts have ruled all to be presumptively unconstitutional.
Such discrimination is unfair and divisive; it breeds corruption and otherwise costs the taxpayers and businesses money to award a contract to someone other than the lowest bidder; and as noted it’s almost always illegal — indeed, unconstitutional — to boot.
On the legal point, there are two problems here. First, before the state can use racial classifications, it must at a minimum do a “disparity study” that documents evidence of discrimination in a specific contracting area that has to be remedied. Governor Cooper gets the process backward: He sets the racial goal, and then says it can be adjusted if some disparity study comes along that proves it’s too high.
Second, and in any event, in 2017 there’s no reason why quotas are the “narrowly tailored” way to remedy any discrimination. Rather, the state should ban racially preferential treatment for any group, enforce that ban, and require plenty of transparency — in publicizing bidding opportunities and in announcing the winners — to avoid cheating.
Contracts are not like employment selection or university admissions, where there is often an irreducible and significant amount of subjectivity in the decision-making. Rather, the low-bid process in government contracting can be made very transparent at every step, and this transparency should make it relatively easy to achieve any remedial purpose, that is, to detect and correct discrimination. This is an area where, as Chief Justice Roberts wrote famously, “The way to stop discrimination on the basis of race is to stop discriminating on the basis of race.”