Intellectuals and Race (23 page)

The distinction is fundamental between saying that statistical disparities found at a particular institution are
caused
by that institution, rather than saying that these disparities
convey
disparities that originate outside that institution. For example, there has been much consternation over the fact that “the poor pay more” in stores located in low-income minority neighborhoods, where stores often charge higher prices than stores located in middle-class or upper income neighborhoods. Those who charge these higher prices have been accused of “exploitation,” “discrimination” and the like. But the question is whether these prices
cause
costs to be higher in low income neighborhoods or are
conveying
costs that are already higher in those neighborhoods, such as higher costs of theft, vandalism, robbery, riots, and the higher costs of security precautions and insurance to guard against these things.

If the higher prices were simply ways of earning higher rates of profit, it would be hard to explain why so many businesses avoid locating in neighborhoods where profit rates would presumably be higher, but where there is in fact usually a great lack of the number and variety of stores found in other neighborhoods. Empirical data indicate no higher profit rates in
low-income minority neighborhoods,
¹⁷
which suggests that the higher prices charged there are
conveying
higher costs, not
causing
them, however much local “leaders,” activists, politicians, and even intellectuals elsewhere, may prefer to blame those who charge the higher prices which reflect the higher costs of doing business.

Where those who charge the higher prices are of a different race than their neighborhood customers, then all the incentives are to blame the outsiders who
convey
higher costs, rather than those locals who
cause
them to be higher. For intellectuals, the incentives are to prefer a moral melodrama, starring themselves on the side of the angels against the forces of evil, rather than a mundane case of elementary economics that would leave intellectuals largely irrelevant. Since misdiagnosed problems are less likely to be solved, there is a high price paid by the majority of local residents, who are usually neither criminals nor rioters, for the actions of those who are. To the extent that the race industry promotes automatic solidarity based on race, rather than behavior, the majority of people in low-income minority neighborhoods may have no idea how much their solidarity with cost-creating local elements is costing them. These costs can include not only higher prices and a dearth of local businesses and professionals, but also a reluctance of taxis to take people to those neighborhoods or of various businesses to deliver in those neighborhoods.

In the more general case of disparate impacts caused by differing standards of behavior or performance, those who are subjected to standards and those who create the standards are not necessarily the most important people affected by the results. Medical schools, for example, have standards— whether for admission or for passing courses— which affect innumerable people outside the medical profession, people whose health and survival depend on the quality of medical care they receive after medical school students become doctors.

In the legal system, “disparate impact” dogma has been a gold mine for the race industry. When an employer’s mix of employees shows an “underrepresentation” of designated minorities (or women), either in general or in more advanced positions, that is taken as
prima facie
evidence of discrimination, whether deliberate or as a result of using criteria with a
“disparate impact” on particular groups. Another way of saying the same thing is that different groups may fail to meet relevant standards for any number of possible reasons. But the burden of proof is put on the accused employer, rather than on those doing the accusing, contrary to legal practice in most other civil or criminal cases.

No speck of evidence is required from those who implicitly assume that employee composition would be similar to population composition, in the absence of discrimination. Moreover, not one flesh-and-blood human being who even claims to have been discriminated against is necessary for “disparate impact” cases to go forward in a costly legal process. Statistics alone are sufficient to establish the “disparate impact” case that employers must rebut. Moreover, the vast financial resources available to government agencies such as the Equal Employment Opportunity Commission means that, even if an employer is exonerated after a trial, the EEOC can keep appealing the decision in successive courts, in a process that can take years and drain millions of dollars in legal expenses from the accused employer.

In a “disparate impact” case against the Sears department store chain, for example, legal processes dragged on for 15 years and cost Sears $20 million, even though there was not one past or present employee of Sears who claimed discrimination (sex discrimination in this case).
¹⁸
All that the EEOC needed to keep this financially draining process going were statistics that did not match its preconceptions. Sears eventually won in the 7th Circuit Court of Appeals, but few employers can afford millions of dollars in legal costs, quite aside from years of bad publicity based on unsubstantiated charges of discrimination. A racial discrimination case against the Wards Cove Packing Company likewise dragged on for 15 years and, even though the Supreme Court refused to accept a lower court decision against Wards Cove, based on putting the burden of proof on the accused, Congress passed a law restoring the burden of proof on the employer in civil rights cases.
¹⁹

Given the enormous costs that can be imposed by charges of discrimination based on “disparate impact” statistics, even large employers usually find it prudent to settle such cases out of court on whatever terms they can negotiate. Although these out of court settlements are not an admission of guilt, they are
widely cited by those in the race industry as damning evidence of pervasive discrimination requiring pervasive government intervention to protect supposed victims, even when there is not one identifiable victim even claiming to have been discriminated against.

Where an employer is in an industry that is already one subject to government regulatory agencies, whose permission is necessary to engage in ordinary business transactions that unregulated businesses are free to make on their own, the leverage of the government is even more powerful. This means that wholly unsubstantiated charges of discrimination can paralyze the ability of a regulated firm to make transactions on which millions, or even billions, of dollars depend, until such indefinite time as the charges have been adjudicated to the satisfaction of the regulatory agency involved. Thus banks accused of either employee discrimination or discriminatory lending practices have had their plans for opening new branches, or merging with other banks, put on hold by government regulatory agencies at the sole discretion of these agencies, without any trial, much less proof, of the charges.

Under these conditions, individuals like Jesse Jackson or organizations such as ACORN can make, and have made, charges of discrimination at virtually no cost to themselves, but which impose huge costs on the accused banks. Given these conditions, banks have paid millions of dollars to their accusers, who then withdraw their accusations, so that normal business processes can proceed in the regulated banks.
²⁰
One economist wrote an essay on this practice titled, “How to Rob a Bank Legally.”
²¹

Intellectuals may think of disparate impact theory as something to discuss around a seminar table or in academic journals but, in the real world, this theory— which serves as evidence, but for which no evidence is necessary to substantiate the theory itself— is powerful leverage for transferring vast sums of money from those who earned it to those in the race industry. In a decade, more than a trillion dollars have been extracted from financial and other business organizations by community activist organizations, using a variety of tactics, according to the National Community Reinvestment Coalition.
²²

However beneficial this may have been to the race industry, among the concessions that have been won from banks have been mortgage loans made to low income and minority borrowers who would not otherwise qualify
under traditional lending standards. These loans in many cases ended up leaving these borrowers with foreclosed homes and ruined credit records. As in other contexts, the race industry benefits, even when the ostensible beneficiaries of their work do not.

A crucial fact about the theories and social visions of intellectuals is that the intelligentsia pay no price for being wrong. In an economy where mistaken business decisions can lead to bankruptcy and extinction, even for the largest corporations, and in a political system where individuals elected to high office on a wave of enthusiasm can find themselves unceremoniously voted out of office in disgrace at the next election, the insulation of intellectuals from paying a price for the consequences of their ideas on millions of other people is a remarkable situation— one buttressed by concepts, laws and traditions ranging from freedom of the press to academic tenure to libel laws that make it nearly impossible for “public figures” to seek legal redress for even outrageous and demonstrable falsehoods about themselves in the media.

Whatever the pros and cons of these concepts, laws and traditions, the point here is simply that intellectuals are in a remarkably different position from that of other decision-makers, and that this is a fact to be taken into account when trying to understand the nature of their decisions, and especially the ability of their theories and visions to survive in defiance of empirical evidence.

Quite simply, intellectuals pay no price for being wrong, no matter how wrong or with what catastrophic consequences for millions of other people. The sweeping acceptance of theories of genetic determinism by intellectuals on both sides of the Atlantic in the early decades of the twentieth century had impacts on things ranging from immigration policies to compulsory sterilization policies to the Holocaust. Yet those who promoted these beliefs paid no price. Madison Grant’s death in 1937 spared him from even learning that millions of innocent men, women and children would be systematically murdered because his book impressed Hitler.

From unaccountability to irresponsibility can be a very short step.

The point here is to suggest nothing more draconian in response than a loss of the gullibility towards ideas in vogue among the intelligentsia that can make their speculations so dangerous to others. All sorts of competing notions can be free in the marketplace of ideas, without becoming dogmas backed by the power of government, just because these notions are currently ascendant among people with high IQs and prestigious degrees and honors. All sorts of ideas, whether on race or on war or on many other subjects, have prevailed among intellectuals with results now recognized in retrospect as having been as utterly invalid intellectually as they were catastrophic in their human consequences. In other words, just because some people are justly renowned within their specialties, and may regard themselves as part of some larger class of “thinking people,” does not mean that the rest of us can neglect to think for ourselves or to demand hard evidence from those with soaring visions and impressive rhetoric.

Among the ideas about race currently in vogue among the intelligentsia are some with enormous potential for needless personal and social tragedies. The apparently benign concept of “equality,” with its numerous and even mutually contradictory meanings, is a fertile source of dangers to individuals, races and whole societies. Equality of treatment by the law, for example, is very different from equality of economic outcomes, and equality of potentialities is very different from equality of developed capabilities. The ease with which many among the intelligentsia turn inequalities of results into “inequities” or “discrimination” might suggest that equality is so automatic that its absence is what needs to be explained— and corrected— despite the gross inequalities in achievements and prosperity that have been common in countries around the world and for centuries of recorded history, even in circumstances in which those more fortunate have had no power to discriminate against those who were less fortunate.

The ultimate sources of these group differences in achievements can be many, and often originated in differences in skills, cultures and other circumstances inherited from past generations. But tracing these sources of intergroup differences can be an arduous and uncertain process, and one with little emotional or other payoff. Instead, those with good fortune have
often attributed that good fortune to their own inherent superiority, while those less fortunate have often preferred to believe that their lesser place in the world is the result of evil done to them by others. Whole ideologies and movements can be, and have been, built on these premises— and whole nations ruined by them. Intellectuals have all too often played a major role in promoting a sense of grievance over inequalities.

The kind of society to which that can lead is one in which a newborn baby enters the world supplied with prepackaged grievances against other babies born the same day. It is hard to imagine anything more conducive to unending internal strife and a weakening of the bonds that hold a society together. When history shows how hard it can be to maintain peace and cooperation among contemporaries, why would we take on the complex, divisive and ultimately futile task of redressing issues between our long dead ancestors or pass on to generations yet unborn the seeds of strife to blight their lives?

The kind of equality being pursued by intellectuals is often the kind of equality that can be imposed unilaterally from the top down, an equality of outcomes— essentially an equality of effects without an equality of causes, or on sheer presumption of an equality of causes, in defiance of both history and logic. Even more ambitious are attempts to create equality of outcomes where differences in causes are acknowledged, but differences in effects are proposed to be eliminated by compensatory policies— a proposition advocated by Condorcet back in the eighteenth century and by Rawls in the twentieth century.
²³
The actual track record of group preference policies, whether in the United States or in other countries around the world, undermines the optimistic assumption that greater equality can be produced in that way, and raises painful questions about the polarization that has all too often been produced instead.