When Does Private Discrimination Justify Public Affirmative Action?

Abstract:     
Commentators and courts alike have ignored the Supreme Court's forthright assertion in City of Richmond v. J.A. Croson Co., 488 U.S. 469 (1989), that government can use its spending power to eradicate the effects of private discrimination. Croson makes it clear that private discrimination can be a constitutionally sufficient justification for government affirmative action, but provided little explanation. Filling out the contours of a private discrimination justification will largely decide the fate of affirmative action in government procurement. This is true because in some markets there is little evidence of current public discrimination, whereas private discrimination remains pervasive. Building on key language from Croson, this Article offers three private discrimination rationales: (1) to ensure that government spending does not directly or indirectly facilitate private discrimination (causal); (2) to correct for the depressive effect of private discrimination on the capacity of minority-owned firms (but-for); and, most radically, (3) to correct for discrimination in parallel private markets (single-market). An example helps to illustrate the less familiar single-market justification: If private purchasers discriminate against minority pencil sellers, the government should be able to buy more pencils from minorities to make up for this shortfall. Finally, we suggest possible applications of the private discrimination justifications to education and employment.

JEL Classification: K10, K31

Accepted Paper Series