Preferential Policies: An International Perspective

by Thomas Sowell

Examines the policies of India, South Africa, Israel, the United States, and other nations that are guilty of government-sanctioned preferential treatment

Genres: Politics, Economics, Nonfiction, Race, Public Policy, History

221 pages, Hardcover

First published June 1, 1990

About the author

Thomas Sowell is an American economist, social philosopher, and political commentator. He is a senior fellow at the Hoover Institution. With widely published commentary and books—and as a guest on TV and radio—he became a well-known voice in the American conservative movement as a prominent black conservative. He was a recipient of the National Humanities Medal from President George W. Bush in 2002.
Sowell was born in Gastonia, North Carolina and grew up in Harlem, New York City. Due to poverty and difficulties at home, he dropped out of Stuyvesant High School and worked various odd jobs, eventually serving in the United States Marine Corps during the Korean War. Afterward, he took night classes at Howard University and then attended Harvard University, where he graduated magna cum laude in 1958. He earned a master's degree in economics from Columbia University the next year and a doctorate in economics from the University of Chicago in 1968. In his academic career, he held professorships at Cornell University, Brandeis University, and the University of California, Los Angeles. He has also worked at think tanks including the Urban Institute. Since 1977, he has worked at the Hoover Institution at Stanford University, where he is the Rose and Milton Friedman Senior Fellow on Public Policy.
Sowell was an important figure to the conservative movement during the Reagan era, influencing fellow economist Walter E. Williams and U.S. Supreme Court Justice Clarence Thomas. He was offered a position as Federal Trade Commissioner in the Ford administration, and was considered for posts including U.S. Secretary of Education in the Reagan administration, but declined both times.
Sowell is the author of more than 45 books (including revised and new editions) on a variety of subjects including politics, economics, education and race, and he has been a syndicated columnist in more than 150 newspapers. His views are described as conservative, especially on social issues; libertarian, especially on economics; or libertarian-conservative. He has said he may be best labeled as a libertarian, though he disagrees with the "libertarian movement" on some issues, such as national defense.

Reviews

[John Nelson · Rating 4 out of 5]

In this book, Thomas Sowell coolly dissects the phenomenon of race and gender preferences, usually identified in this country with the euphemism "affirmative action," as this phenomenon exists around the world.

Sowell begins with countries where the racial group which exercised political power voted itself formal racial preferences. Sowell is able to identify only a few examples under this rubric: the pre-1960s American South, pre-1990s South Africa, which remained under apartheid control when Sowell wrote his book, and some places in India. Sowell's most remarkable finding perhaps is that the only effective resistance to either system was led by private enterprise. This finding should not surprise anyone. Discrimination imposes costs. For example, it is more expensive to provide separate railroad cars for blacks and whites than it is simply to put everyone together. Similarly, the costs of overlooking the best applicant for a job in favor of a less qualified applicant with the proper skin tone should be obvious. These costs make private business and the free enterprise system the natural enemies of irrational racial discrimination.

Sowell proceeds to analyze those more numerous instances where a political minority has been voted preferences over members of more numerous and successful groups. Sowell fails to consider the extent to which Public Choice theory may account for these programs. Public choice theory recognizes that where the benefits of a program are concentrated among members of a motivated minority, while the costs are diffused widely among the public at large, the minority can wield outsized influence over the program in question. This idea explains why many unpopular and unjust programs, including racial preferences and most government "pork barrel" programs, remain in place despite widespread public opposition. This failure is perhaps the most obvious shortcoming of the book.

Sowell finds that the justifications for preference programs tend to be similar from country to country. These justifications include the claim that preferences are only temporary, are needed to lift up underprivileged people, are small in scope, and merely compensate their beneficiaries for past discrimination going the other way. Sowell shows that these justifications are, at best, illusions based upon faulty assumptions and research. I would go farther and say that at least among those who have any knowledge as to how preferences work, such arguments are not mere illusions, but rather knowing lies on the part of people trying to defend a policy they know cannot be defended.

Sowell concludes by arguing that all of the various "illusions" offered by the proponents of preferential policies should be discarded in favor of cold, hard facts. It would be even better simply to adhere rigorously to the principle of equal standing under the law. This principle is so self-evidently fair and reasonable that very few people openly challenge it, no matter how strenuously they may seek to defend preferences.

Preferential Policies: An International Perspective was published in 1990. As a result, it necessarily is somewhat dated. Indeed, most books on public policy would be completely archaic after 26 years had passed. One of the depressing things about racial preferences, however, is that very little has changed over the years. The defenders of preferences have been engaged in a decades-long program of massive resistance against equal protection under the law, and have chosen to employ invective over rational discussion. As a result, the issues and arguments have hardly changed, and Sowell's book remains useful and informative.

[Mark Geise · Rating 5 out of 5]

Thomas Sowell’s “Preferential Policies: An International Perspective” is a fantastic analysis of the history of preferential policies in countries all over the world and their effects on preferred and non-preferred groups. He analyzes situations in as wide reaching places as India, Malaysia, the United States, Sri Lanka, Nigeria, and South Africa. Though this was written in 1990, it is just as relevant now as it was then. The agitation for preferential policies has escalated to even more extreme levels in the United States (where I am writing from) recently.

Sowell breaks up his initial analysis, consisting of detailed looks at one situation after another, into three categories: majority preferences in majority economies, majority preferences in minority economies, and minority preferences in majority economies. “Majority preferences in majority economies,” for example, means preferential policies for the majority group with political power in an economy dominated by the majority group. “Majority preferences in minority economy” means preferential policies for the majority group with political power in an economy dominated by a minority group. Sowell presents very similar patterns regardless of which of the three categories into which a preferential policy falls. Often, the preferred group recognizes that they are not able to compete with other groups. Possibly most importantly, Sowell shows with numerous examples how preferential policies tend to benefit most the elite of the preferred group while punishing most the marginal members of the non-preferred group. He also shows how preferential policies have tended to expand upon both the initially intended benefits and the initially intended beneficiaries to include more extreme preferences and many more “disadvantaged” groups. Finally, he demonstrates that preferential policies often harm both non-preferred and preferred groups, rather than simply transferring resources and benefits from the non-preferred group to the preferred group. The most obvious example of this is increased racial tensions and conflict, but it can also take the form of lesser achievement among the preferred group as they begin to feel entitled to particular jobs or stations in life.

Where Sowell really shines is his analysis and insight into the role of incentives from an economic lens, which he is so talented at doing. One of his explanations for the widespread emergence of preferential policies is that politicians see it as a way to garner short-term gains at a low initial cost. The short-term outlooks of most politicians looking toward their next reelection campaigns cause them to institute preferential policies. However, preferential policies have huge costs in the long run, which in the most extreme cases take the form of racial violence or even war. Rather than make long range investments in education, which may take 20 years to show any real gains, well beyond the outlook of the vast majority of politicians, preferential policies will pay immediate political dividends to the politician without any significant initial monetary cost. I also really liked his discussion of activists who claim to speak on behalf of a group despite the fact that a majority of that group does not identify with the activist's ideas. Agitators who call for preferential policies often come disproportionately from the middle class and from current college students and recent college graduates. They claim to speak on behalf of the entire group, but this often is not the case. These writings coalesce perfectly with the current situation in the United States, with Al Sharpton playing the role of the activist claiming to speak on behalf of the group and college students at the center of the agitation. I think we have also seen plenty of evidence that these groups have less incentive to perform and to try to compete with whites and Asians because they believe they are entitled to quality jobs due to their membership in a “disadvantaged” group, which is exactly what Sowell says tends to happen.

Though “Preferential Policies: An International Perspective” is short (185 pages of text in the edition I read), there is a ton of information here. Sowell is like no other with his ability to weave together examples from all over the world at different points in history to decipher patterns and tendencies. This analysis of preferential policies may be more important than ever in today’s political climate. I highly recommend this book.

[Steven H · Rating 3 out of 5]

AN ATTACK ON POLICIES INTENDED TO HELP ‘NON-PREFERRED’ GROUPS

Thomas Sowell (born 1930) is an economist, social theorist, political philosopher, columnist, and author (known particularly for his books on race and economics, such as ‘Ethnic America: A History,’ ‘The Economics and Politics of Race,’ etc.), who has long been associated with the Hoover Institution at Stanford University.

He wrote in the Preface of this 1990 book, “Groups receiving preferential treatment are indeed as disparate as can be imagined---from untouchables in India to whites in South Africa. That makes it all the more surprising to discover common patterns in programs for such extraordinarily different peoples, in wholly different circumstances, living in countries separated by vast distances and differentiated by sharply contrasting traditions. Much of the massive literature on preferential policies… concerns itself with the morality, sociology, politics, legalities, administration, or goals of these policies… the ACTUAL RESULTS have received remarkably little attention or systematic analysis. A recurring complaint in the relatively few empirical studies that have been done is the lack of data available… Part I of this book focuses on such facts as are available for various groups in various countries… Part II will explore the beliefs and rationales of preferential policies---and why they so seldom match the actual results.”

In Chapter 1, he states, “Preferential policies, as defined here, are policies which legally mandate that individuals NOT all be judged by the same criteria… when they originate in groups differentiated by government into preferred and non-preferred groups… The mechanisms and the consequences of preferential policies will be analyzed in an international perspective… The social context of these programs varies radically among these countries… This makes any common patterns among them all the more striking and deserving of closer scrutiny. Among these patterns are the following: 1. Preferential programs… have tended not only to persist but to expand in scope… 2. Within the groups designated by government… the benefits have usually gone disproportionately to those members already more fortunate. 3. Group polarization has tended to increase in the wake of preferential programs… 4. Fraudulent claims of belonging to the designated beneficiary groups have been widespread… 5. Both official and unofficial writings on preferential programs tend to abound in discussions of the rationale, mechanics… with a dearth… of data on the actual outcomes.” (Pg. 15-16)

He suggests, “Given the differential costs of discrimination in competitive labor markets versus controlled labor markets, it is possible to understand the otherwise puzzling anomaly that Jewish artisans were once more prevalent in eastern Poland, where anti-Semitism was greatest, and black artisans in the American South where racism was most blatant. In each case, these were regions where guilds ... or labor unions … had less control. In each case, there was MORE prejudice than usual but LESS discrimination, because the costs of discrimination (in these particular occupations) were higher in competitive markets than in the controlled markets in other regions of the country.” (Pg. 31)

He argues, “The keystone of many arguments for preferential policies is that large disparities in ‘representation’ are due to discrimination against the under-represented group is clearly false where the under-represented group is the politically dominant majority, which either controls the institutions … or forms the bulk of the clientele on whose patronage the minority depends. Group disparities, which are so often discussed in terms of their abstract statistical improbabilities, are empirically and historically commonplace around the world.” (Pg. 89)

He notes, “The often reiterated belief that standardized tests predict a lower subsequent college performance level than in fact occurs with black students has somehow survived innumerable empirical studies which show the UTTER FALSITY of this claim. There is, in fact, a tendency for test scores to predict a somewhat higher college performance than black students actually achieve. In general, test scores are more accurate predictors than high school grades for blacks, though the reverse is true for whites and Asians… Whether the tenacity with which the belief is held that test scores are less predictive for blacks reflects simply a … pragmatic need to avoid admitting that admissions standards have been lowered to obtain statistical ‘representation,’ this belief simply does not fit the empirical facts. More important, the actual consequences of admitting blacks to institutions where they do not meet the usual admissions standards have been educationally disastrous for those students.” (Pg. 109)

He reports, “The disincentives created by group preferences apply to both preferred and non-preferred groups… [In] Jamaica, after it became independent and black-run… it was the whites who faced the disincentives of a non-preferred. Many withdrew from the competition for public office because they ‘felt that the day of the black man had come and questioned why they had to make the effort if the coveted job or the national honor would go to the blacks, despite their qualifications.’ In short, preferential policies represent not simply a transfer of benefits from one group to another, but can also represent a net loss, as both groups perform less well as a result.” (Pg. 124)

He contends, “Those viscerally convinced of the pervasiveness of discrimination and its potency as an explanation of social disparities---and convinced also of the effectiveness of preferential policies as a remedy---are little troubled by the logical shakiness of the statistical evidence. That is all the more reason for others to be doubly troubled---not simply because an incorrect policy may be followed but also, and more importantly, because actions ostensibly based on the rule of law are in substance based on visceral convictions, the essence of lynch law.” (Pg. 135)

He points out, “The contemporary socioeconomic position of groups in a given society often bears no relationship to the historic wrongs they have suffered. Both in Canada and the United States, the Japanese have significantly higher incomes than the whites, who have a documented history of severe anti-Japanese discrimination in both countries. The same story could be told of the Chinese in Malaysia, Indonesia, and many other countries around the world, of the Jews in countries with virulent anti-Semitism, and a wide variety of other groups in a wide variety of other countries. Among poorer groups as well, the level of poverty often has little correlation with the degree of oppression. No one would claim that the historic wrongs suffered by Puerto Ricans in the United States exceed those suffered by blacks, but the average Puerto Rican income is lower than the average income of blacks.” (Pg. 149)

He summarizes, “preferential policies are intended to favor groups currently ‘under-represented’ in desirable occupations or industries. Both majorities … and minorities … have equated statistical inequalities with moral inequities… the presumption that groups would be evenly represented in various sectors and levels of society, in the absence of discrimination, has become a belief almost hermetically sealed off from any logical or empirical argument. Criticism is dismissed as malevolently motivated, evidence as culturally biased, criteria as irrelevant.

"Evidence that clearly contradicts the vision has often been hidden by redefinition. For example, where the assumption that non-whites’ lower economic position is due to whites’ discrimination, non-white groups who have been successful in the same society are an obvious embarrassment to the proponents of this theory. In Britain, this has led to a redefinition of all non-white groups, including Asians, as ‘black.’ Thus Asians disappear as a separate group by verbal sleight-of-hand, as the collective economic, educational, and other performances of ‘blacks’ as a whole are compared to those of whites. In the United States, a similar burying of discordant evidence is achieved by using the ponderous phrase ‘people of color’ to encompass all non-whites, thereby swamping the above-average income statistics of Chinese and Japanese Americans under the larger numbers of below-average income statistics from blacks and other low-income, non-white groups. In Canada, the lump-together phrase is ‘visible minorities.’ It too helps to conceal the fact that some non-white groups in Canada are more prosperous than some white groups. The particular words used to lump disparate groups together differ from country to country but the tactic is the same. In short, no matter what the evidence says, the vision is protected from it.” (Pg. 176)

He states, “In the United States, the unbridled vilification of the Moynihan Report marked virtually the beginning of the end of candid discussion of minority groups. Ironically, the Moynihan Report was a plea for more government help for blacks, and what it said had already been said by black scholars, some of whom joined in the vilification of the Moynihan. Moreover, the candor of the Moynihan Report did not begin to approach the painful frankness of ‘Black Bourgeoisie’ by E. Franklin Frazier, the outstanding black sociologist.” (Pg. 179)

As with all of Sowell’s books, some love them, and some hate them.

[Sylvester · Rating 5 out of 5]

Preferential Policies was inspired by Thomas Sowell's trip to New Zealand when a Maori woman proclaimed uniqueness of the Maori people to justify special treatment. He conducted his extensive research on the economics of the majority and minority (in its literal sense) in various countries from Nigeria to South Africa, he destroyed all the myths of the affirmative action zealots by presenting detailed arguments with facts to back them up. It is still relevant today, if not, more relevant than ever.

[Jackinbottle · Rating 4 out of 5]

Political correctness appears to have found its well of eternal youth.

[Connie · Rating 3 out of 5]

interesting examples but one-sided and no evaluation of central argument

[Craig Adamson]

Bought 10/13/17. $4.49. Paperback like new.