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The Washington Post: Minority business programs that dispense federal aid based on ‘social disadvantage presumptions’ are built on a ‘house of cards,’ scholars say Established in 1969, the MBDA, part of the Commerce Department, aims to assist minority-owned businesses. However, its foundation is under scrutiny as White entrepreneurs argue its mission is unconstitutional, claiming exclusion due to their race.
The lawsuit, spearheaded by White business owners, seeks to dismantle the government’s presumption of inherent social and economic disadvantage for certain racial groups. A federal judge in Texas has recently issued an injunction preventing the MBDA centers in specific cities from using racial categories for eligibility determination.
The legal offensive targets the underlying assumptions of federal programs, formulated in the early 1970s with minimal research or debate. This patchwork approach to disadvantaged minority categories is criticized for lacking consistency and logic. The MBDA’s future is uncertain, with potential constitutional challenges to its foundational act and the use of the term “minority” in its name.
The lawsuit reflects a broader conservative backlash against affirmative action and diversity initiatives, intensified following the Supreme Court’s decision on race-conscious college admissions. Experts highlight the unique vulnerability of these programs due to their loosely formulated origins.
The MBDA’s impact is significant, with clients securing billions in contracts and creating thousands of jobs, especially among Black and Hispanic-owned businesses. The Justice Department defends the MBDA, citing substantial evidence of social and economic disadvantages faced by certain groups.
Similar legal challenges are faced by other programs, like the Transportation Department’s Disadvantaged Business Enterprise program and the Small Business Administration’s 8(a) program. These cases question the constitutional validity of race- and gender-based classifications in government contracting.
The Supreme Court’s ruling on race-conscious college admissions has only put more pressure on programs that rely on social disadvantage presumptions, La Noue said.
“I expect there are going to be more lawsuits,” he said, “and the government will not be able to defend them.”
The entire article can be read at the link https://www.washingtonpost.com/business/2023/12/18/minority-business-programs-racial-disadvantage/
