6 ms·

It's not just the federal level, I frequently bid on work in the city of Detroit where minority-owned business requirements are built into all sorts of contract

by luma 11y ago

It's not just the federal level, I frequently bid on work in the city of Detroit where minority-owned business requirements are built into all sorts of contracts at the state and local level. The same thing happens as a result: a single person of the correct ethnicity will bid on the contract and sub it out to you for a not-so-modest fee.

Frondo 11y ago
I wanted to make a comment on your "person of the correct ethnicity" remark. These requirements, sometimes they're mandatory and are called set-asides, sometimes they're not mandatory and are called aspirational targets, or they might have any number of other names. They all serve a worthwhile purpose; they help combat years or decades of preferential treatment by procurement officers to pick people of "the correct ethnicity". Like, by now it's been pretty well-established that people tend to hire people that look like them, i.e. one of the factors that contributes into the disproportionate representation of various groups in the tech industry we often talk about. Same thing has been happening in purchasing for a long, long time, and what you end up with is a situation where minority-owned firms will have been largely excluded from government contracting. When this happens for very long, it becomes self-reinforcing and self-perpetuating; there's no institutional knowledge in ethnic community A that passes from one generation to the next about large-scale project bidding or management, and you end up with this sort of disproportionate representation and the ensuing economic effects. The set-aside or aspirational target is at least a start at countering that. Like everything, it gets abused by the people with the power and the money (which is where you get the minority contractor who acts as a pass-through to give the real work to the majority-owned firm; that minority contractor isn't building any business of their own, certainly nothing they could pass onto their kids or whatever), but it's better than what we had before, which was a system that perpetuated an even more unfair system for a lot of people.
- trentmb 11y ago
  A capitalist is a capitalist, regardless of minority status- they're still agents of exploitation. EDIT: #yolo
- deleted 11y ago
  [deleted]
- Ensorceled 11y ago
  I think we can all agree the goal is a good one. Many would disagree this an effective way of solving those problems. As you say, this doesn't even counter the problem. The "minority" is just skimming the "take" not building a business or anything else useful.
  - Anechoic 11y ago
    The "minority" is just skimming the "take" not building a business or anything else useful. In same cases? Maybe. In many cases (including my own MBE/DBE-certified business) we are using those projects to build a business (2 bootstrapped partners to 8 employees and national recognition in 4 years) and to use some of that revenue & expertise to help folks that normally couldn't afford our services. And there are any number of businesses I can point to that are achieving similar success (of course there are also failures, but that's true of businesses in general). With regard to Frondo's claim "where you get the minority contractor who acts as a pass-through to give the real work to the majority-owned firm" - at this point I'm pretty sure that's the exception rather than the rule. The various state MBE/DBE certifying agencies are extremely diligent at policing this behavior and will slap down firms found to engage in it. Primes and subs are audited, contacts are reviewed, MBE/DBE subs are interviewed (included onsite visits) etc. MBE/DBEs must submit annual sworn financial statements, along with examples of contracts, invoices and evidence that firm can conduct the work it's contacted for (resumes of principals, references, list of equipment, and so on).
    - Frondo 11y ago
      Oh it's absolutely the exception, and not the rule, the minority contractor who's a pass-through. It's just an inevitable byproduct of the people who have the money and power having found a way to abuse the set-aside/aspirational target system. I didn't mean to suggest that it was common (though I can see how I could have been clearer on that point!). Also, congratulations on using the MBE/DBE certification to build your business! That's excellent, and I'm quite happy for you.
  - rtpg 11y ago
    But doesn't this prove the point? Either nobody was willing to bid lower: the system works. Or someone would be willing to bid lower but its a team filled with white guys: the system works. Maybe these other companies should think about their hiring practices considering that they exist in an area with a large minority that doesn't seem present in the team. I don't know the details though, maybe there's some capital requirements or something that's pretty hard to match
- deleted 11y ago
  [deleted]
- jcrawfordor 11y ago
  I used to work in an industry and area where a huge portion of the support services (custodial, labor, etc) were provided by tribal contractors with predominantly Native American employees, providing huge employment to these often struggling communities because of preferential selection. So there are definitely anecdotal success stories to these programs. There is also the opposite, though. There are some controls in place. For example, my understanding is that in the federal government, contractors that are preferentially selected for various reasons must perform a majority (at least a technical majority, e.g. 51%) of the work in-house, although I don't know a lot about how that is measured or supervised so I'm not sure how effective it is. I have certainly seen cases that looked like abuse.
- reddytowns 11y ago
  It good to get small business involved, but as it's been said before many times, many people including myself object to the idea of giving advantages to people based on their skin color or genitalia.
- marcoperaza 11y ago
  I don't buy it. The government runs plenty of social programs, but procurement isn't one of them. Procurement should be about getting the best deal for the taxpayer, period. This isn't a game, it's other people's hard-earned money that they've been told is being spent on their defense or other essential service, but is instead being spent on a social agenda. And then when the time for fiscal belt-tightening comes around, we end up cutting more-worthwhile expenditures because this waste is entrenched in a supply chain of government-privileged middlemen.
  - Frondo 11y ago
    Well, the thing is, you'd never want the government to make purchasing decisions entirely on price, so what is it that makes the best deal? Price, quality, timeliness of delivery, these are pretty easy to pick out as parts of "the best deal". These days it wouldn't be a stretch to add "better for the environment" along the lines of "what is the best deal," since that is also a decision that affects everyone in the community, whether the company you hire pollutes more or less. Favoring contractors that pollute less seems uncontroversial. Adding "addresses systemic racism that we have in the past committed and that has hurt a part of our community (who are also taxpayers, just like everyone else)" also seems pretty uncontroversial--unless you don't think racism exists or should be addressed.
    - zeveb 11y ago
      > Adding "addresses systemic racism that we have in the past committed and that has hurt a part of our community (who are also taxpayers, just like everyone else)" also seems pretty uncontroversial When do we start addressing the systemic racism which systematically discriminates against business owned by people of the wrong colour — when that colour is white? I.e., addressing systemic racism by applying systemic racism seems pretty foolish.
      - Frondo 11y ago
        It isn't foolish, though I will agree that a very shallow analysis will make these processes seem that way. In a perfect world, minority-owned and woman-owned businesses would never have faced any discrimination at all. In a perfect world, everyone would have competed on an even playing field since the beginning of government buying. That is not this world. And the real-world consequence of those decades of discrimination is that minority communities had another barrier placed in front of their ability to build wealth in their communities--not the only one, of course, but still a real one and one that's definitely done lasting damage to those minority communities. After all this time, and all that damage done, saying "well, we won't discriminate now but you still need to somehow catch up from decades of discrimination, and we won't do anything to undo the damage we did," if you think that's appropriate, then that's fine, you can think that. But it's only foolish if you don't really think at all about the history of the situation and the accumulated effects of that long history of discrimination. You'd even be in good company if you wanted to take that shallow view--a lot of people I talk to don't seem to want to acknowledge that racism ever existed, or if it did it isn't a problem now, or if it is a problem then someone else should do something about it, and on and on and on. (And, you know, all these aspirational targets, like spending 20% of our dollars on minority-owned firms, they're not hard-and-fast rules. If there are no qualified minority firms, then the work still goes to a white-owned firm, and after decades of discriminatory procurement practices there aren't necessarily a lot of minority-owned firms with the capacity to manage government contracting projects, so it's not like white folks are suffering in any way in the government procurement space.)
shalmanese 11y ago
Why was the fee not-so-modest? Common sense would dictate that since it's a good that's both easy to obtain and also completely commoditized, the amount you could charge would decline to the cost of production.
iolothebard 11y ago
American Indian tribes/nations have this down too. Chickasaw is booming here in Oklahoma. That doesn't count all the casinos where money is flowing out the back doors as well.

by luma 11y ago

Frondo 11y ago

I wanted to make a comment on your "person of the correct ethnicity" remark. These requirements, sometimes they're mandatory and are called set-asides, sometimes they're not mandatory and are called aspirational targets, or they might have any number of other names. They all serve a worthwhile purpose; they help combat years or decades of preferential treatment by procurement officers to pick people of "the correct ethnicity". Like, by now it's been pretty well-established that people tend to hire people that look like them, i.e. one of the factors that contributes into the disproportionate representation of various groups in the tech industry we often talk about. Same thing has been happening in purchasing for a long, long time, and what you end up with is a situation where minority-owned firms will have been largely excluded from government contracting. When this happens for very long, it becomes self-reinforcing and self-perpetuating; there's no institutional knowledge in ethnic community A that passes from one generation to the next about large-scale project bidding or management, and you end up with this sort of disproportionate representation and the ensuing economic effects. The set-aside or aspirational target is at least a start at countering that. Like everything, it gets abused by the people with the power and the money (which is where you get the minority contractor who acts as a pass-through to give the real work to the majority-owned firm; that minority contractor isn't building any business of their own, certainly nothing they could pass onto their kids or whatever), but it's better than what we had before, which was a system that perpetuated an even more unfair system for a lot of people.

trentmb 11y ago
A capitalist is a capitalist, regardless of minority status- they're still agents of exploitation. EDIT: #yolo
deleted 11y ago
[deleted]
Ensorceled 11y ago
I think we can all agree the goal is a good one. Many would disagree this an effective way of solving those problems. As you say, this doesn't even counter the problem. The "minority" is just skimming the "take" not building a business or anything else useful.
- Anechoic 11y ago
  The "minority" is just skimming the "take" not building a business or anything else useful. In same cases? Maybe. In many cases (including my own MBE/DBE-certified business) we are using those projects to build a business (2 bootstrapped partners to 8 employees and national recognition in 4 years) and to use some of that revenue & expertise to help folks that normally couldn't afford our services. And there are any number of businesses I can point to that are achieving similar success (of course there are also failures, but that's true of businesses in general). With regard to Frondo's claim "where you get the minority contractor who acts as a pass-through to give the real work to the majority-owned firm" - at this point I'm pretty sure that's the exception rather than the rule. The various state MBE/DBE certifying agencies are extremely diligent at policing this behavior and will slap down firms found to engage in it. Primes and subs are audited, contacts are reviewed, MBE/DBE subs are interviewed (included onsite visits) etc. MBE/DBEs must submit annual sworn financial statements, along with examples of contracts, invoices and evidence that firm can conduct the work it's contacted for (resumes of principals, references, list of equipment, and so on).
  - Frondo 11y ago
    Oh it's absolutely the exception, and not the rule, the minority contractor who's a pass-through. It's just an inevitable byproduct of the people who have the money and power having found a way to abuse the set-aside/aspirational target system. I didn't mean to suggest that it was common (though I can see how I could have been clearer on that point!). Also, congratulations on using the MBE/DBE certification to build your business! That's excellent, and I'm quite happy for you.
- rtpg 11y ago
  But doesn't this prove the point? Either nobody was willing to bid lower: the system works. Or someone would be willing to bid lower but its a team filled with white guys: the system works. Maybe these other companies should think about their hiring practices considering that they exist in an area with a large minority that doesn't seem present in the team. I don't know the details though, maybe there's some capital requirements or something that's pretty hard to match
deleted 11y ago
[deleted]
jcrawfordor 11y ago
I used to work in an industry and area where a huge portion of the support services (custodial, labor, etc) were provided by tribal contractors with predominantly Native American employees, providing huge employment to these often struggling communities because of preferential selection. So there are definitely anecdotal success stories to these programs. There is also the opposite, though. There are some controls in place. For example, my understanding is that in the federal government, contractors that are preferentially selected for various reasons must perform a majority (at least a technical majority, e.g. 51%) of the work in-house, although I don't know a lot about how that is measured or supervised so I'm not sure how effective it is. I have certainly seen cases that looked like abuse.
reddytowns 11y ago
It good to get small business involved, but as it's been said before many times, many people including myself object to the idea of giving advantages to people based on their skin color or genitalia.
marcoperaza 11y ago
I don't buy it. The government runs plenty of social programs, but procurement isn't one of them. Procurement should be about getting the best deal for the taxpayer, period. This isn't a game, it's other people's hard-earned money that they've been told is being spent on their defense or other essential service, but is instead being spent on a social agenda. And then when the time for fiscal belt-tightening comes around, we end up cutting more-worthwhile expenditures because this waste is entrenched in a supply chain of government-privileged middlemen.
- Frondo 11y ago
  Well, the thing is, you'd never want the government to make purchasing decisions entirely on price, so what is it that makes the best deal? Price, quality, timeliness of delivery, these are pretty easy to pick out as parts of "the best deal". These days it wouldn't be a stretch to add "better for the environment" along the lines of "what is the best deal," since that is also a decision that affects everyone in the community, whether the company you hire pollutes more or less. Favoring contractors that pollute less seems uncontroversial. Adding "addresses systemic racism that we have in the past committed and that has hurt a part of our community (who are also taxpayers, just like everyone else)" also seems pretty uncontroversial--unless you don't think racism exists or should be addressed.
  - zeveb 11y ago
    > Adding "addresses systemic racism that we have in the past committed and that has hurt a part of our community (who are also taxpayers, just like everyone else)" also seems pretty uncontroversial When do we start addressing the systemic racism which systematically discriminates against business owned by people of the wrong colour — when that colour is white? I.e., addressing systemic racism by applying systemic racism seems pretty foolish.
    - Frondo 11y ago
      It isn't foolish, though I will agree that a very shallow analysis will make these processes seem that way. In a perfect world, minority-owned and woman-owned businesses would never have faced any discrimination at all. In a perfect world, everyone would have competed on an even playing field since the beginning of government buying. That is not this world. And the real-world consequence of those decades of discrimination is that minority communities had another barrier placed in front of their ability to build wealth in their communities--not the only one, of course, but still a real one and one that's definitely done lasting damage to those minority communities. After all this time, and all that damage done, saying "well, we won't discriminate now but you still need to somehow catch up from decades of discrimination, and we won't do anything to undo the damage we did," if you think that's appropriate, then that's fine, you can think that. But it's only foolish if you don't really think at all about the history of the situation and the accumulated effects of that long history of discrimination. You'd even be in good company if you wanted to take that shallow view--a lot of people I talk to don't seem to want to acknowledge that racism ever existed, or if it did it isn't a problem now, or if it is a problem then someone else should do something about it, and on and on and on. (And, you know, all these aspirational targets, like spending 20% of our dollars on minority-owned firms, they're not hard-and-fast rules. If there are no qualified minority firms, then the work still goes to a white-owned firm, and after decades of discriminatory procurement practices there aren't necessarily a lot of minority-owned firms with the capacity to manage government contracting projects, so it's not like white folks are suffering in any way in the government procurement space.)

shalmanese 11y ago

Why was the fee not-so-modest? Common sense would dictate that since it's a good that's both easy to obtain and also completely commoditized, the amount you could charge would decline to the cost of production.

iolothebard 11y ago

American Indian tribes/nations have this down too. Chickasaw is booming here in Oklahoma. That doesn't count all the casinos where money is flowing out the back doors as well.