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"At this moment of heightened public awareness, forcing big public pension funds to commit to putting more of their dollars in funds controlled by minorities co
by JPKab 6y ago
"At this moment of heightened public awareness, forcing big public pension funds to commit to putting more of their dollars in funds controlled by minorities could have a major impact. These public institutions, unlike their corporate kin, represent a wide and diverse swath of the country, making investment decisions for public servants like teachers, firefighters and municipal workers."
While I think this is a phenomenal idea, it should be noted that systems like this that currently exist are frequently, almost typically, gamed. I went to work for a Federal Government certified 8a minority woman owned business with at the time about 20 employees in my mid-20s. I remember thinking how cool that was.
The "CEO" was a highly competent woman of Filipino descent who, after having kids, had chosen to become a stay-at home mom. She was CEO in name only, and her husband (a big giant white dude who was also highly competent) was the actual CEO, but with a different title.
The company's main source of revenue was acting as a prime contractor on contracts only available to 8a companies, then subbing the work out to large contractors. Another regulation on the company was a cap on it's profits, as well as a cap on salaries of individual employees. Their way around that was that the acting CEO and his wife both earned max level salaries. Another C level co-founder also payed his wife the maximum salary, and near as we can tell, her sole item of work for the company was sending out holiday gift baskets.
Again, good idea, but we need to think very hard about how to ACTUALLY help, rather than just making a small number of people who know how to game the system wealthy.
- tick_tock_tick 6y agoO wow this takes me back to my first software job we did pretty much only government contracts but were not eligible for 8a. We had another company was that eligible that we sort of brought on to tons on contracts to make the requirements; they were pretty much a single person shop that got paid to be visible.
- deleted 6y ago[deleted]
- jandrewrogers 6y agoI'm not sure why this is being downvoted. It describes common practice for US Federal government business in response to the creation of minority business preferences in contracting. Many companies that are not actually minority-owned essentially rent minority-owned shell companies to clear the qualification hurdle for contract preferences, it is de rigueur unless you have unique capabilities that make it likely you'll get a contract award regardless. The obvious consequence is that once every company is "minority owned" no company is and you are back to where you started, just with some middlemen.
- dx87 6y agoIt's probably getting downvoted because people who support the preferences view it as someone trying to keep minorities down. I've seen a lot of people game the system, where they'll have specialized knowledge from the government of military, then start a small contracting company and make their wife the CEO so they can win contracts. I've also known people doing government contracting where the prime won because it's an Alaskan Native company, but they subcontract out all the work, and there's only 1-2 natives actually doing work on the contract.