NCPA - National Center for Policy Analysis

Disadvantaged Whites Not Eligible For Contracts

October 7, 1997

The Small Business Administration's 8(a) program is used to direct a portion of federal procurement to "socially and economically disadvantaged small business concerns." But whites need not apply.

SBA critics say the agency's bureaucrats consider the program "not designed" for whites -- and senior agency officials have even said it would be a "nightmare" for whites to achieve 8(a) status. A former head of the program is widely reported to have said that "no white woman will get in 8(a) as long as I am in charge."

  • A 1991 General Accounting Office report concluded that only 16 nonminority women had participated in the 8(a) program since 1973 -- and four of those had to sue to be admitted.
  • The SBA's 1996 report to Congress reveals that during the Clinton administration the number of nonminority women in the program had fallen to eight.
  • Yet the SBA considers applicants economically disadvantaged if they have a net worth of less than $250,000 -- excluding their home and their business.
  • Observers say the key to 8(a) admission is to be socially disadvantaged -- and that blacks, Hispanics, Asians and members of "other groups designated from time to time by SBA" are "presumed" to be socially disadvantaged because they "have been subjected to racial or ethnic prejudice or cultural bias because of their identities as members of groups without regard to their individual qualities."

Although the SBA has announced it is going to "strengthen and improve" the 8(a) program, its critics are not counting on any dramatic change in its racial policies.

Source: Lawrence B. Lindsey, "Why Whites Are Never 'Disadvantaged,'" Wall Street Journal, October 7, 1997.


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