Financial Regs Bill/Affirmative Action all in one!
I haven’t figured out why no one is really talking about this yet, so here goes.
The Dodd-Frank financial regulation bill, which passed on June 30th, is a mess. As is anything that has “Dodd” and “financial regulations” in the title. Liberty Central did a grat breakdown of some of the issues with this bill here.
However, it’s this part that I want to highlight:
Did you know…that the bill is full of measures that continue to divide Americans by race by creating specific programs for racial minorities and women, including an Office of Fair Lending and Equal Opportunity (Title X, Sub. A), Office of Housing Counseling (TITLE XIV, Sub. D), the Office of Minority and Women Inclusion (Title III, Sub. D), and requires recruitment at historically black colleges and other minority serving institutions (TITLE III, Sub. D)?
What this is in effect doing is introducing an Affirmative Action style of gender and race quotas to the financial regulation industry.
Without belaboring the point, this is a huge strain on the industry. It’s a major shift in employment law, and gives directors the power to fire any administrator they believe hasn’t put forth a strong enough effort to balance out the workforce. Really, the only way the administrator can hold on to their job is to make sure that their staff is sufficiently diversified.
This puts undue pressure on the system. It’s ultimately unfair to women and minorities who may not be qualified for the job, but are pulled in anyway to make people feel all warm and fuzzy that they’ve got their racial balance. As with any industry, people shouldn’t be hired because they are black or female. It lowers the curve and helps no one. Now, if there’s a black man who’s more qualified than a white man, have at it! Hire him! If a woman can do a better job than the white guy, bring her onto the team! But the idea that a director would be forced to hire someone who isn’t as qualified for the sake of appearances is detrimental to the integrity of the industry. A chain is only as strong as its weakest link and such. They’ll enact these new quotas, and when everything starts falling apart, they’ll wonder why the agency is an inefficient money suck. It dosn’t take a genius to figure out the problem here.
The way things are set up now, there are discrimination laws that don’t allow hiring or firing based on race or gender. That’s quite different than setting up quotas. This is a huge change, and something that has not even been a part of the larger conversation.
Real Clear Markets sums up the whole issue right here:
Setting up these Offices of Minority and Women Inclusion is a troubling indictment of current law. Women and minorities have an ample range of legal avenues already to ensure that businesses engage in nondiscriminatory practices. By creating these new offices, Congress does not believe that existing law is sufficient.