By Walter E. Williams
Wednesday, May 14, 2014
Donald Sterling, Los Angeles Clippers owner, was recorded
by his mistress making some crude racist remarks. Since then, Sterling's racist
comments have dominated the news, from talk radio to late-night shows. A few
politicians have weighed in, with President Barack Obama congratulating the NBA
for its sanctions against Sterling. There's little defense for Sterling, save
his constitutional right to make racist remarks. But in a sea of self-righteous
indignation, I think we're missing the most valuable lesson that we can learn
from this affair -- a lesson that's particularly important for black Americans.
Though Sterling might be a racist, there's an important
"so what?" Does he act in ways commonly attributed to racists? Let's
look at his employment policy. This season, Sterling paid his top three players
salaries totaling over $46 million. His 20-person roster payroll totaled over
$73 million. Here are a couple of questions for you: What race are the players
whom racist Sterling paid the highest salaries? What race dominated the 20-man
roster? The fact of business is that Sterling's highest-paid players are black,
and 85 percent of Clippers players are black. Down through the years, hundreds
of U.S. corporations have faced charges of racism, and many have been subjects
of Equal Employment Opportunity Commission investigations, but none of them had
such a favorable employment and wage policy as Sterling. How does one explain
this? People with limited thinking ability might conclude that Sterling is a
racist in his private life but a nice card-carrying liberal in his public life,
manifested by his hiring so many blacks, not to mention paying Doc Rivers, the
Clippers' black head coach, a healthy $7 million a year. The likelier
explanation is given no attention at all.
Let's use a bit of simple economics to analyze the
contrast in Sterling's private and public behavior. First, professional
basketball is featured by considerable market competition. There's an open
opportunity in the acquisition of basketball playing skills. Youngsters just
buy a basketball and shoot hoops. There's open competition in joining both
high-school and college teams. You just sign up for tryouts in high school and
get noticed by college scouts. Then there's considerable competition among the
NBA teams in the acquisition of the best college players. Minorities and less
preferred people always do better when there are open markets instead of
regulated markets.
Recently deceased Nobel Prize-winning economist Gary
Becker pointed this phenomenon out some years ago in his path-breaking study
"The Economics of Discrimination." Many people think that it takes
government to eliminate racial discrimination, but economic theory predicts the
opposite. Market competition imposes inescapable profit penalties on for-profit
enterprises when they make employment decisions on any basis other than worker
productivity. Professor Becker's study of racial discrimination upended the
view that discriminatory bias benefits those who discriminate. He demonstrated
that racial discrimination is less likely in the most competitive industries,
which need to hire the best workers.
According to Forbes magazine, the Los Angeles Clippers
would sell for $575 million. Ask yourself what the Clippers would sell for if
Sterling were a racist in his public life and hired only white players. All the
evidence suggests that would be a grossly losing proposition on at least two
counts. Percentagewise, blacks more so than whites excel in basketball. That's
not to say that it is impossible to recruit a team of first-rate, excellent
white players. However, because there is a smaller number of top-tier white
players relative to black players, the recruitment costs would be prohibitive.
In other words, a team of excellent white players would be far costlier to
field than a team of excellent black players. It's simply a matter of supply
and demand.
The takeaway from the Sterling affair is that we should
mount not a moral crusade but an economic liberty crusade. In other words, eliminate
union restrictions, wage controls, occupational and business licensure, and
other anti-free market restrictions. Make opportunity depend on one's
productivity.
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