Another area in which disparate impact analysis has been deployed is in housing. Department Housing and Urban Development Secretary Shaun Donovan referred approvingly to a study by Zillow, an online real estate data company, that said blacks and Hispanics are denied home mortgages at rates higher than whites and Hispanics. "(T)hese fundamental disparities affect the abilities of members of each group to accumulate financial assets," Zillow's economist writes.
But he also admits that black and Hispanic applicants had significantly lower incomes than whites and so presumably tend to be less creditworthy. Dispensing with credit standards to promote minority homeownership led directly to the 2008 financial collapse -- and to foreclosures on blacks and Hispanics.
Disparate impact analysis came into the law when courts faced disingenuous and sometimes violent resistance to civil rights rulings and laws by Southern whites. It was a drastic remedy for drastic obstruction of the law.
A 1971 Supreme Court case ruled that employment discrimination could be inferred by seemingly neutral practices that had disparate impact on blacks and whites.
Around that time, the Nixon administration was imposing racial quotas and preferences on building trades unions, where desirable positions tended to be doled out to sons, nephews and cousins of current members.
Ultimately, disparate impact analysis rests on what ordinary citizens instinctively recognize as a fiction, the notion that in a fair society you would find the same racial and ethnic mix in every school, every occupation and every neighborhood.
This runs against the sometimes uncomfortable fact that abilities and interests are not evenly distributed among ethnic and racial groups.
That doesn't justify racial discrimination. Ordinary Americans understand that the variation within groups is much higher than the variation between groups. They understand that it's unfair and unwise to judge individuals by their race of ethnicity.
Unfortunately, disparate impact doctrine produces policies that lead people to do just that. And in the process, it produces results that hurt many of the intended beneficiaries.
In Honor of His 103rd Birthday, Here Are The 20 Best Quotes From The Late, Great Milton Friedman | John Hawkins