Hans F. Sennholz, “Affirmative Action” — Summary

This file is a short polemical economic essay. Sennholz treats affirmative action as a case study in what he sees as the self-defeating logic of political intervention: government first distorts markets and injures vulnerable groups, then expands its power by claiming to repair the resulting damage.

Affirmative Action does both; it inflicts economic harm and then seeks to alleviate it.

The essay opens by placing affirmative action within a broader critique of state action. Davis-Bacon wage rules, minimum wage laws, inflationary monetary policy, zoning restrictions, subsidies, and controls all appear as examples of government creating the very injuries it later assigns agencies to cure. Affirmative action, in Sennholz’s account, is especially revealing because it both grants political privileges and imposes economic burdens on the same people it purports to help.

Structurally, the argument moves from civil-rights legislation to bureaucratic incentives, then to labor-market consequences for minorities, women, and the elderly. Sennholz identifies the Civil Rights Act of 1964 and the EEOC as the institutional beginning of the program, but his emphasis falls less on legal doctrine than on administrative expansion and incentive effects.

The civil rights legislation of the 1960s launched the Affirmative Action program.

For Sennholz, the EEOC’s growth is not neutral evidence of progress. He interprets its expanding budget and caseload as signs either that discrimination has worsened under the regime meant to reduce it, or that the agency has an institutional interest in discovering more discrimination. The core conceptual move is to translate moral-political language into economic causation: protected status, mandates, and compliance rules alter employer behavior, raising costs and encouraging avoidance.

EEOC policies accomplish the very opposite of what they set out to achieve.

His strongest application of this claim concerns inner cities. If employers are pressured to hire according to ethnic composition rather than productivity, he argues, they will avoid locations where compliance is costlier. Thus policies meant to increase minority employment instead accelerate business flight from minority neighborhoods.

By forcing employers to hire workers according to ethnicity rather than productivity EEOC created an exodus of business from the inner cities.

The essay then turns to women through the issue of “comparable worth.” Sennholz frames this doctrine as a revived “just price” theory: a political effort to replace market valuation with official ranking. He rejects the idea that income should track schooling, credentials, or abstract job scores. In his market-centered account, wages reflect services valued by consumers, not moral judgments about academic attainment or occupational dignity.

The economic world of individual freedom and the private property order actually does not pay for academic degrees, it only rewards services rendered.

This passage is central to the essay’s Austrian/libertarian logic. Sennholz distinguishes productivity from status and usefulness from education. A surgeon may earn more than a scholar not because society despises learning, but because consumers urgently value life-saving services. The comparable-worth movement, in his view, confuses credential hierarchy with economic value and channels envy into political redistribution.

The final case is the elderly, where Sennholz criticizes ERISA. Although intended to secure pensions, he argues, its funding mandates caused many private pension plans to close and discouraged new ones. By raising labor costs, the law reduces take-home pay, fringe benefits, and sometimes employment itself. The intended beneficiary again becomes the injured party.

Affirmative Action inflicts harm on the elderly.

The essay’s relevance lies in its compact statement of a broader anti-interventionist theory: policy must be judged not by its announced compassion but by its incentives and unintended consequences. Sennholz’s conclusion generalizes from affirmative action to political power as such. False labor doctrines generate mandates; mandates distort markets; distorted markets injure the vulnerable; agencies then expand in the name of remedy.

Millions of Americans whom it was supposed to benefit are its primary victims.

In this sense, “Affirmative Action” is less a legal analysis than a moral-economic indictment of bureaucratic social engineering. Its thesis is that coerced preference and regulated equality cannot overcome scarcity, productivity differences, or consumer valuation, and that political attempts to do so deepen the harms they promise to cure.