1991 Rights Bill a Return to Earlier Path of Bias Redress : Race relations: After delay of 27 years, Congress is saying that preferences may be used to right past wrongs.

WASHINGTON —  America was no longer a nation weighted down with racial regrets. By the Ronald Reagan years, two decades of self-reproach were merely part of a murky and curious past. More and more whites were troubled instead by the penances imposed on them--affirmative action and busing.

Reagan tapped into this anger. In 1980, he opened his first presidential campaign in the backwater of Philadelphia, Miss. The town had been named for brotherly love but was better known as a bastion of white supremacy. Three young civil rights workers had been murdered there in 1964.

Standing before a huge crowd at the red-earth county fairgrounds, Reagan said something as rousing to them as a rebel yell: “I believe in states’ rights. I believe we have distorted the balance of our government today by giving powers that were never intended . . . to the federal Establishment.”

His election struck out at this Establishment. Affirmative action--that truss bridge of social engineering--was a major target for dismantling. The Justice Department picked up the crowbar. And the program survived only because it had made unexpected friends along the way, including big business.

Over time, another serious adversary appeared. Reagan appointees had recharted the ideological course of the U.S. Supreme Court. In 1989, several rulings reversed the thinking of two decades of anti-discrimination law. Employment practices lapsed into uncertainty--that is, until a week ago.

On Oct. 24, the Senate and the White House agreed on a proposed new civil rights act. The bill may not have seemed as historic as some of its landmark predecessors, what with all the arcane details about how lawsuits were being made easier to file.

But the bill did return the law to its earlier bearings, and, in doing so, Congress explicitly answered a question that it had dodged for 27 years:

Is it OK to use racial preferences to remedy past wrongs?

The answer is yes.

Reagan would have answered otherwise. To him, words like “preference” and “goals” and even “affirmative action” were genteel synonyms for something detestable: “quotas.” He was convinced that the government was forcing employers to hire by the numbers--so many blacks, so many Latinos, so many women.

His point-man for putting a stop to this was an energetic young heir to the DuPont fortune, William Bradford Reynolds, his assistant attorney general for civil rights. Nine lawyers had held this position before, dating back to the Dwight D. Eisenhower Administration. All of them had championed minority rights.

By his own reckoning, Reynolds was doing much the same. He was simply more inclusive in defining his terms. “It must be remembered that we are all--each one of us--a minority in this country, a minority of one,” he said.

Blacks should never be given an advantage over whites because of the color of their skin, he said. Society could not transcend race “by borrowing the tools of the racist.” Government must “never support the use of quotas or any other numerical formulas.”

The Justice Department switched sides in important job bias cases, arguing now that individual rights must take precedence over group rights. We want the “color-blind ideal of equal opportunity for all,” Reynolds said.

It was the rebuttal argument in a long debate about the meaning of the 1964 Civil Rights Act. Did the law permit race-conscious hiring?

Up until then, the working answer had been “yes.” In 1965, President Lyndon B. Johnson had even issued an executive order to that effect. He demanded that the 15,000 companies doing business with the government take “affirmative action” toward hiring minorities.

This would eventually bring a revolution to the American workplace, and the long years of injustice had demanded nothing short of that. Bias had been so widespread that eliminating it was like trying to sop up a flood.

Entire industries were segregated, said Leonard J. Biermann, acting chief of the agency that oversees federal contractors. In many companies, “the highest paid black employee earned less than the lowest-paid white.”

Rapid changes required business cooperation. Much depended on the corporate brass--the earnestness of the top executive and the clout of the person with a newly minted title such as “vice president of equal employment.”

“In the early days in the South, you’d have to go around and tell people that the proper pronunciation is NEE-gro and point to your knee,” said a retired executive who ran a major oil company’s hiring program.

He tattled on the sly to regulators about his own corporation--and requests anonymity now: “I’d tell them where our worst places were, a void here and a void there, and I’d tell them to file a show-cause letter.”

Donald Liebers was in charge of affirmative action for American Telephone & Telegraph. “In the beginning, there was a mix of cooperation and antagonism,” he said. “But, when the government began to pick on some big targets--and we were one--then a lot of companies fell in line.”

Progress was steady, if incomplete. For a time, historic wage gaps between the races narrowed. Only later did structural changes in the economy undermine the advancement.

The average weekly income of black male workers was 57% that of white males in 1959, but 64% in 1969 and 73% in 1979, according to research by economists James P. Smith and Finis R. Welch. The gap between black and white women--sharing the added burden of sex bias--came to a virtual close.

Credit for the substantial gains is hard to parcel out. Some of it is due to a seismic shift in racial attitudes. Still more can be attributed to an opening in educational opportunities.

Timing helped as well. Anti-discrimination efforts picked up velocity in the late 1960s, just as the economy was suffering labor shortages. Many employers were eager to make use of a long-neglected labor pool. Government-enforced affirmative action provided them a justifiable reason for defying the codes of racism.

Prejudice still held a powerful sting, of course, but at its side was something new. Blacks were often in demand, the more educated the better. By 1973, wages of black college graduates entering the labor market equaled those of their white counterparts, according to economists John Bound and Richard B. Freeman. From 1974 to 1978, their starting salaries were actually higher.

Larry Alston remembers what it was like being a black business major graduating from the University of North Carolina in 1978. “I was coming out when affirmative action was really beginning to kick in,” he said.

Banks, retailers, manufacturers--he was sifting through the offers.

In the first decade of the executive order, enforcement was scattershot. Until the Jimmy Carter Administration, oversight was split among 11 government agencies. Some were sticklers, some not. Some had top-notch regulators; others sent forth overmatched sluggards against corporate America’s wily lawyers.

Carter consolidated the program under the Labor Department in 1978. The black man he put in charge was Weldon J. Rougeau, a Harvard-educated lawyer and the son of a sharecropper. He had once been jailed for two months, charged with “criminal anarchy” after a sit-in at a segregated lunch counter.

Rougeau was corporate America’s nightmare. He wanted word to go out: He was ready to “debar” companies from government business if they did not meet their hiring goals. “It was time to get credible,” he said.

Twelve corporations were debarred during his tenure. No one before--or since--has caused so many companies to lose their federal contracts. “ ‘Mr. Debarment,’ the contractors called me,” Rougeau said. “They hated my guts.”

This is so. Company managers, top to middle, feared him. Some complained they were getting picked on, pushed around, beaten up.

Some complained they were forced to use quotas.

Quotas have always been the flash point. Reagan, and later George Bush, knew this. If they forgot, their pollsters were around to remind them.

Approval for the vague words “affirmative action” is high among both blacks and whites. But when the question mentions “quotas” or “preferences,” results begin to somersault.

This is somewhat odd in view of the facts. Even while Rougeau ran the federal program, quotas--or rigid, inflexible numbers--were never a common occurence, employers and labor experts say. When they were used, frequency varied year to year, company to company, even department to department.

Fear--and sometimes laziness--made the difference. On occasion, playing by the numbers is a way for hiring managers to play it safe--to be sure no one in government or upper management penalizes them for missing the goals.

Wanda Lee, of FHP Inc., the health-care provider, said she hired some unqualified engineers when she worked with a government aerospace contractor: “You knew what numbers you needed and you went out and lined them up.”

Affirmative action plans begin with a company’s review of its work force by race and gender. If there is an “underutilization” of any segment of the available--and qualified-- labor supply, then hiring goals are set.

Businesses are only obligated to show a “good faith effort” to meet the goals. Active recruiting, for instance, would be a sign of effort. Serious violations can lead to debarment or, far more often, a negotiated agreement with precise steps for making amends.

These agreements must be signed by a company’s top officer, a chilling thought for a mid-level manager. “If the personnel director in Plant X thinks his future depends on meeting a goal, then that goal becomes a quota,” said attorney Ed Dilworth, of General Motors Corp. “That’s just a fact of life.”

Preferences are far more common than quotas. They have always been a part of the quirky process of hiring. Most often, employers have tended to favor people like themselves, something of obvious benefit to white males. This is still done.

But some companies now are also mindful of affirmative action goals. “I may tell someone we want a female for that job, and we’re willing to wait a month instead of a week if that’s what it takes to find a qualified one,” said John Goodwin, human resources manager for an oil company in the Midwest.

Mike Rogers, vice president of human resources for BancFirst in Oklahoma City, said he would hire a black over an equally qualified white--and “most likely” hire a well-qualified black over an even more qualified white.

Timing plays a huge part in such decisions.

Affirmative action is a moving target. A company’s numbers change; so does the racial composition of its surrounding area. Together, Latinos and Asians now equal the number of blacks in the nation’s work force. New laws also protect the handicapped and older workers from discrimination. “Right now, what I’m trying to do is hire Vietnamese,” Rogers said.

With preferences come stigmas, deservedly or not. In the last two decades a common remark has become: So-and-so is an affirmative action hire.

It joins the other familiar old saws and alibis: So-and so knows someone. So-and-so is a brown-nose. So-and-so looks the part.

The point man at Justice, Reynolds, like Reagan, had no patience for fine distinctions of affirmative action. To him, the program meant preferences, and preferences meant quotas.

He pressed on with his fight, though he was not having any success in the courts. “I was throwing myself in front of a runaway train,” he recalled.

Then, in 1985, Reynolds got a new boss as attorney general, the canny political operator Edwin Meese III. The two devised an additional tactic.

If the underpinning of affirmative action was President Johnson’s 1965 executive order, then the way to gut the program was to rewrite the decree.

Reynolds and Meese proposed a new edict that would have made the setting of minority hiring goals strictly voluntary. This had an implied twist.

Companies that still chose to practice affirmative action would then be in legal jeopardy. If sued for reverse discrimination, they would no longer be able to argue that they were only following the government’s orders.

It was a proposal that fit well under the rhetorical umbrella of the Reagan Revolution. When Meese presented it to the Cabinet, he expected little resistance. The Administration’s most forceful blacks supported him, including Clarence Thomas, then head of the Equal Employment Opportunity Commission.

But the cross-fire was surprisingly heavy. Secretary of Labor William E. Brock III argued against it. He insisted that the nation’s obligations for past injustices were still far from fulfilled. And he had some persuasive allies.

Secretary of State George P. Shultz had run the labor department under Richard M. Nixon. It was Shultz who first approved of “goals and timetables,” the very practice now fingered as the roundabout to quotas.

Reagan faced a quandary. He was philosophically inclined to accept Meese’s view. But the politics were complicated. Some of his traditional supporters were at odds.

Favoring the Meese revisions was the U.S. Chamber of Commerce, made up of small and medium-sized businesses. But on the other side was the National Assn. of Manufacturers, representing the largest companies.

Ironically enough, Big Business had grown accustomed to affirmative action. An emphasis on numerical goals fit its methodical habits.

Faced with this nettlesome conflict, Reagan took the path of least resistance.

He left things alone.

The brouhaha was nevertheless well-noted. Uncle Sam was obviously no longer a major booster of affirmative action. Personnel managers would razz federal compliance officers when they turned up to do an audit.

“You’d get employers saying: ‘Hey, I hear you’re going out of business,’ ” said Robert V. Brown, who retired in 1990 after 20 years in the program. “They gave us static; they were more resistant.”

The basic nature of the game had not changed, and enforcement still went on. Each year, thousands of compliance reviews were conducted. Violations were uncovered. Settlements were negotiated. Back pay was awarded.

But the atmosphere was no longer so adversarial; the dog had less bite. Companies failing to meet hiring goals did not have to meet tougher, “make-up goals” the following year. The audits themselves were not as thorough.

“In the old days, compliance people sometimes stayed three months; now they pulled up their stakes after a week,” said one veteran labor department official who requested anonymity. “Something was clearly different.”

The difference met the decided approval of employers. They did not think that enforcement had turned lax. Rather, they most often used words such as “reasonable” and “more professional.”

It was a nice break from the days of Weldon Rougeau.

Toward the end of the 1980s, there was a welcome change for Brad Reynolds as well. A rebuilt Supreme Court tilted to the right. Finally, he was preaching to a chorus of amens.

In 1971, in Griggs v. Duke Power, an earlier court had laid the foundation for interpreting the 1964 civil rights act. It established that employers could be found guilty of discrimination even if the bias had been unintended.

For example: If a job test--even a fair one--led to more whites being hired than blacks, the mere imbalance was evidence of bias. The company’s only defense would then be to show a “business necessity” for using the exam.

Employers used this guidepost. It made them watch their numbers. Otherwise, if they were sued for bias, proving innocence would be difficult.

On Jan. 18, 1989, two days before Reagan left office, the court heard a case titled Wards Cove Packing Co. v. Atonio. It concerned salmon canneries that operated seasonally in the far reaches of Alaska.

Most of the non-skilled jobs--the eviscerating of the fish--were filled by nonwhites, primarily Filipinos and Eskimos. They claimed that company bias kept them from the better-paying skilled positions, such as machinery repair.

The nine justices never did decide if they were right, but in returning the matter to lower courts, a majority did something far more eventful: It pulled the well-worn rug out from under the Griggs decision. The opinion said that instead of an employer being made to show a business necessity, the burden of proof ought to shift to the employee.

This small point of law made an enormous difference. It required workers to prove a negative: that the company’s job requirements were irrelevant to its business performance.

Lawyers knew this would be hard to do. Companies understood how to interpret their employment and financial records; workers did not.

The Davids had lost their slingshot. All bets were now with the Goliaths.

Reaction was immediate. Democrats proposed a new civil rights bill. For the first time, it formally endorsed the court’s decisions from Griggs up to, but not including, Wards Cove. In effect, the legislation stamped approval on a quarter of a century of race-conscious hiring to remedy numerical imbalances.

And that put President Bush on the spot.

Like Reagan, he was faced with a split in his Administration--for and against affirmative action. Initially, he took the advice of C. Boyden Gray, his White House counsel, and Dick Thornburgh, then-attorney general. They argued that the recent Supreme Court decisions ought to stand.

Then, in the summer of 1990, under pressure from civil rights groups and moderate Republicans, Bush reversed his position and submitted his own bill. It, too, called for a return to Griggs. But when the Democrats’ version was passed instead, the President vetoed it and called it “a quota bill.”

The “quota” label was again a puzzling one. To most eyes, neither bill opened that dreaded trapdoor any wider. If the Democrats’ proposal did, so did the President’s. But “quota” is a well-chosen word freighted with political symbolism. It is associated with a liberalism gone out of fashion.

A Democratic presidential candidate has not won a majority of white votes since 1964. This is a dramatic change in American politics, involving a shift in the allegiance of working-class whites. They are the ones who have been most hurt by a decade of changes in the American economy. As they aim their blame wherever it might fit, affirmative action is a favored target.

For more than a year, Bush’s strategy was to offer his own Griggs bill--all the while lashing out at the Democrats for being pro-quotas. This worked until fellow Republicans began to bolt. The battle seemed unseemly. They wanted to compromise.

“Civil rights is whispered to be a politically-defining issue, a so-called wedge issue that can be used to drive middle-class white voters into the arms of the Republican Party,” Sen. William S. Cohen (R-Me.) said in a speech on the Senate floor on Oct. 23.

“But I believe the short-term political success is going to prove to be a long-term public policy disaster . . . . Success, for a party and for our country, ought to mean something more than he who dies holding the most votes.”

Two days later, the President agreed on a bill strikingly similar to the ones he had opposed.

So now, a generation after the landmark 1964 law, the apparatus of affirmative action remains in place, even as the undertaking has lost its moral clarity. And perhaps that was inevitable.

Two contrary notions of equality have confronted each other in the combustible laboratory of the American workplace. One idea offered racial preferences as compensation for past injustices. The other insisted that the way to overcome race was to simply disregard it.

The law still adheres to the first approach. But for how much longer will that be necessary? Ed Dilworth, the General Motors executive, said the company now employs many minorities who grew up in privilege and are now raising families the same way.

“Should their children be favored over, let’s say, the children of white people who are less privileged?” he asked. “Those are the questions we have to start to ask ourselves.”

Vantage points are woefully different across the racial chasm. Many whites feel they have already overpaid on the debt to civil rights. Many blacks believe the obligation is only going further into arrears.

A Los Angeles Times poll in September showed that nearly two-thirds of whites say affirmative action is adequate now or has gone too far; 60% of blacks respond that it has yet to go far enough.

By a margin of 65% to 30%, blacks say that discrimination is the main cause of their having “worse jobs, income and housing”; whites disagree by a 60% to 33% margin.

These differences are remarkable. And troubling.

And ironic.

Affirmative action now has a momentum of its own. Demographic changes propel it. By the year 2000, according to Labor Department estimates, 61% of the work force will be women and minorities; the number was only 49% in 1976. Companies have increasingly catered to the needs of the incoming talent.

But the bounty has been very often lost to blacks. During the 1980s, the racial wage gap zigged and zagged, but certainly did not narrow from the previous decade. Changes in the American economy badly hurt blacks.

For a generation, the unionized heavy industries of the Midwest--steel, automobiles, foundries--had attracted tens of thousands of black workers. Then massive layoffs sent them off in retreat.

Even black college graduates--the foremost beneficiaries of affirmative action--suffered. The wage gap between them and white grads opened again in 1979 and continued to widen, due in some part to wage freezes in state and local governments--a disproportionate employer of black professionals.

Further down the economic scale, the stagnant minimum wage sapped the incomes of laborers, also a disproportionately black group. Many blacks have left the work force--or never entered it at all.

In 1954, in the grip of blatant racism and caste dominance, the percentage of black men who were working was 85%, the same as that for whites. By 1990, only 70% of black men were in the labor force.

Affirmative action embraces those who have qualifications--and has no blueprint for those who do not. As one segment of black America--the middle-class--prospers, another is beset by the social convulsions of drugs, joblessness and welfare dependency.

These are an entirely different set of problems, an unfinished business on a racial agenda that is often preoccupied with the effects of quotas and preferential treatment and who is getting what.

A quarter-century ago, the nation awakened from the long shame of its moral slumber. Then, like a sinner in the throes of confession, it made promises that were hard to keep.

Justice for blacks has at times led to unfairness for whites. The nation reaped as it sowed.

It is a great wheel turning. And the balance is forever unsteady.

The Gap in Earnings

The combination of a growing economy and civil rights efforts narrowed the gap in wages between black and white males throught the 1960s and into the mid-70s, then a combination of economic factors and the de-emphasis of affirmative action widened the gap through the mid-1980s.

1967 1990 White Males $28,942 $24,881 Black males $18,693 $21,114

NOTE: Starting in 1989 earnings include workers in the military.

Source: U.S. Bureau of the Census