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Authors: Thomas Sowell

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Much that has been said on many sides of racial and ethnic issues requires far more inquiry and far closer scrutiny than that behind currently prevailing views. This book attempts to provide some of that further inquiry and closer scrutiny.

E. Franklin Frazier urged that the history of black Americans be studied in a larger, international context.
2
In the chapters that follow, American racial and ethnic issues in general will be put in an international context. This neither assumes nor denies the uniqueness of American racial and ethnic issues, but lets that be an empirical question.

There is no subject that is more in need of dispassionate analysis, careful factual research and a fearless and honest discussion than is race. Ideally, we might look to intellectuals for such things. But it is also true that the mental
skills and verbal dexterity of intellectuals can be used to evade evidence and promote whatever beliefs or agendas are in vogue among their peers. The intelligentsia in the media can decide what to emphasize, what to downplay and what to ignore entirely when it comes to race. These may be individual choices, rather than a conspiracy, but individual choices growing out of a common vision of the world can produce results all too similar to what is produced by centralized censorship or propaganda.

As a concrete example, statistics comparing American blacks and whites in many respects— jobs, incomes, and mortgage approval rates, for example— are often drawn from data that include similar information about Asian Americans. Yet seldom are the Asian American data included in news stories, or even in academic studies, which conclude that racial discrimination explains much or most of the disparities between blacks and whites. In many, if not most, cases, reporting the data for Asian Americans would undermine, if not devastate, the conclusions reached from black-white comparisons.

In the job market, for example, it has often been said over the years that blacks are “the last hired and the first fired,” since black employees are often terminated during an economic downturn sooner or to a greater extent than white employees. Data thus seem to substantiate this social vision of the world common among the intelligentsia and others. But if data on Asian Americans were included— which seldom happens— it would turn out that white employees are usually let go before Asian American employees.
3
Can this be attributed to racial discrimination against whites by employers who are usually white themselves? More fundamentally, can we accept statistical data as showing discrimination in cases where that reinforces existing preconceptions, and then reject the same kind of data when it goes counter to those preconceptions?

It is much the same story when examining what happens to people who apply for mortgage loans. There has been much indignant outcry in the media when statistics have shown that black applicants for mortgage loans were turned down more often than white applicants. Newspapers across the country, as well as television commentators, have treated such statistics as proof of racial discrimination by white banks against black applicants for
mortgage loans. Yet statistical data on Asian Americans have been conspicuous by their absence from these comparisons as well. If such data are included, it turns out that, in 2000, black applicants were turned down for prime mortgage loans twice as often as white applicants— and white applicants were turned down nearly twice as often as Asian American applicants.
4

The question arises again whether we are going to accept statistical data as evidence of racial discrimination when it fits the preconceptions of the intelligentsia and reject it when it goes counter to those preconceptions. In the case of mortgage loans, there is other evidence against the conclusions reached almost universally in the media and in academia. Average credit scores are higher among whites than among blacks— and higher among Asian Americans than among whites.
5
Taking into account the data for Asian Americans threatens to reduce a moral melodrama to a mundane matter of elementary economics in which lenders are more likely to lend to people who are more likely to pay them back.

Since many, if not most, of those financial officials who actually make the decision to lend, or not to lend, do so on the basis of paperwork passed on to them from others who do the face to face interviews with applicants, it is doubtful whether these decision-making officials even know the race of the applicants. But differences in credit scores and other qualifications virtually guarantee racial disparities in outcomes anyway. Again, it seems hardly likely that white-owned banks are discriminating against whites and in favor of Asian Americans. Moreover, black-owned banks turn down black mortgage loan applicants at an even higher rate than do white-owned banks,
6
and it seems equally unlikely that this is due to racial discrimination.

It is much the same story in the public schools, where black students are disciplined for misbehavior more often than white students— who in turn are disciplined more often than Asian American students.
7
Again, the question must be faced whether disparities in outcomes represent disparities in behavior or disparities in the way that others treat various races. Certainly the disparities themselves cannot be denied, however much different observers may attribute these disparities to very different causes. This extends far beyond questions of blacks and whites in the United States
because, as we shall see, disparities of similar or greater magnitude are common in other countries around the world.

Uncritical use of statistics risks many pitfalls. The very definitions used with statistical data create traps for the unwary. For example, when the Ravenswood School District in California turned out to have the country’s highest rate of disciplining of students who are “Asian and Pacific Islanders,”
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that was taken by some as showing racial discrimination. However, the omnibus category “Asian and Pacific Islanders” includes many very different groups. People whose ancestors originated in China, India or Japan are very different in many ways from people who originated in Guam or Samoa. In most places in the United States, most of the “Asian and Pacific Islanders” are people from the mainland of Asia. But, in the Ravenswood School District, most of the students who are “Asian and Pacific Islanders” are the offspring of Pacific Islanders.
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Comparisons of outcomes in this school district with outcomes in other school districts across the country are comparisons of apples and oranges.

This small example is a microcosm of problems involved in attempting to understand racial and ethnic issues, whether these issues are expressed in numbers or in words, and whether they are expressed by the intelligentsia, the media or academia.

__________

*
A white Congressman once said of black Congressman Augustus Hawkins, “Gus Hawkins is whiter than I am.”

Chapter 2

Disparities and Their Causes

A
ny serious study of racial and ethnic groups, whether in a given society or in a wide variety of societies in countries around the world, repeatedly encounters the inescapable fact of large and numerous disparities among these groups, whether in income, education, crime rates, IQs or many other things. These differences cannot be dismissed as mere “perceptions” or “stereotypes,” nor can they be automatically attributed to some one given cause, such as genetics, as was often the primary cause cited in the early twentieth century, or to maltreatment by others, as was equally often cited in the late twentieth century.

The sources of these disparities are numerous and complex, and they must be confronted in their complexity, if we are seeking the truth, rather than trying to promote a vision or an agenda.

THE REALITY OF DISPARITIES

Sometimes minorities are on the short end of disparities (as in the United States, Britain and France), and sometimes it is a majority that lags behind (as in Malaysia, Indonesia or the Ottoman Empire). Sometimes the disparities are blamed on discrimination, sometimes on genes, but in any event the disparities are treated as oddities that need explaining,
no matter how common such supposed oddities are in countries around the world
or in how many centuries they have been common. Because intellectuals’ assumptions about these disparities are so deeply ingrained, so widely disseminated, and
have such powerful ramifications on so many issues, it is worth taking a closer and longer look at the facts of the real world, now and in the past.

Where minorities have outperformed politically dominant majorities, it is especially difficult to make the case that discrimination is the cause.
*
A study of the Ottoman Empire, for example, found that “of the 40 private bankers listed in Istanbul in 1912 not one bore a Muslim name.” Nor was even one of the 34 stockbrokers in Istanbul a Turk. Of the capital assets of 284 industrial firms employing five or more workers, 50 percent were owned by Greeks and another 20 percent by Armenians.
1
In the seventeenth century Ottoman Empire, the palace medical staff consisted of 41 Jews and 21 Muslims.
2

The racial or ethnic minorities who have owned or directed more than half of whole industries in particular nations have included the Chinese in Malaysia,
3
the Lebanese in West Africa,
4
Greeks in the Ottoman Empire,
5
Britons in Argentina,
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Belgians in Russia,
7
Jews in Poland,
8
and Spaniards in Chile
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— among many others. As of 1921, members of the Tamil minority in Ceylon outnumbered members of the Sinhalese majority in that country’s medical profession.
10
In America, there were eight times during the twentieth century when a baseball player stole 100 or more bases in a season; all eight times that player was black.
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Groups have differed greatly in innumerable endeavors in countries around the world. In 1908, Germans were the sole producers of the following products in Brazil’s state of São Paulo: metal furniture, trunks, stoves, paper, hats, neckties, leather, soap, glass, matches, beer, confections, and carriages.
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People of Japanese ancestry who settled in that same state produced more than two-thirds of the potatoes and more than 90 percent of the tomatoes.
13
Exporters from the Lebanese minority in the African nation of Sierra Leone accounted for 85 percent of the exports of ginger in 1954 and 93 percent in 1955.
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In 1949, Lebanese truckers in Sierra Leone outnumbered African truckers and European truckers combined.
15

In 1921, more than three-fifths of all the commerce in Poland was conducted by Jews, who were only 11 percent of the population.
16
In 1948, members of the Indian minority owned roughly nine-tenths of all the cotton gins in Uganda.
17
In colonial Ceylon, the textile, retailing, wholesaling, and import businesses were all largely in the hands of people of Indian ancestry, rather than in the hands of the Sinhalese majority.
18

As early as 1887, more than twice as many Italians as Argentines had bank accounts in the
Banco de la Provincia de Buenos Aires
,
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even though most nineteenth-century Italian immigrants arrived in Argentina destitute and began working in the lowest, hardest, and most “menial” jobs. In the United States, knowledge of the frugality of Italian immigrants, and their reliability in repaying debts, even when they had low incomes, caused a bank to be set up to attract this clientele in San Francisco, under the name “Bank of Italy.” It became so successful that it spread out to the larger society, and eventually became the largest bank in the world under its new name, “Bank of America.”
20
The frugality of Italians was not simply a “perception” or a “stereotype,” as A.P. Giannini well knew when he set up this bank. As far away as Australia, Italians “earned a reputation for scrupulous honesty in the repayment of their debts, and were frequently able to secure more extensive loans than Australians.”
21

At one period of history or another, when it was not one specific racial or ethnic minority dominating an industry or occupation, it has often been foreigners in general, leaving the majority population of a country outnumbered, or even non-existent, in whole sectors of their own economy. Even after the middle of the twentieth century, most of the industrial enterprises in Chile were controlled by either immigrants or the children of immigrants.
22
At various times and places, foreign minorities have predominated in particular industries or occupations over the majority populations of Peru,
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Switzerland,
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Malaysia,
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Argentina,
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Russia,
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much of the Balkans,
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the Middle East,
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and Southeast Asia.
30
Indeed, it has been a worldwide phenomenon, found even in some economically advanced countries, as well as being common in less advanced countries.

In the nineteenth century, Scottish highlanders were not as prosperous as Scottish lowlanders, whether in Scotland itself or as immigrants living in Australia or the United States.
31
In the twentieth century, Gaelic-speaking children in the Hebrides Islands off Scotland did not score as high on IQ
tests as the English-speaking children there.
32
Rates of alcoholism among Irish-Americans have at one time been some multiple of the rates of alcoholism among Italian Americans or Jewish Americans.
33
In the days of the Soviet Union, the consumption of cognac in Estonia was more than seven times what it was in Uzbekistan.
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In Malaysia during the 1960s, students from the Chinese minority earned more than 400 degrees in engineering, while students from the Malay majority earned just four engineering degrees during that same decade.
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