The Journal. - The Supreme Court Rules Against Affirmative Action

Episode Date: June 29, 2023

The Supreme Court has ruled that affirmative action is unconstitutional in college admissions. We talk with WSJ's Douglas Belkin about how the decision upends decades of admissions policies at the nation's most selective schools. And WSJ's Lauren Weber describes how this ruling could impact corporate America. Further Reading: - Supreme Court Rules Against Affirmative Action  - The Man Behind the Case Seeking to End Affirmative Action  - Companies Brace for Supreme Court Ruling on Affirmative Action  Learn more about your ad choices. Visit megaphone.fm/adchoices

Today, we got a landmark ruling from the Supreme Court. The decision upends affirmative action policies at colleges. And that's a major shift in how especially selective colleges and universities have operated for the past 45 years. That's our colleague Doug Belkin, who covers higher education. In its ruling, the court said that considering race in the admissions process was unconstitutional. This is a watershed moment for higher education. So around the country this morning, college presidents are on the phone with their attorneys and their admissions directors to figure out what they can do.

There's a tremendous amount of focus on what's happening right now. Race has played a huge part in the admissions process. And as the country has become more polarized, this issue has really risen up to become one of the most significant, I think, culture war issues in the country. to become one of the most significant, I think, culture war issues in the country. And while today's ruling is about college admissions, its effects could ripple out across corporate America with implications for companies that are trying to diversify their workplaces. Welcome to The Journal, our show about money, business, and power. I'm Jessica Mendoza. It's Thursday, June 29th. Coming up on the show,

the Supreme Court rules against affirmative action. Need a great reason to get up in the morning? Well, what about two? Right now, get a small, organic Fairtrade coffee and a tasty bacon and egg or breakfast sandwich for only $5 at A&W's in Ontario. There were two cases that went before the Supreme Court to challenge affirmative action in college admissions. One case involved Harvard University and the other, the University of North Carolina. Both cases were brought by an organization called Students for Fair Admissions, which was created by a man named Edward Bloom.

And what he was trying to do was to challenge their use of race in the admissions process. His contention is that under the Constitution, this process needs to be race blind, that there's a protection for everybody and that you shouldn't be judged by race. And so he's brought eight cases before the Supreme Court. These are seven and eight. And he seeked to overturn the use of race in really everything from political gerrymandering to college admissions. So this organization was created by him to help solicit plaintiffs who were injured by this policy and then to sue on their behalf. The universities challenged that and said that in order to create a diverse class that would reflect the country that kids are going to graduate into, it was important for them to be able to consider as many things as possible, including race.

for them to be able to consider as many things as possible, including race. But today, a majority of the Supreme Court justices found that colleges shouldn't be taking race into account when deciding who gets a place. They said doing so violates the Constitution. So Chief Justice John Roberts wrote the decision, and he was joined by Clarence Thomas, Alito, Gorsuch, Brett Kavanaugh, and Amy Coney Barrett. The court's three liberals dissented, Sonia Sotomayor, Elena Kagan, and Katonji Brown-Jackson. Justice Sonia Sotomayor, writing for the dissent, said society, quote, is not and has never been colorblind. And she said, quote, the court ignores the dangerous consequences of an America

where its leadership does not reflect the diversity of the people. So, the reason affirmative action was put in place initially was that, especially African Americans in this country, they don't have the same opportunities, especially educational opportunities, as many white students. And so the argument was that they need a leg up. There's also continuing racism and discrimination in this country. And so that affirmative action continues.

How wide ranging is this decision? Which schools will it affect? The thing about this decision is it's really only going to affect, I mean, probably 100 schools. Most schools don't have very selective admissions or use race. Most schools are hungry to get students in the door. There's a demographic cliff. There's fewer students applying to schools right now, but there's this real push to get into the very best schools. These are the ones that are more likely to consider race, and certainly these are the Ivies and some of the public flagships in states where it's allowed. They will be affected by this. And so while the

ruling doesn't affect most schools, Doug says the ones it does affect have outsized influence in our society. Universities, especially these selective universities, are kind of the sorting hats for American culture. Eight U.S. presidents went to Harvard University. That's not an accident. Colleges decide who the best and the brightest are. They are the gatekeepers to the American meritocracy. So if you have Harvard or Yale stamped on your resume, that will open doors for the rest of your life. And it means something that will inform the power structure of the country. So there's a tremendous amount of focus on the admissions process at universities. How do you expect or how do you think college applicants will experience

the effects of this decision? What I would expect would happen would be that there won't be a box. Checking the box of your identity has been an intense source of consternation for high school students who feel like they're going to be discriminated against or not discriminated against. So a lot of kids, there are reports about a lot of kids who lie, white kids who say that they're Latino or black or stuff. I think that box will be affected in some way.

It may disappear altogether. Doug says that colleges now have to figure out what they can do to replace that box on their application forms. There are nine states that have already banned race-conscious admissions. And what's happened in those states might give us some clues as to what could come next. In places where states have decreed affirmative action can no longer be used, like California, like Michigan, schools have become whiter. They've become less diverse. And so the concern is that that's what's going to happen at

the Ivy League schools and these selective schools. And since they are the gateway to the sort of corner offices and the power structure of this country, they carry a lot of weight. Okay, so in those nine states, what have schools done to attract a racially diverse class of students? a racially diverse class of students. So the schools where affirmative action have been banned have really dug into this to try to bring in a diverse class. And the things that they've done are to recruit from schools that are majority minority. There's been a lot of money spent, a lot of effort spent to build bridges into these schools. The issue with these tactics is that they're expensive. Affirmative action empowered schools to bring on often middle class or upper middle class minority students who could afford to pay a good amount of their tuition. That may be changing,

and so schools are going to have to dig into a sort of economic affirmative action where they're looking for kids who may not be just middle class but poor. And poor kids have less money. Their families have less money. So in order for the schools to make that happen, they'll have to give them more financial aid. So there's a really big financial component to what just happened. This decision, if schools are going to maintain a diverse campus, is going to cost them tens of millions of dollars. Does evidence show that offering opportunities based on class also improve racial diversity? It is not as effective as using race.

Using class as a proxy for race is not as effective as using race. In a speech today, President Biden said that he strongly disagrees with the court's decision. Is there any sense that this decision could have an impact beyond college campuses? Yeah, there's a significant concern. There's been a lot of outcry from the corporate sector that what they're trying to do to make their workforces more diverse is going to be hindered, both because there may be fewer minorities coming out of colleges and universities, these very selective colleges and universities, and because their own affirmative action policies

may now come under fire. What this ruling could mean for corporate America. That's next. Uber Eats. What do we mean by almost? Well, you can't get a well-groomed lawn delivered, but you can get a chicken parmesan delivered. A cabana? That's a no. But a banana? That's a yes. A nice tan? Sorry, nope. But a box van?

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Terms apply. Corporate America is looking closely at today's watershed decision from the Supreme Court. While the decision doesn't directly affect employers' practices and policies right now, there are concerns that this will change. A number of large companies and employer associations had filed friend-of-the-court briefs to the Supreme Court supporting affirmative action. Here's our colleague Lauren Weber. So they made the argument that they supported race-conscious admissions because they want to

ensure that there's a future workforce available to them that is qualified, that is well-educated, that has access to the best educations out there. Their argument was that there's a ton of research out there that shows that diverse companies, diverse organizations do better financially, they're more innovative, they're more creative, their share prices are higher. And a lot of that has to do with being able to serve many customers, a diverse customer base, etc. customer base, etc. Some companies Lauren spoke to are also concerned that this ruling will kick off a round of legal challenges to their own racial diversity programs. A lot of companies have invested a tremendous amount of time and energy into diversity, equity, and inclusion programs, also known as DEI. And that relates to recruiting, hiring, promotion policies, to creating sense of belonging for everybody in

the workplace. Some even went as far as creating goals for their hiring. They would say, we want our leadership team to be 50% women by the year 2030, or we want representation of people of color to increase by 25% in the next few years. So companies got fairly explicit in some cases. And there's a very good chance that some people will start to challenge those programs using the arguments that the court laid out today. So there are concerns about how this could affect diversity efforts in the general workforce. Is it also a concern at the leadership level? general workforce. Is it also a concern at the leadership level? I think there is for sure.

They want to have a pipeline of potential leaders that is diverse and that is filled with qualified candidates. So if you've attended a selective college, that gets you the really good first job, which then gets you to the really good next job. So it's a... Like a chain. Yes, it's a chain and it builds on itself to have those qualifications to start your career with. What impact do you think this will have on employees of color? I think the question of mobility is a big one for companies. How do we create mobility for employees? And that is particularly an issue for people who come from less privileged backgrounds, who may not have the educational pedigree or the connections, the professional networks from their parents or from communities that help people get ahead. I think many, many people sort of overlook the importance of that, especially people who grew up taking that for

granted. And I think for employees of color, if we see fewer companies creating programs that are about creating that first opportunity or creating additional opportunities, you know, it might be harder for people to get on that first rung of the ladder and then maybe get on future rungs. Affirmative action was a key piece of creating mobility for people. How big a moment do you think this is for companies? Like how significant do you think this ruling will be? I think it will take a while to answer that question, but I think it goes hand in hand with just a general backlash in the workplace right now on diversity, equity, inclusion, accessibility. That speaks to where we are in our political moment and our social moment. So I think this decision, taken along with some of what else is going on in the culture, may chill some programs around diversity and equity and inclusion and opportunity.

We might see companies getting a little more cautious about how they think about diversity in the workplace. That's all for today, Thursday, June 29th. The Journal is a co-production of Gimlet and The Wall Street Journal. See you tomorrow.