In the black community, progress in lowering the high dropout rates in schools and raising the proportion of intact families would produce more upward mobility than all of the government's affirmative action programs combined. Children from single-parent families are nearly twice as likely to be expelled from school and 40 percent more likely to repeat a grade. The collapse of families and education in the African-American community is a larger obstacle than discrimination in the battle against poverty. For black Americans who stick with school and marriage, the story is not one of hopelessness and bigotry. The most effective policy the government can pursue to promote economic equity and upward mobility is to provide incentives for growth in the private sector.
Discrimination shrinks in a full-employment economy.
Affirmative action programs were in place during both the Carter and Reagan terms, but it was the difference in economic policies and growth during those two administrations that had the greatest impact on the economic success of disadvantaged groups. The real median income of black families increased 17 percent during the Reagan administration, after falling 10 percent in the Carter years. By the end of Reagan's two terms, female entrepreneurs employed more people than all of the Fortune 500 companies combined. For the vast majority of those firms, federal set-asides and contract preferences had nothing to do with their business. From 1981 to 1987, the number of black-owned businesses increased from 300,000 to 425,000.