As labor markets and product markets become ever more competitive, govern¬ ment programs involving affirmative action and set-asides have increasingly been attacked. U.S. Representative Jan Meyers has led the charge to eliminate the set-aside programs for minority businesses, which are administered by the Small Business Administration (SBA).

“The program has never worked as it was expected to work," said Rep. Meyers, who heads the House Committee on Small Business. Rep. Meyers, a Kansas Republican, said she is especially troubled by the program's practice ofawarding contracts without bidding. The SBA confirms that more than 90% of the contracts are awarded without competition.

Thus, for example, minority-owned businesses can obtain federal contracts for construction work without bidding against other businesses,

a. In evaluating the policy of set-asides for minority businesses, address the likely impact of the programs on 1. the cost of contracts to the federal government. 2. the quality of work performed by government contractors. 3. the ability of the minority-owned businesses to successfully compete.

b. Describe the circumstances under which you would find the use of set-asides to be ethically acceptable and ethically unacceptable.

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