'High fliers' probe finds widespread abuse of government preferences

Governments at all levels award contracts for billions of tax dollars every year using Affirmative Action preferences for businesses and individuals based on their ethnicity, gender, income status, or other characteristics having nothing do with the skills or services being provided.

Affirmative Action opponents have long claimed that, besides being unconstitutional forms of discrimination, such preferences are also open invitations to every sort of official corruption, influence-peddling and conflicts of interest because they replace competition and merit with access to political insiders.

But critical reporting to determine who is right – defenders of government-sanctioned discrimination or the critics – is all but unheard of, if not totally verboten, in the politically correct mainstream media. So such investigations are increasingly being conducted independently, not infrequently by think tanks like the Goldwater Institute in Arizona.

Mark Flatten is a veteran investigative reporter who was hired by Goldwater to do what he does best, which is expose corruption wherever it is found. Flatten in recent months has focused on how Affirmative Action preferences have been abused in the awarding of food concessions at the Phoenix Sky Harbor International Airport terminal 4.

What Flatten found makes a mockery of claims by Affirmative Action proponents that such preferences are essential to creating levels playing fields on which minorities and other disadvantaged groups can compete equally with established business and political interests.

Flatten's investigation was published today on the Goldwater Institute's web site, and it is entitled “High Fliers: How political insiders gained an inside edge in Sky Harbor concessions.”

While it is focused on one airport, Flatten's investigation is important because it puts a much-needed spotlight on an issue that mainstream journalists either ignore or don't even know exists. For example, Flatten found that a member of the Maricopa County Board of Supervisors used her ownership of small Mexican restaurant that made barely $10,000 in annual profits to a co-franchiser of a Chili's at the airport. She reported making more than $113,000 in profit on the deal a mere seven months later.

But guess what? Flatten describes the back story of Supervisor Mary Rose Wilcox and her role at the Chili's:

“Wilcox did not have to bring any money into the deal. Host International Inc., which holds the master concession contract with the City of Phoenix for all food and beverage sales in Terminal 4, fronted her company a loan for her initial capital contribution of $450,000. The loan was to be repaid through profits from the restaurant, and was made in violation of city policy.

“In violation of federal rules, Wilcox did not have a role in the day-to-day operations of the franchise. That was the exclusive job of Host, according to the joint venture agreement she signed with the international mega-concession company. Wilcox was not even required to spend any more time on the restaurant business than she deemed appropriate.”

What Wilcox did have to do was simply maintain her status as owner of an Airport Concession Disadvantaged Business Enterprise (ACDBE) preference, which is a product of federal laws and regulations designed to help businesses owned by women and minorities.

To prevent established corporations and businesses from using of people with ACDBE preferences as fronts in order to secure the tax dollars, federal regulations require the preference owner be actively involved in the daily management of the firm providing the contracted products or services.

But what Flatten found, at least in the Sky Harbor probe, is that “firms certified as 'disadvantaged' are often little more than a name on the lease, brought in as partners by large concession companies to meet city imposed goals for participation by businesses owned by women and minorities.”

Anybody want to put odds on the proposition the situation Flatten found in Phoenix exists all over the country? How about odds that a mainstream media outlet takes on the challenge of finding out?

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