THE U.S. SUPREME COURT'S DISMISSAL OF THE DEFUNIS CASE ON MOOTNESS GROUNDS LEFT PROPONENTS AND OPPONENTS OF PREFERENTIAL POLICIES WITHOUT A DEFINITIVE ANSWER ON THIS CONTROVERSIAL ISSUE. THE PURPOSE OF PREFERENTIAL HIRING AND ADMISSION POLICIES IS TO GIVE MEMBERS OF THE MINORITY GROUPS CONCERNED AN ADVANTAGE IN COMPETITION FOR JOBS OR PLACES IN EDUCATIONAL INSTITUTIONS. ALTHOUGH THE MOST COMMON USE OF PREFERENTIAL POLICIES IN THE U.S. HAS BEEN TO PROVIDE SPECIAL EDUCATION AND EMPLOYMENT OPPORTUNITIES FOR VETERANS, THE RECENT CONTROVERSY CONCERNS THE EXTENSION OF SUCH POLICIES TO BLACKS AND OTHER DISADVANTAGED GROUPS. THE ADVANTAGE CONFERRED ON THE PREFERRED GROUP MAY BE VERY SMALL WHEN THE POLICY IS USED ONLY IN FAVOR OF MEMBERS OF THE GROUP WHO ARE AS WELL QUALIFIED AS OTHER CANDIDATES, OR VERY LARGE, WHEN THE POLICY IS USED FOR BLANKET EXCLUSION OF NONMEMBERS OF THE PREFERRED GROUP. THE ISSUE OF QUOTAS, USUALLY ASSOCIATED WITH THIS POLICY, IS DISCUSSED. ALSO DISCUSSED ARE ISSUES OF COMPENSATORY JUSTICE, DISTRIBUTIVE JUSTICE, UTILITY, PROBLEMS OF INCOMPETENCY, PROBLEMS OF UNFAIR BURDEN, PROBLEMS OF STIGMATIZATION, AND LOSS OF SELF-RESPECT. IT IS MAINTAINED THAT PREFERENTIAL POLICIES NEED NOT BE USED IN COMBINATION WITH RACIAL, SEXUAL, OR OTHER CLASSIFICATIONS BASED ON INHERENT CHARACTERISTICS. APPLICATION OF PREFERENTIAL POLICIES TO ALL PERSONS WHO ARE ON WELFARE, OR WHO HAVE INCOME BELOW A CERTAIN LEVEL IS SUGGESTED; JUSTIFICATIONS FOR THE USE OF PREFERENTIAL POLICIES ARE DISCUSSED. THE AUTHOR ADVOCATES PREFERENTIAL POLICIES. REFERENCES ARE FOOTNOTED. (TAO)