The answer is the 1st one. Hope it helps :)
They were “of low physical and mental standards.” They were “filthy.” They were “often dangerous in their habits.” They were “un-American.”
“The view was they could not fit into the American orientation toward progress and doing better, and would be forever manual laborers stuck at the very bottom,” Diner said of attitudes toward Southern Italians. She said Jews, by contrast, were viewed as “a little too successful, a little too pushy, getting on that American track too fast. They were viewed as competitors.”
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If your friend is a business owner in a planned economy, then it would be the "central government" that decides how to allocate the productive resources he uses, since the government "plans" the economy as opposed to having supply and demand take place in the marketplace.