This thesis recounts the history of the Portland Learning Community, an experimental institution of higher education founded in 1970 by a group consisting mostly of former faculty and students at Reed College. The Learning Community was funded by the Carnegie Corporation and affiliated with Antioch College.

This study investigated the effects of selfesteem, controllability, and optimism, the constructs inherent in positive illusions, on perceived racism. The perceived racism scale in this study was found to contain two dimensions, Equal Opportunity (EO) racism and Authority (AUT) racism. Thirty-seven AfricanAmerican, 64 Asian-American and 100 White-American students at Portland States University {101 females, 100 males and mean age of 25 years) served as subjects. The findings revealed that both African- and AsianAmerican students perceived a racist atmosphere from peer students {EO racism) significantly higher than did the White-American students. However, only AfricanAmerican students perceived greater racism from faculty members (AUT racism) than the White-American students. None of the illusions had an effect on perceived EO racism. However, all types of illusions (self-esteem, controllability and optimism) had a significant effect on perceived racism from faculty members {AUT racism). Higher perception of AUT racism was correlated with less self-esteem(~= -.089, R = .12), less controllability(~= -.319, R < .001), and less optimism (~ = -.144, R = .03). The results of this study support empirical evidence showing that the illusions, especially controllability, change individuals in how they perceive racism when the racism is practiced by authorities.