The US Treasury is No Place For DEI
In recent years, the U.S. Treasury has been committed to DEI practices as part of a broad initiative in the Biden administration to promote fairness across the nation. However, the role of the US Treasury is to promote an economy based on sound fiscal practices and policies, not one that favors some groups over others. And yet, that is what is happening.
In the past few years, Secretary Yellen has focused much of her strategy on preferential treatment. In 2021, the Treasury released an Equity Action Plan and within a year, she had achieved the following:
Appointed a Counselor for Racial Equity, whose role is“to coordinate all offices and work streams intended to advance equity and advise the Department on all racial equity policy issues and programs.”
Spent $8.7 billion to “in order to increase lending to small and minority-owned businesses, and low- and moderate-income consumers in underserved communities” through the Community Development Financial Institutions (CDFIs) and Minority Depository Institutions as part of the Emergency Capital Investment Program.
But that’s not all, Yellen established a Treasury Equity Hub in 2022 to ensure that “equality, fairness and diversity are realized for all Department of the Treasury employees and applicants for employment, and with external stakeholders.”
Furthermore, the Treasury department stated in its 2023 Equity Plan review that its goal is to “advance equity through agency mission” noting that the “Treasury must address the legacy of structural racism, gender-based discrimination, economic disadvantages facing rural communities, and economic exclusion that continue to keep some people, businesses, and communities from fully participating in and benefiting from our nation’s economic growth and prosperity.”
These initiatives are now informing policy. Treasury researchers developed a method for imputing race and ethnicity data in tax data, which has enabled multiple ongoing and completed studies, including one on audit disparities between Black and non-Black taxpayers and one on the distribution of tax expenditures by race and ethnicity.”
These policies have real world impact, and not for the better. The Equity Plan notes that “racial disparities in audit rates mean that Black taxpayers are audited at three to five times the rate of non-Black taxpayers”, and that this “disparate impact is believed to be driven by correspondence audits among taxpayers who claim the Earned Income Tax Credit (EITC).”
But everyone knows that the IRS itself says they do not know the race of the taxpayer when selecting returns for audit and there is no place on a tax form to denote race when submitting a return to the IRS. Therefore there can be no bias in the algorithm, which is a sophisticated analysis designed to show where taxpayer error occurs. Congress made the EITC calculations very complicated but also too easy to cheat. It is simply the case that low-income taxpayers claiming the EITC statistically have a large error rate, running upwards of 50% per year, which leaves the IRS no alternative but to inquire further via the audit process. It has nothing to do with race, and yet the Treasury Department is looking for a problem to solve where there is none.
Equity policies are preferential treatment, plan and simple. The fact that DEI has taken over even the Treasury Department is alarming. The US Treasury has no business picking winners and losers in its handling of the US economy under the guise of fairness. It is supposed to create economic and job opportunities for all without regard to any specific category.