Commentary

Federal Judges Block Racial Exclusions in Biden’s $1.9 Trillion Stimulus Package

By Hans Bader | June 15, 2021 | 4:20pm EDT
President Joe Biden signs executive orders. (Photo credit: JIM WATSON/AFP via Getty Images)
President Joe Biden signs executive orders. (Photo credit: JIM WATSON/AFP via Getty Images)

Federal judges have temporarily blocked racial handouts in President Biden's $1.9 trillion stimulus package. It offered debt relief to non-white farmers, and aid to non-white restaurant owners. But whites were excluded. Judges found that was likely unconstitutional.

The New York Post reported on a judge's ruling in a lawsuit brought by white farmers:

A federal judge has put the brakes on a nearly $4 billion Biden administration effort intended to provide debt relief to farmers of color, noting that the program doesn’t even consider the financial status of applicants — just their race.

The relief program, launched in March under Biden’s American Rescue Plan Act, paid up to 120 percent of the loans for farmers or ranchers who are black, Hispanic, Latino, American Indian or Alaskan native and Asian American or Pacific Islander.

The $3.8 billion initiative drew an April lawsuit in Wisconsin Federal Court by 12 white farmers and ranchers from nine states — who said they were excluded from the program due to their race.

Judge William Griesbach issued a temporary restraining order Thursday halting the program while the case is decided.

Griesbach pointed out that the United States Department of Agriculture provided the debt relief “without actually considering the financial circumstances of the applicant,” and that there is no evidence of “intentional discrimination” by the agency in recent agriculture subsidies or pandemic relief efforts.

The “only consideration in determining whether a farmer or rancher’s loans should be completely forgiven is the person’s race or national origin,” Griesbach wrote. “Plaintiffs are completely excluded from participation in the program based on their race.”

Past Democratic administrations have paid billions to black farmers, claiming that the Agriculture Department discriminated against them well into the 1990's. But even if that's true, Biden's stimulus package doesn’t just give debt relief to black farmers; it also gives preference to Hispanic, American Indian, and Asian American farmers, despite the lack of evidence that groups like Asian Americans have been discriminated against by the Agriculture Department in recent years.

Judges have ruled that discrimination against black people can sometimes be remedied through affirmative action in their favor. But it can’t be remedied with affirmative action for all non-whites, including those who aren't black. For example, discrimination against blacks didn’t justify an affirmative-action program that benefited not just blacks, but also Pacific Islanders. So that whole affirmative-action program was struck down by a court in L. Feriozzi Concrete Co. v. CRDA (2001).

Moreover, discrimination against blacks in the 1990s is not recent enough to justify affirmative action in their favor today. For example, an affirmative-action plan for women was declared unconstitutional because the government hadn't discriminated against them in the past 14 years. (See Brunet v. Columbus (1993)).

Biden's stimulus package also excluded whites from certain aid to restaurants. On May 27, a federal appeals court issued an injunction against prioritizing relief to restaurants based on their owners’ race and sex, finding that was unconstitutionally discriminatory. Its 2-to-1 ruling involved the stimulus package's Restaurant Revitalization Fund. That's a $29 billion program that gives priority to restaurants owned by certain minorities and women, while bumping white males to the back of the line, for funds that will soon run out.

That racial preference is unconstitutional. Racial preferences aren't permitted under the Constitution, except for narrow circumstances that don’t apply to the restaurant sector. The restaurant industry is not a white old-boy network, much less one where the federal government played favorites at the expense of women and minorities. Hispanic restaurant owners received preference, even though Hispanics aren’t  underrepresented much in the restaurant industry — 18.2% of restaurant owners were Hispanic in 2020, which is very close to the Hispanic percentage (19%) of the U.S. population

According to courts, only evidence of widespread, intentional discrimination against a minority group by the government can justify giving it a racial preference. (See Middleton v. Flint (1996); Michigan Road Builders v. Milliken (1987)).

But as the court noted, the government pointed to “little evidence of past intentional discrimination against the many groups to whom it grants preferences." The stimulus package was crude in its racial favoritism, providing "preferences for Pakistanis but not Afghans; Japanese but not Iraqis; Hispanics but not Middle Easterners.”

The result was quite arbitrary, said the court: “Imagine two childhood friends—one Indian, one Afghan. Both own restaurants, and both have suffered devastating losses during the pandemic. If both apply to the Restaurant Revitalization Fund, the Indian applicant will presumptively receive priority consideration over his Afghan friend. Why? Because of his ethnic heritage. It is indeed ‘a sordid business’ to divide ‘us up by race.'”

Hans Bader practices law in Washington, D.C. After studying economics and history at the University of Virginia and law at Harvard, he practiced civil-rights, international-trade, and constitutional law. He also once worked in the Education Department.

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