That’s the title of an editorial today in the Wall Street Journal (behind the firewall here). Here’s the story: Earlier this year, the Supreme Court was poised to hear oral arguments in the fully briefed Magner v. Gallagher, a case presenting the issue of whether a “disparate impact” cause of action may be brought under the Fair Housing Act. Now, the theory in disparate-impact causes of action is that someone can be held liable for racial discrimination if he uses a selection device that leads to a racial imbalance, even if the device is neutral on its face, in its intent, and as applied. In the housing context, for example, rejecting mortgage applicants because of their credit history can be challenged if this results in a higher percentage of blacks than Asians being turned down, and it then becomes up to the lender to prove to a jury some degree of “business necessity” for his practice. The Obama administration is a great fan of this approach to civil-rights enforcement, and it was quite upset that the Supreme Court might rule it illegal. So it successfully leaned on the City of St. Paul, a petitioner in the suit, to withdraw its case from the Supreme Court.
When the Justice Department’s coercion came to light, two House committees decided to investigate, and what they found is the subject of today’s Journal editorial. It turns out that part of the deal with the City of St. Paul was that the Justice Department agreed not to intervene in a separate, False Claims Act lawsuit alleging that the City had made false certifications to the federal government. That deal was made at the insistence of Civil Rights Division head Thomas Perez and over the objections of the department’s career attorneys in the Civil Division. Oh, and here’s another nugget, not mentioned by the Journal: The false certification was that the city was using federal funds to create jobs for low-income workers of all races, when in fact it was only focused on employing minorities. To Perez, then, it was a win-win deal: He would ensure that the Obama administration could continue to bring disparate-impact lawsuits (which result in politically correct racial discrimination) in exchange for giving the city a pass on its policy of . . . politically correct racial discrimination. Of course, staying out of the False Claims Act suit may have cost U.S. taxpayers over $180 million, according to the House committees, but who says that social justice is cheap?