CFER Foundation


Published February 02, 2021

CFER Expresses Outrage at the EDD Scandal as Emblematic of Attacks on Merit




For Immediate Release

February 2, 2021

SAN DIEGO, CA -- February 2, 2021- Californians for Equal Rights (CFER) is appalled by the massive EDD fraud under the leadership of California Labor Secretary Julie Su and is disappointed at Su's nomination as Deputy Labor Secretary as an unmeritocratic act of racial identity politics. The scale of the EDD (California's Employment Development Department) scandal, estimated to be upwards of $31 billion dollars, exposes a prime example in which the systematic assault on merit results in gross government failures, betrayal of public trust, abuse of taxpayer money, and erosion of fairness in wealth re-distribution.

At the heart of this Unemployment Insurance (UI) malpractice is the Secretary for the California Labor and Workforce Development Agency Julie Su, a former labor movement activist and the Litigation Director of Asian Americans Advancing Justice-Los Angeles (AAAJ). In March 2020, Su directed EDD to remove a key safeguard against identity theft and required the agency to distribute UI funds before determining eligibility. This strategic error to eliminate standards opened the flood gate for fraudsters and crowded out legitimate claimants who desperately needed unemployment assistance. While her best intention was to distribute funds in a timely manner, removing the eligibility requirement resulted in a huge backlog of legitimate claims, which defeated the purpose of fast-tracking the process. Su's decision to remove standards in making decisions on UI claims then trickled down to the entire EDD, where staff members claimed they simply misunderstood the importance of upholding the eligibility standards in spite of repeated warnings from the federal level.

CFER stresses that the assault on standards is a concerning trend in various areas of public policies. EDD inaction and missteps in diluting eligibility standards cost billions of tax dollars at a whopping 27% rate of fraud. The University of California, among many other selective colleges, has adopted reforms to abandon standardized testing in admissions. The United States Medical Licensing Examination (USMLE) has cancelled Step 2 CS permanently and its Step 1 is now pass/fail. San Francisco's world-class public high school Lowell is now considering a proposal to switch to lottery admissions. These interconnected events reject merit and excellence, which would surely lead to declining qualities of our academia, medical profession and more. The road to underperformance and destruction is paved with good intentions.

"The merit-based principle from which America derives its greatness and uniqueness is undermined, comprising our national competitiveness in education, technology, and governance." said Wenyuan Wu, Executive Director of CFER.

Secretary Su's decision to remove the eligibility standard is a serious abuse of taxpayer funds, if not a crime. Ironically, Su is nominated by President Joe Biden as Deputy Labor Secretary as a result of a multi-months campaign by labor unions to pressure the new administration to pick an Asian-American, female cabinet member. This imprudent decision was made in pure political calculations of racial diversity and would do great disservice to the Federal Department of Labor and the American workers it's supposed to safeguard.

"In the event of the colossal unemployment fraud, Secretary Julie Su has failed her fiduciary responsibilities to California taxpayers, harmed legitimate claimants and eroded public trust. It would be a crime should the similar unprotected fraud have happened in private sector. Her promotion to the post of Deputy Labor Secretary at the federal level is an insult to Americans of Asian descent who believe that merit, not race, should be a primary consideration in public employment," commented Frank Xu, President of CFER.


Wenyuan Wu

(786) 393-8028

About Californians for Equal Rights Foundation (CFER):

We are a non-partisan and non-profit organization established following the defeat of Proposition 16 in 2020, with a mission to defend and raise public awareness on the cause of equal rights through public education, civic engagement and community outreach. In 1996, California became the first U.S. state to amend its constitution by passing Proposition 209 to ban racial discrimination and preferences. Prop. 209 requires that “the state shall not discriminate against, or grant preferential treatment to, any individual or group on the basis of race, sex, color, ethnicity, or national origin in the operation of public employment, public education, or public contracting.” CFER is dedicated to educating the public on this important constitutional principle of equal treatment.


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