The Trump administration is doubling down on its segregationist policy agenda by threatening the tax-exempt status of private universities that provide targeted aid to nonwhite students. This new proposed policy is an extension of President Donald Trump’s unprecedented campaign against the independence of America’s system of higher education. His administration attempted to impose a compact on elite schools that would give political appointees a say in hiring and curriculum. The administration has also curtailed the labor force (and hit universities’ revenue stream) by drastically limiting international students.
To justify these attacks, Trump has claimed that colleges are full of “Marxist maniacs and lunatics” apparently bent on corrupting America’s youth. This week’s significant escalation seeks to make the IRS a combatant in the administration’s war on higher education.
Any implementation of this policy would put the nearly 18,000 private educational institutions in the U.S. in a terrible bind. Losing their tax-exempt status would make it more difficult for them to fundraise.
Any implementation of this policy would put the nearly 18,000 private universities in the U.S. in a terrible bind. Losing their tax-exempt status would make it more difficult for them to fundraise, as donations would no longer be tax-deductible. If the proposed Treasury rules become policy, risk-averse schools will further eliminate programs designed to fix historic inequities, and there will undoubtedly be fewer students of color in American colleges and universities.
That’s clearly what the president intends. The second Trump administration has overturned Johnson-era anti-discrimination protections for federal workers. Defense Secretary Pete Hegseth has fired or rejected the promotions of senior Black officers and banned books about America’s history of racism from the military academies. The Justice Department has shifted its focus from historically marginalized groups to (alleged) discrimination against white men. Threatening to revoke the tax-exempt status of universities that integrate is a logical next step in the administration’s segregationist project.
This new plan is a devious inversion of civil rights history. Following the Civil Rights Movement, intransigent religious colleges such as Bob Jones University refused to desegregate, so the IRS stripped them of their tax-exempt status by deciding that they violated civil rights law. Despite the prevalent belief that opposition to abortion led to the rise of the religious right, historians peg it to religious universities’ resistance to desegregation, and their outrage at the government trying to make them violate segregationist beliefs they saw as ordained by God. Now the man that movement catapulted to the presidency is threatening to sic the IRS on schools that seek to make the promise of desegregation real.
The proposed rules don’t spell out exactly what the IRS would consider discrimination. The ambiguity regarding what constitutes a diversity policy or discrimination has been a strategy the administration has used in attacking these policies. This uncertainty has often triggered a maximalist response from college administrators and general counsel’s offices afraid of upsetting the White House.
The Trump administration and Republican-controlled state legislatures have already forced many colleges and universities to abandon the post-Civil Rights Movement consensus that integration was a collective good.
To avoid legal exposure, universities have dismantled a whole host of programs aimed at leveling the playing field for historically marginalized groups. Since 2023, The Chronicle of Higher Education has documented the destruction of diversity policies, with 251 changes to diversity programming across 48 states in response to the administration’s demands. It says, “The pace of change ramped up in 2025,” the year Trump returned to the White House.
The Trump administration and Republican-controlled state legislatures have already forced many colleges and universities to abandon the post-Civil Rights Movement consensus that integration was a collective good. But Treasury’s proposed rule illustrates that Trump won’t rest until higher education is brought to heel.
Despite strategic ambiguity around what counts as discrimination, the Treasury Department’s statements and the administration’s broader dismantling of anti-discrimination protections across the federal government hint at the new vision for higher education. Treasury claims that the proposed rules “would further define race-based action for the purpose of ameliorating societal discrimination as a form of discrimination.” This is a bizarro-world definition of discrimination that equates fighting discrimination with enacting discrimination. Stopping a robbery isn’t theft. And policies designed to remedy historical and ongoing discrimination aren’t discriminatory.
The administration claims that its authority for the proposed rules is derived, in part, from the 2023 Supreme Court ruling in Students for Fair Admissions v. Harvard, which banned the explicit use of race in admissions. Chief Justice John Roberts’ decision in that case made it clear that some considerations of race were still permitted. He wrote that “nothing in this opinion should be construed as prohibiting universities from considering an applicant’s discussion of how race affected his or her life, be it through discrimination, inspiration or otherwise.” Here, Roberts acknowledges the truism that race inevitably shapes higher education admissions policy because it partially determines access to quality education.
By creating a set of proposed rules that go well beyond current Supreme Court guidelines and turning civil rights law against its intended purpose, the administration hopes to force higher education into collaborating with Trump’s resegregation efforts. But recent history shows that such collaboration is a fool’s errand, as some universities that cut diversity programs hoping they would quell Trump’s wrath are now facing the threat of having their tax-exempt status revoked anyway. Capitulating to this administration only emboldens further attacks on colleges’ independence. University leaders should make it clear that it’s their right to address historical inequities and help students from historically marginalized racial groups, and that they will fight this authoritarian escalation with everything they can.
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