Federal contractors have until Friday, the deadline set by Executive Order 14398, to strip race- and sex-based classifications out of every covered contract or risk debarment and False Claims Act exposure. The Federal Acquisition Regulatory Council estimates it reaches roughly 640,000 contracts held by more than 34,000 vendors. I’ve spent 30 years underwriting counterparties for private equity funds, private credit deals, and family offices. Not one credit file ever asked me to weigh a borrower’s creditworthiness by the owner’s race. That’s not an oversight. It’s the whole point of underwriting.For 60 years, Washington built a parallel market where the government decided which businesses got to compete based on who owned them. That market is collapsing.Start with the Small Business Administration’s Section 8(a) program, the granddaddy of federal set-asides. In Ultima Services Corp. v. USDA, a federal court in Tennessee found that presuming a business owner is “socially disadvantaged” based on race fails scrutiny under the Fifth Amendment. The Justice Department told Congress in November it would no longer defend the presumption. On June 10, the SBA proposed replacing it entirely with a test asking any citizen to show actual harm from actual discrimination. Not ancestry. Harm. That’s what a legal standard remedies: an injury, not a group bonus.