Much much simpler than that. Remember how just a few months ago everything the right didn't like was "woke"? And a few months before that how everything the right didn't like was CRT?
Well, we are here now. All problems are a result of DEI. It really does not matter that it's completely insane to view the world like this. Right wing media has it's current swear word of the month and that word (or in this case acronym) is DEI.
What's super effective about this tactic is exactly what the mayor hints at. It's a way to say the n-word without saying it.
The angle here is the right is a bunch of racist bigots and framing all the ills of the world in terms of that racist bigotry makes their lizard brained viewers happy (well, angry, but at the right people).
Quiet literally how Nazi propaganda worked. Blame all the problems of germany on the jews and the non-jews right wing morons will happily nod along with "yer right, it is the Jews' fault our society is crumbling!" It did not have to make sense or be reasonable. You just constantly plant that fear and suspicion in your dumbass follower's brains.