Fraud And Abuse By ‘Those People.”

The Hill recently published an article that should be filed under “telling it like it is.” The title is explanatory: “The War on Fraud is Really a War on the Poor.”

I’ve published several recent posts addressing the multiple inadequacies of what passes for America’s social safety net,  especially focusing on the fact that very little of the money we spend on welfare  programs actually gets to the beneficiaries of those programs; thanks to lawmakers’ obsession with determining recipients’ “merit,” we’ve erected a large and costly bureaucracy to screen applicants and to eliminate those perennial bugaboos “fraud and waste.”

As The Hill points out, what is described as a war on fraud and waste is really a war on poor people.

Every few years, someone digs up an example of someone gaming the system, and the response is always the same: “more paperwork, more surveillance, more hoops to jump through for people who are already struggling. The United States has long organized its anti-poverty programs around one overriding assumption: that poor people are likely to cheat.”

The article notes the costs of this misperception–including the expense of the enormous bureaucracy we’ve erected to ensure that no poor person gets a penny to which s/he is not “entitled.”

Families who claim the Earned Income Tax Credit are audited at dramatically higher rates than wealthier taxpayers. Families applying for SNAP benefits–aka Food Stamps–have to document income, housing and household composition not just when they first apply, but in “re-certifications” every few months. Those who miss a deadline or misunderstand a form lose their benefits — not because they did something fraudulent, but because they “failed to navigate an administrative maze designed to catch it.”

And cash benefits? As the article notes, after decades of “reform” intended to weed out the fraudulent and ineligible, only  one in five eligible families currently receives any cash assistance, and even for those who do, benefit levels don’t begin to cover basic needs.

This approach also corrodes trust. When every interaction with the government begins with suspicion — when benefits arrive late, disappear without warning or require endless proof — people learn that institutions are not there to help them. They disengage. They stop applying.

None of this means fraud should be ignored. Public programs need safeguards. Taxpayer dollars matter. But fraud losses are a cost of doing business in every system — from corporate accounting to defense contracting. We don’t respond to those risks by forcing CEOs to recertify their eligibility every six months or freezing entire programs over isolated scandals. We reserve that treatment for those living in poverty, and it doesn’t have to be this way.

This obsession with suspected “Welfare Queens” who abuse government generosity isn’t based on experience or data; multiple audits have found that actual fraud by benefit recipients is rare. Improper payments — most of which are errors, not fraud — make up only a small fraction of spending. As the linked article points out, “We have constructed a massive enforcement apparatus to root out a small minority, and in the process, we have made life materially harder for millions.”

What is particularly galling about this war on poor people is the mounting, irrefutable evidence that the people looting the treasury aren’t poor single mothers “raking in” $450 a month. The real “fraud and waste” comes from the millionaires and billionaires making shady (or worse) deals with the Trump administration, and they’re making out like bandits.

As numerous watchdog organizations, including the Campaign Legal Center, have reported,  Trump has been rewarding his biggest donors with political favors and providing his donors and friends with countless opportunities to enrich themselves at the expense of the American people. Crew reports that 20 cabinet members have directed at least 30 million dollars to “pad Trump’s political coffers, pet projects or personal bottom line.” Government officials and secret service members have spent untold hours at Trump resorts, paying inflated rates and filling Trump family coffers. The list goes on.

The Intercept reports that Trump–with the help of the Republicans in Congress– funded his tax cuts for corporations and the uber-rich by cutting  billions of dollars in services for the poor and for working people, including Medicaid, and that large numbers of corporate executives are “quietly enriching themselves on Trump’s policies.”

And while massive grift and theft goes on at the top, our intrepid lawmakers are making sure that no one can spend their food stamps on sodas…

We’re waging war on the wrong people.

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Defining Nonprofit

When I began this blog–nearly twenty years ago!–I would occasionally run out of likely subjects, and ask my husband to suggest something. That problem has vanished; today, the challenge is to choose which aspect of a tumultuous time to consider. I share this small dilemma because today’s post is centered on a problem that probably doesn’t rank high in the universe of challenges we face, but still deserves attention–and ultimately, a remedy.

That problem is the definition of nonprofit.

Back before I decamped from legal practice to join academia, I was aware that a good lawyer could often turn what was really  a for-profit endeavor into a nonprofit organization. Assuming an arguable existence of a public good, it was possible to create a corporation that didn’t have a positive bottom line. You would simply transfer amounts that would otherwise be taxable profits into overhead costs, mainly salaries and perks for those in charge, and avoid those pesky taxes.

That clever lawyering has given us (among other things) “nonprofit” hospitals paying executive salaries of over a million dollars a year (Hospital CEO’s are paid an average of I.3 million according to a recent study from Rice University.)

The effects of that blurry line between for-profit and nonprofit was the subject of a recent opinion piece in the Washington Post that called it a 2.8 trillion dollar tax shelter. As the author noted, a growing number of supposed “charities” have become big businesses.

Granted, many charities are authentic and truly benevolent, but it is also true that the nonprofit sector is dominated by  companies that are exempt from the tax obligations that burden their virtually indistinguishable for-profit competitors. According to the linked essay, “the commercial revenue generated by these nonprofits totaled $2.8 trillion in 2023, nearly three times the amount nonprofits receive from donations and government grants.”

In 1909, Congress exempted charitable organizations from the corporate income tax, intending to protect “small fraternal societies providing insurance to widows and tending to the poor.” But the exemption also applied to mutual lending and insurance companies, which opened the door to exempting other “businesslike” companies. As a result, the “past century of special-interest lobbying has transformed a modest carve-out into a sprawling network of billion-dollar enterprises that look, act and compete like businesses — while enjoying privileged tax status.”

Consider nonprofit hospitals and health care plans: In 2023, they generated $1.3 trillion in revenue and nearly $45 billion in tax-free profits. The largest, Kaiser Foundation Health Plan and its affiliated hospitals, recently announced over $127 billion in revenue in 2025 — more than many of America’s largest for-profit companies — yet paid no corporate income tax on more than $9.3 billion in net income. The justification? In exchange for their tax exemption, nonprofit hospitals are supposed to provide charity care for the poor. However, studies consistently find that tax-exempt hospitals don’t provide more free or discounted care to low-income patients than their taxpaying competitors.

Or take AARP, an advocacy group for older Americans, which earned $9.9 billion in tax-free royalties in 2024 by licensing the use of its name to for-profit companies. AARP signed a sponsorship deal last year with the Washington Nationals to place its logo on players’ uniforms. Hardly the action of your neighborhood nonprofit.

Other organizations that fall into that category include the PGA–which pays no income taxes on the hundreds of millions it makes from television or tournament sponsorships, and the U.S. Tennis Association, the U.S. Polo Association, the WTA Tour, the Breeder’s Cup and the National Hot Rod Association. The list also includes profitable award shows like the Academy of Motion Picture Arts and Sciences Oscars ($147 million tax-free in 2023), and the Grammys (nearly $93 million from TV, sponsorships and ticket sales in 2024.)

Then there’s the credit union industry, which was originally exempted to serve working-class people of “small means.”  They are now indistinguishable from commercial banks–in fact, over the past decade, they’ve purchased nearly 100 commercial banks, converting taxpaying businesses into tax-exempt ones.

We can exempt genuinely charitable endeavors like food banks, homeless shelters and others serving the needy from taxation, but it is long past time to distinguish between truly charitable endeavors and what the essay calls “commercial enterprises wearing nonprofit clothing. If it walks and quacks like a business, tax it like one.”

There is serious money at stake. The essay points out that taxing the net business income of these faux nonprofits at the standard 21 percent corporate rate would raise $51 billion annually — and would do so without raising rates on anyone  currently being taxed.

It’s past time to treat these pretenders like the for-profit businesses they really are. Put this reform on your list of things we must do when we emerge from our current nightmare.

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Rewriting History

I went through grade school, high school, college and law school without ever hearing about the Tulsa riots or the Trail of Tears, among other negative episodes. My experience was not unique. It is only in the last couple of decades that a number of previously suppressed episodes showing the underside of our nation’s history have finally emerged into the public consciousness.

It isn’t a coincidence that Americans are only recently hearing about historical events involving women and people of color. The full history of women and Black and Brown Americans is finally emerging thanks to the civil rights movement and the women’s movement–movements that fostered the equal rights and recognition that MAGA despises as “woke.”

As the culture has changed, the backlash has become more ferocious. The Trump administration is trying to root out DEI–characterizing efforts to combat historic exclusion as “anti-White,” and mounting assaults on historic displays at museums and national parks. Meanwhile, Red states like Florida are re-writing curricula to ensure that their students will graduate with the same ignorance of history that I experienced.

The Washington Post recently reported on one aspect of the administration’s efforts.  An internal government database disclosed “the vast scope of the Trump administration’s ongoing effort to revise or remove information on African American history, climate change and other topics at hundreds of national park sites.” Park employees are under orders to eliminate displays that might “disparage” America, and a growing number of those displays are being “evaluated” to ensure that they are properly positive.

At the Emmett Till and Mamie Till-Mobley National Monument in Mississippi, the Trump administration is “reviewing” the exhibit on the teen’s brutal 1955 killing by White men— though the park’s staff warned that its removal would leave the site “completely devoid of interpretation.”

At the Harpers Ferry National Historical Park in West Virginia, the staff has asked federal officials “to decide whether a document that describes an abolitionist’s murder by a mob might “denigrate the murderers.'”

These displays and materials are among several hundred that managers have flagged at hundreds of national park locations since last summer in response to administration orders to scrub sites of “partisan ideology,” descriptions that “disparage” Americans, or materials that stray from a focus on the nation’s “beauty, abundance, or grandeur.” The submissions were compiled in an internal government database and reviewed by The Washington Post, which confirmed its authenticity with current federal employees.

The submissions are a troubling indication of the  scope of Trump’s effort to recast the history of the country–and to revise how–if at all– our national parks address such subjects as America’s history of racism and sexism, LGBTQ+ rights, climate change, and pollution.

The database became public when a group that described itself as “civil servants on the front lines” posted it to two public websites, explaining that it did so to show Americans how the administration is “trying to use your public lands to erase history and undermine science.”

You will not be surprised to learn that the Department failed to respond to reporters’ questions about the status of the reviews, the process for evaluation, or about the specific examples in the database.

One obvious effect of the administration’s new rules has been confusion.

Staff members identified a brochure at Cape Hatteras National Seashore, in North Carolina, for “possible disparaging of a prominent American” because it mentions that aviator and onetime Smithsonian Institution secretary Samuel Langley failed to achieve flight. A park staffer at Glen Canyon National Recreation Area in Arizona asks for clarification about whether displays on California condors’ return from the brink of extinction disparage hunters “or tell a success ??”

Others wanted to know whether books or displays about slavery and the black experience, or about Lincoln’s assassination–events that may or may not “disparage” historical figures, but that do cover “dark periods in American history”– are acceptable. What about displays that acknowledge Jefferson’s children with Sally Hemings?

As the report notes, many–if not most– National Park Service employees gravitated toward their work because they were passionate about telling true stories about history and science. A former superintendent of Shenandoah National Park was quoted as saying “It’s a real affront to the values that rangers have.”

Among the MAGA revisionists who have applauded Trump’s effort to redact inconvenient history is Indiana’s embarrassing White Christian nationalist Senator Jim Banks, who has written to officials at Interior and the Park Service over his concerns about “woke” projects that “cast America’s founding and history in a negative light.”

Actually, it’s people like Trump and Banks–people who want to rewrite history– who cast America in a negative light.

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Unanticipated Consequences

Official stupidity can do a lot of harm, as the daily examples from the Trump administration have made all too clear. (Official cowardice–can we spell Congressional Republicans?–doesn’t help.)

Trump’s “gut decision” to wage war on Iran, and the warrior cosplay of Pete Hegseth (who should never have been allowed near the grown-up’s table, let alone the Defense Department) will undoubtedly have multiple horrific consequences. We are already seeing some of them–along with obvious evidence that the “Peace President” consulted no intelligence personnel and engaged in nothing so pedestrian as planning before authorizing an assault that will destabilize the Middle East and quite possibly the world.

Just classify it as another  administration “whoops”–like the raging re-emergence of measles, and the “accidental” deaths of peaceful protestors….

But as Paul Krugman has reminded us, sometimes stupidity inadvertently teaches people a truth they’ve been trying to ignore.

It’s very obvious that Trump gave no thought at all about the huge importance of the Strait of Hormuz to America’s continued reliance on his beloved fossil fuels. And in just a couple of weeks, it has turned out that Trump’s war of choice has made a strong case for renewable energy.  We are suddenly being reminded that the wind and the sun don’t require transit through the Strait of Hormuz.

As Krugman notes, the policy folks who have been beating the drums for solar and wind power generally argue for renewable energy based upon its environmental benefits, and its role in moderating the damage caused by fossil fuels that have a major  role in  climate change and air pollution, the latter of which imposes significant damage on human health and reduces life expectancy. Trump’s “wag the dog” war has pointed to another reason we need to reduce dependence on fossil fuels: “In a dangerous world, it’s infinitely safer to rely on the sun and the wind than to depend on fossil fuels that must be transported long distances, from nations that are untrustworthy, often exploitative and located in regions that frequently devolve into war zones.”

Ya think?

Krugman tells us that approximately 20 percent of the world’s oil supply comes through the Strait of Hormuz. It isn’t just oil, either– the Strait is a “crucial route for shipment of liquefied natural gas and fertilizer.” When, as now, that passage is effectively closed, there are no good alternatives.

It is still very early in this unwise conflict, but consumers are already seeing rising gas prices. Krugman expresses surprise that crude oil prices haven’t increased even more steeply, but he is also surprised at how quickly retail gasoline prices have surged.

It isn’t only Americans who are feeling the effects. Not that Trump gives a rats patoot about our longtime allies, but Europe is being affected as well. As Krugman notes, and environmentalists know, most of Europe is far ahead of the US in renewable energy capacity, but it remains dependent on imported gas for a significant portion of its heating and electricity generation needs. Trump’s ill-considered war is hurting their economies. Meanwhile, Krugman tells us that Asian nations, “scrambling to replace their LNG imports from the Middle East, are driving up prices worldwide.”

Now, Trump hates renewable energy, especially wind power. He has tried to destroy hundreds of millions of dollars’ worth of investment in offshore wind turbines and sought to block land-based projects as well, although in some cases he has been stopped by the courts. He has also put pressure on other countries to go back to fossil fuels. On Tuesday he lashed out at the UK, calling the British “very uncooperative” and attacking them for having “windmills all over the place that are ruining the country.” But Britain would be in much worse shape right now if wind power weren’t supplying about 30 percent of its electricity.

And as Alan Beattie recently wrote in the Financial Times, U.S. stupidity has once again gifted China. “From the US you get forced into trade deals promising a future of burning fossil fuels whose price is subject to wildly destructive US adventurism. From China you get reliably cheap EVs and green tech to generate renewables.”

As Krugman concludes, Trump’s ill-conceived war against Iran ends up making a strong case for nations to seek energy independence. For many of those nations, that will means wind and solar and nuclear. The rising gas prices in the U.S. also bring that lesson home–justifying my devotion to my Prius.

Donald Trump, hero of renewable energy? Talk about unanticipated consequences…

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We The People

I know it’s bad.

There’s a question I get more and more frequently–during an after-speech Q and A, at lunch or dinner with friends, and on this platform: do I think the American experiment over? Is America going the way of Orban’s Hungary, or (even worse) Hitler’s Germany? Will the immense damage being done every day by Trump’s corrupt clown car of an administration prove to be irreversible?

There are obviously good reasons to expect the worst. I even have friends who are leaving the U.S.–heading for countries with competent governments (and national health care systems).

But I remain convinced that we will emerge from the current nightmare–that We the People will defeat the cranks, bigots and White Christian nationalists who currently exercise and abuse power. 

I agree wholeheartedly with a recent newsletter from Robert Hubbell, in which he pointed to the incredible courage and effectiveness of the people of Minnesota. He pointed to the “Stop ICE for Good” campaign that he says has stiffened the spines of Democratic lawmakers and raised the anxiety levels of “mid-term wary Republicans.”

Trump tried to intimidate the people of Minnesota by unleashing a secret police force that had been told “the Constitution does not apply” and “you have absolute immunity” from state prosecution. But the people of Minnesota refused to be intimidated. Instead, they formed the equivalent of a citizens ’ mutual aid society, protesting, ride-sharing, grocery shopping, and serving as the community’s eyes and ears, watching and listening for the roving gangs of paramilitary thugs. The people of Minnesota made their stand in the coldest months of the year, braving temperatures that sometimes dipped to 30 degrees below zero (Fahrenheit).

In the end, the citizens of Minnesota won their battle with Trump’s Gestapo. As Hubbell acknowledges, that victory is not complete–but it is evidence that resistance is ultimately more powerful than autocrats understand. The magnificent effort mounted by ordinary Americans in Minnesota should encourage all of us–and it should also prompt each of us to do whatever we can to bring this increasingly ugly time to a close.

That brings me to a widely-cited eulogy delivered at Jesse Jackson’s funeral by former President Obama, in which he counseled us not to lose hope–not to give in to despair, despite the extent of the assaults we currently face. Obama has always been a powerful speaker, and there’s a reason so many outlets have quoted his remarks, especially the following paragraphs.

We are living in a time when it can be hard to hope. Each day we wake up to some new assault on our democratic institutions, another setback to the idea of the rule of law, an offense to common decency. Every day you wake up to things you just didn’t think were possible. Each day, we’re told by those in high office to fear each other and to turn on each other, and that some Americans count more than others, and that some don’t even count at all. Everywhere we see greed and bigotry being celebrated and bullying and mockery masquerading as strength, we see science and expertise denigrated while ignorance and dishonesty and cruelty and corruption are reaping untold rewards. Every single day we see that, and it’s hard to hope in those moments. So it may be tempting to get discouraged, to give into cynicism. It may be tempting for some to compromise with power, and grab what you can, or even for good people to maybe just put your head down and wait for the storm to pass.

But Jackson’s life inspires us to take a harder path. His voice calls on each of us to be heralds of change, to be messengers of hope…. Wherever we have a chance to make an impact, whether it’s in our school or our workplaces or our neighborhoods or our cities, not for fame, not for glory, or because success is guaranteed, but because it gives our life purpose, because it aligns with what our faith tells us God demands, and because if we don’t step up, no one else will.

The citizens of Minnesota stepped up. And by stepping up, they showed the rest of us what We the People can accomplish when–as a popular protest sign reminds us– enough of us say no.

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