In recent weeks, better detail has emerged about the political and structural roots of Minnesota’s social services frauds. Most edifying was a column by Hamline University political scientist David Schultz on his public policy commentary website Minneapolis Times, which took the origins of the frauds back half a century. Additional feedback from the legislative auditor, and even Gov. Tim Walz, has brought the problems into clearer focus.

At their core, they are a function of a few phenomena: Minnesota’s status as a generous funder of aid for the less fortunate; the GOP’s hatred of government bureaucracy; and the DFL’s concomitant use of private charitable organizations and nonprofits to manage all that aid. Walz noted in his March proposals that Minnesota had less robust auditing and oversight compared to most states with similar programs.

Walz suggested the state repatriate, if you will, its outsourced aid back to state agencies—a proposal that found little support in either party. Republicans are concerned about expanding government and wary of enlarging a bureaucracy under whose watch all this fraud took place; meanwhile, the DFL has deep ties to the left-leaning NGO sector, which comes hat in hand to the Legislature, counties, and cities every budgeting period.

Schultz makes the point that outsourcing made the state’s social service expansion palatable to Republicans, who were apparently unable to foresee that it would create an entrenched network of nonprofits beyond the reach of state scrutiny.

Many but not all of the fraud is in state-administrated Medicaid programs, while some are in homegrown programs. The bulk are administered through counties, like Hennepin and Ramsey, which direct state funds to private NGOs of their choosing. If you can’t see the potential for abuse here, I don’t know what to tell you.

Both parties created this mess. They are going to need to put aside built-in biases and belief systems to fix it, and need to do so in the current legislative session, not after the election.

And just as there are too many cold-hearted GOP politicos who view every individual tragedy as an opportunity for bootstrapping, there are too many DFL electeds and program administrators who believe in the unshakable nobility of every person who receives aid. (See how members of the DFL leftist caucus routinely refer to the homeless as “our unhoused friends,” but labels no other group so fondly.) I don’t accept the thesis that the DFL wanted the state to be ripped off, but I am struck by the party’s apparent belief that people in need would never steal if the state made it so easy.

For Minnesota to rein in this era of  theft, we need to be more skeptical, less generous, and fund oversight as if taxpayer dollars are a sacred trust, not an entitlement of the political class.

Those who seek to scapegoat the Somali community are missing the point. Yes, by and large, it appears most of the perpetrators of these frauds are immigrants from East Africa. But given how many of these programs were designed on the honor system, I wonder if they didn’t appear to be a sort of open invitation to people unfamiliar with the state’s Scandinavian/Lutheran culture of earnestness.

Both parties created this mess. They are going to need to put aside built-in biases and belief systems to fix it, and need to do so in the current legislative session, not after the election, as the GOP seems to want to do.

In other news, we’ve got a strong issue for you: Charlie Rybak spoke to Claros Technologies CEO Michelle Bellanca about its solution to the PFAS nightmare. Our annual Women in Leadership package includes St. Catherine University’s annual Minnesota Census of Women in Corporate Leadership, plus Liz Fedor’s feature about a local program helping women of color crack the insular board code. Connor O’Neal traveled to Tofte to look at the aftermath of the Lutsen Resort blaze, while I went to Florida to learn what new CEO Tom Pohlad has in store for the Twins. Plus, we’ve got the story of a local liqueur that ran afoul of the Trump tariffs but appears to have won. And please check out our new “Twin Cities Business Show” on YouTube (a new episode debuts every week or so).