❓WHAT HAPPENED: The Trump administration has announced a freeze on $10 billion in childcare subsidies to five Democrat-led states due to allegations of massive fraud.
👤WHO WAS INVOLVED: The Trump administration, journalist Nick Shirley, and state authorities in Minnesota, New York, California, Illinois, and Colorado.
📍WHEN & WHERE: The freeze impacts federal funding to Democrat-led states, with Minnesota at the center of the allegations.
💬KEY QUOTE: “Democrat-led states and governors have been complicit in allowing massive amounts of fraud to occur under their watch.” – Andrew Nixon, Department of Health and Human Services (HHS) spokesman
🎯IMPACT: $10 billion in federal subsidies, including funds from the Temporary Assistance for Needy Families program and the Child Care Development Fund, will be frozen.
The Trump administration has paused more than $10 billion in federal funding for child care and social services programs in five states led by Democrats—Minnesota, New York, California, Illinois, and Colorado—citing concerns over fraud and improper use of taxpayer dollars. This comes amid ongoing investigations into welfare fraud, particularly in Minnesota, where a report by independent journalist Nick Shirley highlighted issues at certain daycare centers operated by members of the Somali community.
The withheld amounts break down as approximately $7 billion from the Temporary Assistance for Needy Families program, $2.4 billion from the Child Care Development Fund, and $870 million from social services block grants. These funds support supposedly low-income families with child care costs and related assistance. The decision extends a previous pause of $185 million in yearly funding specifically for Minnesota daycare providers.
Minnesota officials have identified multiple welfare fraud cases over recent years, but whistleblowers say the Walz administration was reluctant to investigate them and threatened staff who pressed the issue with retaliation. Andrew Nixon, a spokesman for the Department of Health and Human Services (HHS), stated, “Democrat-led states and governors have been complicit in allowing massive amounts of fraud to occur under their watch. Under the Trump administration, we are ensuring that federal taxpayer dollars are being used for legitimate purposes.”
Federal authorities have obtained numerous convictions tied to fraud involving the Feeding Our Future nonprofit in Minnesota, where several associated daycares also functioned as meal distribution sites.
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