Politics
Who Are Elon Musk’s Friends, Investors and Family?
A look at the people who influence the world’s richest man, and those who stand to gain from their association with him now.
Elon Musk occupies a rare place at the center of American power.
As the “first buddy,” he has won the ear of President-elect Donald J. Trump, having spent over $250 million in the final months of 2024 to help him get elected. Mr. Musk has appeared in family photos at Mar-a-Lago and joined Mr. Trump on calls with world leaders and chief executives.
Mr. Musk has never had more influence over business, global politics and the American democratic system. He helped kill bipartisan legislation in Congress to avoid a government shutdown, though a bill was later passed.
Where does he go from here?
These are the people who influence Mr. Musk right now, and those whom he influences in turn. They are longtime friends, investors, staff members or party buddies — and sometimes, those boundaries blur.
They shape how Mr. Musk operates and views the world. Many have propped him up, in the good times and the bad, and some now stand to gain from his new position in U.S. politics.
These people have fueled Mr. Musk and his businesses. Over the years, they’ve invested millions of dollars in SpaceX, Tesla, Neuralink, the Boring Company, X and xAI. Some have gained board seats or become close friends with Mr. Musk for their loyalty.
Steve Jurvetson
Mr. Jurvetson is a longtime Silicon Valley venture capitalist and was an early investor in Mr. Musk’s SpaceX, where he is a board member. He is also a superfan of Mr. Musk’s. On a podcast in 2020, he praised the billionaire for being “the greatest gift of the American dream living right now.”
Marc Andreessen
The venture capitalist is one of Mr. Musk’s big financial supporters in Silicon Valley: His firm, Andreessen Horowitz, has backed SpaceX, X and xAI.
Shaun Maguire
A partner at Sequoia Capital, Mr. Maguire led the firm’s deals into Mr. Musk’s SpaceX, X, xAI and Boring Company, a tunneling venture. He has played a big role in Mr. Musk’s work during the presidential transition.
John Hering
Mr. Hering, a venture capitalist, invests in Mr. Musk’s companies and has become a trusted adviser. Recently, Mr. Hering has spent time in Palm Beach, Fla., helping with the presidential transition.
Peter Thiel
Mr. Thiel and Mr. Musk are members of the so-called PayPal Mafia, a group of founders and early employees of the payments company. While Mr. Thiel helped oust Mr. Musk from the company decades ago, he has recently become a political ally and supporter. Vice President-elect JD Vance once worked for Mr. Thiel’s venture capital firm, and Mr. Thiel was the one who introduced the running mates.
Roelof Botha
A fellow South African, Mr. Botha was a member of the PayPal Mafia. Now, as the managing partner of Sequoia Capital, he oversees the venture firm’s various investments into Mr. Musk’s companies, including X and xAI.
Larry Ellison
Mr. Ellison, the co-founder of Oracle, is a self-described good friend of Mr. Musk’s and has taken part in some Trump transition meetings. When Mr. Musk bought Twitter in 2022, Mr. Ellison committed $1 billion to the deal.
Mr. Musk’s friends come from different areas of his life. Some started as colleagues or investors, but later developed personal relationships with the billionaire — to the point where they’ve attended Burning Man or vacationed together.
Mr. Musk has also grown close with a number of figures in the tech scene around Austin, where he has been relocating some of his companies’ operations to, away from the San Francisco area.
Antonio Gracias
Mr. Gracias is one of Mr. Musk’s oldest friends; he was an early investor in SpaceX, Tesla and other companies, and he helped fund a pro-Trump super PAC started by Mr. Musk.
Ken Howery
A co-founder of PayPal, Mr. Howery is very involved in Republican politics. He and Mr. Musk are part of the same social circles in Austin.
Michael Kives
Mr. Musk has sometimes stayed with Mr. Kives, a Hollywood agent and Democratic financier, when he is in Los Angeles.
Luke Nosek
A close friend in Texas now and active in conservative politics, Mr. Nosek is one of the several entrepreneurs who helped start PayPal.
David Sacks
A PayPal Mafia associate, Mr. Sacks is a longtime friend who has grown closer to Mr. Musk after the acquisition of Twitter and his rightward political shift. Mr. Sacks has been picked to a tech position in Mr. Trump’s White House.
Sriram Krishnan
A former venture capitalist at Andreessen Horowitz, Mr. Krishnan was part of the crew that took over Twitter after Mr. Musk bought it. President-elect Trump recently tapped him to work with Mr. Sacks on artificial intelligence initiatives.
Joe Lonsdale
A co-founder of the software company Palantir, which has numerous Defense Department contracts, Mr. Lonsdale provided guidance to Mr. Musk’s pro-Trump super PAC and has helped advise the world’s richest man on the presidential transition.
Rupert Murdoch
Mr. Musk dined at Mr. Murdoch’s apartment just before Election Day. The media mogul has remained close with Mr. Musk even as his flagship newspaper, The Wall Street Journal, has reported critically on him.
James Murdoch
A current Tesla board member, as well as a SpaceX investor and a son of Rupert Murdoch’s, James Murdoch and Mr. Musk are friends who have vacationed together.
Joe Gebbia
A former Airbnb executive, Mr. Gebbia sits on Tesla’s board and is also part of the crowd that Mr. Musk hangs out with in Austin.
Jason Calacanis
A start-up investor and podcaster, Mr. Calacanis has been a longtime supporter of Mr. Musk’s from the early days at Tesla. He has attended Burning Man with Mr. Musk and most recently advised the billionaire during the takeover of Twitter.
Michael Dell
The billionaires have become closer as Mr. Musk has made Austin his home base. Mr. Dell has voiced his support of the government efficiency department and is developing computing infrastructure to help power Mr. Musk’s xAI.
Ari Emanuel
The Hollywood media mogul has grown close to Mr. Musk, who once sat on the board of his company, Endeavor. The SpaceX chief has vacationed with Mr. Emanuel and attended his wedding. Endeavor has also invested in X.
Robin Ren
Mr. Ren attended the University of Pennsylvania with Mr. Musk, who considered him to be better at physics during that time. Mr. Ren went on to work at Tesla as a vice president of business development and, for a time, led the company’s expansion into China. He also invested in Mr. Musk’s Twitter takeover.
Joe Rogan
The popular podcaster has hung out with Mr. Musk in Austin. Mr. Musk has appeared on his show five times in the last six years.
Mr. Musk has a large, complicated family. He has fathered at least 12 children with three different partners. He sometimes mixes business with family matters. His brother has sat on the boards of his companies, while his mother and young son have sat in on meetings for his companies and for his newly formed Department of Government Efficiency.
Kimbal Musk
Kimbal, Mr. Musk’s brother, has been a close confidant for years. He runs a restaurant business in Denver, but has long been involved in Elon’s companies: He was an early SpaceX and Tesla board member, in addition to advising on smaller endeavors.
James Musk
Mr. Musk’s younger cousin James now works as a trust engineer at X, after following Mr. Musk from company to company.
Errol Musk
Mr. Musk told a biographer that he and his father, Errol, are sometimes estranged, but Errol has said the two are in frequent contact. He has visited his son in Texas.
Tosca Musk
Mr. Musk’s sister, Tosca, is the head of a production company that focuses on adapting romance novels and erotic fan fiction. She has been a big Democratic donor, and helped host a fund-raiser for Stacey Abrams, the 2022 Democratic gubernatorial candidate for Georgia.
Grimes
The pop singer, born Claire Boucher, is the mother of three of Mr. Musk’s children and has been engaged in custody battles wtih him.
X Æ A-12 Musk
Mr. Musk’s eldest son with Grimes, the four-year-old X, as he is commonly known, has been a frequent presence with his father at his companies’ various offices and at Mar-a-Lago.
Justine Wilson Musk
Mr. Musk’s first wife and the mother of five of his eldest children, she helps parent some of those children with him. (Though one of the children, Vivian, has cut off ties with her father.)
Talulah Riley
Ms. Riley, an actress, is Mr. Musk’s second wife, having married and divorced him twice. They remain in contact.
Shivon Zilis
A former venture capitalist and current executive at Neuralink, Ms. Zilis is the mother of at least three children with Mr. Musk. She has been spotted at Mar-a-Lago after the election.
Maye Musk
Mr. Musk’s mother, a model and dietitian, frequently attends social and political events with her son.
With Mr. Musk leading six different companies, he’s kept a small circle of trusted advisers and deputies across those organizations to maintain operations. Some of these men and women have worked with Mr. Musk for more than a decade and joined Tesla or SpaceX in the early days, when neither company was a guaranteed success. Some of these lieutenants move from job to job with Mr. Musk as he deploys them on the latest issue he’s deemed important.
Alex Spiro
Mr. Spiro, an attorney with high-profile clients, notably defended Mr. Musk in a defamation lawsuit after the billionaire called a British cave explorer a “pedo guy” on Twitter in 2018. Recently, Mr. Spiro has become Mr. Musk’s attack dog against government regulators.
Chris Young
Mr. Young, a top Republican field operative, was hired to be Mr. Musk’s political adviser earlier this year. They did not know each other before the election, but Mr. Young has led Mr. Musk’s tactical work in Republican politics.
Terrence J. O’Shaughnessy
Mr. O’Shaughnessy, a retired Air Force general known as “Shags,” is one of Mr. Musk’s top lieutenants at SpaceX. He was recently pushed as a candidate for a Defense Department job.
Mark Juncosa
As the vice president of vehicle engineering at SpaceX, Mr. Juncosa has worked his way up the ranks in his more than 13 years at the company. He is one of Mr. Musk’s most trusted engineers.
Omead Afshar
Mr. Afshar, one of Mr. Musk’s right-hand men, previously oversaw the construction of Tesla’s factory in Austin, and is now involved with the production of the Starship rocket at SpaceX.
Tim Hughes
As a senior government affairs executive at SpaceX, Mr. Hughes has become vital to Mr. Musk as the company has looked to spread its influence and its satellite internet service, Starlink, outside the United States. Mr. Musk has put forth Mr. Hughes as a potential hire for the Department of Defense.
Ira Ehrenpreis
A current Tesla board member, Mr. Ehrenpreis helped push through a controversial pay package at Tesla that helped make Mr. Musk the richest man in the world.
Jared Birchall
Mr. Birchall, a former wealth manager at Morgan Stanley, is the longtime head of Mr. Musk’s family office, as well as of the Musk Foundation. He has also been advising the presidential transition.
Jehn Balajadia
Though she has the title of “operations coordinator” at the Boring Company, Ms. Balajadia is effectively Mr. Musk’s secretary, helping him with day-to-day tasks and scheduling. She often follows him as he travels, and was ever-present during his acqusition of Twitter.
Linda Yaccarino
A former executive at NBCUniversal, Ms. Yaccarino is the chief executive of X — and often parrots his political views and talking points.
Robyn Denholm
As the chair of Tesla’s board, the Australian business executive has exerted little oversight over Mr. Musk, who had to step down from his role as chairman after his fight with the Securities and Exchange Commission in 2018.
Tom Zhu
A senior vice preisdent at Tesla who oversees much of the company’s operations in China, an increasingly important market for the electric automaker.
Franz von Holzhausen
The lead designer at Tesla, he has been known to appear onstage with Mr. Musk during launch events. He has worked at the company for nearly 16 years and is one of Tesla’s longest-serving employees.
Ross Nordeen
One of Musk’s most trusted engineers, he has moved from Tesla to X and now to xAI. He has worked closely with Mr. Musk’s cousin James.
Steve Davis
Few people on this list have earned Mr. Musk’s trust more than Mr. Davis, who is often called upon to help with special situations. Mr. Davis, who by day is an executive at the Boring Company, has effectively led Mr. Musk’s work on the presidential transition.
Gwynne Shotwell
The second most powerful person at SpaceX, she has overseen the day-to-day operations of the rocket company as it has grown to be a major contractor of NASA and the Defense Department.
Mr. Musk’s introduction into the MAGA world has been swift, after his public endorsement of Mr. Trump’s candidacy in July. Since the election, Mr. Musk has become almost inseparable from the president-elect, building fast friendships not only with Mr. Trump, but also with some of his closest advisers. These alliances will become even more important, as Mr. Musk has said he will push to slash federal spending with his government efficiency organization.
Alex Lorusso
A business partner of Benny Johnson’s, the conservative media personality, Mr. Lorusso was a paid consultant for Mr. Musk’s super PAC. Mr. Lorusso is one of the several-high profile conservative voices who was once barred on Twitter and later reinstated by Mr. Musk.
Tucker Carlson
Before leaving Fox News, Mr. Carlson interviewed Mr. Musk for one of his last shows. Since then, the pair have bonded. Mr. Carlson posts episodes of his new online show on X, and has become one of Mr. Musk’s biggest defenders in media.
Vivek Ramaswamy
Leading up to the election, the pharmaceutical entrepreneur turned Republican presidential candidate was frequently cited online by Mr. Musk. Now, the two will be the co-leaders of the government efficiency department in an attempt to slash $2 trillion from the federal budget.
Stephen Miller
Mr. Musk has backed some of Mr. Miller’s prior political work. And the Trump senior adviser, known for his vocal stances on immigration issues that Mr. Musk cares deeply about, has worked side-by-side with the billionaire during the transition.
Nelson Peltz
Mr. Peltz has described himself as the “matchmaker” between Mr. Trump and Mr. Musk. Mr. Peltz, an activist investor, hosted a dinner at his home in Palm Beach this February where Mr. Musk first voiced his desire to become involved with the election.
Donald Trump
Though they did not know each other well six months ago, the two have appeared insperable since the election. Mr. Trump tapped Mr. Musk to be the co-head of the new effort to downsize government, and publicly, they often seem to be mesmerized by each other.
Politics
Commentary: Tim Walz isn’t the only governor plagued by fraud. Newsom may be targeted next
Former vice presidential contender and current aw-shucks Minnesota Gov. Tim Walz announced this week that he won’t run for a third term, dogged by a scandal over child care funds that may or may not be going to fraudsters.
It’s a politically driven mess that not coincidentally focuses on a Black immigrant community, tying the real problem of scammers stealing government funds to the growing MAGA frenzy around an imaginary version of America that thrives on whiteness and Christianity.
Despite the ugliness of current racial politics in America, the fraud remains real, and not just in Minnesota. California has lost billions to cheats in the last few years, leaving our own governor, who also harbors D.C. dreams, vulnerable to the same sort of attack that has taken down Walz.
As we edge closer to the 2028 presidential election, Republicans and Democrats alike will probably come at Gavin Newsom with critiques of the state’s handling of COVID-19 funds, unemployment insurance and community college financial aid to name a few of the honeypots that have been successfully swiped by thieves during his tenure.
In fact, President Trump said as much on his social media barf-fest this week.
“California, under Governor Gavin Newscum, is more corrupt than Minnesota, if that’s possible??? The Fraud Investigation of California has begun,” he wrote.
Right-wing commentator Benny Johnson also said he’s conducting his own “investigation.” And Republican gubernatorial candidate Steve Hilton is claiming his fraud tip line has turned up “(c)orruption, fraud and abuse on an epic scale.”
Just to bring home that this vulnerability is serious and bipartisan, Rep. Ro Khanna, the Silicon Valley congressman rumored to have his own interest in the Oval Office, is also circling the fraud feast like a vulture eyeing his next meal.
“I want to hear from residents in my district and across the state about waste, mismanagement, inefficiencies, or fraud that we must tackle,” Khanna wrote on social media.
Newsom’s spokesman Izzy Gardon questioned the validity of many fraud claims.
“In the actual world where adults govern,” Gardon said, “Gavin Newsom has been cleaning house. Since taking office, he’s blocked over $125 BILLION in fraud, arrested criminal parasites leaching off of taxpayers, and protected taxpayers from the exact kind of scam artists Trump celebrates, excuses, and pardons.”
What exactly are we talking about here? Well, it’s a pick-your-scandal type of thing. Even before the federal government dumped billions in aid into the states during the pandemic, California’s unemployment system was plagued by inefficiencies and yes, scammers. But when the world shut down and folks needed that government cash to survive, malfeasance skyrocketed.
Every thief with a half-baked plan — including CEOs, prisoners behind bars and overseas organized crime rackets — came for California’s cash, and seemingly got it. The sad part is these weren’t criminal geniuses. More often than not, they were low-level swindlers looking at a system full of holes because it was trying to do too much too fast.
In a matter of months, billions had been siphoned away. A state audit in 2021 found that at least $10 billion had been paid out on suspicious unemployment claims — never mind small business loans or other types of aid. An investigation by CalMatters in 2023 suggested the final figure may be up to triple that amount for unemployment. In truth, no one knows exactly how much was stolen — in California, or across the country.
It hasn’t entirely stopped. California is still paying out fraudulent unemployment claims at too high a rate, totaling up to $1.5 billion over the last few years — more than $500 million in 2024 alone, according to the state auditor.
But that’s not all. Enterprising thieves looked elsewhere when COVID-19 money largely dried up. Recently, that has been our community colleges, where millions in federal student aid has been lost to grifters who use bots to sign up for classes, receive government money to help with school, then disappear. Another CalMatters investigation using data obtained from a public records request found that up to 34% of community college applications in 2024 may have been false — though that number represents fraudulent admissions that were flagged and blocked, Gardon points out.
Still, community college fraud will probably be a bigger issue for Newsom because it’s fresher, and can be tied (albeit disingenuously) to immigrants and progressive policies.
California allows undocumented residents to enroll in community colleges, and it made those classes free — two terrific policies that have been exploited by the unscrupulous. For a while, community colleges didn’t do enough to ensure that students were real people, because they didn’t require enough proof of identity. This was in part to accommodate vulnerable students such as foster kids, homeless people and undocumented folks who lacked papers.
With no up-front costs for attempting to enroll, phonies threw thousands of identities at the system’s 116 schools, which were technologically unprepared for the assaults. These “ghost” students were often accepted and given grants and loans.
My former colleague Kaitlyn Huamani reported that in 2024, scammers stole roughly $8.4 million in federal financial aid and more than $2.7 million in state aid from our community colleges. That‘s a pittance compared with the tens of billions that was handed out in state and federal financial aid, but more than enough for a political fiasco.
As Walz would probably explain if nuanced policy conversations were still a thing, it’s both a fair and unfair criticism to blame these robberies on a governor alone — state government should be careful of its cash and aggressive in protecting it, and the buck stops with the governor, but crises and technology have collided to create opportunities for swindlers that frankly few governmental leaders, from the feds on down, have handled with any skill or luck.
The crooks have simply been smarter and faster than the rest of us to capitalize first on the pandemic, then on evolving technology including AI that makes scamming easier and scalable to levels our institutions were unprepared to handle.
Since being so roundly fleeced during the pandemic, multiple state and federal agencies have taken steps in combating fraud — including community colleges using their own AI tools to stop fake students before they get in.
And the state is holding thieves accountable. Newsom hired a former Trump-appointed federal prosecutor, McGregor Scott, to go after scam artists on unemployment. And other county, state and federal prosecutors have also dedicated resources to clawing back some of the lost money.
With the slow pace of our courts (burdened by their own aging technology), many of those cases are still ongoing or just winding up. For example, 24 L.A. County employees were charged in recent months with allegedly stealing more than $740,000 in unemployment benefits, which really is chump change in this whole mess.
Another California man recently pleaded guilty to allegedly cheating his way into $15.9 million in federal loans through the Paycheck Protection Program and Economic Injury Disaster Loan programs.
And in one of the most colorful schemes, four Californians with nicknames including “Red boy” and “Scooby” allegedly ran a scam that boosted nearly $250 million in federal tax refunds before three of them attempted to murder the fourth to keep him from ratting them out to the feds.
There are literally hundreds of cases across the country of pandemic fraud. And these schemes are just the tip of the cash-berg. Fraudsters are also targeting fire relief funds, food benefits — really, any pot of public money is fair game to them. And the truth is, the majority of that stolen money is gone for good.
So it’s hard to hear the numbers and not be shocked and angry, especially as the Golden State is faced with a budget shortfall that may be as much as $18 billion.
Whether you blame Newsom personally or not for all this fraud, it’s hard to be forgiving of so much public money being handed to scoundrels when our schools are in need, our healthcare in jeopardy and our bills on an upward trajectory.
The failure is going to stick to somebody, and it doesn’t take a criminal mastermind to figure out who it’s going to be.
Politics
Wyoming Supreme Court rules laws restricting abortion violate state constitution
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The Wyoming Supreme Court ruled on Tuesday that a pair of laws restricting abortion access violate the state constitution, including the country’s first explicit ban on abortion pills.
The court, in a 4-1 ruling, sided with the state’s only abortion clinic and others who had sued over the abortion bans passed since the U.S. Supreme Court overturned Roe v. Wade in 2022, which returned the power to make laws on abortion back to the states.
Despite Wyoming being one of the most conservative states, the ruling handed down by justices who were all appointed by Republican governors upheld every previous lower court ruling that the abortion bans violated the state constitution.
Wellspring Health Access in Casper, the abortion access advocacy group Chelsea’s Fund and four women, including two obstetricians, argued that the laws violated a state constitutional amendment affirming that competent adults have the right to make their own health care decisions.
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The Wyoming Supreme Court ruled that a pair of laws restricting abortion access violate the state constitution. (Tom Williams/CQ-Roll Call, Inc via Getty Images)
Voters approved the constitutional amendment in 2012 in response to the federal Affordable Care Act, which is also known as Obamacare.
The justices in Wyoming found that the amendment was not written to apply to abortion but noted that it is not their job to “add words” to the state constitution.
“But lawmakers could ask Wyoming voters to consider a constitutional amendment that would more clearly address this issue,” the justices wrote.
Wellspring Health Access President Julie Burkhart said in a statement that the ruling upholds abortion as “essential health care” that should not be met with government interference.
“Our clinic will remain open and ready to provide compassionate reproductive health care, including abortions, and our patients in Wyoming will be able to obtain this care without having to travel out of state,” Burkhart said.
Wellspring Health Access opened as the only clinic in the state to offer surgical abortions in 2023, a year after a firebombing stopped construction and delayed its opening. A woman is serving a five-year prison sentence after she admitted to breaking in and lighting gasoline that she poured over the clinic floors.
Wellspring Health Access opened as the only clinic in the state to offer surgical abortions in 2023, a year after a firebombing stopped construction. (AP)
Attorneys representing the state had argued that abortion cannot violate the Wyoming constitution because it is not a form of health care.
Republican Gov. Mark Gordon expressed disappointment in the ruling and called on state lawmakers meeting later this winter to pass a constitutional amendment prohibiting abortion that residents could vote on this fall.
An amendment like that would require a two-thirds vote to be introduced as a nonbudget matter in the monthlong legislative session that will primarily address the state budget, although it would have significant support in the Republican-dominated legislature.
“This ruling may settle, for now, a legal question, but it does not settle the moral one, nor does it reflect where many Wyoming citizens stand, including myself. It is time for this issue to go before the people for a vote,” Gordon said in a statement.
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Gov. Mark Gordon expressed disappointment in the ruling. (Getty Images)
One of the laws overturned by the state’s high court attempted to ban abortion, but with exceptions in cases where it is needed to protect a pregnant woman’s life or in cases of rape or incest. The other law would have made Wyoming the only state to explicitly ban abortion pills, although other states have implemented de facto bans on abortion medication by broadly restricting abortion.
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Abortion has remained legal in the state since Teton County District Judge Melissa Owens blocked the bans while the lawsuit challenging the restrictions moved forward. Owens struck down the laws as unconstitutional in 2024.
Last year, Wyoming passed additional laws requiring abortion clinics to be licensed surgical centers and women to receive ultrasounds before having medication abortions. A judge in a separate lawsuit blocked those laws from taking effect while that case moves forward.
The Associated Press contributed to this report.
Politics
What Trump’s vow to withhold federal child-care funding means in California
SACRAMENTO — Gov. Gavin Newsom and other state Democratic leaders accused President Trump of unleashing a political vendetta after he announced plans to freeze roughly $10 billion in federal funding for child care and social services programs in California and four other Democrat-controlled states.
Trump justified the action in comments posted on his social media platform Truth Social, where he accused Newsom of widespread fraud. The governor’s office dismissed the accusation as “deranged.”
Trump’s announcement came amid a broader administration push to target Democratic-led states over alleged fraud in taxpayer-funded programs, following sweeping prosecutions in Minnesota. The U.S. Department of Health and Human Services confirmed the planned funding freeze, which was first reported by the New York Post.
California officials said they have received no formal notice and argued the president is using unsubstantiated claims to justify a move that could jeopardize child care and social services for low-income families.
How we got here
Trump posted on his social media site Truth Social on Tuesday that under Newsom, California is “more corrupt than Minnesota, if that’s possible???” In the post, Trump used a derogatory nickname for Newsom that has become popular with the governor’s critics, referring to him as “Newscum.”
“The Fraud Investigation of California has begun,” Trump wrote.
The president also retweeted a story by the New York Post that said his Department of Health and Human Services will freeze taxpayer funding from the Child Care Development Fund, the Temporary Assistance for Needy Families program, which is known as CalWORKS in California, and the Social Services Block Grant program. Health and Human Services said the affected states are California, Colorado, Illinois, Minnesota and New York.
“For too long, Democrat-led states and Governors have been complicit in allowing massive amounts of fraud to occur under their watch,” said Andrew Nixon, a department spokesperson. “Under the Trump Administration, we are ensuring that federal taxpayer dollars are being used for legitimate purposes. We will ensure these states are following the law and protecting hard-earned taxpayer money.”
The department announced last month that all 50 states will have to provide additional levels of verification and administrative data before they receive more funding from the Child Care and Development Fund after a series of fraud schemes at Minnesota day-care centers run by Somali residents.
“The Trump Administration is using the moral guise of eliminating ‘fraud and abuse’ to undermine essential programs and punish families and children who depend on these services to survive, many of whom have no other options if this funding disappears,” Kristin McGuire, president of Young Invincibles, a young-adult nonprofit economic advocacy group, said in a statement. “This is yet another ideologically motivated attack on states that treats millions of families as pawns in a political game.”
California pushes back
Newsom’s office brushed off Trump’s post about fraud allegations, calling the president “a deranged, habitual liar whose relationship with reality ended years ago.” Newsom himself said he welcomes federal fraud investigations in the state, adding in an interview on MS NOW that aired Monday night: “Bring it on. … If he has some unique insight and information, I look forward to partnering with him. I can’t stand fraud.”
However, Newsom said cutting off funding hurts hardworking families who rely on the assistance.
“You want to support families? You believe in families? Then you believe in supporting child care and child-care workers in the workforce,” Newsom told MS NOW.
California has not been notified of any changes to federal child-care or social services funding. H.D. Palmer, a spokesperson for the Department of Finance, said the only indication from Washington that California’s child-care funding could be in jeopardy was the vague 5 a.m. post Tuesday by the president on Truth Social.
“The president tosses these social media missives in the same way Mardi Gras revelers throw beads on Bourbon Street — with zero regard for accuracy or precision,” Palmer said.
In the current state budget, Palmer said, California’s child-care spending is $7.3 billion, of which $2.2 billion is federal dollars. Newsom is set to unveil his budget proposal Friday for the fiscal year that begins July 1, which will mark the governor’s final spending plan before he terms out. Newsom has acknowledged that he is considering a 2028 bid for president, but has repeatedly brushed aside reporters’ questions about it, saying his focus remains on governing California.
Palmer said while details about the potential threat to federal child-care dollars remain unclear, what is known is that federal dollars are not like “a spigot that will be turned off by the end of the week.”
“There is no immediate cutoff that will happen,” Palmer said.
Since Trump took office, California has filed dozens of legal actions to block the president’s policy changes and funding cuts, and the state has prevailed in many of them.
What happened in Minnesota
Federal prosecutors say Minnesota has been hit by some of the largest fraud schemes involving state-run, federally funded programs in the country. Federal prosecutors estimate that as much as half of roughly $18 billion paid to 14 Minnesota programs since 2018 may be fraudulent, with providers accused of billing for services never delivered and diverting money for personal use.
The scale of the fraud has drawn national attention and fueled the Trump administration’s decision to freeze child-care funds while demanding additional safeguards before doling out money, moves that critics say risk harming families who rely on the programs. Gov. Tim Walz has ordered a third-party audit and appointed a director of program integrity. Amid the fallout, Walz announced he will not seek a third term.
Outrage over the fraud reached a fever pitch in the White House after a video posted online by an influencer purported to expose extensive fraud at Somali-run child-care centers in Minnesota. On Monday, that influencer, Nick Shirley, posted on the social media site X, “I ENDED TIM WALZ,” a claim that prompted calls from conservative activists to shift scrutiny to Newsom and California next.
Right-wing podcaster Benny Johnson posted on X that his team will be traveling to California next week to show “how criminal California fraud is robbing our nation blind.”
California officials have acknowledged fraud failures in the past, most notably at the Employment Development Department during the COVID-19 pandemic, when weakened safeguards led to billions of dollars in unemployment payments later deemed potentially fraudulent.
An independent state audit released last month found administrative vulnerabilities in some of California’s social services programs but stopped short of alleging widespread fraud or corruption. The California state auditor added the Department of Social Services to its high-risk list because of persistent errors in calculating CalFresh benefits, which provides food assistance to those in need — a measure of payment accuracy rather than criminal activity — warning that federal law changes could eventually force the state to absorb billions of dollars in additional costs if those errors are not reduced.
What’s at stake in California
The Trump administration’s plans to freeze federal child-care, welfare and social services funding would affect $7.3 billion in Temporary Assistance for Needy Families funding, $2.4 billion for child-care subsidies and more than $800 million for social services programs in the five states.
The move was quickly criticized as politically motivated because the targeted states were all Democrat-led.
“Trump is now illegally freezing childcare and other funding for working families, but only in blue states,” state Sen. Scott Wiener (D-San Francisco) said in a statement. “He says it’s because of ‘fraud,’ but it has nothing to do with fraud and everything to do with politics. Florida had the largest Medicaid fraud in U.S. history yet isn’t on this list.”
Added California Assembly Speaker Robert Rivas (D-Hollister): “It is unconscionable for Trump and Republicans to rip away billions of dollars that support child care and families in need, and this has nothing to do with fraud. California taxpayers pay for these programs — period — and Trump has no right to steal from our hard-working residents. We will continue to fight back.”
Times staff writer Daniel Miller contributed to this report.
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