In a stunning development, Minnesota Governor Tim Walz dropped out of the 2026 gubernatorial race after his state was exposed for massive fraud in taxpayer-funded childcare programs. The Trump administration has halted federal childcare funding nationwide while it investigates the scope of fraud.
Independent journalists like Nick Shirley have been exposing what looks like a massive scam in taxpayer-funded childcare programs. Shirley and his team visited addresses listed as childcare centers in Minnesota — places supposedly serving vulnerable kids — and found empty lots, abandoned buildings, or no sign of any children being cared for.
Some of these operations have raked in hundreds of millions of dollars in government subsidies over just a few years, even though state databases show they’re only licensed for a handful of kids, if any at all. It’s the kind of story that makes your blood boil: hard-earned tax dollars vanishing into thin air, funneled away from those who might really need it.
And it isn’t limited to Minnesota. Internet sleuths and investigators have uncovered similar patterns in states like Washington, where childcare centers — many tied to Somali communities, as in Minnesota — have been accused of the same shady practices. What’s more, many of these centers have donated thousands to politicians, raising serious questions about where the public’s money is going. The whole thing reeks of corruption. Federal agents are now probing nationwide fraud in these programs.
But as outrageous as this daycare scam is, it’s small potatoes compared to the massive, ongoing fraud perpetrated by teachers’ unions every single year, in every state, right under our noses. These unions advocate to pour billions of taxpayer dollars into public schools, only to funnel a huge chunk back out — and into Democratic politics. It’s a closed-loop racket that’s been running for decades.
While there are key differences — the daycare fraud often involves phantom centers with no children at all and a shocking lack of state oversight, whereas public schools do have students they consistently fail to educate — the underlying incentive structure is frustratingly similar. In both cases, taxpayer dollars are poured into failing or fraudulent public initiatives, with little accountability, perpetuated by political alliances that prioritize funding over results.
In the 2024 election cycle, a staggering 99.89 percent of the campaign contributions from the American Federation of Teachers (AFT) went to Democrats. This isn’t a fluke — it’s been that way for over three decades, with the union acting as a reliable cash machine for one party. Similarly, 98.24 percent of contributions from the National Education Association (NEA) flowed to Democrats in the same cycle.
And that’s just the tip of the iceberg. The latest publicly available LM-2 report for the NEA reveals it spent more than $39 million on political activities and lobbying alone. Yet only about nine percent of their total budget went toward actually representing teachers — their supposed core mission. Keep in mind, that’s just one national union; it doesn’t include the political spending by hundreds of local affiliates across the country. For instance, the Chicago Teachers Union (CTU) has failed to produce its required audits for five years in a row now, and a congressional committee is formally investigating the CTU for violating union bylaws and federal transparency laws.
This political machinery is fueled by the enormous river of taxpayer money pouring into K–12 education: nearly a trillion dollars annually, or more than $20,000 per student. That’s your money, funding a system that’s become a political slush fund.
Prepared by Melanie Hanson for EducationData.org, February 2025.
Unions and the Democratic Party share more than just dollars and donors. In many cases, they actually overlap. NEA President Becky Pringle serves as an at-large member of the Democratic National Committee, blurring the line between union leadership and party apparatus. AFT President Randi Weingarten held a similar position for decades before stepping down last year.
During the COVID-19 pandemic, these unions lobbied the CDC to keep schools closed longer than necessary, aligning perfectly with Democrats who criticized President Trump for pushing to reopen them. Kids suffered massive learning losses while unions protected their power.
The teachers’ union scam involves laundering taxpayer dollars to Democratic politicians and wasting those dollars on schools that fail children year after year. Remember that misspelled sign at one of the alleged fraud centers in Minnesota — “Quality Learing Center“? It was probably made by a graduate of a public school controlled by the teachers’ unions, where about two-thirds of US students aren’t proficient in reading, according to the Nation’s Report Card.
In fact, only 33 percent of fourth-graders and 33 percent of eighth-graders are proficient in reading. Math fares even worse, with just 36 percent of fourth-graders and 26 percent of eighth-graders reaching proficiency. And recent reports show continued declines, with twelfth-grade math and reading scores dropping further since 2019.
In Minnesota specifically, the situation is equally dire and has only worsened. The share of eighth-graders meeting basic reading standards hit a record low in 2024, fourth-grade reading and math scores have dropped steeply since 2019, and overall proficiency rates in math and reading have reached their lowest marks in decades. Meanwhile, Education Minnesota, the state’s largest teachers’ union, hosts trainings on “Interrupting Whiteness” through their FIRE (Facing Inequities and Racism in Education) program. The guiding minds of the public school system are plainly more interested in politics than education.
To keep the scam alive, unions fight tooth and nail against school choice programs that would introduce competition. Trapping kids in their failure factories with no escape is essential to maintaining the flow of funds. Then, unions point to their own dismal results as proof they need even more taxpayer money. It’s a never-ending, vicious cycle.
The dues-to-donations kickback loop is just as insidious. Unions collect dues — from salaries they negotiate and taxpayers must fund — and pour them into Democrats’ campaigns. Those same politicians then approve bigger budgets for public schools, which means more dues for the unions, which means more campaign cash. Wash, rinse, repeat.
If we’re outraged about daycare fraud, we should be furious about the teachers’ unions’ scam. It’s time to break the cycle: empower parents with school choice, hold unions accountable, and stop the flow of tax dollars into political machines.
