In a viral video posted the day after Christmas 2025, Nick Shirley, a right-wing YouTuber in his early twenties, drives around a snowy Minneapolis aiming to expose what he alleged was the widespread misuse of federal funds by Somali-owned daycares. Shirley is accompanied by a local conservative lobbyist-cum-vigilante named David, who warns that the perpetrators of the scheme are “exceptionally violent”; Shirley declares that the money is being used for “terrorism.” He approaches several strip mall storefronts that have been registered as daycares, shoves a camera in the faces of the workers who answer the door, and asks to enroll his son, “little Joey.” His interlocutors look frightened and suspicious. No children appear outside the facilities. The numbers next to the “fraud counter” at the bottom of the screen tick upward.

After the video was posted, investigators from the state Department of Human Services Office of Inspector General visited nine out of the ten day care centers that Shirley featured — one had been closed for several years. Of the remaining nine, they found normal operations and children at all except one, which had not yet opened for the day. No evidence showed that federal funds were diverted to terrorist groups. No matter. Vice President JD Vance praised Shirley’s “useful journalism” on X and cemented the narrative of widespread wrongdoing in Minnesota. At the beginning of January, the Trump administration announced that it would halt ten billion dollars in childcare subsidies and other social services in Minnesota and four other Democratic states, claiming that benefits were going to scammers and “illegal aliens.” Two of the programs the administration targeted, Temporary Assistance for Needy Families (TANF) and the Social Services Block Grant, were not even implicated in the video. Meanwhile, the Department of Homeland Security sent thousands of ICE agents to Minneapolis, some assigned to “conduct a massive investigation on childcare and other rampant fraud.”

Democratic officials were quick to rebut the federal government’s allegations. In a complaint filed on behalf of New York, California, Colorado, Illinois, and Minnesota, lawyers pointed out that the administration had not provided any proof of fraud nor cited any evidence that undocumented residents were receiving benefits. And yet, Democrats have conceded the basic terms of the debate, boasting of their own efforts to crack down on what they’ve portrayed as real benefit fraud. While announcing the end to his campaign for reelection in early January, Minnesota Governor Tim Walz cited his inability to defend “the people of Minnesota against the criminals who prey on our generosity.” California Governor Gavin Newsom has likewise touted his state’s arrest of 929 people for unemployment insurance fraud, and New York Governor Kathy Hochul’s office has accused state Republicans of undermining her efforts to “root out waste, fraud, and abuse” in Medicaid. 

These officials’ ostensible point is that the Trump administration has less interest in eliminating actual welfare fraud than in using exaggerated or misleading claims as a pretext for denying critical resources to vulnerable families. Democrats have tried to refocus attention away from ordinary welfare recipients to welfare providers and large-scale scammers, who have diverted significant program funds. However, even the benefit-fraud investigations designed to target these malicious actors routinely ensnare ordinary, needy Americans who have misrepresented their eligibility to claim aid. Welfare recipients really do break the rules. Often, they do so unintentionally, because the rules are extraordinarily confusing, and it’s risky to ask for clarification. Others cheat knowingly, not because they are fundamentally lazy, greedy, or dishonest, but because program criteria are so restrictive — and benefit amounts are so paltry — that individuals could not otherwise provide for themselves and their families.

But mainly, they break the rules because the state relies, to a certain extent, on their noncompliance. From its earliest days, America’s welfare system has forced its beneficiaries to lie not only for their survival, but also for its own survival. When they fail to report their income or other sources of financial support, the poor effectively subsidize the programs that are supposedly intended to assist them. Distinguishing between real and fake allegations does little good, because neither accuracy nor deterrence has ever been the true purpose of fraud investigations. What neither Republicans nor Democrats will admit is that welfare policing is simultaneously draconian and highly discretionary by design. By turning a blind eye to some rule-breakers while harshly punishing others, the state ensures that all are kept isolated by shame and suspicion. The system allows the poor to break the rules just often enough so that they do not openly challenge its injustice. If recipients couldn’t cheat, they might starve; or worse, they might revolt.

In the Jewish immigrant writer Anzia Yezierska’s 1923 short story “The Lord Giveth,” an impoverished woman named Mrs. Ravinsky and her daughter are evicted from their home on New York City’s Lower East Side. A neighbor, equally poor, takes the family into her own apartment, and others donate butter and eggs. Then, the “charity lady” comes by and, after peppering Mrs. Ravinsky with questions, sends an errand boy to the store to buy them groceries. While he’s gone, the charity lady opens a cupboard and finds the donated butter and eggs. “How you took me in with your hungry look!” she cries. When the boy returns, she tells him to send the groceries back and turns to Mrs. Ravinsky. “What would be left for deserving cases if we allowed such as you to defraud legitimate charity?” 

The story satirizes the philanthropic customs that prevailed in Yezierska’s time — and continue to shape welfare policy to this day. In the early 1800s, as the historian Brent Ruswick recounts, the indigent sought relief from a patchwork of poorhouses, asylums, and private donors — and from one another. But toward the end of that century, as urban populations swelled, local institutions were strained by the scale of need. The main problem, some civic-minded elites argued, wasn’t insufficient aid: it was that help was going to the wrong people. “The pauper, the imposter, and the fraud of every description carry off at least half of all charity,” the Reverend Oscar McCulloch warned in 1880.

Like many Americans of his era, McCulloch believed that there were essentially two kinds of poor people: the deserving, who were honest and hardworking but down on their luck, and the undeserving, who chose lives of idleness and sin. Over the course of the next half-century, McCulloch codified the principles of “scientific charity,” a model of philanthropy that sought to coordinate and rationalize giving. Charity Organization Societies across the country enlisted “friendly visitors” — usually middle-class women, who were more skeptical than friendly — to determine the true extent of potential aid recipients’ need. “The poor will take your gifts and laugh at your credulity,” one charity organization’s handbook warned. Visitors denied aid to those who drank, had sexual relations outside marriage, or otherwise offended middle-class morality. 

When private charities were eventually replaced by state-funded agencies, the distinction between the deserving and the undeserving was enshrined into law. The first modern public welfare programs in the U.S. focused on single mothers in part because they could be more easily seen as victims: Illinois established a “mothers’ pension” in 1911, and two decades later, 46 of 48 states had similar programs. But not everyone was convinced that single mothers were entirely blameless. So, like the Charity Organization Societies, states employed social workers to evaluate their clients’ neediness and determine whether they maintained “suitable homes.” Because policymakers hoped to encourage mothers to devote themselves fully to childcare, many programs prohibited full-time employment and deducted recipients’ earnings from their stipends. But aid amounts were so paltry that few could survive on them alone. To get by, writes the historian Molly Ladd-Taylor, people cheated. When Mary Legaikas, an Illinois widow, applied for a pension in 1918, she got permission to work part-time at a car repair shop. But even with the added income, she couldn’t feed her children, two of whom were clinically underweight. When a social worker called the shop, she learned that Legaikas was scheduled for fifty hours a week. “The mother is doing surreptitious work!” she noted in Legaikas’s case file.  

While the state sanctioned women for working too much, early-twentieth-century policymakers were reluctant to offer aid to jobless men. It took the enormous scale of job loss following the 1929 stock market crash to sufficiently challenge their assumption that men’s unemployment was the product of personal fault. “Not perseverance, nor skill, education, and health, nor a long and excellent work record, stand the breadwinner in any certain stead when the bad word is handed down from directors to executive to foreman,” the author Clinch Calkins concluded in her widely acclaimed Some Folks Won’t Work (1930), a collection of sympathetic profiles of the jobless. In 1935, Congress passed the Social Security Act, which established federal “social insurance” programs for old age and unemployment. These programs offered relatively generous benefits, but they conditioned eligibility on claimants’ past records of regular employment and excluded agricultural and domestic workers, among others. As a result, many of the poorest Americans, disproportionately women and people of color, were left out.

To aid some of those who were especially impoverished, the Social Security Act also authorized grants to the states to fund public assistance programs for the elderly, the blind, and single women with children. The benefits these programs offered were significantly less robust than those tied to employment. As the historian Linda Gordon recounts, Aid to Dependent Children (ADC) was modeled on mothers’ pensions and was similarly means-tested, requiring mothers to report and deduct any earnings from their stipends. ADC was also morals-tested, with many states continuing to enforce “suitable home” requirements. The presence of a man in a client’s house could result in the denial of aid on either grounds, because a lover was also an assumed source of hidden financial support. As with mothers’ pensions, the combination of meager assistance and strict rules forced recipients to cheat. “Luck and skill at dissemblance, not rules, determined who got caught,” Gordon writes.

ADC’s rules were originally intended to fend off the stigma attached to the undeserving poor. But once the program became law, this had the opposite effect. Punished for working, those receiving welfare were seen as lazy. Forced to break the rules to earn sufficient income, they were seen as dishonest. These stereotypes only became more pronounced as the program grew. Between 1936 and 1957, ADC’s rolls expanded from 162,000 to 667,000 families. The racial demographics of the program also changed as black and Puerto Rican families migrated to northern cities. (While discrimination occurred across the country, public assistance agencies in the South were especially likely to deny aid to women of color.) Northern politicians launched increasingly racialized attacks on welfare recipients, stoking concerns that they were choosing benefits over waged work. In 1961, the city manager of Newburgh, New York, made national headlines when he pledged to revoke benefits from “chiselers, loafers, and social parasites” coming up from the South. 

Amid such fearmongering, a Democratic-controlled Congress passed amendments to the Social Security Act in the 1960s that created job-training and work programs for participants in the newly renamed Aid to Families with Dependent Children (AFDC), and then made those programs mandatory. Welfare recipients were now permitted to keep some, but not all, of their earnings. These changes reversed the assumption that mothers should devote themselves fully to caregiving. But they did not resolve the inherent contradictions of stingy aid and strict rules. Because the small amount of income that AFDC beneficiaries were allowed to retain did not adequately supplement stipends that continued to fall far below the cost of living, they continued to work off the books or hide their wages. 

“You couldn’t make it unless you did something illegal,” Mary Wesley told the historian Annelise Orleck. “You had to do something — some work on the side — because you couldn’t pay your rent, your utilities and have enough to feed your kids.” In 1967, Wesley and other welfare beneficiaries in Las Vegas were enrolled in a sewing course as part of a new, state-mandated job-training program. Meeting five days a week, eight hours a day, the women began talking about the difficulty of surviving on the system’s terms. Wesley had lost her medical benefits when the state found out that she was failing to report money she made selling homemade goods to neighbors. Others had similar stories. “I guess that’s what keeps the rich richer and the poor poorer,” Wesley remembered realizing. The sewing group helped found the Clark County Welfare Rights Organization. While middle-class feminists were consciousness-raising in living rooms, women collecting AFDC funds, too, were gathering all over the country, transforming their private hardships into a structural critique of the welfare system — and lobbying city and state governments for higher payments and less prohibitive eligibility criteria.

As this grassroots movement emerged, academics began to argue that the administration of welfare sustained rather than mitigated inequality. In a 1966 article in The Nation, the sociologists Frances Fox Piven and Richard Cloward wrote that public assistance agencies under pressure to keep their budgets low failed to enroll everyone who might be eligible, arbitrarily denied claims, and intimidated potential applicants. To highlight the discrepancy between the benefits to which the poor were legally entitled and those they received, Piven and Cloward proposed a mass campaign to enroll eligible welfare recipients. Activists followed suit, teaming up with lawyers to flood local offices with benefit claims. In the spring of 1968, members of New York’s Citywide Coordinating Committee of Welfare Rights Groups submitted requests for clothing, household items, and other necessities, which the city’s agency made available through special grants but did not advertise. Around seventy people camped out in the East Tremont Welfare Center in the Bronx for four days in protest of its practice of holding up aid until an investigator visited the client’s home. Organizers won more than thirteen million dollars in extra benefits that June. That summer, the National Welfare Rights Organization encouraged other groups across the country to launch similar actions in a campaign called “More Money Now!” 

Welfare rights advocates also initiated broader legal challenges against AFDC restrictions. By the start of the 1970s, the Supreme Court had struck down “man-in-the-house” provisions, curbed states’ ability to deny aid to new residents, and established clients’ rights to fair hearings before their benefits were cut. Though these legal victories fell far short of completely overhauling the welfare system, they ended some of its most exclusionary regulations and provided a formal avenue to protest unfair treatment. In the early 1960s, only about one-third of families eligible for the program were enrolled in AFDC nationwide. By 1971, about ninety percent of those eligible received benefits.

The backlash was swift. In the wake of these legal victories, politicians and pundits argued that the expansion of aid had created a new avatar of deviance and dependency: the “welfare queen.” In 1974, the Chicago Tribune reported extensively on the case of Linda Taylor, who wore furs, drove a Cadillac, and allegedly used multiple aliases to collect thousands of dollars in AFDC cash aid and food stamps. During his presidential campaign two years later, Ronald Reagan amplified the sensational story. “There’s a woman in Chicago,” he told an audience in Gilford, New Hampshire. “She has eighty names, thirty addresses, twelve Social Security cards and is collecting veterans’ benefits on four nonexistent deceased husbands.”

Before the 1970s, as the historian Julilly Kohler-Hausmann writes, welfare fraud charges were very rarely prosecuted: public assistance agencies typically just adjusted payout amounts or removed those caught cheating from the rolls. But beginning with California’s Welfare Reform Act of 1971 — signed by Reagan during his second term as governor — states passed laws that introduced new forms of surveillance and imposed harsher penalties. Illinois, for instance, started requiring residents to present three forms of identification to collect benefits and hired off-duty police officers to track down alleged cheaters. Lawmakers also allowed the state attorney’s office to keep 25 percent of the money recouped from resulting investigations. In 1979, Illinois referred more than ten times as many welfare fraud cases to law enforcement as it had in 1971, a dramatic increase that reflected national trends.

One of Illinois’s most frequently used tools, Kohler-Hausmann notes, was a “hotline” for reporting rule-breaking. Between 1977 and 1980, it received more than thirty thousand calls. According to state officials, many of the callers were neighbors, aggrieved acquaintances, and estranged relations of the accused. Often, callers were on welfare themselves. A Department of Public Aid investigator told the Chicago Defender that he once heard from a tipster who claimed that his neighbor was on aid while making enough money to drive a new car. When the investigator said that he’d need the name of the neighbor’s employer, the tipster peered through the window with binoculars and spied his neighbor wearing a Sears employee T-shirt. 

But the crackdown did not address any of the underlying reasons for welfare clients’ cheating — nor did it extend to every corner of the system. In the 1980s, one Chicago caseworker told the sociologist Kathryn Edin that she expected her clients to lie. “Let’s face it,” she said. “You’re getting $250 from Public Aid and your rent is $235, you certainly aren’t living on $15.” Enforcement remained subjective and discretionary. Some caseworkers turned a blind eye out of sympathy. Others said that they couldn’t possibly complete all the paperwork necessary to attend to every case. A few worried about what would happen if they took every rule-breaker off the rolls. “If we cancel too many cases, then they won’t need too many caseworkers, and we’ll all be out of a job,” another welfare administrator member told Edin. 

Even if welfare policing didn’t curtail cheating, it did serve a purpose: neutralizing the poor as a political force. Potential allies became potential informants, and participation in welfare activism declined rapidly. In 1968, the National Welfare Rights Organization had ten thousand paid-up members; in 1974, the number had dropped so low that the organization’s leaders could no longer provide an accurate count. It declared bankruptcy a year later. By the end of the decade, most local groups had folded, and legal campaigns had stalled.

The rollback of activists’ gains was only just beginning. As president, Reagan established further work requirements for AFDC, cut federal funding for food stamps, and even tightened eligibility requirements for the federal school lunch program. But it was a Democrat who promised to “end welfare as we know it.” In 1996, Bill Clinton signed the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), which replaced AFDC with grants for states to fund TANF. The law made work requirements almost universal and established a lifetime aid limit of sixty months. Between 1994, when the AFDC caseload peaked, and 2023, the number of adults receiving cash assistance dropped from more than 4.6 million to 497,500.

In the early 2000s, when the legal scholar Kaaryn Gustafson interviewed Californians receiving welfare, most found compliance difficult. But few thought that anything should change. One woman, Barbara, had her aid reduced for failing to meet work requirements that she should have been exempted from due to a disability. Still, she didn’t think the system was unfair. “Ah, they’ve given me a rough time,” she told Gustafson. “Because I know there are so many people who try to trick them, you know.” Gustafson’s interviewees, who largely skirted income-reporting requirements so that they could afford necessities for their families, didn’t think of themselves as cheaters. Even as they faced punishment, they imagined the system needed to be protected from real con artists. “I see some women in Bayview City who have got the really long fake nails,” said one woman, Jane, who herself hid her earnings. “They’ve got a Gucci bag and Fila shoes. They’re wearing leather coats.” 

Like earlier restrictions on aid, the changes PRWORA made to public assistance failed to reduce the stigma of receiving welfare. Instead, they bolstered the belief that the poor required policing. In the three decades since the law’s passage, politicians have continued to decry the prevalence of welfare abuse. Trump has only amplified their rhetoric, and brought it into the immigration debate. In 2016, he ran a campaign ad that claimed — falsely — that “illegal immigrants” were “skipping the line” to collect Social Security and Medicare. Unauthorized immigrants were not, in fact, able to receive Social Security or Medicare, but in his second term, Trump has worked to make it harder for eligible claimants to access a range of benefits. In his 2024 campaign, he had vowed to “get rid of waste and fraud” in the welfare system, and by April of 2025, Elon Musk’s Department of Government Efficiency had cut around twelve percent of the workforce from the Social Security Administration. 

But Trump and the GOP have reserved their biggest assault for SNAP and Medicaid: the means-tested programs that, since the passage of the PRWORA, have become the principal sources of aid for poor Americans. (Today, SNAP serves about 42 million people per month; about seventy million are enrolled in Medicaid.) In February 2025, Republican House Speaker Mike Johnson began touting proposed work requirements for Medicaid to prevent “29-year-old males sitting on their couches playing video games” from claiming benefits. The Congressional Budget Office estimates that the One Big Beautiful Bill Act, passed in July 2025, will reduce federal spending on Medicaid by about $1 trillion and on SNAP by about $187 billion over the next ten years. The law will also impose more frequent eligibility checks and expanded work requirements, as well as restrict aid to some lawfully present immigrants. 

Historically, politicians’ pledges to reduce waste and fraud have not necessarily resulted in initiatives that save taxpayers money: welfare policing is costly itself. Government fraud detection units justify their expense by pointing to the funds that would have otherwise been illegitimately issued. But the amount of improperly distributed benefits that investigators actually claw back doesn’t always make up for the expense of investigations. In California, for instance, the legal scholar Gustafson found that the state spent $34 million investigating abuse in public-assistance programs in 2008 but identified overpayments of only $19.6 million. Nevertheless, government investigators are happy to keep spending taxpayer money. Welfare police are today a powerful constituency in their own right. Dawn Royal, the director of the United Council on Welfare Fraud — a lobbying group that represents investigators in federal, state, and local public assistance agencies — has been a vocal proponent of the Trump administration’s crackdown on what the organization calls “fraud, waste, and abuse.” 

Corporations are also getting in on the action. Across the social safety net, policing operations are subcontracted out to private actors. This past May, Mark Begor, the CEO of the multinational consumer credit reporting agency Equifax, told financial analysts that the administration’s focus on welfare abuse was a “tailwind.” The company sells government agencies a product called “The Work Number,” an identity verification tool that collates data from employers, schools, and other organizations. According to Begor, safety net programs offer an annual revenue opportunity of as much as five billion dollars. As policy analyst Luke Farrell has written, a “means-testing industrial complex” generates profits from the denial of benefits to needy Americans.

Private contractors often flag claims that result from simple clerical errors. After the Supreme Court upheld the Affordable Care Act in 2012, a third-party vendor helped Illinois cancel benefits for nearly 150,000 people, claiming to save seventy million dollars. In fact, many of those kicked off had simply missed notifications to provide information and were reenrolled a short time later. About a year into the pandemic, California’s Employment Development Department paid at least $236 million to private contractors, including Deloitte, V3Gate, and Thomson Reuters, to modernize its systems and root out illegitimate claims. According to a state report, EDD and its contractors improperly denied or delayed payments to millions of people. Among them were Danny Ramos, a construction worker who missed a request for identity documents after he moved; Donna Cook, a seasonal hospitality worker in Big Bear Lake who failed to report $61 in income she hadn’t known she was paid for a single-day orientation; and Maria Sanchez, a nanny in San Francisco who made a “false statement” on a form (she does not speak English fluently). The 929 people that Newsom boasted of arresting for unemployment fraud no doubt included more Californians like them. 

Today, benefit policing is more discretionary and subjective than ever. Those who break the rules knowingly may escape notice, and those who try to follow them may be harshly punished. The subreddit r/foodstamps is full of posts testifying to program participants’ fear and confusion. “Is my life ruined,” asked one nineteen-year-old user who had erroneously listed herself as a “head of household” on her application, unaware that the program counts any person under the age of 22 living with a parent as part of the parent’s household. Another food stamp beneficiary posted about receiving a call from a man who identified himself as a welfare fraud investigator. She didn’t know what she had done wrong, but when the man began bombarding her with personal questions, she got nervous and told him to cancel her benefits.

If progressives really wanted to fight back against Trump’s efforts to dismantle the safety net, they’d need to do more than dispute his accounts of welfare cheating. They’d need to challenge the entire premise of contingent aid. So long as eligibility criteria remain too restrictive and benefits remain too low, people will cheat — inadvertently, and intentionally, too. A food service worker in Missoula, Montana, who identified himself by his middle name, James, told KFF Health News that he knowingly failed to report an increase to his income of about one dollar an hour to Medicaid. With the raise, he was exceeding his income eligibility limit of about $21,000 per year by roughly $50 a week. But he was still struggling to cover his routine expenses and couldn’t afford even the cheapest plan available to him on the Affordable Care Act marketplace. “I don’t want to be a fraud. I don’t want to die,” he told a reporter. “Those shouldn’t be the only two options.” 

For now, it’s only under the cloak of anonymity that anyone can say that they were forced to break program rules, whether intentionally or not. To openly protest the state’s terms would mean not only losing one’s benefits but risking harsh criminal punishment. Overly punitive as it’s always been and truly draconian as it’s become, welfare policing still doesn’t really deter welfare fraud. It does, however, deter the poor from confiding in one another, from discovering, as activists once did, that their sources of private shame are part of a common struggle. The state is content to let welfare recipients do what they need to do to survive, so long as they keep their heads down, suspecting and blaming one another, but never the law. The state lets the poor break the rules so that they don’t break the system.