Joe Biden’s pick to head the Department of Labor is current Deputy Secretary Julie Su, who is, according to a White House statement, “a tested and experienced leader.” As confirmation hearings await, senators might test her experience during an unemployment scandal in California.
Su headed California’s Labor and Workforce Development Agency (LWDA) which oversees the Employment Development Department (EDD) responsible for unemployment claims. On Su’s watch, the EDD sent more than $31 billion in fraudulent unemployment claims to California, out of state, and even out of the country. In 2020 alone, Su confirmed, fraudsters stole at least $11.4 billion in California unemployment benefits. As it happens, fraud was not a new problem at EDD.
California’s state auditor reported that “EDD had no comprehensive plan for how it would respond if California experienced a recession and [unemployment insurance] claims increased accordingly.” Su had failed to modernize outdated EDD technology, and in the early days of the pandemic suspended eligibility requirements for EDD claims. Convicted criminals took full advantage.
The state approved more than $140 million for at least 20,000 prisoners. Convicts who made fraudulent claims included convicted murderers Scott Peterson and Cary Stayner. Death row inmates accounted for at least 158 claims landing more than $420,000 in benefits.
Inmates used their real names, fake names, and fake Social Security numbers. One convict filed a claim under the name “poopy britches,” but rapper Fontrell Antonio Baines of Memphis, Tennessee, took it to another level. He obtained debit cards pre-loaded with unemployment benefits administered by the California EDD, issued in the names of third parties and victims of identity theft.
Baines, also known as “Nuke Bizzle,” posted a video titled “EDD,” bragging about “my swagger for EDD,” as a second rapper says, “You gotta sell cocaine. I just file a claim.”
Prosecutors accused Roseville, California, woman Andrea Gervais of filing 100 fake unemployment claims, including one in the name of California Senator Dianne Feinstein. While this massive fraud carried on unchecked, legitimate claimants waited months to collect the benefits they deserved.
“There is no sugar coating the reality,” Julie Su told reporters. “California did not have sufficient security measures in place to prevent this level of fraud.” Su did not explain what security measures she failed to put in place and to what extent she was responsible for the fraud. Incompetence and unaccountability aside, Su boasts other experience Joe Biden might find useful.
Su also served as California Labor Commissioner and supported Assembly Bill 5, authored San Diego Democrat Lorena Gonzalez, a frontal assault on workers’ independence. The measure primarily targeted independent truckers and rideshare drivers but there was more to it. AB5 also limited freelance writers, photographers, and videographers to 35 submissions per publication, per year. Independent musicians also took a hit.
Trumpeter Joe Mazzaferro protested that AB5 had already reduced his band’s pay. “I feel like it’s our right to work as we choose,” the bandleader told the Sacramento Bee. Gonzalez and Julie Su didn’t think so, and Gavin Newsom budgeted $20 million for AB5 enforcement.
In April 2020, in the early days of the pandemic, Williamson Evers and David Theroux of the Independent Institute sent Newsom an open letter, signed by 153 California economists and political scientists, urging the immediate suspension of AB5.
“By prohibiting the use of independent contractor drivers, health care professionals, and workers in other critical areas,” the experts explained, “AB5 is doing substantial and avoidable harm to the very people who now have the fewest resources and the worst alternatives available to them.” Newsom, who had already taken on emergency powers, said there was no chance he would suspend the measure, even on a temporary basis.
AB5 seeks to force independent workers into unions, staunch supporters of Democrats. According to the federal Bureau of Labor Statistics, 88.9 percent of workers, the vast majority, are not union members. Unions now represent only 10.1 percent of workers, the lowest percentage on record.
In California, a full 83.9 percent of workers are not union members, and unions represent only 16.1 percent of the state workforce. As these statistics confirm, unions do not represent “labor” in any meaningful sense. AB5 could be the most anti-worker law ever passed in California, and Joe Biden loved it.
The Delaware Democrat said he was “glad the California legislature passed AB5.” That invites a look at another Biden pick for a key federal position.
Joe Biden’s nominee for Comptroller of the Currency in the U.S. Treasury Department was Saule Omarova. A native of the Kazakh Soviet Socialist Republic, Omarova attended Moscow State University on a Lenin Scholarship. In the best Leninist-Stalinist style, Omarova wanted to end independent banks as a class and put the Federal Reserve in charge of every American’s money.
Such centralization essentially replicates banking in the Soviet Union, a regime Omarova still praises. Based on her record, Senator Tim Scott (R-S.C.) could think of nobody “more poorly suited to be the Comptroller of the Currency” than the Moscow State alum.
Biden now wants “tested and experienced leader” Julie Su for U.S. labor secretary. The confirmation hearing might take testimony from Californians harmed by AB5, which stripped workers of their independence and inflicted harm on people with the fewest resources and alternatives.
For Su’s leadership during California’s unemployment scandal, senators might bring in Fontrell Antonio Baines, or just play lyrics from his EDD video: “I done got rich off of EDD . . . I just might swipe me a lump sum. I’m in Dior havin’ money fun. . . . Ten cards, I’m swiping 10K a day. Counting up bills like a CPA.”