Grifty Mississippi 'Charity' Eated All The Welfare Monies
Mississippi is not a good place in which to be poor. It's the go-to state for other states with crappy social programs to compare themselves to: "Thank God for Mississippi!" (Alabama sometimes goes in the object slot, too.) Like many red states, Mississippi doesn't believe that poor people can be trusted to receive cash assistance, so instead, the state gives most of its federal "welfare" funds to nonprofit organizations that are supposed to fight poverty through job training, parenting classes, and other important services like telling poor people not to fuck.
Such programs may not reduce poverty in any measurable sense, but they're a great deal for the nonprofits being funded by federal anti-poverty money. So it probably shouldn't be too big a surprise that last week, several top people at "Mississippi Community Education Center," one of the state's biggest nonprofits, were arrested for embezzling millions of dollars that didn't even go to the pretense of providing services for the poor, as Mississippi Today details in a report that may have you hurling your computer across the room.
Get this: The investigation didn't just nab the director of the outfit, Nancy New, and several members of her family who worked for the nonprofit. New, who founded a private school in Jackson and tried but failed to get in on the charter school grift too, "has long had the support of state leadership and often appeared on conservative SuperTalk radio to promote her work." No telling how the criminal charges will affect her standing on the wingnut economic prosperity circuit, but she can probably claim she was victimized by Cultural Marxists.
The probe also led to the arrest of John Davis, the former director of the Mississippi Department of Human Services, the state agency responsible for disbursing the funds. Since 2018, the nonprofit had sucked up $53 million in funding from the federal Temporary Assistance for Needy Families (TANF) program, the cash-assistance program that used to be called "welfare." The case is still under investigation, so the exact amount of embezzled funds hasn't been released.
But don't you worry: Mississippi only uses five percent of its annual TANF funding for direct payments to needy families, so even without the crimes, the money would have gone to programs that may or may not have actually been helping poor people. In a sense, this is really a case of some crooks stealing money from the legitimate grift they were already running. Isn't that a comfort?
As Yr Wonkette has noted previously, one of the very best things about the decades-long rightwing war on the poor is that under federal law, states are actually not required to spend federal "welfare" funds on cash assistance to poor people. Instead, TANF funds can be spent on other programs, as long as the state can say with a straight face, and at least some kind of documentation, that those programs are aimed at helping low-income families with children.
A few years back, former Maine Gov. Paul LePage decided his state needed to spend TANF funds on elderly people and people with disabilities, because they deserve help and lazy takers don't — and even that may have been legal-ish. LePage also transferred other TANF monies to church-run abstinence programs for young folks, so that undoubtedly prevented some poverty, maybe?
In the past few years, Mississippi has been particularly generous to an offshoot of the MCEC, a statewide outfit called "Families First for Mississippi" that was also run by New and her family.
The program faced criticism over the last year from advocates and lawmakers who questioned the large contracts and unclear objectives of the operation.
"They were fudging the numbers by saying they were helping so many people and you had an office that was barely open, that barely acknowledged people walking by asking for help," said state Rep. Chris Bell, D-Jackson.
But at least they're providing valuable services to help lift people out of poverty, maybe?
By the end of fiscal year 2018, Human Services had paid Mississippi Community Education Center roughly $30 million. In the same time frame, the nonprofit had helped 94 people complete a resume and 72 people fill out job applications in addition to the educational classes it conducted, according to outcome reports it sent the state agency.
But just look at the cool stuff offered at Families First's flagship State Street Center in Jackson! We bet Families First could have done all 94 of those resumes in that computer room, although that was a statewide figure and the new facility just opened last September. We also like that a good half of the video emphasizes that what poor people really need is to learn how to dress up really nice so they'll project a professional attitude in job interviews.
Will Lamkin, the "operations director" seen in the video, was full of information last week when Mississippi Today interviewed him — a few hours before the arrests, as it happened (Lamkin was not implicated in the criming, but stopped returning reporters' calls). He explained that the center's "main goal is getting them off of TANF," although if you want to get all technical about it, hardly anyone in Mississippi is actually on TANF anymore. Ten years ago, only 12,000 families received TANF, but even fewer — 3,500 families — received cash assistance in 2019. So hooray, by sending all the TANF money to groups like Families First, Mississippi can declare Mission Accomplished!
If someone came into the center and needed money to pay a utility bill, that wouldn't be an option, Lamkin explained, because that is not how things work. Instead, he would help them learn to fish, should there be any fishing holes nearby that aren't contaminated with industrial waste. Perhaps they could sell the fish to pay the bill!
"Let's say, for instance, somebody comes in and they say, 'They're about to cut my gas off. I need $40 for my gas bill.' Well I can't just give them $40."
Lamkin gestured to the shelves in the Families First food pantry, lined almost exclusively with canned corn and green beans. "But I can give them $40 worth of food."
Asked why the welfare agency couldn't provide energy assistance, Lamkin responded, "I don't have the funding"; then clarified, "Our grant doesn't allow for that. I can't just give a client cash."
Even the canned food and used clothing came from donors, so that federal money sure was "helping the poor," huh?
And remember, kids, that's how the system is supposed to work without adding in the alleged fraud. Which was also a doozy. State Auditor Shad White said that New, Davis, and others in the scheme skimmed millions of dollars from the nonprofit. In one scam, they faked documents to use TANF money to send a former pro wrestler, Brett DiBiase, to drug rehab in California. On paper, he was supposedly teaching classes to prevent drug abuse among those messed up people on welfare. But come now, how could he do that without getting clean himself? The scammers also took federal funds to invest in "medical device companies" in Florida; no telling whether they made any profits that might be seized.
And then there's this amusing nugget about the bang-up job John Davis did while he was director of Mississippi's DHS: In 2017, Mississippi made national headlines when it was revealed DHS rejected 98.5 percent of TANF applicants in 2016.
The agency also reported leaving nearly $50 million in TANF funds unused. After that, the agency stopped publishing its approval rate in annual reports, which shrunk from 108 pages in 2004 to 20 pages in 2019 — one way the agency managed its programs in secrecy under director Davis. Davis regularly refused to allow his employees, even taxpayer-funded agency spokespeople, to talk with the press.
Imagine that! Davis also had a habit of awarding no-bid contracts to nonprofits, which no one thought twice about because he'd been a respected public servant for decades. Davis resigned suddenly, last summer, when internal DHS accounting documents raised red flags. By then, though, MCEC was already getting the state's biggest slice of the TANF pie, receiving far more funds than another nonprofit that wasn't part of the alleged scheme, even though both groups' state contracts were for the same amount.
The funds that were illegally obtained in this case were intended to help the poorest among us. The funds were instead taken by a group of influential people for their own benefit, and the scheme is massive.
Yeah, that's not right either. Even when the system is operating exactly as it should, those funds weren't directly helping anydamnbody but the outfits that pretended to help poor people by referring them to still other nonprofits. You want to get poor people out of poverty? Direct cash assistance does that, as this example in Canada suggests, but oh my, that plays badly on Fox News.
But this case? This was really just a case of some grifters stealing from the legally established poverty-services mafia. Sure, were it not for the theft, maybe another 20 or 30 people might have completed job applications. Let's not pretend the authorized system is that much better than the scammers.
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