President Joe Biden’s nominee for the Department of Labor was grilled by Senate Republicans over “rampant” fraud that took place under her watch in a previous post.
Nominee Julie Su, who would replace retired Secretary Marty Walsh, appeared before the Senate Health, Education, Labor, and Pensions Committee on April 20 to testify on her confirmation.
Su is serving as the acting head of the Department of Labor, but she still needs to win the Senate’s approval to cement that position. Su previously served as the California Secretary of Labor.
During the hearing, Su faced substantial pushback from Republicans, who pointed to the $31 billion in fraud that occurred during Su’s time in a California post.
“I can say with a straight face that I don’t think you should be the Secretary of Labor,” Ranking Member Bill Cassidy (R-La.) told Su during his opening remarks.
During his opening remarks, Chairman Bernie Sanders (I-Vt.) defended Su, suggesting that President Donald Trump was to blame for Californians’ exploitation of COVID-19 benefits programs. Sanders said the Trump administration did not provide proper guidance to state-level officials on how to administer the funds granted by the $1.9 trillion CARES Act.
However, Republicans weren’t swayed by this defense.
Cassidy pointed to Su’s track record at the Employment Development Department (EDD)—which lost over $31 billion to fraud, Cassidy said, “by waiving fact-checking requirements recommended by the Department of Labor guidance.”
“Under Ms. Su, fraud in California was rampant,” Cassidy said.
To bolster this claim, Cassidy cited the case of rapper Nuke Bizzle, who was arrested after releasing a song rapping about how he had defrauded the California government of COVID-19 relief funds.
Cassidy recited the lyrics during the hearing: “I done got rich off of EDD.” The rapper claims to have made $300,000 by defrauding the program. After his conviction, Bizzle was ordered to pay back $700,000.
“The rapper was not held accountable due to Ms. Su’s oversight, but because he publicly admitted to his crime on a rap video,” Cassidy said before having the rap video in question placed in the record.
Sen. Mitt Romney (R-Utah) also criticized the nominee’s track record in California.
“The fact that under your lead, unemployment insurance payments in California of some $31 billion, went to people who were basically receiving money on a criminal basis, illegally receiving money from the federal government,” Romney said. “That’s about as much as we provided in military aid to Ukraine. That’s almost twice the total budget of the Department of Labor.
“Under your leadership in California, $31 billion was fraudulently paid out,” Romney reiterated.
“In this case, your record is so severely lacking that I don’t know how in the world it makes sense for the president to nominate you to take over this department,” he said.
Anti-Gig Economy Bill
Su was also grilled by Republicans on a bill targeting the gig economy that she supported in California.Cassidy cited Su’s administration of the effort to “dismantle the gig economy in California,” targeting services like Uber, Lyft, and DoorDash as part of the reason for his opposition to the candidate.
These services employ people as independent contractors, meaning they work on an independent basis and are not subject to the same protections or privileges as other types of employees. Supporters of the platforms say that they provide an easy way for people to make money on the side, while their opponents accuse them of exploiting their workers. Notably, none of these platforms have yet achieved profitability.
The bill in question, California Assembly Bill 5, required the application of an “ABC test” to determine whether workers in California were employees or independent contractors.
Su supported and helped carry out the policy, which closed off the gig economy to many, during her time as California Secretary of Labor.
Later, California lawmakers had to pass over 100 exemptions to the law—a legislative list longer than the original bill itself, Cassidy noted.
‘Nothing to Do With Her Qualifications’: Sanders
In his opening remarks, Sanders suggested that GOP criticisms of the candidate were not substantive and have “nothing to do with her qualifications.”
“No one can tell us with a straight face that Ms. Su is unqualified for this position,” Sanders said. “In fact, she’s extremely well-qualified.”
“This debate really has everything to do with the fact that Julie Su is a champion of the working class of this country who will stand up against the forces of corporate greed,“ he said. ”That’s really what this debate is about.”
Sanders added, “Julie Su should be confirmed as the Secretary of Labor because she spent her life fighting for those working families and they need her now.” He also noted that Su has the support of “every single labor organization in this country.”
Su’s confirmation is far from certain. She has yet to win the support of key Democrat players in the Senate, like Joe Manchin (D-W.Va.) and Jon Tester (D-Mont.)—both of whom are up for reelection in heavily red states next year.
A final vote on the nominee in the HELP Committee is expected sometime next week.
