Democratic California Rep. Ro Khanna is sharpening his criticism of Gov. Gavin Newsom’s handling of taxpayer dollars, arguing that $72 billion in alleged fraud in the state’s budget is “outrageous and appalling.”
Khanna, a populist Democrat representing Silicon Valley, said he has been inundated by constituents concerned about “fraud, waste and abuse” in California’s state government. The California Democrat said he would launch a bipartisan effort from his perch on the House Oversight Committee to combat state-level fraud and would draft legislation that would independently audit the Golden State’s budget.
“There needs to be full accountability for the waste and new leadership in Sacramento,” Khanna wrote on X Saturday. “Taxpayers are owed an accounting of where every penny of their tax dollars are going –a detailed receipt.”
Newsom’s camp has accused Khanna of repeating Republican talking points by calling attention to wasteful spending in California. The duo are seen as contenders for the 2028 Democratic presidential primary with Newsom carving out an early lead in recent polling.
“Interesting to see a Dem repeat the MAGA-made-up $72B number,” Izzy Gordon, communications director for Newsom, wrote on X in response to Newsom’s initial tweet. “That ‘fraud’ supposedly includes the $17B spent on high-speed rail — which has created 16,000 union jobs and built 50+ COMPLETED projects. Calling union work ‘fraud’ is certainly a choice.”
California’s high-speed rail project has been plagued by serial delays and mounting costs. The Trump administration revoked $4 billion in federal funding for the project earlier this year, dubbing it a “boondoggle.”
Khanna recently ignited a firestorm among tech elites who threatened to leave California after he backed a controversial wealth tax that could appear on the Golden State’s ballot in 2026. The proposal — spearheaded by a prominent Democratic Party-affiliated healthcare union — would enact a one-time 5% tax on all the assets of California residents worth more than $1 billion. Newsom expressed opposition to the measure in December.
“While calling for higher taxes, FDR [former President Franklin D. Roosevelt] also decried the ‘tax burden caused by inefficient and extravagant local government.’ I have always been for accountability and taking on corruption,” Khanna wrote on X Tuesday. “I believe we can and must ask those Americans who have done well to pay more so everyone has healthcare and education. In turn, we must provide an accountable and transparent government.”
Khanna’s decision to spotlight fraud comes after Republicans have sharply criticized a massive welfare fraud scandal in Minnesota that could amount to more than $1 billion in stolen taxpayer money. More than 60 individuals — many of Somali descent — have been convicted.
House Oversight Committee James Comer has invited Minnesota Democratic Governor Tim Walz and Attorney General Keith Ellison to testify before his panel in February 2026.
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