Minnesota Gov. Tim Walz, a Democrat, announced his decision to drop out of the 2026 gubernatorial election on Monday, citing the fraud scandal that continues to roil the North Star State.
JNS spoke with Henry Olsen, a senior fellow at the Ethics and Public Policy Center, about what the former vice presidential candidate’s decision to forgo a third-term run means for Minnesota and national politics going into the 2026 midterms.
“It shows how badly the scandal was both hurting Democrats and is inescapable by the incumbent administration that Walz, had he continued to run, would have been enmeshed in an argument he could not win,” Olsen told JNS.
“Democrats rightfully believe that that would drag other candidates down, which could be on the federal level—there’s an open House seat, and there’s the open Senate seat—but more importantly, the legislature is basically split,” he said.
The local affiliate of the Democratic Party, the Minnesota Democratic-Farmer-Labor Party, currently controls the governor’s office and the state Senate. Neither party holds a majority in the Minnesota House, though Republicans control the chamber as part of a power-sharing agreement, pending two special elections later this month.
“It only takes a couple of seats in the Senate and the House for Republicans to gain control,” Olsen said. “I’m sure the DFL did not want to see a Republican trifecta as a result of Walz’s administrative inability to root out fraud.”
For years, Walz’s state has been at the center of federal and local investigations of fraud regarding improper payments for social services, including school meals, Medicaid and daycare that were never distributed.
Many of the alleged perpetrators are members of Minnesota’s large Somali community, which Walz said in his speech on Monday has resulted in “smearing entire communities,” even as he acknowledged widespread fraud.
“We’ve got the president of the United States demonizing our Somali neighbors and wrongfully confiscating funds that Minnesotans rely on,” Walz said. “It’s disgusting, and it’s dangerous.”
Walz said that he had to choose between running for a third term and properly prosecuting fraudsters while defending the needs of his state.
“Every minute that I spend defending my own political interest would be a minute I can’t spend defending the people of Minnesota against the criminals who prey on our generosity and the cynics who want to prey on our differences,” Walz said.
Minnesota’s fraud scandal began with a case involving Feeding Our Future, a school-meals nonprofit that received some $250 million in federal funds. Federal prosecutors, starting in the Biden administration, have handed down 78 indictments in that case and secured dozens of guilty pleas and convictions.
That case then expanded into investigations of potentially billions of dollars in fraud into other programs that provide social services, many administered by Somali-Americans, prompting high-profile media attention in reports from County Highway and The New York Times, and a recent viral video about alleged no-show daycare centers.
Somalis in Minnesota are now a key DFL constituent and increasingly prominent in Minnesota politics, with elected officials like Rep. Ilhan Omar (D-Minn.) and a left-wing Somali-American challenger to incumbent Democratic Minneapolis Mayor Jacob Frey garnering more than 44% of the vote in that city’s 2025 election.
“They’ve grown to depend on overwhelming margins from the Somali community,” Olsen told JNS. “The fact that the Somali community is so closely tied to the Democratic-Farmer-Labor Party is a problem for the DFL, and the fact that the fraud is apparently—I say ‘apparently’ because investigations are ongoing—but is apparently both long-standing and obscene, and it suggests the possibility that people with reason not to look did not look.”
“That’s surely the argument that Republicans were going to make,” Olsen said.
Walz’s decision to withdraw from the race throws open the Democratic primary to replace him, with Sen. Amy Klobuchar (D-Minn.) reportedly considering a run. That would in turn leave open both of Minnesota’s Senate seats, after Minnesota’s incumbent junior senator, Tina Smith (D-Minn.), decided not to run for re-election in 2026.
Olsen said that if Klobuchar runs for governor, that might be a signal that she will not once again seek the presidency.
“I think if Klobuchar does run, she views it as the capstone of her career, that she would go and serve two, maybe three, terms as governor of her home state, and then call it quits,” he said.
‘Grasp exceeded their power’
Republicans face difficult odds heading into the 2026 midterms, with Democrats consistently winning generic congressional polls and the GOP holding narrow margins in both the House and Senate. But if they can keep the fraud story relevant in national politics, then Minnesota could become a key battleground for control of the House and Senate.
“They want to portray Democrats as corrupt, incompetent and blinded by an incorrect ideology to the exclusion of the public interest, and this is one story that they will tell that is in line with that argument,” Olsen told JNS. “If Lt. Gov. Peggy Flanagan wins her contested race in the primary for the Senate against Rep. Angie Craig, then there will be a race where the question is, ‘What did she know and when did she know it?’”
“That will be paramount in Minnesota, and if it’s paramount in Minnesota, then that’s something that raises the chance that Republicans can keep this alive in a meaningful way through the midterms,” he added.
Walz’s decision to withdraw amid his state’s fraud scandal also retroactively tarnishes his stint as Kamala Harris’s vice-presidential nominee and could complicate any ambition that she might have to once again seek the nation’s highest office.
“Anyone who closely followed that process knew from the start that this was a sign of a weak candidate, a weak leader,” Olsen said, of Harris’s decision to tap Walz for veep.
“One shudders to think what would have happened if he were the sitting vice president when this came,” he said. “Then the scandal would be touching the White House, because it certainly is not something that he could escape judgment for simply because he had changed addresses.”
“It provides yet more evidence that Kamala Harris’s and Tim Walz’s grasp exceeded their power,” he added.
Sam Markstein, spokesman for the Republican Jewish Coalition, told JNS that Walz’s withdrawal was a “hilariously pathetic political crashout.”
“It started when he was totally embarrassed by Vice President Vance in last year’s VP debate, continued when he lost his home county in Minnesota to Donald Trump and crescendoed with his decision to drop out of the race for governor this week after bombshell fraud allegations,” Markstein said.
“Tim Walz will be remembered as an incapable, feckless and bozo governor,” he added.
