By Yasha Levine and Mark Ames
The Tea Party Revolution has struck the Texas gubernatorial race, with the insurgent Republican candidate, Debra Medina, gaining in the polls and threatening the leading candidates, incumbent Gov. Rick Perry and Sen. Kay Bailey Hutchison. Medina has positioned herself as a radical anti-government outsider who would cut Texas free from federal government programs and influence in favor of the free market. However, according to an investigation of Medina's business records, her company, Prudentia Inc., benefited greatly over the past decade from federal government subsidies and lucrative municipal government contracts.
Our investigation shows that when you scratch the surface of Texas' rising tea party star, you'll find just another Bush-Republican, big-government hypocrite.
On Tuesday, Texas will hold a gubernatorial primary election that has come down to a three-way fight for the GOP nomination. Surprisingly, Medina, a rookie Republican candidate from the tiny rural town of Wharton who has positioned herself as the tea party alternative, is soaring beyond expectation. She has become a national celebrity, suddenly posing a threat to Gov. Perry and Sen. Hutchison. A tougher, rougher, stockier version of Sarah Palin, Medina surged in the polls after she slammed her mainstream Republican opponents in a televised debate, accusing both Perry and Hutchison of succumbing to "big-government solutions" and selling out their Republican ideals. But for all her derision, Medina has been milking taxpayers for years, including those in her own community who subsidize her business.
Medina, a 44-year-old registered nurse who presents herself as the proud owner of a small medical billing business, offered a small-government platform based on God and the free market. She would scrap Texas' property taxes, criminalize abortions, expand home-schooling, eliminate guns laws and shrink government to the size of a walnut.
"If we get government off the backs of Texans, we're not gonna have an economic crisis. We're not gonna have an energy crisis. We're not gonna have an immigration crisis," she yelled to an audience of "Don't Tread on Me" types during a stump speech at a Chevrolet dealership.
The crowd went wild for Medina. She had all the right credentials: ran a small business, grew up on a farm in rural Texas, paid her dues as Texas coordinator for Ron Paul's 2008 presidential campaign, home-schooled her children, didn't trust flu vaccines and always carried a loaded Springfield 9-millimeter in her purse—and made sure she was photographed doing it. But the biggest villain of all in Medina's rhetoric is the United States federal government. In the Republican primary debate in January, Medina said that the federal government's powers should be stripped down to nothing more than making treaties with other countries. She also has said that as governor of Texas she would make sure that her state's laws overruled the federal government's—under what's called "nullification"—and that she would do her best to stop just short of full secession from the Union.
Tea-baggers are slurping it up, but they probably aren't aware exactly what it is they're slurping. Despite her impassioned rhetoric and principled anti-federal government stands, Debra Medina hasn't stuck by her principles. What she hasn't told her libertarian supporters is that her business success over the past decade has depended on the government subsidies and contracts that she denounces. The tea party candidate is the same sort of hypocrite as her Republican foes: preaching free-market ideals to the masses while profiting off taxpayer money.
According to data compiled by OMB Watch, Medina's medical billing company, Prudentia Inc., was granted a $50,000 federal loan guarantee shortly after she incorporated it in 2002. The loan guarantee came courtesy of a program administered by the Small Business Administration, headquartered in Washington—a program that Republicans tried to kill twice in the past 15 years. Thanks to the federal government's loan guarantees, Medina and people like her are able to secure loans for their fledgling small businesses that banks might otherwise be reluctant to grant, or would charge a higher rate of interest on.
How did Medina qualify? The federal record describes such loan guarantees as being "for small businesses which are unable to obtain financing in the private credit marketplace." In the terms of Ayn Rand, this makes Medina one of the "moochers" who needed to soak the "producers" to fund her business, rather than (to use Medina's words) "having the courage" to let the business sink or swim in the free market. Apparently Medina was not ready to face her beloved free market: She stood in judgment before the Invisible Hand, got an invisible thumbs down and beelined it straight to Uncle Sam for a loan guarantee.
And yet Medina does not want to share the welfare she gets with her fellow Texans, which seems kind of unfair. Here's what she's promising to offer the suckers: "Get the government off their back, let them get out there and get a job, and we don't have to worry about unemployment, that charity does not belong with the government," she told one right-wing radio host.
But while Medina would get government off everyone else's back, she has made a handsome profit piggybacking on the government twice over: first, with a federal loan guarantee, and, even worse, by using that government-subsidized business to soak the taxpayers of Wharton, Texas, her hometown, by obtaining lucrative city contracts.
In October 2002, just a few months after getting the federal loan guarantee, Medina was ready to start operating her business. And that meant heading straight to the Wharton City Council, where Medina lobbied the government to hand her a sweetheart deal to manage billing and collection for the city's emergency medical services (EMS). Despite the fact that Medina's company was brand new and therefore untested, the council voted unanimously to dump the previous company and bring Prudentia onboard, under generous terms. The city agreed to pay an 8.5 percent commission on whatever Prudentia collected (rising to 10 percent for collections over $500,000). According to Medina's political campaign, Prudentia Inc. is a company that improves medical billing procedures. "Improves" for whom? Definitely for Medina. full story
