Nick Shirley exposed $170 million in California Medicaid fraud – and Gavin Newsom's answer was a law designed to stop him.
Newsom signed a separate bill and declared himself the protector of a free and independent press.
The governor who criminalized one journalist just handed government checks to all the rest.
AB 2222 and the Community NEWS Act Put California Newsrooms on Newsom's Payroll
California's new Community NEWS Act – AB 2222 – is a government payroll program dressed up as a media rescue.
Gavin Newsom signed it, creating refundable tax credits of $20,000 per journalist for a newsroom's first five positions, $15,000 for every additional full-time hire, and $7,500 for each part-timer.
Qualifying outlets don't just get a deduction – they get a check, even when credits exceed what they owe in taxes.
Newsom called it support for "independent journalism."
That word – independent – is doing a lot of heavy lifting for a governor who just put newsrooms on his payroll.
Canada tried the same experiment under Justin Trudeau starting in 2019.
The Trudeau government poured hundreds of millions of dollars into journalism tax credits and private media subsidies.
Within four years, the government became the arbiter of which outlets qualified as journalism organizations and which ones didn't.
Canadian media analysts warned that recipients were trading short-term financial survival for long-term editorial independence.
One Canadian outlet rejected the subsidies entirely, warning the grants weren't saving journalism – they were creating a two-tiered press where government-approved outlets got access and everyone else got frozen out.
Newsom's press office calls AB 2222 "news neutral" – meaning any qualifying outlet can apply regardless of political viewpoint.
The government sets the qualifications and signs the checks.
Calling that arrangement "independent journalism" is the kind of word game Sacramento Democrats have perfected.
Newsom Signed the Stop Nick Shirley Act to Protect the Fraudsters Shirley Exposed
Six weeks before Newsom posed with journalists and signed his press subsidy bill, he signed a different piece of legislation aimed at a journalist who wasn't on his approved list.
Assembly Bill 2624 – written by Assemblymember Mia Bonta, wife of California Attorney General Rob Bonta – became law August 22.
Critics immediately dubbed it the Stop Nick Shirley Act.
Shirley is the independent journalist whose undercover videos caught taxpayer-funded daycare centers sitting vacant in Minnesota and alleged $170 million in fraud at California healthcare nonprofits drawing Medicaid dollars.
His reporting went directly to the public on YouTube, with no subsidized newsroom in between.
AB 2624 imposes civil fines starting at $4,000 on anyone who publishes images or personal information of workers at government-funded immigration nonprofits.
Republican Study Committee Chairman August Pfluger named it exactly for what it is: "The Stop Nick Shirley Act shows exactly how far Governor Newsom and California Democrats will go to protect fraudsters."
The RSC sent a formal letter to Attorney General Todd Blanche demanding the DOJ challenge the law on First Amendment grounds.
Shirley filed his own federal lawsuit against California Attorney General Rob Bonta and Secretary of State Shirley Weber, arguing the law imposes an unconstitutional viewpoint-based restriction on journalism.
When Shirley handed Sacramento Democrats the evidence of fraud, their response wasn't to investigate – it was to write a law against him.
Newsom Wants a Press He Pays and a Law for the Ones He Can't
Newsom has no quarrel with a powerful press, as long as he controls it.
The journalists who qualify for his tax credits owe part of their payroll to his signature.
The journalist who didn't need his money exposed hundreds of millions in fraud inside his state – and got a law written against him.
That is the Newsom model for press freedom – subsidize the outlets that cover for him, and legislate against the ones who don't.
Democrats have been trying to run this model at the federal level for fifteen years.
Obama's FTC floated the same scheme in 2010 – tax credits for journalists, a government-funded reporter corps through AmeriCorps, and a national fund for local news to rescue legacy outlets that couldn't compete in the digital age.
Biden's team buried a $1.3 billion journalism bailout on page 2,326 of the $3.5 trillion reconciliation bill – payroll credits of up to $50,000 per journalist annually, written broadly enough to cover major national outlets dressed up as local news.
Congress blocked the federal version both times, so Newsom built the same machine at the state level – and California is now the testing ground.
The legacy media can't compete, so Democrats intend to keep it alive on the taxpayer's dime – and a press that owes its survival to Democrat signatures has no incentive to hold Democrats accountable.
If Newsom reaches the White House, AB 2222 is the preview of what comes next for every newsroom in America.
Newsom isn't saving journalism – he's buying it at the taxpayer's expense.
And the one journalist in California who proved he couldn't be bought is currently suing the state.
Sources:
- Angelina Delfin, "California Advances Controversial 'Stop Nick Shirley Act,'" The Daily Signal, May 27, 2026.
- Staff, "'Stop Nick Shirley Act' Sparks Showdown at California Capitol," The Daily Signal, August 26, 2026.
- Staff, "Citizen journalist Nick Shirley files lawsuit against top Calif. officials, seeking to block Assembly Bill 2624," OAN, 2026.
- Republican Study Committee, "RSC Urges AG Blanche to Challenge 'Stop Nick Shirley Act' Over First Amendment Concerns," press release, September 2026.
- Staff, "The Hidden Gift for Media Dems Put in Their Spending Bill Effectively Turns Every Outlet Into NPR," Western Journal, September 2021.
