Klobuchar and Demuth clash over fraud scandal and costs in first Minnesota governor debate

Democratic U.S. Sen. Amy Klobuchar and Republican Minnesota House Speaker Lisa Demuth shared a debate stage for the first time Monday, trading sharp exchanges over the state's welfare fraud scandal, rising healthcare costs, and taxes at a Minnesota Chamber of Commerce business forum — with a second, televised debate already scheduled for Wednesday evening in Rochester.

The hour-long forum, focused on the economy and business climate, unfolded against the backdrop of a fraud scandal that has come to define the race: pandemic-era social services schemes that siphoned hundreds of millions — and potentially billions — of taxpayer dollars from federal and state programs in Minnesota. The scandal prompted two-term Democratic Gov. Tim Walz, who has taken full responsibility for it, to abandon his 2026 re-election bid.

Demuth repeatedly steered the conversation toward the fraud scandal in the debate's first half, working to link Klobuchar to Walz and the failures of Democratic governance. Klobuchar, for her part, moved quickly to separate herself from the sitting governor.

I have been very clear. I would have caught that fraud. I would have done something about it. We have very different backgrounds.— Amy Klobuchar, Democratic gubernatorial candidate

We have allowed a culture of waste and fraud to go on far too long and we can't keep going this way.— Lisa Demuth, Republican gubernatorial candidate

Demuth pressed Klobuchar on why she hadn't done more before the scandal became public, asking why she didn't reach out to the governor or attend more hearings on fraud, according to Fox News.

Klobuchar pushed back, saying that once the fraud became public, she called the Justice Department to request more resources — a move she said resulted in additional federal prosecutors being assigned to the investigation. On the missed hearing, she said the specific session Demuth cited was a subcommittee she was not a member of, and that she had attended a dozen hearings where she raised questions about fraud, according to Fox News.

The minute that the fraud went public, I did something that was real….. I called the justice department and asked for more resources.— Amy Klobuchar, Democratic gubernatorial candidate

Demuth pledged that if elected she would fire all of the commissioners in the state of Minnesota to start fresh after the scandal, according to Fox News.

The two candidates also clashed over healthcare costs, with Demuth arguing that Klobuchar's support for the Affordable Care Act had driven costs higher.

We must recognize that our healthcare costs have exploded across the country and in Minnesota because of the Affordable Care Act. The senator said that it would bring the cost of our healthcare down, we could access whatever we needed and it would be more affordable. That is absolutely untrue where we find ourselves today.— Lisa Demuth, Republican gubernatorial candidate

The forum also covered gas prices, paid family and medical leave, and efforts to cap insulin costs. On taxes, the two candidates found rare common ground: both ruled out tax increases.

Tax hikes are absolutely off the table for me.— Lisa Demuth, Republican gubernatorial candidate

I've made clear I'm not going to increase taxes. I've been willing to take on my own party on taxes in the past.— Amy Klobuchar, Democratic gubernatorial candidate

The race carries additional significance beyond the fraud scandal: whoever wins will become Minnesota's first woman governor, according to Fox 9. If Demuth wins, she would also become the state's first Black governor, according to data from the National Governors Association cited by Fox 9. Demuth is also the first Black lawmaker to serve as speaker of the Minnesota House.

Klobuchar, who launched her gubernatorial campaign in January — three weeks after Walz dropped his re-election bid — holds an upper single-digit lead over Demuth in recent polls, according to Fox News, which rates the race as Likely Democrat. Demuth is aiming to become the first Republican to win a Minnesota gubernatorial election in twenty years, according to Fox News.

The two candidates are set to face off again Wednesday, Oct. 21, in a televised 60-minute debate live from KTTC/KXLT in Rochester, co-produced by Fox 9 and several Gray Media television stations serving Minnesota. That debate begins at 7 p.m. and will be followed by an hour of post-debate analysis, according to Fox 9. The general election is Tuesday, Nov. 3.

Why it matters — With Minnesota's governor's race the most competitive in two decades and the fraud scandal reshaping Democratic politics in the state, Monday's debate was the first direct test of whether Klobuchar can separate herself from an unpopular incumbent — and whether Demuth can close a polling gap before Election Day.

Reported by thehill.com, startribune.com, minnesotareformer.com, foxnews.com, fox9.com