Welfare Billionaire

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Twenty years ago, while I was working at Berkeley-based Ramparts magazine, reports began to surface about H. Ross Perot's Electronic Data Systems Company. Having just taken over the processing of California's Medicaid and Medicare cliams, E.D.S. was charged with carrying out a racial purge, firing or demoting anyone who was black. As I investigated the accusations, not only did they turn out to be substantially true but Perot's whole elaborately confected story of free enterprise wizardry began to disintegrate into Oz-like deception.

Artful misrepresentations to the contrary, E.D.S.'s intercourse with American's private sector was fleeting and insubstantial. The subcontract with California Blue Shield for processing health care claims provided one-third of Perot's total revenues. Similar Medicare and Medicaid subcontracts in ten other states provided …