For your awareness and action!
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CAFR Scam On American Taxpayers Continues!
By: Walter Burien
4/5/2003 : 4:07:32
The Comprehensive Annual Financial Report (CAFR) is local government's Annual Financial Report, which is the standard, starting as of 55 years ago. The true and more complete accounting of local governments.
Local governments promote the 'Budget' each year but hold back disclosure of their actual annual financial report...which includes their aggregate net worth and total gross annual income.
A PERSONAL EXAMPLE:
If you have a budget to operate your house; Let's say your budget is $30,000 per year, of which you put $30,000 aside to cover your budget and this year you spend $40,000 that now means you have a $10,000 budget deficit. You also are telling everyone you are $275,000 in debt already from the past mortgages / bonds/ debt, So what are you going to do to make up that $10,000 shortfall?
A. Knock on your neighbor's door and say I am short $10,000 on my budget, and I am $275,000 in debt, can I borrow $10,000 from you?
B. Sell your house and possessions to raise the cash to meet the $10,000 shortfall?
C. Cut back on half of your budget expenses next year ($15,000) and hope you catch up by the following year?
D. Ignore the $10,000 shortfall and hope someone else bails you out next year?
Does the above sound familiar when listening to your local government official(s)?
If you were a shareholder in a public Corporation, and that corporation said they had a shortfall on their budget this year and they could not pay dividends, and the value of your stock in their corporation was being cut by 45% of value, would you look at their budget report to verify the standing value of the corporation, or would you look at their Annual Financial Report? You would look at their AFR of course.
In fact, a public Company's Annual Financial Report is required by SEC law to be provided to every shareholder. A local government's Annual Financial Report is the Comprehensive Annual Financial Report, or CAFR for short.
Now back to the above example of a $10,000 shortfall in your operating budget.
If you had a Financial Statement prepared in accordance with accounting standards and existing laws that apply, your financial statement as shown for this example would show your $30,000 operating budget for your house and let's say the following:
1. Your personal gross annual income ------------------------------$ 75,000
2. Your investment assets---- (you have invested for years) ------$ 1,400,000
3. Your advance tax liability accounts -(tax liability 20K/year---$ 300,000
4. Your self-insurance funds --- ($30,000 required) --------------$ 215,000
5. Your advance forward debt repayment account -----------------$ 350,000
6. Your IRA account --- ($400,000 needed) --Balance -----------$ 2,275,000
7. Corporate income kept separate from your personal income --$ 515,000
8. Your openly disclosed total (gross) debt----------------------- ( $ 275,000 )
Now, upon review of your Financial Statement we have learned:
a. Your true debt from item 8 above is: [$275,000] minus item 5 above, $350,000 is a $75,000 (positive) Or a (NET) asset of $75,000 and NO DEBT.
b. Your true total gross income from item 1 above is $75,000 plus item 7 above $515,000 gives you $590,000 in TOTAL GROSS INCOME
c. Your tax liability is $20,000 per year as shown in item 3 above. Your advance tax payment account you established to pay your future taxes has a balance of $300,000, this gives you a standing positive asset of $280,000.
d. Your self-insurance fund has $185,000 over your true liabilities, or another asset of $185,000
e. Your IRA account has $1,875,000 over the required $400,000 in funds needed at your retirement.
f. Your investment account(s) have the ability of paying for your house-operating budget, and you would still have at a 10% return, $100,000 left over after paying for this year's $40,000 house operating budget.
g. Your total Net Worth is: 75K + 590K + 280K + 185K + 1.475K + 1.400K + 100K minus 40K of this year's actual annual operating budget, that now gives you a Net Worth of $3,975,000
Upon review of your financial statement, and knowing that others have reviewed or are looking to review your Financial statement. People that you approached to borrow $10,000 from, as you cried poverty, do you:
1-A. Quickly spend your excess net worth on yourself, family, and friends to justify being $10,000 short on your operating budget?
1-B. Hire a good accountant to shift and move your assets somewhere else so that they don't appear on your financial statement so that your report of being $10,000 short on your budget appears to be correct?
1-C. Exert influence to change the accounting standards so that the Financial report you prepare does not reflect your true net worth and thus you can show a negative of $10,000?
1-D. Pay the $10,000 dollar budget shortfall from your $3,975,000 Net Worth?
1-E. Ignore the fact that others now know about your true net worth and hope the problem of this knowledge disappears or has no impact on you?
1-F. Create a serious distraction that is so over powering and prevalent, that no one will be able to divert attention away from the promoted distraction to be able to even glance at your true net worth, let alone address or take action towards the issue?
National Public disclosure first began coming out as of June 8, 1998, exposing how all local governments promote their 'Budget' while holding back, for over 55 years, their true Financial Statement, the CAFR.
It took up until 2000-01 before enough people were reached to have significant impact on this game of financial cat and mouse. Many began comprehending what was taking place right under their noses each and every day.
It appears that Government's response to the public's newfound knowledge that is now developing has been to follow steps 1-A, 1-B, 1-C, 1-F above with emphasis given to 1-F.
MAKE SURE TO SECURE PAST ISSUES OF THE CAFR FROM 1999 AND BEFORE. COMPARE A 1974 CAFR TO WHAT YOUR LOCAL GOVERNMENT HAS DEVELOPED INTO BY VIEWING THE STATISTICAL SECTION FROM THEN AND NOW.
THE GROWTH OF REVENUE TAKEN BY GOVERNMENT(S) HAS BEEN OBSCENE.
YOU WILL NOT GET A STRONGER WAKE-UP CALL IN YOUR LIFETIME.
The personal example above is exaggerated to give a clear showing of some techniques used. There are many techniques employed to turn an asset through investment or claimed liability into a 'debt' so that it is not shown as an asset.
The bottom line is, that if a public corporation played the same shell game(s) with its share holders, holding back disclosure of its true Net Worth, every one of the directors that participated would be indicted by the SEC, convicted, and sentenced to very long prison sentences in a Federal penitentiary.
Here we have our local governments across the land doing the same thing and they are in charge of policing, investigating, and indicting themselves.
Will those responsible for this theft from you in the past be held accountable? Probably not.
Can those that are currently stealing from you be held accountable? Probably yes.
Can the situation be corrected where in the future those that steal in this fashion are held accountable? Definitely yes!
WHAT NEEDS TO BE DONE!
1. Full public review of the existing Net Worth's of all local government entities, on a case-by-case basis.
2. A standard must be set in place limiting government's personnel and revenue holdings to a specific and set size in relativity to the population and total gross income of that population. Ten Percent (10%) would be good standard.
When limited government in America was started, the government personnel standard maintained for over 100 years was 3% to 5%. Currently, in the state of Washington, 1 out of every 4 people in the work force is a local or federal government employee receiving an average annual salary of $30,100 which gives an allocation in the state retirement fund for that government employee of about $600,000. Socialism / Communism under the guise of a free market capitalist system, surely does make the socialists and communists very secure and wealthy, at your deception and expense! They now own and control everything.
SOURCE: Statistical section of the 1999 Washington State CAFR.
Tennessee State government increased their gross income by 600% in 15 years while the non-government workers personal income increased by 68% for the same time period. The total population increased very little.
SOURCE: Statistical section of the Tennessee State CAFRs
3. When bringing government back to a standard by mandate of the public, the Net Worth's of those local governments will be utilized to make government self-sufficient utilizing the investment principles that are well in place and proven for those local governments to meet their annual operating budgets from annual returns without any form of taxation needed. Nada, none, zilch.
A good pension fund management team can write a prospectus that is ready for implementation of a TAX RETIREMENT FUND and accomplish this for any State, City, or County. We as workers participate with a Pension Fund to pay our salaries upon retirement. The same method can be applied to meet government's annual operating budgets and thus retire all taxation. Again, this is basic fundamental application, and it can happen overnight if applied with a strong hand by public mandate. Keep in mind they have for over a 65 year period showed an exemplary track record of managing hundreds of billions of dollars (Trillions). THEY have proved the application for this purpose.
NOTE: As the public 401K plans got eaten alive over the last 2 years, government investment management on the general front faired quite well. The management teams were and are professional short players using derivatives. (They make big money as markets collapse.) Look at the State Pension Fund CAFRs for the years 2001 and 2002. On average they did quite well on performance compared to the dismal performance of the public's 401K plans. (Look at actual market performance, not what is depicted as the "NET" overall gain or loss for the year.
4. The general public will gladly authorize large performance bonuses to the government financial managers solely for being within compliance of the stated objectives of the TRF and maintaining a public approval rating as to services provided. (Gives the Foxes plenty of chickens to eat, and now for all of the right reasons.)
Can steps 1, 2, 3, and 4 be accomplished above? Yes, they can!
Can they be accomplished without civil war and bloodshed? Hopefully yes.
Who would be the best allies to the general public to put this into motion and secure its implementation? The Insurance Companies, Investment Houses, and the Commercial Banks. (They assisted out of greed in the building of government's wealth over the last 65 years, they will do the same for implementation of the TAX RETIREMENT FUNDS to benefit the public, and for the same reason)
Will these institutions willingly help? Only if the ship is at the dock, and is ready to sail without them.
Should the general public ask the government, or any government officials to help with the implementation of the standard? No! The current and past administrations have held back their financial records, and true disclosure of their Net Worth. You do not ask foxes to help secure the hen house from foxes eating chickens.
The foundation of the American Public is the Ranchers, Farmers, and private Workers of this land. Most have been too busy supporting and feeding their families to have become foxes. A consortium of the general public must target, prepare, and implement the standard in the chosen county by forced mandate and not by choice of the foxes.
When will the standard begin? The hour and the day The People make it happen!
If the standard is implemented, will we the people be better off? Oh, yes indeed!
If the standard is implemented, will the country be better off? Anyone ever hear of the millennium, a thousand years of prosperity for all? The answer is definitely yes.
All that exists on this planet started with an idea, then the implementation of that idea with effort and resources applied, and then the fruits of that idea are harvested.
Today, is a good as day as any to make it happen. Well, ready to get started?
Those reading this have several choices.
A. Reflect briefly, and then see if there is a good movie playing that you can watch to entertain you.
B. Reflect briefly, then say to yourself, the problem is to big, it will never be able to be corrected, why bother.
C. Reflect briefly, and if you are a fox, send this communication to all the other foxes so that they can prepare a strategy to prevent the implementation of the standard.
D. Reflect briefly, and say to yourself, I can't understand this, and channel hop on your TV.
F. Reflect, digest, and then build a coalition of responsible individuals from your community, with resources to push forward to make the standard happen.
NOTE: It is not important as to which county or state is the first, but it is important that the first be implemented into the guidelines of the standard as soon as possible. Keep in mind that many existing Taxpayer organizations are run by and were started by the foxes for the covert purpose of; To control the Chickens and the Hen house so that business as usual would continue for the Foxes. Sometimes it is easy, and some times it is hard to spot Foxes in disguise wearing feathers and a beak.
THEY DO WHAT THEY DO, DUE TO THE MONEY ENVOLVED.
The People must act in unity, with one common goal until the standard is in place and not allow ourselves to be distracted (or killed) by the foxes.
Walter J. Burien, Jr.
P. O. Box 2112
St. Johns, Arizona 85963
Tel. 928 445-3532
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