GOVERNMENT FRAUD: HOW THEY COOK THE BOOKS TO CLAIM DEFICITS IN SURPLUS BUDGETS AS SHOWN IN THE CAFR
Brie Hoffman
Comprehensive Annual Financial Reports or CAFR's
Have you ever wondered why governments never have enough money? Have you ever wondered why taxes keep going up up up and services keep disappearing? Have you ever wondered how it is that there is money for projects like "bridges to nowhere" and $7,000 toilets but no money for school lunches? Well, there is a very good reason for this dichotomy, the reason is as old as Methuselah...it's called governmental fraud or to use a more colloquial phrase...cooking the books! Here is how it's done.
All mafias have to have two sets of books. One for the public wherein the numbers are cooked and one that shows the real story. Our criminal government is no exception. The “book” that the government wants you to see is “The Budget”. The Budget only talks about revenue from taxpayers and expenditures. The “book” that shows the real numbers is called the Comprehensive Annual Financial Report or CAFR for short and it includes revenue from investments and interest as well as everything in the budget. Every State, City, County and the Federal Government has one, it is put out every year and is on the internet (see below for links). It was created in 1946.
The Comprehensive Annual Financial Report is kept under wraps because the main stream media never talk about it, they only sound the alarm when government is ready to default and needs another bail-out, another credit increase, or for services to be cut and taxes to be raised. They tow the line for their masters and as it so happens are in bed with many local, state and federal government agencies becoming treasurers, government accountants and heads of treasury departments after doing their stint as editors or journalists.
The budget is the annual operating cost per year, the budget doesn't mention the total investments, income or net worth. Alex Jones said it would be like a husband making 100k per year and telling his wife that he only makes 10k per year and basing their budget on the 10k per year. The media and the politicians (both sides of the same coin) are always decrying the shortfall in the budget based on faulty books! The public doesn't have a clue because even though the main stream media get almost all the reports each year they wont report on it. All we hear is that we have to cut services, cut social security, cut medicare or raise taxes because there isn't enough money when it's all a lie.
Government shills hide the money by putting it in “investments” like bridge repairs or waste management, then that investment or project is NOT audited. It's a sophisticated shell game. And, even though the reports are put on the internet no one knows about them, nor does the media report on them. When criticized for trying to pull the wool over the public’s eyes they will always say “well they are on the internet in plain sight”. Putting the reports on the internet gives the politicians plausible deniability when accused of fraud.
As of 1999 they no longer show all investment income from all sources, and all gross amounts now (because they know that we are on to them thanks to Walter Burien and Alex Jones) they only show investment revenue necessary to meet obligations and only targeted net amounts. So as of 1999 they have started cooking these books too! The only way to find out what the discrepancies are is to go through and meticulously compare previous years CAFR's with current CAFR's.
This is money that is legitimate just think about all the money the government is getting from black ops like drug running or the selling of guns under the table or for something as banal as traffic cops. Every traffic cop hired at a starting salary of $30,000 may bring in $100,000 in revenue conservatively. Fines, fees, permits and licenses have all gone up over 600% in the past few decades...where is the money going?
According to Walter Burien the major ownership in the stocks represented by the Dow is controlled by government funds. As of the late 1990's that number was 70%. In other words city, state and federal governments own 70% of all major stocks. Moreover, these investment managers know how to make money whether the stock market increases or decreases so these governments whether city, state or federal should have more than enough money to pay their bills and continue. However, what is it we are told over and over? We are told that city, state and now the federal government are going bankrupt because they do not have enough revenue! Moreover, if they lose money on their investments they will site that as the reason for having to raise taxes but what is NEVER mentioned is the gain on investments which more than offset the losses.
Wikipedia writes; while a budget may indicate that a specific government or agency has financial trouble and debt as a result of excess spending within the select grouping of "general fund" accounts, the CAFR may indicate that overall the same government entity has many facets possessing large holdings and income considerably greater than what is shown in a budget report or the "general fund" alone.
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In 1994, Orange County California government lost about $1.5 Billion on investments in the derivatives market and claimed they needed to declare bankruptcy per their general purpose budget while holding approximately 11.3 billion in profitable holdings in their investment portfolios.[9]
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The University of Kentucky's holdings of 85% of CHA Health insurance stock was documented in 2005 in the Lexington Herald Leader newspaper when CHA was sold to a rival firm as part of the UK president's effort to raise a billion dollars to fund becoming a "top 20" research university an ongoing effort.
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In 2010, Oregon Rep. Bruce Hanna during general session when the floor was discussing what to do about the state's 3.5 billion dollar budget shortfall (fire employees, cut back on services, close state parks), stood up with the cover page from the state CAFR in hand and stated that in less than a few minutes he found $3.5B to satisfy the state shortfall, there being no shortfall when comparing the state CAFR and the previous "selective" presentation of the State general purpose operating budget.[10][11]
I spoke with Walter Burien personally and I asked him if he knew of any government whether city, state, county or federal that ever showed a true deficit on the Comprehensive Annual Financial Report. He said that in some small factions of government like rural counties they may have come short by a small amount but never in any government of decent size. He said the bigger the government the bigger the fraud. Mr Burien has suffered tremendously for blowing the whistle on this carefully constructed shearing of the public. He has had death threats, he had his children removed, he has had to defend himself from a variety of lawsuits, his dogs were executed and his business destroyed. He now lives in total isolation for the last three years.
So what is the solution here? Short of stringing up every single politician, banker and journalist (I can dream can't I?) the best thing that we can do is to shine a light into the darkness. Start by educating yourself, your family and your friends. Get copies of the Comprehensive Annual Financial Report for your area, your state and the Federal Government. Call into talk shows and radio shows and start talking about it. Walter Burien suggested passing a law that requires verbiage printed on all tax receipts stating that either local, state or federal revenue can be verified on your CAFR and then direct people to a website so that they are forced to acknowledge it's existence. I think that this is a great idea.
Finally, remember the saying of Edmund Burke “The only thing necessary for evil to triumph is for good men to do nothing”. We are way past the hour when we can sit back in our ignorance and let these criminals continue to rape our country.
Nov. 12, 2011