- Original Email To Sightings.com:
- Date: 7-18-00 From:
- David Williams <firstname.lastname@example.org
- Subject: State, County, and Local Governments Hide Trillions-CAFR
- Hi Jeff,
- I'm an avid reader of your homepage news stories. Most
of them are intriguing, inciting and generally introspective of the author's
first-hand knowledge of the subject. However, I must take exception to
the newsletter reported on by Mr. Burien.
- First, let me state I have no connections (working or
affiliation) to or are a part of any state, local or federal government
entities. I'm an engineer by trade but am very familiar with numbers, accounting
methods and the reading of such statements. My wife is a CPA and when I
have questions I'm not familiar with, I go ask her to clarify. She has
read and agreed with the financial statements I and Mr Burien are relating
to here. There's just one problem my wife and I don't agree on with Mr.
Burien. Either by mis-reading on his part or by deliberate mis-statement
to eschew fear-mongering, the figures he sights are not in the trillions,
but are in fact in BILLIONS.
- Response From Walt Burien (WJB):
- I am glad David Williams and his wife are looking for
the first time, and now starting to learn. They now, for the first time,
have taken the trip to the beach and have seen sand. With their questioning
minds they have looked as far as they can see upon arrival at the beach
and said within our sight of the beach there has to be "Billions"
of pieces of sand on the beach. Well, now that they have seen the beach
for the first time, in their amazement, hopefully they will now get their
second revelation: Their vision of the beach, within their initial view,
is only a fraction of the beach. The beach (Government revenue and investments)
is much larger than the view from their initial view when standing on the
beach for the first time. When taking the trip down the beach for it's
entire length looking at composite totals, they will start using the word
"Trillions" over the now insignificant use of the word "Billions"
when looking at "Composite Totals" of grains of sand on the beach.
- Dave Willaims email continued:
- I have performed a detailed analysis of the two CAFR
reports and related "Local Investment Pools" for both Texas and
California. I encourage all readers of the news story to do so as well,
because everyone should know what their respective governments are all
about. I will agree that the "Locale Investment Pools" were difficult
to locate. You have to backup to the respective state's homepage and click
on their associated links to find them, but they are there.
- During this analysis, Texas's general government CAFR
is reported in thousands (e.g. - the last three zeros are dropped so as
not to fill the columns and pages with to many numbers), but the "Local
Investment Pools" are reported in dollars and cents (nothing is dropped,
so you're reading the figures as they are). This may be where Mr. Burien
mis-read the statements. Instead of $8.3 trillion you're looking at $8.3
billion in local investments. Not near enough to pay off the national debt
with some left over, but enough to derive income to help defray expenditures
for the local units who contribute to the fund.
- Response From WJB:
- When looking at Texas, the 1999 State CAFR keep in mind
it is exclusively the State Governments report. It will not reflect most
of the revenue and investments held by thousands of "other" local
government entities that are "separate" government corporations,
filing and having their "own" revenue and investments within
the state of Texas. Look at the States 1996 CAFR. In the Texas "state"
CAFR of 1996 it shows some of the transactions handled for "other"
local governments. This figure in Texas's 1996 CAFR was 1.8 "Trillion"
dollars. In 1998 and 1999 the accounting in the state CAFR was changed
not to reflect "other" local government transactions.
- The state government investment pool is "one"
investment pool operated by the "state." All others investment
"pools," "investment accounts," "bond surety /
refinancing accounts," "Pension Funds" not handled by the
state for "other" local government operations, are listed and
shown elsewhere, in "other" reports for determining "composite"
- I strongly suggest that Dave and his wife go to the following
Internet sight and read it to advance their learning curve:
- The site shows how to identify "Basic" potential
surpluses and makes it perfectly clear that potential surpluses identified
for "each" entity listed is from "that" report, of
which there is over 83,000 reports coming from "separate" government
corporate operations within this country.
- Dave Williams email continued:
- The California CAFR is similar and I'd like to see the
statement he read that shows there is some $12 trillion sitting around
deriving income for the state. Another thing I'd like to know is where
he got the math from for his figures. He doesn't explain where the $60
trillion figure was derived from and $12 trillion is 20%, not 25% as the
$3 trillion to $12 trillion is compared. Does he realize that the interest
from the $12 trillion alone at 5% would = $600 billion? Why the state
of California alone would be able to provide enough money to pay a 1/10th
of the national debt off, much less what the rest of the states' could
provide. The total California combined statement of all enties for the
state (includes retirement accounts and derived income from taxes and such)
is only $520 billion something. I would also venture to say that there
aren't enough land, business and personal property combined to total the
$60 trillion he's mentioned. Both of the example states local investment
pools don't or aren't allowed to invest in anything other than money market
accounts, t-bills or such and have to have a turnover period of 13 months
or less. This hardly would allow one to move this large amount of money
on a continual basis without someone catching on. You just couldn't possibly
hide this kind of money on a yearly basis since the interest derived couldn't
be hidden in company stocks. Where would one put this kind of amount without
someone noticing or going to press with it?
- Response From WJB:
- Dave, you mention you looked at the California "state"
CAFR. I would imagine the 1999 CAFR. I looked at the 1997 California CAFR.
The 1997 California "state" CAFR, when I looked at "all"
totals from the combined financial columns and what was disclosed separately
from the notes of the CAFR, showed the total to be closer to 3 Trillion
dollars. The 12 Trillion dollar figure I mention is the "composite
totals" of revenue and investments coming from "all" local
government operations, "combined" with the "state CAFR"
derived from "all" government operations within the state of
- Again Dave, I suggest you and your wife go to: http://www.cafrman.com/Special%20Section%20Main%20Page.htm
- Dave Williams email continued:
- I have reviewed several other states, including my own
of Virginia, and there just aren't the kind of surpluses Mr. Burien is
referring to, whether or not he thinks this money is being hidden from
the public somehow. If every state on a per capita basis were the same
that would amount to a sum of $4.9313 billion billion. That's right, in
billion billion's of dollars its $4,931,300,000,000,000,000.00 *. All of
the US's companies, land holdings and floating investments wouldn't come
near half this much. You can't invest more money than the sum of the whole
combined entities are and most states by their charter aren't allowed to
invest their public funds into company stocks or land.
- Response From WJB:
- You lost me, Dave. I have said from the beginning of
my effort for national disclosure starting June 8th 1998, that: Composite
government totals in this country (all local government operations plus
federal) revenue and investments using a "conservative" figure
comes out to being 60 Trillion dollar plus.
- And Dave, I have a big correction for you on what you
said above regarding; "and most states by their charter aren't allowed
to invest their public funds into company stocks or land."
- I guess you haven't looked at the listed investments
shown in "any" local government pool or pension investment account.
Guess what Dave, composite government investment revenue "is"
the majority of the revenue in the "stock," options, futures
markets. The restriction you mentioned as far as a local government's "charter"
is limited to that governments "annual" general purpose "budgetary"
obligations. Outside of that, the investment arena is wide open. You now
know why they do their best job to over inflate the pensions, virtually
never mention local government investment pool or bond surety / refinancing
investment accounts, etc.
- Alan Greenspan, about five month ago mentioned his concern
publicly (it appeared in the Wall Street Journal) that he was concerned
about the now 80 Trillion dollar derivatives market. And yes, guess who
is the primary player in that market? Hint: it's not the private sector.
- Dave Williams email continued:
- I felt that everyone should have the facts whether or
not they choose to make time to look them up for themselves.
- * I used the per capita of CA being $1.875 million per
person of the $60 trillion total surmised figure. Then multiplied this
by the roughly 260 million people in the country to arrive at my figure.
- Response From WJB: The people should know the facts Dave,
and I am glad that you and your wife are making an attempt for comprehension.
At the end of your learning curve, I hope you will send me a Thank You
note. As far as your last comment on the "$1.875 million,"
again you lost me there Dave.
- Have a good year 2000 Dave, and keep up the search for
- Yours Truly,
- Walter J. Burien, Jr. C. E. V. I. P. O. Box 11444 Prescott,
- E-mail: CEVI@aol.com
- PS Dave: If you missed Tuesday nights radio show (7/12/00),
and if you have Real Audio, on your computer, go to the following link
and Real Audio will start playing.
- Move the play bar ahead 59 minutes into the show and
that will be the starting point of the topic. Candidate for Governor of
the state of Oregon, Rich Smith appeared with Walter Burien.
- Mr. Smith's platform is for full disclosure of the wealth
and consolidation of that wealth for the exclusive purpose of phasing out
taxation and upon doing so, providing a return for the public on top of
no taxation, this being done for the public allowing government to continue
the "New and Revised" "Business as Usual" in Oregon.
- To hear the show go to:
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