It has taken me a while to begin to understand what Walter is talking about in regards to the CAFR as opposed to the budget. The budget is a subset of the CAFR. The Complete Accounting Financial Reports includes all the net assets that the governments have in their entirety. The income from government investments far outweigh, the taxes collected in any one year. In theory any budget shortfalls should be taken from the government investments. What occurs is that the budget is kept completely separate from the government investment income. The investment income is re-conciled in the year end books, which ends up every year with a massive surplus. However the media hype generated from shortfalls allows state governments to continually raise taxes. It is the second greatest scheme after the Federal Reserve Monopoly Plan.
TO: THE EDITORIAL STAFF OF THE -
I just submitted a comment on the SFC California Budget challenge and wanted to make sure you got a copy.
This is information you need to know and comprehend.
Sent FYI from,
Walter Burien - CAFR1.com
COMMENT SUBMITTED AT: CALIFORNIA BUDGET CHALLENGE
It was not from the options offered but what was not shown. Collective local governments in California are now over 14,000. The State Government is the largest but collective totals from local governments from within the State dwarf the revenue pool of the state.
Collective CA local government's each have many specialty investment accounts (many thousands of separate funds large and small). The total from all are in excess of eight-trillion dollars. (conservative estimate)
To resolve the so called "Budget Shortfall" I would do a standing audit of "all" local government investment funds and then from each deduct an equal percentage to satisfy any budget shortfall "with" a 50 billion dollar cushion to last through the rough times... the "equal" percentage would probably be less than 2% to accomplish that objective, and done deal..
People have been sound-bite conditioned to think Government only generates tax income and that is where the public's focus is directed. In reality in combination of all local governments and the state from CA the investment capital is massive (noted above in excess of 8 trillion dollars) that generates in return revenue greater than all taxation collected in the state.
The public has been kept oblivious to the scope and size of these collective funds and through intentional misdirection pointed at tax income and expenditures dealt with. So your pie charts that give the impression of 100% is actually just 1/3rd of the pie when it comes down to government's true "gross income"
Now you will hear expressions like: "Here is our rainy day fund" and in reality that is like your pocket change jar you keep in the kitchen compared to the many other thousands of other government investment funds never mentioned.
You will also hear when investments are mentioned: "Oh, that is our employees retirement Funds" WRONG... The retirement funds are but one category.. (a large one) then you have self insurance funds; advance forward liability funds; special liability funds; enterprise forward project funds; and the list goes on and on. Just on the state level you are looking at around 12,000 separate specialty investment funds large and small. And with an audit of all local government specialty investment funds would be well in excess of 100,000 specialty investment accounts.
Never a peep about this to the public, and the reason why? DUE TO THE MONEY AND CONTROL involved! Governments from all across the country have been developing their non-tax income for over 65 years.
The public was presented with "Budget Reports" to account for where "Tax" income and expenditures were applied "for the year". To see the same local governments "gross income; standing investment wealth derived over decades; the investment return generated; and the enterprise operations massive wealth generated, you must look at the same local governments Annual Financial Report, or as government calls it, their: Comprehensive Annual Financial Report (CAFR). A Google search will pull up many.
For the CA State CAFR just put on the search line: "The State of California" CAFR
The state CAFR will pop up for downloading. You can do the same for "The city of Los Angeles" or Burbank, San Francisco, Sacramento, County of Los Angeles, etc., etc., etc....
Now a local government like the State of CA can say: "We have a fifty-billion dollar shortfall on our budget" (Tax Revenue) and a "true" review of the state's Comprehensive Annual Financial Report could show the state 200 billion in the black. The budget will be shown in the CAFR and it is only 1/3rd of the pie when it comes down to gross income...
Some people have referred to this as having two sets of books. Well, there are not two sets, there is only one and that is the CAFR of which the budget is a segment thereof.. an inferior report to the CAFR.
The silence (is golden) maintained as far as not a peep as to government's Annual Financial Report and non-tax income shown that most Cities: Counties; School Districts; State Universities; Enterprise operations; and the states prepare each year I call "The Biggest Game in Town" of which I put a video up on Google 12/25/08 that had over 870,000 views in the first 5 days worldwide and not a word from the media; controlled education; the political parties; or government itself. That silence is golden rule present over the last several decades is well entrenched due to the money and control involved. The public would not be pleased to find out that they have been played like this to say the least..
I challenge the SFC to publish in the next 30 days, and do so conspicuously the links to download the top 200 local California government CAFRs with it noted: "The SFC strongly suggests that every taxpayer carefully review their local government's Comprehensive Annual Financial Report (CAFR)"
The CAFRs are local governments "Holy Grail" of accounting showing collective wealth that has built up over decades. Whereas a budget report primarily shows "TAX" income and tax expenditures for the year....
Walter Burien - CAFR1.com
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