Double booking.....
The country's biggest swindle!
Comprehensive Annual Financial Reports
From: hengist
By Walter J. Burien, Jr.
Forward by Al Adask - Anti-Shyster

As editor of the AntiShyster, Iíve seen so many unbelievable stories  over the last eight years, that Iíve become jaded, cynical and worldly. There are no surprises left for me. Iím sure that Iíve seen it all. Iíve thought so for several years. And generally speaking, about every two  or three months, life proves me absolutely wrong by showing me another story so awesome that Iím left (almost) speechless. This    article introduces another one of those stories so awesome that itís  right off the Richter Scale.

Walter Burien Jr. worked as a Wall Street commodity trader for fifteen years, but now resides in Arizona. According to Mr. Burien, every state, county and major metropolitan city is keeping two sets of books. One set (the ĎBudgetí) is commonly available and tracks each governmental entityís casts and tax revenue. The Budget is the financial record thatís seen by the public and used by politicians to justify new governmental services and higher taxes.

However, there is a second set of books (called the Comprehensive Annual Financial Report, or CAFR) which is virtually unkown to the public but contains the real record of total governmental income. According to Mr. Burien, although the Budget gives an accurate account of government costs, only the CAFR gives an accurate account ot governmentís income.

For example, while a particular state budget might report receiving $20 billion in taxes (just barely enough to sustain its $20 billion in costs) - the CAFR might reveal the stateís real income is in the neighborhood of $60 billion - three times as much as reported on the budget. If these allegations are accurate, the particular state could stop charging all the taxes we are familiar with and, not only survive but, either double the amount of reported government services or give every citizen a huge tax rebate.

The implications are mind-boggling. Theyíd mean our world is so different from what we are led to believe, so much more corrupt than even I suspect, that we are left with three choices, either; 1) government agrees to end the deception and stop overtaxing us, or 2) the American people agree to accept their status as slaves, or 3) both sides refuse to agree and precipitate a shooting revolution. The issue is that big.

But are Mr. Burienís allegation correct? How could any governmental entity dare to routinely overcharge its citizens by 200%, underreport its income by 2/3rds, and knowingly press for higher taxes based on an inaccurate budget? Worse, how could such a fraudulent system become widespread among all states, counties, cities and the Federal Government? When you stop to think about it, Mr. Burienís allegations are too fantastic to be credible.

Nevertheless, I talked to Mr. Burien by phone for several hours and found him to be articulate, knowledgable, and apparently sincere. I asked a retired professor of economics to interview Mr. Burien and evaluate his allegations. The professorís assessment? Burien is probably correct. I steered an Alaskan M.D. (who is also a dedicated constitutionalist researcher) to Mr. Burien. The Doctor subsequently found evidence supporting Mr. Burienís claims: The State of Alaska and the city of Anchorage both use Budget/CAFR accounting systems that conceal a Ďbreathtakingí difference in reported revenue. Another researcher in Wyoming claims that a comparison of his stateís budget and CAFR also support Mr. Burienís arguments. In every case, there are two sets of books and the income reported on the budget is millions or billions of dollars less than is reportedon the CAFR.

Does this support prove Mr. Burienís extraordinary allegations? No.    But they lend enough credence to publish his allegations to a broader audience who will do more research to confirm, refute or refine those allegations.

What follows is an amalgam of statements or implications raised by Mr. Burien on our telephone conversation, Tom Valentineís radio interview, Mr. Burienís Email, and an article on Mr. Burien written by "Betsy Ross".

Mr. Burien reports first discovering the CAFR report in New Jersey in 1989, when he helped start a New Jersey tax protest group called "Hands Across New Jersey". While involved with that group, Mr. Burien read in the stateís Annual Budget that the total cost of all public services was $17 billion and the "net available" (the money on hand to pay all bills) was $24.6 billion. But then he asked the first question the IRS asks in any audit: "What are the gross receipts? He added the figures from various sources and came up with about $44 billion and began to wonder how the state could have $17 billion in costs, $24.6 billion in cash on hand, and $44 billion annual income? The numbers didnít add up, so he bagan to dig deeper.

Because his father had been Personnel Manager for the State Treasury for eight years, Mr. Burien understood how to get around in the various government departments. The state Director of the Budget was on vacation, so Mr. Burien called one of his lowest level assistants and said, "Iím working on a report for Richard [the vacationing Budget Director] and I need all the figures on the autonomous agency accounts, interest accounts, investment accounts." The assistant said, "Ohh, you want the CAFR." This was the first time Burien had heard of CAFR but he said, "Yes" and the assistant mailed it to him.

The CAFR showed that New Jersey had liquid investment funds (cash) of $188 billion; common stocks worth $70 billion, $10 billion in loans due from public and private corporations, and $14 billion in insurance company equity participation. The little state of New Jersey, which admitted to less than $25 billion in annual income on its budget, reported $300 billion in cash, stocks, loans and equity participation on its CAFR. According to Mr. Burien, "On that day, I learned the definition of syndicated organized crime."

The scam worked something like this: Anything that was a cost or expense for public services (the traditional side of the Annual Service Budget, such as the Department of Transportation, health and welfare, etc.) was reported on the Budget where public taxes paid 100% of the bill for those services. That was $17 billion.

However, any governmental agency that was a profit center (the Port Authority for New Jersey, the New Jersey Turnpike, and investment account, etc.) that generated no-tax revenue was "restricted by statute from being reported in the Annual Budget. Why? Because the state legislature passed laws to prevent reporting the income from profit center on the Budget. Instead, income from these profit centers was disclosed only on the CAFR.

But that disclosure was not immediately apparent. For example, when Mr. Burien looked for New Jerseyís 1989 "gross cash receipts" in the CAFR, he found the figure buried on page 174, under the "Waste Water Treatment Trust Fund". It showed the amount of the total cash receipts for 1989 from all 69 autonomous state agencies and departments was almost $87 billion. In other words, New Jersey was charging $87 billion to provide $17 billion in public services. New Jersey citizens were paying $5 for every $1 in services they received, and the state was pocketing the other $4 as "profit".

The CAFR also reported the state owned $32 billion in common stocks - but this figure was footnoted. The footnote revealed that the stocks were valued according to their original purchase price, not the current market value. In other words, if the state bought a stock in 1968 at $1.25 a share and itís worth $3,000 a share now, they still report it on the CAFR as worth $1.25 a share. Burien determined that the true market value for the "$32 billion" in stocks reported on the New Jersey CAFR was actually about $70 billion.

But Mr. Burien goes further - he claims that the dual system of books is not unique to New Jersey, but also common among all fifty states. Moreover, he claims the dual accounting system was not only used ten years ago, but is still being used today.

For example, "In 1987 Arizonaís annual service budget reported $2.8 billion in revenues but the stateís 1987 CAFR reported total cash receipts of $3.1 billion, a mere $300 million difference."

"However, in 1997, Arizona reported an Annual Service Budget of $5.5 billion while the Stateís CAFR (printed by the Auditor Generalís Office) showed total gross cash receipts of $17 billion. thatís a difference of over $11 billion. In just ten years, Arizona had caught up to New Jersey in that both statesí annual budgets reported less than one-third of the actual gross income seen in the statesí CAFRs.

"CAFR reports indicate that the composite totals for all government (Federal, state, county and city) ownership of publicly traded stocks exceeds $32 TRILLION (53% of the total ownership of all listed stocks), $8 TRILLION in insurance company equity (should we be surprised by high priced mandatory auto insurance or unaffordable health care?) and $5 TRILLION in Bond Surety Escrow Accounts for future liability of existing or potential debt.

Governments use Bond Surety Escrow Accounts to evade that pesky little rule that government should not operate at a "profit". That is, government should not impose more taxes than it actually uses to run the government. By designating tax revenue that exceeds operating costs as "Bond Surety Escrow" for future liability, government avoids calling excess revenue a "profit" and is thereby enabled to continue to enrich itself at public expense.

To illustrate the potential for abusing "future liability payments", consider the New Jersey plan in the 1950s to build the New Jersey State Turnpike and Garden State Parkway Authorities. The state asked voters to approve a $7.5 billion bond to construct the turnpikes. The state explained that these turnpikes would be operated as toll roads by the bondholders until the $7.5 billion bond was paid off - but the bondholders could not operate the toll roads at a profit. Once the bonds were repaid, the turnpikes would revert back into the stateís Annual Budget as a normal cost/revenue item. The public voted Yes.

Over the following years, the state sometimes alleged that the toll revenue from operating those turnpikes failed to cover their operating expenses, and so additional bonds were passed to fund the turnpikes. As a result, in 1990, the total bond liability still owed for the turnpike had grown to $14.5 billion. But guess how much was in the ĎBond Surety Escrow Accountsí? $38 Billion! Enough to repay the original $7.5 billion bonds almost four times!

How could that happen? Say the toll road made a $400 million profit for the year and the scheduled payment on the $7.5 billion bond was $100 million. The state made the $100 million payment but kept the extra $300 million in a Bond Surety Escrow Account for Ďfuture liability paymentsí. Although they kept the $300 million, they did not declare it as an asset but wrote it off as a line item payment. In other years, even though they made a profit, theyíd allege that they lost money and therefore floated more billions in bonds. (Guess who pays?)

The bottom line is that New Jersey is collecting hundreds of billions of virtually unreported dollars from all the autonomous agencies. The motivating factor is not public welfare, but control of those billions.

Mr. Burien not only alleges that the dual accounting system exemplified by CAFR is not only used by all fifty states, but also by all counties, cities and the Federal Government itself. If Mr. Burienís allegations are correct, they comprise the most damning indictment of big government yet seen. In sum, Mr. Burien implies that our government is in fact a criminal enterprise bent on oppressing Americans by extorting several times as much tax revenue as it spends on public services and using the majority of thos extorted revenues to enrich, empower and enlarge government at public expense.

According to Mr. Burien, although the public is absolutely ignorant concerning CAFR, the primary cause for that ignorance is not the politicians but the mainstream media. When Mr. Burien first discovered the CAFR reports in New Jersey in 1989, he went on radio 101.5 FM in a live 45 minute interview. Two days later, that radio station was threatened with losing its license and was almost shut down. CAFR had become another example of - "third rail journalism" - any reporter or media outlet that touched the issue would be silenced or driven from journalism. As a result, thereís been a total mainstream media blackout on disclosing CAFR reports.

Later, Burien learned that the New Jersey official in charge of discrediting his CAFR discoveries was a former reporter whoíd been appointed Assistant State Treasurer - even though he had no former financial background. Burien investigated his background and learned that as a reporter he made $35,000 a year. But as Assistant State Treasurer he made $65,000 a year - plus a Carte Blanche expense account of $125,000. !????????

Burien claims this was not an aberration: "I knew there was a state data search department which tied all agencies and departments together. I called that departement and asked for a data search on all key level directorships and supervisory positions for all budgetary or autonomous agencies, and they came up with some 3,500 names from several administrations. Almost 1800 of these Directors were former editors or reporters! It is a virtual certainty that many of these appointments were payoffs for the journalistsí previous "cooperation" in spinning or silencing stories to suit government.

If you conduct a comparable search in other states, you may find a similar symbiotic relationship between government, editors, and reporters. If so, the mediaís "liberal, pro-government bias" may run much deeper than anyone has imagined, and the Ďmilitary-industrial complex" described by President Eisenhower in the 1950ís may have been replaced by a "media-bureacracy-banker complex" in the 1990s.

Therefore, Mr. Burien recommends that once you analyze your stateís Budget and CAFR reports, you insist that your local news mainstream media (TV, papers, radio) raise the "Public Awareness" by reporting the difference between the composite "total of cash receipts from all agencies, departments, investments, etc." and the "actual total composite revenues held or controlled".

If your local media refuse to publicize your stateís CAFR, they may be cooperating with a criminal agreement which has effectively silenced public disclosure of the CAFR reports for over forty years. However, once Americans know how much money is out there, where itís coming from and where itís going - the governmentís game will be over.

Any media that refuses to make immediate mention of the CAFR report should be publicly and aggressively boycotted. Media exposure is the jugular vein of the evil and corruption.

Ed. Note- Thanks to "AntiShyster" for bringing this critical info. to out attention. AntiShyster subscriptions are available $30 for six issues c/o P.O.Box 540786, Dallas, Texas 75354, (972) 418-8993, or