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American Cities Going Bankrupt: Making Sense of the Growing Trend

by
October 10, 2012
Homeland Security News
One Comment

“Financial fallout in many US cities following the recession has left a growing number of US cities in economic crisis of their own. With no ability to pay runaway pension promises and even basic salaries, more and more cities are declaring bankruptcy. Bankruptcy, however, is a last resort option that leaves a deep and uninviting scar on its cities for many years to come. Fortunately, the economic condition of the US as a whole is far better than the dire economic conditions of many of her cities.”

Source: OODA Loop – American Cities Going Bankrupt: Making Sense of the Growing Trend


one Responses

  1. Walter Burien

    March 21, 2013, 23:00:44

    Has someone mentioned the CAFR of these local governments crying bankruptcy?

    Read through the comment section of “any” local government that cried bankruptcy. The CAFR, that local government’s Annual Financial Report was mentioned on most. The CAFR shows the wealth involved that has built up over decades.

    The issue is not the “mention” of it. The issue is the cooperative players from within government (mostly attorneys) who block any discussion and treat the population like useful idiots, taking everything they have, and then laugh all the way down to the bank chuckling with the other members of their gang on how easy the take was.

    When they stop laughing and chuckling behind closed doors and in the alternative have true and severe consequences for their theft, then the issue will be on its way towards correction.

    For the last few decades and at present, the population is too easily masterfully entertained off into distraction where the theft of billions is taking place daily. The population scratches their heads saying: “There is something wrong here but I just can’t put my finger on it.”

    When massive wealth transfer is taking place on the institutional government level, the takers make sure the taken from are looking in left field as all of the money passes in right field. Done for no other reason then due to the massive money and wealth involved.

    So far it has been like taking candy from a baby for them. You don’t stop thieves with discussion. You stop thieves with the Lewie-ville slugger technique. It all boils down to the word consequences. So far the application of that word over the last few decades has fallen almost exclusively on the population and not the thieves.

    NOTE: Up until 1999 the CAFR showed the “gross” standing balances of income and investment fund balances. Then with onset of disclosure by CAFR1 and the public now looking for the first time http://GASB.org (a 100% private association) who oversees the accounting guidelines of the CAFR, changes were made starting with transmittal letter-31 (up to 90 now) changing the showing in the CAFR from that of gross balances to a showing of “net” balances. Many games are played there so it is very important now to look through the “notes to the financial section” to spot or be directed to many of the specialty advance liability actual fund balances.

    Government was NOT supposed to operate at a profit. How did they get around this restriction?

    ANSWER: If for example a city had a 100-million dollar profit for the year from any of its operations, at a stroke of a pen they create a “liability fund” and poof, there goes the profit re-designated now as a liability.

    A personal example would be:

    If you and I ran a business for the last twenty years and we now had 1-billion dollars clear. We decide we are going to retire in five-years and want to buy an island in the Bahamas for 700-million dollars. So we create an advance liability fund, move 700-million dollars into it and now our “net” balance on our books is 300-million dollars. Now if with drafted a “Budget” for our business operations (projection of expenses for the upcoming year) of say 325-million dollars, that budget would show us to be 25-million dollars in the red. If we now actually spent 200-million for the upcoming year, gee, we now have 125-million we can move into our “buy an island liability fund in the Bahamas” zero out our profit, have the ability to buy a bigger island now with 825-million in our fund, and start the process all over again for next year.

    Now catch this point: On our accounting of the “buy an island fund’, our liability if we left the price at 700-million and the fund balance was 825-million, the “net” balance of the fund is now 125-million dollars. (700-million of the funds balance is a liability to pay). If we modified the liability to 825-million then our “net” fund balance is zero. 825 – 825 = 0

    One other tactic we could use as a mask of our true funds held would be to take the 825-million, deposit it with some financial institution domestic or international and arrange a loan or investment from that same financial institution of 825-million using our own capital through that financial institution to give the impression the 825-million was 100% a debt for repayment to whatever X financial institution we were using in that shell game of appearance. AGAIN why it is important to carefully look at the notes to the financial section of the CAFR.

    To find local government CAFRs for cities, counties, school districts, states, and enterprise operations, use a Google search with quotes. Example of what to put in the search line for say the city of Las Vegas:

    “The City of Las Vegas” “Annual Financial Report”

    or for the state of Florida:

    “The State of Florida” “Annual Financial Report”

    or for the school district of Burbank, CA:

    “Burbank School District” CA “Annual Financial Report”

    Many local government operations (of which there are over 184,000) will pop up on a Google search to download their CAFR or AFR.

    A “Budget Report” is a projection of expenses and selective presentation of income “for the year.” A CAFR or AFR is the showing of what developed over decades. Think of a CAFR as an individual’s statement of net worth. And as mentioned above, keep in mind how that word “net” and created “liabilities”can be played to hide wealth.

    Homeland Security? I don’t know about you, but I would feel a lot more “secure” if those thieving inside players within government were plucked out and given a little 5 x 10 concrete cell to sit in for the next 5 to 10 years.

    I will quote what three FBI agents said from the past per corrupt government attorneys operating from within the political of local governments: “If we indicted and arrested them for their crimes, we would have to indict and arrest them all.”

    Which brings to light an old quote from a few centuries ago:

    TREASON: “Treason doth never prosper; what’s the reason? For if it
    prosper, none dare call it treason.” Sir John Harrington, 1561-1612…

       


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