By Frank Keegan – CATASTROPHIC FAILURE ALERT! Bill Gates told a gathering of deep thinkers in California Wednesday that states are “building their budgets on tricks,” and “more people need to investigate their state’s budget.” To help them he should push Truth in Accounting laws that would force governors and legislators to meet minimum accounting standards.
What staggers people like Gates when they look at how state and municipal governments keep books is they know the technical accounting term for it is “felony.”
If Microsoft ever did what states do, Gates would be in prison.
And he hasn’t even scratched the surface of their fiscal deception.
As of Friday, no transcript (See the video) of Gates’ talk to the annual Technology, Entertainment and Design conference was available, but he previewed it on his foundation Web site:
“This time, I wanted to share some of what I’ve been learning about state budgets. I got interested in them because states supply most of the money for public education in the United States. What I’ve been learning, though, is that states are under increasingly intense budget pressure, and not just because of the aftereffects of the economic recession, although that has made things worse.
“There are long-term problems with state budgets that a return to economic growth won’t solve. Health-care costs and pension obligations are projected to grow at rates that look to be completely unsustainable, unless something is done. But so far, many states aren’t doing much to deal with their fundamental problems. Instead they’re building budgets on tricks – selling off assets, creative accounting – and fictions, like assuming that pension fund investments will produce much higher gains than anyone should reasonably expect.
“Eventually they’ll have to make some hard decisions about priorities, and I’m worried that education will suffer, even more than it is suffering already because of budget cuts. The issues are complicated and obscured by the complexities of accounting, so most people don’t fully understand what’s going on. More people need to investigate their state’s budget and get involved in helping to make the right choices. My TED talk is sort of a call to action for citizens, taxpayers, parents, everyone.”
He, citizens, taxpayers, parents and everyone should demand their states pass Truth in Accounting laws. Then read Government Accountability Office report 10-899.
Released in July, it states in no uncertain terms that as of 2008, even based on incomplete, misleading official data, states must begin real cuts to expenses equivalent to 12.3 percent a year “each and every year for the next 50 years.” That’s a hidden deficit of at least $9.9 trillion.
And this GAO report based on false accounting does not even include other hidden deferred expenses such as their own study finding almost $3 trillion in catastrophe insurance “exposure” as of 2009, $2.2 trillion the American Society of Civil Engineers calculates we owe on public infrastructure beyond design life, and an array of other deferred costs that could push real state and municipal obligations to $18 trillion not on the books.
We have to pay it over the next five to 50 years, no matter what, in addition to state politicians’ self-inflicted “structural” deficits.
State and local governments face catastrophic fiscal failure that goes way beyond Republican or Democrat, Left or Right.
Truth in Accounting founder Sheila Weinberg said Friday she is glad Gates has thrown his weight behind open, transparent state finances. “We have to require states to disclose the true financial consequences of their budgets.”
She said she has found sponsors for Truth in Accounting bills in Illinois and Florida, and is looking for legislators of any party to push them in the other 48 states.
“All states have balanced budget requirements, but nothing requires them to tell the truth,” Weinberg said.
The true numbers are irrefutable. Citizens and the politicians who claim to lead us must know the truth and face it. Now.
Frank Keegan is a national editor for The Franklin Center for Government and Public Integrity, watchdog.org and statehousenewsonline.com . Any disgusted public employee, journalist, activist organization or citizen watchdog who wants help exposing government waste, fraud and abuse may contact him at: frank.keegan@franklincenterhq.org
Tags: accounting, Bill, deficits, design, entertainment, GAO, Gates, pensions, State, taxpayers, Technology, TED, truth, Weinberg
