a trillion here, a trillion there ...
Rumsfeld said "$2.3 trillion missing" the day before 9/11
"You can have wealth concentrated in the hands of a few, or democracy,
but you cannot have both."
Come you masters of war,
The War On Waste
LOS ANGELES, Jan. 29, 2002
"How do we know we need $48 billion since we don't know what
we're spending and what we're buying?"
Retired Vice Admiral Jack Shanahan
(CBS) On Sept. 10,  Secretary of Defense Donald Rumsfeld declared war. Not on foreign terrorists, "the adversary's closer to home. It's the Pentagon bureaucracy," he said.
He said money wasted by the military poses a serious threat.
"In fact, it could be said it's a matter of life and death," he said.
Rumsfeld promised change but the next day – Sept. 11-- the world changed and in the rush to fund the war on terrorism, the war on waste seems to have been forgotten.
Just last week President Bush announced, "my 2003 budget calls for more than $48 billion in new defense spending."
More money for the Pentagon, CBS News Correspondent Vince Gonzales reports, while its own auditors admit the military cannot account for 25 percent of what it spends.
"According to some estimates we cannot track $2.3 trillion in transactions," Rumsfeld admitted.
$2.3 trillion — that's $8,000 for every man, woman and child in America. To understand how the Pentagon can lose track of trillions, consider the case of one military accountant who tried to find out what happened to a mere $300 million.
"We know it's gone. But we don't know what they spent it on," said Jim Minnery, Defense Finance and Accounting Service.
Minnery, a former Marine turned whistle-blower, is risking his job by speaking out for the first time about the millions he noticed were missing from one defense agency's balance sheets. Minnery tried to follow the money trail, even crisscrossing the country looking for records.
"The director looked at me and said 'Why do you care about this stuff?' It took me aback, you know? My supervisor asking me why I care about doing a good job," said Minnery.
He was reassigned and says officials then covered up the problem by just writing it off.
"They have to cover it up," he said. "That's where the corruption comes in. They have to cover up the fact that they can't do the job."
The Pentagon's Inspector General "partially substantiated" several of Minnery's allegations but could not prove officials tried "to manipulate the financial statements."
Twenty years ago, Department of Defense Analyst Franklin C. Spinney made headlines exposing what he calls the "accounting games." He's still there, and although he does not speak for the Pentagon, he believes the problem has gotten worse.
"Those numbers are pie in the sky. The books are cooked routinely year after year," he said.
Another critic of Pentagon waste, Retired Vice Admiral Jack Shanahan, commanded the Navy's 2nd Fleet the first time Donald Rumsfeld served as Defense Secretary, in 1976.
In his opinion, "With good financial oversight we could find $48 billion in loose change in that building, without having to hit the taxpayers."
©MMII, CBS Worldwide Inc. All Rights Reserved
SATURDAY, JUNE 17, 2006
Flight of Capital
They say I shot a man named Gray and took his wife to Italy.
She inherited a million bucks and when she died it came to me.
I can't help it if I'm lucky. - Bob Dylan
This may be old news to you, but just a quick note here of something I'd missed
about Flight 77, thanks to "Bismillah" and the RI forum, that I hope
you won't miss, too.
At least among those with a mind for such things, it's fairly well-remembered that on September 10, 2001, Donald Rumsfeld made the shocking announcement that the Pentagon "couldn't track" $2.3 trillion of its transactions. "Iroquois" observes, "What's interesting to me is that he made his press release on a Monday. In DC, I always see bad news given on a Friday, usually late in the afternoon on Friday. The exception, of course, would be when someone happens to know that there is a far bigger story coming out."
And we know that Flight 77, allegedly piloted by an incompetent, made an aerobatic, spiralling descent over Washington, effecting a 270-degree turn to strike the Pentagon from a western approach at ground level. The side struck was the only one with an exterior wall hardened against attack, and was relatively empty while renovation continued.
Relatively. The unfortunate construction workers perished outside, but who were the expendables within?
From The Pittsburg Post Gazette, December 20, 2001: "One Army office in the Pentagon lost 34 of its 65 employees in the attack. Most of those killed in the office, called Resource Services Washington, were civilian accountants, bookkeepers and budget analysts. They were at their desks when American Airlines Flight 77 struck."
The Arlington County After-Action Report noted that the "impact area included both the Navy operations center and the office complex of the National Guard and Army Reserve. It was also the end of the fiscal year and important budget information was in the damaged area." And Insight Magazine editorialized that "the Department of the Army, headed by former Enron executive Thomas White, had an excuse [for not making a full accounting]. In a shocking appeal to sentiment it says it didn't publish a "stand-alone" financial statement for 2001 because of "the loss of financial-management personnel sustained during the Sept. 11 terrorist attack."
High Crimes of State often come down to the movement of capital, and so the
high criminals generally share the gray and black economics of common felons.
Money is money; it's the magnitude of the heist that's different, and the means
to effect and cover-up the crime. And part of the cover-up of the Pentagon heist
has been the no-plane shell game, played smartly by Rumsfeld himself who "misspoke"
that a "missile" had struck the Pentagon the same week Thierry Meyssen's
original no-plane website was launched.
It's such disinformation that has drilled irrelevance and folly into a once potentially dangerous and angry army of authentic skeptics.
Army unit piecing together accounts of Pentagon attack
By MILAN SIMONICH, Pittsburgh Post-Gazette
WASHINGTON -- They are soldiers on the capital city's saddest mission.
Each working day, a three-man military history unit uncovers firsthand stories of the Sept. 11 attack on the Pentagon.
The terrorism here killed 189 people, including the five hijackers who crashed a commercial jet into America's military headquarters.
Now the Army's 305th Military History Detachment has the job of making sense of the madness. It is interviewing every willing survivor and witness -- a number that could climb into the thousands -- to write the U.S. government's book on the Pentagon assault and the lessons that can be learned from it.
The job is full of pain.
One Army office in the Pentagon lost 34 of its 65 employees in the attack. Most of those killed in the office, called Resource Services Washington, were civilian accountants, bookkeepers and budget analysts. They were at their desks when American Airlines Flight 77 struck.
Faced with so many funerals of friends and colleagues, the director of the office, Robert Jaworski, agonized over which ones to attend. He could not possibly be at all of them.
Jaworski's plight was extreme, but not so different from what the military historians find every day. Just about every witness or survivor gets emotional when recounting Sept. 11.
"In most interviews there's a tear or two," said Sgt. 1st Class Dennis Lapic of Industry, Pa., who is a member of the history unit.
Before Sept. 11, Lapic spent most of his working life as a territorial sales manager for a manufacturing company. His duties with the 99th Reserve Support Command consumed only a few weeks a year. Now he is on active duty with a two-year assignment to find out everything he can about the attack on Washington.
That job was daunting enough for the Army to dispatch a second unit, the 46th Military History Detachment from Little Rock, Ark., to help with the interviews.
In all, the Army has 66 such units devoted to compiling history from battles and missions around the world. The Pentagon project is unprecedented because it will attempt to unravel an attack on domestic soil that indiscriminately killed civilians.
Even Pearl Harbor was different in that respect. All but 68 of the 2,403 Americans who died in the Japanese attack on Hawaii were soldiers and sailors.
More than three months after the Pentagon was hit, nuggets of information continue to emerge as witnesses step forward.
One day last week, Lapic ventured to Arlington National Cemetery to interview a groundskeeper who watched in horror as the plane crashed into the Pentagon.
The worker, William Middleton Sr., was running his street sweeper through the cemetery when he heard a harsh whistling sound overhead. Middleton looked up and spotted a commercial jet whose pilot seemed to be fighting with his own craft.
Middleton said the plane was no higher than the tops of telephone poles as it lurched toward the Pentagon. The jet accelerated in the final few hundred yards before it tore into the building.
"My sweeper has three wheels. I almost tipped it over as I watched," Middleton said.
In those first minutes, he thought he had seen a plane in trouble, not a terrorist attack.
Middleton and his co-workers at Arlington continued to work Sept. 11 as Washington offices closed and buildings emptied. The cemetery crew had no choice. Funerals were scheduled and burials had to be completed, chaos and all.
As Middleton labored, he could see the destruction less than a mile away at the Pentagon, where the U.S. military mobilized for war.
Another Arlington worker who declined to be interviewed in front of the media told a story that the military historians had not heard in the 244 interviews they had conducted through last week. The man said a mysterious second plane was circling the area when the first one attacked the Pentagon.
The interviewers ask every witness what might have been done to prevent the attack. It is more than protocol. They want to know if somebody may have seen or heard something hours or days earlier that could have been useful in stopping the attack.
When the interviews are completed, the findings will be published in book form and kept at the Army Center of Military History. The researchers hope their work will be a thorough account of the Pentagon attack, as well as a guide on what should be done to prevent terrorist attacks.
Along with facts for the book, the historians collect tidbits on what the attack did to the nation's psyche.
"I felt complete anger. If I wasn't an old man, I might volunteer to go back into the service," said Middleton, 54.
The history detachments for the Pentagon project are based at Fort McNair, a Washington post established in 1791 as Old Arsenal Penitentiary. Until now, the installation's most notable brush with American history involved the murder of President Lincoln.
Four people who conspired with Lincoln assassin John Wilkes Booth were hanged there July 7, 1865. The executions occurred as a nation torn by civil war tried to heal itself.
Now the military historians see their research on the Pentagon attack as one way to help people cope with today's crisis.
"There can be a cathartic effect to people talking about what they have seen and gone through," said Maj. Robert Smith of Germantown, Md., commander of the 305th History Detachment.
Military waste under fire
$1 trillion missing -- Bush plan targets Pentagon accounting
Tom Abate, Chronicle Staff Writer
Sunday, May 18, 2003
The Department of Defense, already infamous for spending $640 for a toilet seat, once again finds itself under intense scrutiny, only this time because it couldn't account for more than a trillion dollars in financial transactions, not to mention dozens of tanks, missiles and planes.
The Pentagon's unenviable reputation for waste will top the congressional agenda this week, when the House and Senate are expected to begin floor debate on a Bush administration proposal to make sweeping changes in how the Pentagon spends money, manages contracts and treats civilian employees.
The Bush proposal, called the Defense Transformation for the 21st Century Act, arrives at a time when the nonpartisan General Accounting Office has raised the volume of its perennial complaints about the financial woes at Defense, which recently failed its seventh audit in as many years.
"Overhauling DOD's financial management operations represent a challenge that goes far beyond financial accounting to the very fiber of (its) . . . business operations and culture," GAO chief David Walker told lawmakers in March.
WHAT HAPPENED TO $1 TRILLION?
Though Defense has long been notorious for waste, recent government reports suggest the Pentagon's money management woes have reached astronomical proportions. A study by the Defense Department's inspector general found that the Pentagon couldn't properly account for more than a trillion dollars in monies spent. A GAO report found Defense inventory systems so lax that the U.S.
Army lost track of 56 airplanes, 32 tanks, and 36 Javelin missile command launch-units.
And before the Iraq war, when military leaders were scrambling to find enough chemical and biological warfare suits to protect U.S. troops, the department was caught selling these suits as surplus on the Internet "for pennies on the dollar," a GAO official said.
Given these glaring gaps in the management of a Pentagon budget that is approaching $400 billion, the coming debate is shaping up as a bid to gain the high ground in the battle against waste, fraud and abuse.
"We are overhauling our financial management system precisely because people like David Walker are rightly critical of it," said Dov Zakheim, the Pentagon's chief financial officer and prime architect of the Defense Department's self-styled fiscal transformation.
Among the provisions in the 207-page plan, the department is asking Congress to allow Secretary of Defense Donald Rumsfeld to replace the civil service system governing 700,000 nonmilitary employees with a new system to be detailed later.
The plan would also eliminate or phase out more than a hundred reports that now tell Congress, for instance, which Defense contractors support the Arab boycott of Israel and when U.S. special forces train foreign soldiers, as well as many studies of program costs.
The administration's proposal, which would also give Rumsfeld greater authority to move money between accounts and exempt Defense from certain environmental statutes, prompted influential House Democrats to write Speaker Dennis Hastert last week complaining that the proposals would "increase the level of waste, fraud, and abuse . . . by vastly reducing (Defense) accountability."
"The Congress has increased defense spending from $300 billion to $400 billion over three years at the same time that the Pentagon has failed to address financial problems that dwarf those of Enron," said Rep. Henry Waxman, D-Los Angeles, one of the letter's signatories.
Saying critics of the bill "were arguing for more paperwork," Hastert spokesman John Feehery said his boss would support the Bush reforms on the House floor. "The purpose is to streamline the Pentagon to become a less bureaucratic and more efficient organization . . . while also making it more accountable," Feehery said.
PROCESS WILL TAKE MONTHS
The debate will center around the defense authorization bill, the policy- setting prelude to the defense appropriations measure that comes up later in the session. With the House and Senate considering different versions of the transformation proposals, it will be months before each passes its own bill and reconciles any differences.
But few on Capitol Hill would deny that, when it comes to fiscal management,
Defense is long overdue for "transformation."
In congressional testimony Rumsfeld himself has said "the financial reporting systems of the Pentagon are in disarray . . . they're not capable of providing the kinds of financial management information that any large organization would have."
GAO reports detail not only the woeful state of Defense fiscal controls, but the cost of failed attempts to fix them.
For instance, in June 2002 the GAO reviewed the history of a proposed Corporate Information Management system, or CIM. The initiative began in 1989 as an attempt to unify more than 2,000 overlapping systems then being used for billing, inventory, personnel and similar functions. But after "spending about $20 billion, the CIM initiative was eventually abandoned," the GAO said.
Gregory Kutz, director of GAO's financial management division and co-author of that report, likened Defense to a dysfunctional corporation, with the Pentagon cast as a holding company exercising only weak fiscal control over its subsidiaries -- the Army, Navy, Air Force and Marines. Today, DOD has about 2,200 overlapping financial systems, Kutz said, and just running them costs taxpayers $18 billion a year.
"The (Pentagon's) inability to even complete an audit shows just how far they have to go," he said.
Kutz contrasted the department's loose inventory controls to state-of-the- art systems at private corporations.
"I've been to Wal-Mart," Kutz said. "They were able to tell me how many tubes of toothpaste were in Fairfax, Va., at that given moment. And DOD can't find its chem-bio suits."
CRITICS CALLED UNPATRIOTIC
Danielle Brian, director of the Project on Governmental Oversight, a nonprofit group in Washington, D.C., said waste has become ingrained in the Defense budget because opposition to defense spending is portrayed as unpatriotic, and legislators are often more concerned about winning Pentagon pork than controlling defense waste.
"You have a black hole at the Pentagon for money and a blind Congress," Brian said.
But things may be changing.
GAO's Kutz said Rumsfeld has "showed a commitment" to cutting waste and asked Pentagon officials to save 5 percent of the defense budget, which would mean a $20 billion savings.
Legislators are also calling attention to Defense waste. "Balancing the military's books is not as exciting as designing or purchasing the next generation of airplanes, tanks, or ships, but it is just as important," Sen. Robert Byrd, D-W.V., said last week. In a hearing last month about cost overruns, Rep. John Duncan, R-Tenn., of the House Committee on Government Reform said: "I've always considered myself to be a pro-military type person, but that doesn't mean I just want to sit back and watch the Pentagon waste billions and billions of dollars."
But while Capitol Hill sees the need, and possibly has the will to reform the Pentagon, the devil remains in the details, and the administration aroused Democratic suspicions when it dropped its 207-page transformation bill on lawmakers on April 10 -- leaving scant time to scrutinize proposals that touch many aspects of the biggest department in government.
"We have as much problem with the process as with the substance," said said Rep. John Spratt, D-S.C., who co-signed Waxman's letter calling the transformation bill "an effort by the Department to substantially reduce congressional oversight and public accountability."
Defense's Zakheim counters that the reform proposals would "remove the barnacles of past practices (and provide) DOD with modern day management while preserving congressional oversight and prerogatives."
But Waxman, a critic of the administration's handling of Iraqi reconstruction contracts, called the proposals "a military wish list" to take advantage of "the wartime feeling."
"Secretary Rumsfeld is hoping to march through Congress like he marched through Iraq," Waxman said.
E-mail Tom Abate at tabate @ sfchronicle.com.
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[Like their American counterparts, the British elite have situated a significant portion of their money someplace outside the taxable economy of their own nation-state. While taxation was the traditional motive for doing so, new motives are active now. Until Britain joins the EU, its fortunes are bound to the American system of international loan-sharking. That system is in crisis. And if the energy for which it ransacks the globe proves too elusive, Britain will be hard put to replace the depleted North Sea reserves that drove its economic recovery of the past twenty years. At that point, offshore assets will become useful in a whole new way: they may help investors to survive the perils of a falling dollar and its eventual impact on the pound, and they can equip the ruling class of the UK to buy up forfeited domestic assets after a crash. -JAH (Jamey Hecht)]
Super-rich hide trillions offshore
· Study reveals assets 10 times larger than UK GDP
· Exchequers deprived of hundreds of billions in tax
Sunday March 27, 2005
In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes.
The world's richest individuals have placed $11.5 trillion of assets in offshore havens, mainly as a tax avoidance measure. The shock new figure - 10 times Britain's GDP - is contained in the most authoritative study of the wealth held in offshore accounts ever conducted.
The study, by Tax Justice Network, a group of accountants and economists concerned at the escalating wealth held in offshore locations, shows that the world's high-net-worth individuals earn $860 billion each year from their assets.
But there is growing alarm among regulators and campaigners because exchequers worldwide are missing out on at least $255bn of tax each year. Governments appear unable, or unwilling, to prevent the rich employing aggressive strategies to minimise their tax liabilities.
The OECD this weekend confirmed that international tax avoidance is a growing problem that troubles governments not just of rich countries, but middle-income ones as well.
'This is one of the defining crises of our times,' said John Christensen, coordinator of the Tax Justice Network and a former economic adviser to the Jersey government. 'One of the most fundamental changes in our society in recent years is how money and the rich have become more mobile. This has resulted in the wealthy becoming less inclined to associate with normal society and feeling no obligation to pay taxes.'
James Jones, Anglican Bishop of Liverpool, said: 'In this country, we have created a culture of tax avoidance. The current debate is pandering to a culture of consumption and avoidance. We need a much better debate than the political parties are currently giving us.'
Individuals such as Rupert Murdoch, Philip Green, Lakshmi Mittal and Hans Rausing - among the world's richest men - all make extensive use of tax havens.
There is nothing illegal about placing assets and cash offshore, but campaigners are promising to attack tax avoidance by the world's richest people in much the same way that they currently target environment and trade issues.
The $11.5trn does not include the vast amount of money stashed in tax havens by multinational corporations, which are using increasingly sophisticated techniques to run rings round the authorities.
The Tax Justice Network study has drawn from data supplied by the Bank of International Settlements, Merrill Lynch and McKinsey. Richard Murphy of Tax Research, who co-authored the report, said: 'No one has tried to calculate a number like this before. To ensure the credibility of our data, we have only used information already in the public domain and produced by some of the most authoritative sources in the world.
'In addition, we tested our conclusions against three independent sources of information, and all seem to substantially agree, giving us a high degree of confidence in the conclusions.'
'Gordon Brown and the British government are ideally placed to act on offshore tax avoidance, since so many of the banks and tax havens that facilitate these processes have British links,' said Charles Abugre, Christian Aid's head of policy.
'Only last week, the Commission for Africa called for an immediate doubling of aid to Africa to help it meet the Millennium Development Goals. And yet here is a potential source of revenue that even the most responsible governments are doing little to tap into.'
Rep. Dennis Kucinich (D-Ohio) has no patience for the idle rich.
Speaking on the House floor last week during debate over the estate-tax legislation, he said the bill “should be more accurately described as the American Idle Act, I-D-L-E, because it relieves the children of billionaires and multi-multi-millionaires of over one-quarter of a trillion dollars in estate taxes in just five years starting in 2013.”
But he wasn’t through with the colorful rhetoric. “The Bible says it is easier for a camel to get through the eye of a needle than for a rich man to get to heaven,” he said. “Here in Washington, the superrich ride elephants, and some donkeys, to get to their alabaster heaven where they pay no taxes.”
Catherine Austin Fitts
whistleblower Catherine Austin Fitts on the federal "Black Budget," 9/11 and covert operations
more details from Catherine Austin Fitts - including a state-by-state analysis of how much the taxpayers are impacted by this looting
A good introduction to the missing Trillions from the US government budget
(enough to end global poverty, to compensate Iraqis and other victims of US warfare, and to fix US domestic problems)
Richest 2% hold half the world’s assets
By Chris Giles, Economics Editor in London
Published: December 5 2006 13:13 | Last updated: December 5 2006 13:13
Personal wealth is distributed so unevenly across the world that the richest two per cent of adults own more than 50 per cent of the world’s assets while the poorest half hold only 1 per cent of wealth.