Cris Alarcon, Part 2 of a series. Part 1]
A lot of Gold was taken home in Old Hangtown with a card game called three-card Monte. It looks good, but it is a total scam. The practiced sleight-of-hand is not visible and the game efficiently tricked people out of their hard-earned money using deception and ego. As part two in this series I will explain how three-card monte dealers have never left, they just made their game more permanent as career politicians. Today good conservatives are being treated to a modern-day three-card-monte dealer named Joe Harn. He plays our ego and deceives us with the silver tongue of a career politician.
Almost two decades ago I started attending El Dorado County Taxpayers’ Association Monday morning meetings. For the first ten years, I believed that Joe was a taxpayers’ advocate, but as time passed I saw Joe’s left hand when he was saying, “Look in my right hand.” He told me how he saved money for us. It sounded great. And we bought in by electing him. But just like the Monte dealer of old, this one never seems to deliver what we expected. Odd, Curious, but we re elect him as our conservative representative. It sounds and looks great, but we still don’t seem to get what we expected. Sooner or later we realize we got scammed! Joe is not a conservative, his actions betray his polished words of a career politician.
One thing that Joe Harn, Mike Owen, Larry Weitzman, and I have in common is collegiate training in accounting. Accounting gives us the ability to take a large set of numbers, and make them seem to indicate a predetermined goal, to tell many different stories with the numbers. The only thing that makes them meaningful, is a standardized set of rules. In accounting these rules are often called “GAAP” an acronym for Generally Accepted Accounting Principles.
Anyone involved in business ownership is somewhat familiar in some of those rule even if not the details. An example is things like “Profit/Loss” and “Cash Flow” even if it just at tax time. As a conservative principle we want enough cash-flow to cover expected expenses, but not any more than needed as that is a non-performing asset.
Now let us shift to Joe for an example. When Joe was in a heated race four years ago he announced that the county had a “surplus” of over $54 million. [“Harn takes credit for … to move El Dorado County from a negative cash balance to a $54 million surplus.” Sacbee, Peter Hetch, May 24, 2014.] Less than a year later he told the BOS that we were effectively broke! [Mtn Dem, Supes begin year with budget woes, data shortcomings, January 14, 2015]
How can that be? By not following the GAAP rules…
Take the word “Surplus,” when Joe says the county is doing fine under his watch demonstrated by the county’s “surplus.” (Many already know where I am headed because this is most basic stuff for anyone with a college accounting background and of course something every CPA must know to get a lic). Surplus is “Profit” not “Cash-Flow” and Joe knows that. As every CPA knows.
Budget surplus refers to the amount by which an organization’s revenue exceeds its expenses (or Revenues exceeds Liabilities). In other words, it measures how much money the organization has left over after paying all of its expenses. This term is most commonly used to refer to government spending. That means that as a head accountant type I can delay paying the last two months of bills at the end of the year and say, “Look how much money I have in the bank.” It looks pretty good if you don’t think about those unpaid bills… No, they are likely to show up as hugh cash outlays at the beginning of the next fiscal year, but that gives plenty of time before to next report – to cover the deception.
It is GAAP rules that keep this from deceiving us into thinking we have money to spend, simply because there is money in the account today. It is clear in the accepted rules of accounting that you don’t confuse profit with cash-flow. Any accountant type knows this, even a hillbilly hack like me, let alone a CPA or a county Auditor… So ignorance is no excuse.
This is the kind of sleight-of-hand that career politicians become adept at. Manipulating cash-flow and then using that to intentionally confuse cash-flow as “surplus” is one example of the dishonesty of Joe Harn on a macroscale, now let me drill down to the microscale level with the details of specific examples.
EXAMPLE A:
A few years ago our state taxed billionaires extra to fund mental health service on the county level. A huge sum was transferred to the counties and showed as revenue. In our county it was not released to be used by Joe. That is part of the money that is unspent (not without obligation) that he calls “surplus.” As it was not spent, it was slated to go back to the state’s general fund — not back to the taxpayers.
But the state bulked and said, no, use the money so it sits waiting to be used to help the mental health issues facing our county residents. That is part of Joe’s “surplus.” Sure it sits there, but it has obligations to be spent. When and how is not known, but it is a safe bet is is not EVER going back to the taxpayers.
EXAMPLE B:
In a case of the Pioneer Fire Department, he refused to pay some bills of the fire department from the fees. Sounds good on its face for a conservative, but, he collected taxes from those area taxpayers specifically for those bills, then refused to pay the bills, but the money was never returned to the taxpayers that were told it was for something, nor were the taxpayers given any say in where or how those assessed taxes are to really be spent to do. We know in the reality of government budgets is that it was swept into some shortfall that the taxpayer was never told about.
I recall these facts as I see Joe claiming to be a “Taxpayers Advocate” and seeking our support as conservative voters.
Seeing theses facts I cannot accept Joe’s claim of being a taxpayer’s advocate, even if he is great at talking the talk. But even a non-accountant can see he does not walk the walk. That he is about keeping his paychecks and bonuses, not about bringing conservative principles to our local government.
Now those are good examples but I want to drive it home with our own little political pay bonus scandal.
EXAMPLE C:
Two things happened years ago: the county citizens voted term-limits on every elected office they could as a strong message that long-term politicians were unwelcome; the county approved a pay bonus for longevity based on the known cost of a high employee turnover rate. This is standard policy in most major American enterprises. Years after, some county Supervisors wanted their share of the longevity bonus and argued that the vote was for employees and did not differentiate types of employees, therefore it was for all employees, including elected office holders. This is very irregular policy.
Many of us local conservatives went ballistic over this self-serving reinterpretation of the approved rule. Even the Howard Jarvis Taxpayers Association called it a bonus for getting re-elected. As if there were not enough bonuses to getting reelcted, now we are giving big cash bonuses to every elected office holder. Those bonuses are adding to the debt liability that Joe was warning us about. Long-term debt as this is a factor of retirement pay.
What he failed to do was to warn us about is this trickery. He should have done what he prides himself on, refuse to pay the bill claiming it is an illegal payment. Maybe needing a new election to clarify if this was for a county incentive for regular employees to stay with the county for their full career life, or if it included the same inducement to elected office holder so they would stay longer
That is the kind of grandstanding Joe is famous for and many of us have seen him perform it many times.
But not this time… Maybe because this bonus was going into his pocket? I don’t know but I know he did not sound the alarm as the Audit/Controller that money was being misspent as bonuses that were originally justified as an incentive to be inducement county employees to stay longer as employees, while at the same time we voted in term-limits for most elected officeholders.
A taxpayer’s advocate would have not only sounded the alarm, they would have suited up for battle… as many locals did. One of the major obstacles in that battle to stop giving “reelected” bonuses to electeds, has been Joe Harn.
Joe Harn is simply not the conservative he claims to be but has hoodwinked good conservatives with the finely polished soundbites of a career politician… A career politician that adds to his mandatory bonuses if he gets reelected.
In 2015 Joe Harn made $154,944, and another $58,540.45 in “Other pay”, and wait, another $46,071.99 in benefits for $259,556.44.
$58,540 bonus for a small-county employee is hard to get alarmed about, if you are Joe Harn.
One time I got caught up in a game of Monte in my travels. I was amazed at the seamless manner I was being scammed. So now I am cautious of the invisible sleight-of-hand, just like I am cautious of the glib politician that tells me everything I want to hear…
End of Part 2.
Part 3, “Failure to conform to modern personnel practices” next week.
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