Saturday, November 6, 2010

Jerry Brown - Non Profits and the Destruction of Our Democracy

It's the mid 90's and I'm waiting for passengers to be seated on my layover at Dulles International Airport when who sits next to me but former Governor of California Jerry Brown lugging a couple of books.

We both settled in for our long flight to San Francisco with me just dumbfounded that I had this guy sitting next to me. As the plane leveled off and the seat belt sign went off Jerry was off, to the races. Talking to Jerry was like trying to catch a fly. He was super-charged and a complete motor mouth. I don't mean that in a bad way. He just had a lot to say and he used every second and I'm not exaggerating. His self promoting was endless.

He worked that plane like a professional nightclub singer, walking up and down the aisle working the crowd with conversations of all sorts.

After being drained just watching him and speaking with him he did leave me with one thought that I should have taken more to heart at the time. He said as he pointed to the books

"This is the future ".

You see he was coming back from a seminar on 501-c - non-profit organizations and the books he was toting were the cookbooks for forming and running these entities.

As an accountant, I knew of the entities and how they worked, but I had no idea that this section of the IRS code was about to be exploited by politicians and grassroots organizations from the left. *

Now lets fast forward to 2009, ACORN is the big scandal on every front page in America, "finally". Every elected official from democrat-led districts is now distancing him/herself from Acorn as quickly as possible. ACORN is a 501 - c with tentacles reaching into every intercity and encompassing hundreds and maybe thousands of subsidiaries, all 501-c's.

Just as the unregulated shadow banking industry has nearly destroyed our world economies, the 501-c nonprofits have been doing the same to our Democracy.

Money laundering by converting public funds into campaign contributions and voter fraud will be the death of many political careers in coming months.

It is my belief that a good part of the annual $80 billion in fraud of the Medicare and Medicaid programs involves 501-c's.

It will take some very courageous Americans to properly examine this problem and clean it up. I just hope we have elected officials left on Capital Hill that can carry out this monumental endeavour.

* SPECIAL NOTE : The mention of former Governor Jerry Brown in this article is not meant to insinuate that he is, was or ever has been involved with any illegal activity involving 501 - c's. 501-c's if used properly can be an effective tool in helping underprivileged people in America and that was Mr. Brown's intention per our discussion.
Update November 4, 2010
It should also be mentioned that Mr. Brown who is now the Attorney General of the State of California and now the Governor Elect did stop an investigation of Acorn last year.

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