Meltdown: the debacle at Special Olympics Oregon

SpecialOlympicsOR

The recently disclosed financial meltdown at Special Olympics of Oregon shouldn’t have come as a surprise to the members of its board. If it did, they were either not paying attention or they were the victims of the endless capacity of people for self-delusion.

Margaret Hunt, CEO of the nonprofit from 2003 to May of this year, portrayed the organization’s current troubles as part of the normal ebb and flow of a typical nonprofit’s finances. “There are always ups and downs in the nonprofit world,” she told The Oregonian.

But the nonprofit’s financial filings going back to 2003 show that the only years its expenses exceeded its revenues from 2003-2013 were in 2007 and 2008. It covered a $525,979 deficit in 2007 with balances from 2006. In 2008, it faced a $666,361 deficit, but it recovered, restoring its net assets or fund balances to 1,484,764 by 2013.

The following year, however, was a fiscal fiasco, with expenses exceeding revenue by $506,464, necessitating another dip into its net assets to cover the overspending. Some recovery came in 2015, when revenues increased by about $1 million, but 2016 brought another revenue dip of about $700,000, resulting in $325,280 of expenses over revenues.

Britt Carlson Oase, appointed Special Olympics Oregon’s CEO in June, attributed the financial problems to a mismatch between the program spending and charitable giving. In other words, the nonprofit spent more than it took in.

Things got even worse in 2017, Oase told The Oregonian earlier this month. Few details are available, however, because Special Olympics has not yet filed its 2017 financial report to the Internal Revenue Service and the organization has not made public a 2017 financial report by its CPA, GaryMcGee & Co. LLP.

The nonprofit’s tenuous position was evident, however in the CPA’s 2016 report.

The 2016 financial statements reported a net operating loss of $131,850 and a decline in total net assets of $269,156. This followed operating losses in 2014 and 2015, and a decline in new grant and contribution commitments in 2016.

As a result, the organization’s cumulative unrestricted net asset deficit increased from negative $1,172,950 in 2015 to negative $1,304,800 at December 31, 2016.

In addition, during 2016, outstanding trade payables, money the nonprofit owed to suppliers for goods or services, grew by $328,082, and cash balances declined to $58,360, representing only 5 days of operating outflows.

As of the end of 2016, current liabilities were greater than current assets by $282,346 and after the 2016 report, out-standing trade payables increased to more than $1.0 million.

According to the CPA’s annual report for 2016, the organization had outstanding borrowings of $651,232 on its line of credit, which increased to $1 million as of September 30, 2017.

In other words, even if Special Olympics Oregon had pulled off a decent 2017, it would have been in trouble.

The CPA’s report said that as of October 31, 2017, Special Olympics of Oregon did not expect to be in compliance with certain financial covenants under the credit agreement. “If unable to continue to obtain amendments from the Lender that waive compliance with these financial covenants, the Lender could place the organization in default under the terms of the Credit Agreement,” the report said. A default “may severely or completely constrain the organization’s ability to continue to operate its business…”

Pretty alarming stuff.

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Demographics are going to debilitate China

Many Americans seem fixated on the threat of China as an emerging world power. But they ignore the fact that China’s long-term prognosis is not good.

There’s no question that China has achieved unprecedented economic success, but decisions on population growth made in the 1970s are going to come back to haunt the country. That was when the government set a goal of limiting most families to one child in order to deal with  huge and rapidly growing population.

The policy was formalized on September 25, 1980 in a public letter published by the Central Committee of the Chinese Community Party, calling upon all families in China to adhere to the one-child policy.

But however well intended, the policy has had significant unintended consequences that will burden China for years to come and threaten its political and economic power: too sharp a drop in birth rates and too many old people.

In 1979, Liang Zhongtang, a Chinese economist and demographer, insisted that the one-child policy would be a “terrible tragedy” that would turn China into a “breathless, lifeless society without a future,” but he was ignored.

 

OneChildPoster

The rigorous enforcement of the policy quickly got ugly, with a particularly devastating impact on female babies, as families favored having male children.

NPR reported on the consequences of the one-child policy in China’s Rudong County in Jiangsu province.

The county launched a family planning pilot program in the 1960s. “Having a second child wasn’t allowed, so we had to work on (pregnant women) and persuade them to have an abortion,” Chen Jieru, the Communist Party secretary of a village at the time, told NPR.

The result? The policy, in combination with an exodus of young people to cities for better opportunities, left the county’s young population shriveled while the elderly population has exploded.

The increasing number of the elderly is soon going to be a problem across China. There are now five workers to each retiree, but in a little more than 20 years that is projected to shift to 1.6 workers to every one retiree. “It spells shrunken tax coffers, reduced consumer spending and all-around diminished productivity,” said Mei Fong in her recently issued book, “One Child – the story of China’s most radical experiment.”

A senior Chinese economist, Liu Mingkang, speaking at the Asia Global Dialogue in 2012, said China’s population growth will end as soon as 2020 when its population will peak at 1.6 billion.

Youhua Chen, a demographer at China’s Nanjing University, gained some notoriety by warning about a sharp drop ahead for China’s population. The decline will be accompanied by soaring health care and pension costs, and collapsing real estate markets, he warned.

Prof. Chen has predicted that China’s population will peak at about 1.4 billion and then fall precipitously to 500 million. His graph is below.

GraphImage

Title: Figure 1   Estimated China Population Growth 1950-2100   (Black line): Low (Plan, Program, Prospects…)   (Pink line): Medium (Plan, Program, Prospects…)   (Blue line):  High (Plan, Program, Prospects)   Graph courtesy of Mei Fong, Fellow, New America

If Prof. Chen is right, this means lots of problems.

“These problems will compromise economic development, strain social harmony, and place the traditional Chinese family structure under severe pressure; in fact, they could shake Chinese civilization to its very foundations,” said Nicholas Eberstadt, Henry Wendt Scholar in Political Economy with the American Enterprise Institute.

China has recently loosened the one-child restrictions, but it hasn’t resulted in a baby boom. So the prediction still holds that sometime in the next 7 years, India may overtake China as the world’s most populous state, and India will keep growing while China declines.

“When you see a country’s population decline, the country will definitely degrade into a second-rate one,” said Yao Yang, an economist with Peking University’s China Center for Economic Research.

 

 

America’s never-ending wars

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“We have reached an important point where the end (of the Vietnam War) begins to come into view.” – General William C. Westmoreland speaking to the National Press Club November 21, 1967.

 “We stand together for a new and better future for Afghanistan — a future free from terror, war, and want.”- President George W. Bush and Chairman Hamid Karzai, January 28, 2002

“Major combat operations in Iraq have ended. In the battle of Iraq, the United States and our allies have prevailed.” – President George W. Bush, May 1, 2003



 

Chief Warrant Officer 3 Taylor J. Galvin, a married father of two, died Monday from injuries he received in a helicopter crash in Iraq on on his ninth, yes ninth, combat deployment to Iraq and Afghanistan.

taylor galvin_1534860610209.png_12870778_ver1.0_1280_720

Galvin, 34, was an MH-60M Black Hawk helicopter pilot assigned to the 160th Special Operations Aviation Regiment (Airborne) at Fort Campbell, Kentucky – the same unit that reportedly flew Navy SEALs into Pakistan for the 2011 raid that killed Osama bin Laden according to Task & Purpose, a news site for veterans.

Since joining the Army in 2003, Galvin had deployed twice in support of Operation Iraqi Freedom, three times in support of Operation Enduring Freedom, and four times as part of Operation Inherent Resolve, according to a news release from his unit.

“God Bless the Fallen and their Families,” said one online commenter.

“17 years and counting, and nothing to show for all this blood, money, disabilities and loss,” said another.

And the Iraq and Afghanistan wars are just part of America’s never-ending wars.

Only a few years after the United States and its allies had won WWII,  the U.S. began supporting the French with military assistance in their war against the Viet Minh in Vietnam. On May 1, 1950, President Truman approved the allocation of $10 million to the Department of Defense to cover the early shipment of urgently needed military assistance items to Indochina, thus taking the first crucial decision regarding U.S. military involvement in Vietnam.

According to the infamous Pentagon Papers, the rationale of the decision was provided by the U.S. view that the Soviet-controlled expansion of communism both in Asia and in Europe required, in the interests of U.S. national security, a counter in Indochina.

In March of 1965,  the first U.S. ground combat unit deployed to Vietnam landed at Danang. One of those Marines, Lieutenant Philip J. Caputo, later wrote a classic Vietnam War memoir, A Rumor of War.

VietnamLarryBurrows

U.S, Marines in Vietnam. Oct. 1966

U.S. military actions seem to have persisted every year thereafter.

As of Oct. 2017, the US military was conducting counterterror activities in 76 countries, according to the Costs of War project at Brown University.

CostsOfWarProject

Currently, there are 76 total countries affected by the U.S. engagement into counterterror.
The U.S. counterterror war consists of air and drone strikes, training in counterterrorism, combat troops and U.S. military bases.
Watson Institue- Brown University  Cost of War.

Why is America perpetually at war?

Perhaps, with no military draft to spur civilian concern, we’ve begun to accept war as part of the natural condition.

As West Point graduate and historian Andrew J. Bacevich, who lost a son in Vietnam, put it, “Once, the avoidance of war figured as a national priority. On those occasions when war proved unavoidable, the idea was to end the conflict as expeditiously as possible on favorable terms. These precepts no longer apply. With war transformed into a perpetual endeavor, expectations have changed. In Washington, war has become tolerable, an enterprise to be managed rather than terminated as quickly as possible.”

Never-ending war as a “tolerable” condition. How bleak.

 

 

 

Kate Brown’s TV ads: Just the facts, ma’am

A lawyer for Gov. Kate Brown’s campaign sent a letter to 10 Oregon television stations on Monday claiming that an ad titled “Scary”,  issued by Priority Oregon, a business-oriented nonprofit, contains an allegation that “is a clear, unambiguous false statement of fact.”

If the governor is looking for false statements in political commercials, she should be looking at her own.

negative political ad cartoon

A campaign committee calling itself Defend Oregon’s Values is identified as the purchaser of a current television ad  attacking Republican gubernatorial candidate Knute Buehler. The ad aims to convince Oregonians that Buehler would be a threat to abortion rights.

If you look up Defend Oregon’s values on the Oregon Secretary of State’s website you find it is a committee established by Service Employees International Union (SEIU) Local 49. But if you look deeper you find that the committee  is actually an arm of Gov. Kate Brown’s campaign. According to the state Elections Division, the group is a “candidate-controlled committee” working on Brown’s behalf.

Its financial report shows that the committee was initially seeded with a July 13, 2018 contribution of $100,000, all of it from the Kate Brown Committee. Three days later, on July 16, the committee paid $96,000 to Targeted Platform Media LLC of Annapolis, MD for broadcast advertising on television and radio.

So Defend Oregon’s values is hardly an independent committee. But who would know that without digging deeper?

So much for truth in advertising.

 

 

 

 

 

 

 

 

 

Wyden and Merkley: Out of Bounds

Senators Ron Wyden and Jeff Merkley (D-OR) should be ashamed of themselves.

wydenmerkley

The misguided duo: Sen. Ron Wyden (L) and Sen. Jeff Merkley (D-OR)

In their effort to defeat the nomination of Oregon federal prosecutor Ryan Bounds for the 9th U.S. Circuit Court of Appeals, Wyden and Merkley misrepresented the facts, relied on questionable accusations by a left-leaning judicial advocacy group, engaged in the kind of character assassination that is sadly predictable in Washington and obscured their motivations.

In September 2017, President Trump nominated Bounds, who grew up in Hermiston, OR, to fill a vacancy on the markedly liberal 9thCircuit.

That the nomination was made without the advice and consent of Wyden and Merkley hinted at a difficult road ahead. But it was a “Snapshot” report issued in February 2018 by the Alliance for Justice that provided fuel for the arguments used by Oregon’s senators. Without hesitation, they weaponized the report.

But the Alliance was no neutral observer. The Alliance is a group of 130 organizations focused on legal issues to advance progressive causes. In the 1980s, it mounted campaigns against President Ronald Reagan’s appointees to the federal courts and was a key player in a successful scorched-earth attack against D.C. Circuit Court of Appeals Judge Robert Bork, who was nominated to the Supreme Court by Reagan. The Alliance is currently a player in the fight against Trump’s nomination of Judge Brett Kavanaugh to the Supreme Court.

The Alliance’s report was a vehement broadside against Bounds, with particular criticism of some of his writings. “…while Bounds has few public writings, those he does have are deeply disturbing,” the report said. “Particularly noteworthy are several articles Bounds wrote for The Stanford Review while a college student. He expressed hostility toward multiculturalism and diversity, often using derogatory language. Throughout these writings, Bounds displayed a strong intolerance for issues or positions he deemed liberal or progressive.”

Merkley and Wyden jumped on the opportunity to use the Alliance report against Bounds in a barrage of allegations full of sound and fury, but blissfully free of substance. In a joint statement, they asserted, “…Ryan Bounds failed to disclose inflammatory writings revealing his archaic and alarming views about sexual assault, the rights of workers, people of color, and the LGBTQ community.”

The media and liberal organizations embraced the ensuing conflict, highlighting the Alliance’s report, but not its biases, and rarely offering the public online links to the report itself. The Oregonian, the New York Times and other publications and organizations referred repeatedly to Bounds’ “inflammatory” writings.

Asserting that Bounds had “expressed his disdain for multicultural values and organizations” while at Stanford University, the report cited excerpts from Stanford Review articles Bounds had written taking to task some aspects of of multiculturalism for undermining social cohesion.

“During my years in our Multicultural Garden of Eden, I have often marveled at the odd strategies that some of the more strident racial factions of the student body employ in their attempts to ‘heighten consciousness,’ ‘build tolerance,’ ‘promote diversity,’ and otherwise convince us to partake of that fruit which promises to open our eyes to a PC version of the knowledge of good and evil,” an excerpt from a February 1995 article by  Bounds read.

Bounds expressed the opinion that  groups organized around racial identity exhibit “the fundamental behaviors of group think,” have no tolerance for individualism and are too fixated on their “sensitivity”, that  “threatens to corrupt our scholastic experience and tear our student community asunder.”

Bounds may have expressed himself clumsily (he was, after all, a brash undergraduate student at the time), but his opinions then are widely shared today, particularly among conservatives. Today’s critics argue that an overemphasis on multiculturalism undermines national unity, encourages separatism over assimilation and isolates ethnic groups within the body politic.

Kenan Malik, a contributing opinion writer for The International New York Times, addressed the issue in a Foreign Affairs article, “The Failure of Multiculturalism.” Multiculturalists “seek to institutionalize diversity by putting people into ethnic and cultural boxes – into a singular, homogeneous Muslim community, for example – and defining their needs and rights accordingly,” he wrote. “Such policies, in other words, have helped create the very divisions they were meant to manage.”

Similarly, Victor Davis Hanson,a senior fellow at the Hoover Institution, recently argued in the National Review  that an overemphasis on multiculturalism is “dividing up the country according to tribal grievances,” rather than making the nation stronger by encouraging a common culture.

Claire Fagin, former President of the University of Pennsylvania, elaborated. “We are moving into a very, very hyphenated world: It’s Asian-American, African-American . . . it’s so contrary to everything I grew up with . . . when everyone fought to just be American. For many of us who stress pluralism, these are not easy times.”

The Alliance report also took Bounds to task for writing a Commentary  in the Oct. 1994 Stanford Review  “… arguing that campus sexual assault and rape victims should have to satisfy the stringent “beyond reasonable doubt” standard. The report twisted this to mean Bounds “…supports making it more difficult to hold perpetrators of campus sexual assault accountable.”

Merkley jumped on this allegation. “Is the person fit (to serve on the Circuit Court) who says that there’s nothing wrong with a university failing to properly punish an alleged rapist?” he said on the Senate floor.

In fact, what Bounds argued against was a relaxation of the burden of proof required in prosecuting alleged violations of the University’s Fundamental Standard, especially in cases of sexual assault. In making his case, he expressed the views of many legal scholars who today argue that campus tribunals operating under university procedures do not adequately protect student rights, resulting in students losing their right to due process.

In other words, Bounds’ views 24 years ago were ahead of his time and hardly worthy of condemnation today.

Even worse, in a particularly egregious overreach, Wyden suggested a connection between Bounds and the Nazis.

Bounds  “…essentially compared tolerance and diversity to Nazi practices” in his writings, Wyden said to Willamette Week.  “…my late great Uncle Max was one of the last to be gassed in Auschwitz, and the idea that comparing tolerance to the Nazis is just so offensive that this is somebody who was not fit to be on an important court. A judge ought to be held to a higher standard.”

Nazis! Auschwitz! This crossed the dividing line between civil discourse and hysterical vitriol.

Wyden was presumably castigating Bounds for writing, “I am mystified because these tactics (by racial factions at Stanford) seem always to contribute more to restricting consciousness, aggravating intolerance, and pigeonholing cultural identities than many a Nazi bookburning.”

Merkley piled on, asking in remarks on the Senate floor, “Is the individual fit when the individual says that promoting diversity contributes more to restricting consciousness and aggravating intolerance than a Nazi bookburning?”

But that’s not really what Bounds said. Bounds was saying that some of the divisive tactics adopted by campus groups were more harmful to the school’s sense of community than the censoring of beliefs and ideas represented by the hateful burning of works decreed by propaganda minister Joseph Goebbels to be “un-German”.

Bounds was most certainly not equating tolerance with Nazism. Accusations that he was were a political cheap shot that illustrate the depths to which politicians will sink in this hyper-partisan time.

Wyden and Merkley celebrated when Senate Majority Leader Mitch McConnell abruptly withdrew Bounds’ name on July 19, 2018 after a Republican Senator, Tim Scott (R-NC), indicated he wouldn’t vote for Bounds.

Though Wyden and Merkley tried to sound high-minded in their victory, their real elation was that they had set the stage for possibly delaying a vote on Brett Kavanaugh’s nomination to  a seat on the Supreme Court until after the midterms (when the Democrats hope to take control) or defeating the nomination based on some as yet undiscovered material.

Sen. Dianne Feinstein (D-CA), Chair of the Senate Judiciary Committee, has already said Bounds withdrawal makes it clear the Senate should have access to all the records associated with Kavanaugh’s lengthy career in Washington before voting on his nomination.

“If Republicans agreed that Bounds is not qualified because of what he wrote in college, how could they possibly argue that material from Brett Kavanaugh’s time in the White House and as a political operative aren’t relevant?” Feinstein said in a statement        released the same day as McConnell’s announcement.

Before Bounds’ withdrawal, Wyden told Willamette Week  that Senators are honorable people. “We don’t reward people who mislead,” he said.

Apparently they do.