The Foundations

Reading Time: 9 minutes

The Foundations

The causes and effects of organizational corruption have been widely examined in literature, including malfeasance that is specific to nonprofits organizations. This post draws a distinction between outright illegal and soft corruption, the latter referring to the continued and deliberate misuse of donated funds to benefit officers of the nonprofit, with little – in some instances less than 5% – going to the nonprofit’s supposed cause.

Ultimately it has been shown that either the existence of an independent voting board or the conduct of an independent audit are the most important means of preventing soft corruption; far more important than state or federally mandated reporting requirements.

Thankfully, the vast majority of charities and nonprofits do a lot of good and they are largely unknown, never making it to the top of Google search. There are a lot of charities out there. According to the National Center for Charitable Statistics, there are upwards of 1.5 million nonprofits in the U.S. alone. Most of these are tiny, a fundraising organization for one Marine who has lost his legs, for instance, or an organization established by a wealthy family to provide scholarships to local youth. While news of scams will occasionally rise from these obscure ranks, most quietly go about doing good in their communities.

Here are five of the ugliest scandals involving charities.

1) The Clinton Foundation

Due to Hillary Clinton’s White House bid, her bitter back-and-forth with Donald Trump’s campaign, and her penchant for stirring up distrust toward herself, it was inevitable that Clinton’s nonprofit would be dragged under the microscope.

On the books, according to its financials on nonprofit watchdog site Charity Navigator, the Clinton Foundation is clean as a whistle. They brought in a ton of money in 2014, over $319 million, via donations, fundraisers, and grants. Nearly 87% of that went to the programs and services the charity offers. But it’s not the financials that have attracted the suspicion and scorn of the American public.

Earlier this year, it was revealed by the Daily Beast that, during Clinton’s tenure as Secretary of State, a suspicious number of donors to a State Department fund to restore parts of the White House also donated to the Clinton Foundation. But no wrongdoing could be connected to the findings.

Then in late summer 2016, as Clinton’s State Department emails began to come to light, it was revealed that an inordinate number of foundation donors were granted special access to Clinton, President Obama, and other important leaders via the State Department. Grumblings began to surface of Clinton using the foundation as a front for a pay-to-play scheme, where she sold access to movers and shakers in return for lucrative donations.

As the presidential race reached its climax, more revelations came to life, uncovering numerous instances where the Clinton’s received hefty sums of money from foreign leaders. In 2010, the foundation accepted $500,000 from the Algerian government, but they never disclosed the donation to State Department as they should have. Clinton had also received a $12-million donation from the King of Morocco, which was also not reported. Most recently, it’s been revealed that Clinton received a $1-million gift — a birthday gift to Bill Clinton — from the government of Qatar.

Helped along by other email revelations, all of this has cascaded into a likely indictment against Clinton and the foundation, and right on the doorstep of the 2016 election. It might be enough to end her White House bid.

2) 3. Wounded Warrior Project

In terms of charities for veterans, few have become as well known as the Wounded Warrior Project, which focused on helping wounded and disabled vets recover, mentally, physically, and financially. It was a worthy cause, to be sure. Sadly, this charity’s marketing got ahead of their actual charitable activities.

In February, the charity’s leaders were shown to be blowing shocking amounts of money on hobbies and parties. Employees flew in business class, stayed in $500-a-night hotels, and threw expensive parties. Their executive director was reported to rappel down buildings and ride a Segway to events. Events that cost as much as $3 million apiece. One employee called it, “extremely extravagant. Dinners and alcohol. Just total excess.”

CBS News reported: “Compared to other veterans’ organizations, Wounded Warrior is giving less to the people it serves. Disabled American Veterans Charitable Service Trust spends 96 percent of its budget on vets. Fisher House devotes 91 percent. But, the Wounded Warrior Project spends only 60 percent on vets.”

The silver lining here is that, since the expose and a Senate investigation , the Wounded Warrior Project has ousted its former leadership and is now focusing its efforts on financial responsibility and better serving veterans.

3) Moore Charitable Foundation

Not all charity scandals are the result of internal greed or irresponsibility. Like any other business or individual, they can, in an effort to get more for their buck, be duped into scams. That’s what happened to the Moore Charitable Foundation, which funds social welfare and environmental causes.

Wall Street hustler Andrew W.W. Caspersen was found to have scammed the Moore Charitable Foundation out of $25 million as part of a fraudulent investment scheme. Perhaps most shocking was how little due diligence the charity put into the investment before giving Caspersen the money. Luckily, when Caspersen came asking for another $20 million, the charity wised up and decided to do their homework before handing anymore over.

Unfortunately, fraud is not uncommon for charities, but the size of this scam was large enough to put it in the headlines.

4) Sugar Research Foundation

You ever wonder how one commercial can promote the health benefits of a product, only to be followed by another that says the opposite? This year, an old scandal finally saw the light of day that illustrates the forces that cause consumers to receive mixed messages about the food they eat.

A research paper was published in the scientific journal JAMA Internal Medicine that revealed a 1967 study on sugar as a fraud. According to the paper’s author, the Sugar Research Foundation paid a trio of Harvard scientists $50,000 to debunk claims that sugar was causing a host of health problems in the American public, including heart disease.

Sadly, the scientists went ahead with the deception, writing up a paper and having it published in the prestigious New England Journal of Medicine. As a result, consumers and health professionals remained uninformed and confused about the true dangers of sugar for decades.

The biggest twist of all of this is that one of the scientists, Dr. Mark Hegsted, went on to become the head of nutrition at the Department of Agriculture and one of the creators of the federal government’s first dietary guidelines in 1977.

Unfortunately, this illustrates how so-called charities are often used by businesses and powerful individuals to achieve decidedly un-charitable ends.

5) Leonardo DiCaprio Foundation

Leonardo DiCaprio. If you’ve followed the star’s career, you know that he has had an interest in climate change issues since Al Gore was a presidential candidate. So it makes sense that he’s set up a charity to bring attention and funding to environmental issues. According to its site, his foundation is “dedicated to the long-term health and well-being of all Earth’s inhabitants.”

In July, the U.S. Justice Department filed a complaint alleging that DiCaprio’s charity was part of the mounting three-billion Malaysian embezzlement scandal that was still fresh in the headlines. Because the foundation was set up as a donor-advised fund, it didn’t have to disclose its financials or much of anything about their internal workings to anyone.

The foundation claimed to have only six staff members, none paid, none of whom could be located or communicated with for questioning, but they regularly raised eye-popping figures at their lavish, star-studded events.

One gala was reported to have raked in $25 million, another $6 million in ticket revenue alone. At the time of the complaint, DiCaprio claimed to have raised $45 million total. But where exactly that money is coming from and where it’s going, no one knows. And DiCaprio’s not saying.

What is known is that DiCaprio is a friend of Jho Low, a central figure in the Malaysian money scheme, and that the two have a habit of taking lavish trips together. The Justice Department complaint alleges that the money to produce DiCaprio’s Wolf of Wall Street was actually siphoned from the Malaysian scheme. Low is even thanked in the film’s closing credits.

 

The Untold Water Issue

Reading Time: 6 minutes

Mad Max

While reading the other day, – as I so often do – I ran into an article that at first I thought “this can’t be right.” In the fashion that I’ve been known for, I set out to research what was said in the article.

Much to my amazement, it was right, which prompted me to think about the movie Mad Max; Mad Max tells the story of a now ex highway patrolman cruising the squalid back roads that have become the breeding ground of criminals foraging for gasoline (Guzzolene) and scraps. After the motorcycle gang kills his wife and child, Max sets out across the barren wastelands in search of revenge and what has ultimately led me to write this post.

It made think “could it be possible to have a Mad Max scenario?  Only instead of gasoline, it would be for water.”

In the short of it, this planet has a shortage of water. Sure there are vast oceans that would lead us to believe that we have enough water to sustain life forever, however, that appears to not be the case. Not only is it not feasible to drain the oceans to feed the now eight-billion people that inhabit the earth, it would not be feasible in a financial aspect.

So lets kick this off by taking a look at some of the largest natural water supplies around the world, their histories and where they are now.

We’ll start with China.

Yangtze River

The Yangtze or Ch’ang Chiang, (longest river) the longest river in both China and Asia and third longest river in the world, with a length of 3,915 miles (6,300 km). Its basin, extending for some 2,000 miles (3,200 km) from west to east and for more than 600 miles (1,000 km) from north to south, drains an area of 698,265 square miles (1,808,500 square km). From its source on the Plateau of Tibet to its mouth on the East China Sea, the river traverses or serves as the border between 10 provinces or regions. More than three-fourths of the river’s course runs through mountains. The Yangtze has eight principal tributaries. On its left bank, from source to mouth, these are the Yalung, Min, Jialing, and Han rivers; those on the right bank include the Wu, Yuan, Xiang, and Gan rivers.

To get an idea of just how bad the situation in China has become, lets take a look at what the river used to look like.

Yangtze River

In comparison to what it looks like now.

Yangtze River

With China’s record growth came record problems compounded by record breaking heat waves causing record breaking drought.

While China has been able to hide this catastrophic water problem for many years, it was just a matter of time before enough media attention would be placed on it for the rest of the world to understand just how dire the situation has become.

With China’s thirst for becoming the most powerful nation on earth, many of the issues that have plagued the country and the people living there have been largely swept under the carpet and as we have seen so many times before, anyone that dares to speak of it, is made to magically disappear.

With the Chinese Communist Party so bent on production and exports of goods to embolden them with great GDP numbers, they have conveniently forgotten – or just kept it quite – the fact that they are using Ten-Billion barrels of water per day.

Quickly using a calculator, it easy to see that the water usage is staggering. Assuming these barrels of water are 55 gallons (208 liters) each, that would add up to the astronomical number of five-hundred-thousand, fifty billion gallons (2,081,976,481,200 liters (over two trillion liters)) per day.

This crisis has become so exponential that it is estimated that in Chong Ching over 350 thousand people are dying due to water shortage. Crops are pretty much all but dried-up, power generation is also a major issue as most of China’s power generation is hydroelectric.

So what does this mean? It means that through decades of land and water abuse, the ground water is not usable for anything, much less crops. It means that many factories – including Toyota – have all been shut down as the power is not stable. As well, China is also the largest producer of Aluminum, Ferrosilicon, Lead, Manganese, Magnesium, Zinc, and a whole host-load of other rare earth materials, it begins to draw a picture of what it means for the rest of the world’s manufacturing. It only takes a minute to think about what this means if China was to fall.

But….China is not the only one. There are other countries are in the same situation.

In the United States, the state of California, and more notable, Los Angeles county. At 4,083 square miles (10,570 km2), at an estimated population of 9,861,224 residents (2022). Los Angeles has had a water crisis brewing since the late 1970’s, with water rationing throughout the 80’s, 90’s and that continues to this day. With the primary water supply coming from the Colorado River.

The Colorado River is also responsible for feeding many other areas, states along the way.

In the city that never sleeps (Las Vegas), enterprising engineers have been able to conserve water by replacing lawns with rock gardens and many other mandates. With continued and careful planning, Las Vegas has been able to keep its county from a water crisis, despite the fact that Las Vegas is literally out in the middle of a barren desert.

So where do we go from here? The logical answer would be to find some big drafting tables, where smart engineers would be allowed to open/freely think and present solutions that would not be scoffed at or discarded by the world’s governments.

The United States Mid-Term Election Process Explained

Reading Time: 5 minutes

House Delegations

In a previous post, I explained about the US election process and once again, I’ve received an email asking me to explain the mid-term election process.

Unlike the presidential election process, the mid-term – also held every four years, is an election of senators and representatives, the representatives – as implied – being those that represent each district within each state of the union.

It should be noted that like the presidential election, the mid-term elections are also held on November 8th.

During this midterm election year, all 435 seats in the U.S. House of Representatives and 35 of the 100 seats in the U.S. Senate were contested.

Thirty-nine state and territorial gubernatorial elections, as well as numerous other state and local elections, were contested.

The results will determine the 118th United States Congress. This was the first election affected by the 2022 U.S. redistricting that followed the 2020 U.S. census.

A predicted red wave, named after the color of the Republican Party, did not materialize and the race for U.S. Congress control has been closer than expected. As of November 10, Republicans are favored to regain control of the House with a narrow majority of 3 seats (214–221) according to Decision Desk HQ, while the Senate remains too close to call.

While midterm elections often see the president’s party lose a significant number of seats in the U.S. Congress, preliminary results instead saw Democratic Party candidates dramatically outperform these historical trends, making this the best performance for the president’s party since the 1950 U.S. midterm elections.

Meanwhile, Republican Party candidates that were backed by Donald Trump under-performed significantly.

Both general turnout and among young voters (18–29) is the second highest (after 2018) of any midterm since 1970.

Issues that favored Democrats included significant concern over respect for democratic norms among Republicans as part of democratic backsliding, abortion rights, and the status of abortion in the United States after Dobbs v. Jackson Women’s Health Organization, and a potential Trump 2024 election campaign.

The elections reflected trends that started in 2012, in which the white American working-class and since 2016 minorities, in particular those who are working class and/or Hispanic and Latino Americans, moved towards Republicans, while affluent and college-educated whites continued to move towards the Democrats.

Six referendums to preserve or expand abortion access uniformly won, including in the states of Kansas, Kentucky, Michigan, and Montana, as did those increasing the minimum wage (Nebraska and Nevada) and expanding Medicaid coverage (South Dakota). In other elections, Democrats gained full control of government in Minnesota and gained in Pennsylvania. In the state of Michigan, Democrats took full control of government for the first time since 1983. Democrats made further gains in the 2022 U.S. gubernatorial elections (Maryland and Massachusetts), while Republicans outperformed in Florida.

Several notable Native American tribes are holding elections for tribal executive positions during 2022, including the Kaw Nation, Cheyenne River Sioux, San Carlos Apache Tribe, Wampanoag Tribe of Gay Head, and Delaware Tribe of Indians.

During 2022, Osage Nation Principal Chief Geoffrey Standing Bear and Tribal Council Chief Beverly Kiohawiton Cook of the St. Regis Mohawk Tribe were both re-elected to third terms. Chairman Marshalle Pierite of the Tunica-Biloxi Tribe, the Peoria Tribe of Indians of Oklahoma chief Craig Harper, and Prairie Band Potawatomi Nation tribal chairman Joseph Rupnik were re-elected for a second term.

The Central Council of the Tlingit and Haida Tribes of Alaska re-elected Tribal President Chalyee Éesh Richard Peterson to a fifth term; Lynn “Nay” Valbuena was also elected to serve a fifth term as chair of the San Manuel Band of Mission Indians. Also re-elected were the Peoria Tribe of Indians of Oklahoma chief Craig Harper and Salt River Pima–Maricopa Indian Community president Martin Harvier, as well as the Quapaw Nation chairman Joseph Byrd. Bill Sterud was re-elected as chair of the Puyallup Tribe; he first joined the Puyallup Tribal Council in 1978. Reid D. Milanovich was elected chairman of the Agua Caliente Band of Cahuilla Indians, replacing the retiring Jeff Grubbe. Clayton Dumont Jr. won an open seat to become chairman of the Klamath Tribes.

Arden L. Kucate was elected governor of the Pueblo of Zuni. In the Wabanaki Confederacy, the Passamaquoddy Tribe at Motahkmikuk re-elected William Nicholas to a fourth term as chief; chief Kirk Francis was elected to serve a sixth term as head of the Penobscot Nation; and tribal representative Rena Newell was elected chief of the Passamaquoddy Tribe at Sipayik, ousting Chief Maggie Dana.

Several other tribal leaders were defeated when seeking re-election. Buu Nygren defeated Jonathan Nez to become president of the Navajo Nation; Nygren’s running mate, Richelle Montoya, is the first woman elected as Navajo Nation vice president. Lora Ann Chaisson defeated August “Cocoa” Creppel in the election for principal chief of the United Houma Nation. Kasey Velasquez defeated chairwoman Gwendena Lee-Gatwood to become the second woman elected to lead the White Mountain Apache Tribe. RoseMary LaClair defeated incumbent Nooksack Indian Tribe Tribal chairman Roswell Cline Sr. Former Red Lake Band of Chippewa chairman Floyd “Buck” Jourdain defeated incumbent Tribal Chairman Darrell Seki Sr.