Ian Pike noon, Dec. 8
Wall Street Journal Blasts San Diego in Municipal Bond Editorial
In an editorial Dec. 31, the Wall Street Journal excoriated "shady accounting in the public sector," and cited San Diego as an example. The editorial asked multi-billionaire Warren Buffett to tell governments to insist on honest accounting, now that Buffett's company, Berkshire Hathaway, has launched an insurance company to help municipalities find insurance to back their tax-free bonds. "'An ongoing [Securities and Exchange Commission] investigation resulted in new fraud charges this month against San Diego's [former] auditor," wrote the journal. "The City issued false and misleading financial statements in no fewer than five separate bond offerings in 2002 and 2003. The City didn't tell investors that its unfunded pension liabilities were about to balloon to $2 billion by 2009, or about that little matter of another billion for retiree health care...The residents of San Diego know all too well how costly such frauds can be for taxpayers and citizens who rely on City services."