My Adventures
By Wade Frazier
Getting the Bad News about the Easter Bunny
Hitting Rock Bottom and Meeting Dennis Lee
Make Them an Offer They Can't Refuse
December 2005,
My childhood had a significant bearing on my adult experiences. From an early age, the idea instilled in me was that I must leave the world a better place, or the life I had lived was not worth much.
I was gifted in science and mathematics, and took it for granted that I would be involved in science somehow. It did not turn out as planned. I had a mentor of international reputation who was an engineer and inventor. His inventions revolutionized some industries, and some were so revolutionary that they were suppressed in order to preserve the status quo. One invention was considered the world's most effective engine for powering a car. Another was a bomb that eliminated most conventional warfare without harming people (quickly suppressed by the Pentagon). Another was a circuit that revolutionized the electronics industry and earned the man who stole the invention the title of "Electronics Design Man of the Year." Although a government study devoted about $10 million to analyzing his engine, it went nowhere, partly due to auto industry inertia. During the hullabaloo over his engine, one of my mentor's well-connected associates told him that if he really thought his engine would make the internal combustion engine obsolete, he had better start making his funeral plans.
I was a teenager when my mentor invented his engine, and I had visions of revolutionizing the energy industry and ending the insanity of producing energy by raping the planet. That was more than thirty years ago. What I could do about the world's energy situation when I was a teenager, I had no idea. I held the dream for many years and had the chance to try making my dream a reality. For that alone, I feel fortunate.
In the meantime, I was graduating from high school and going to college, studying biochemistry. Chemistry was my second love, an affair that began at about age twelve, after an infatuation with paleontology when I was about nine. I had vivid dreams about the elements, such as a dream about gallium. In my second year of college I came to the existential crisis that many young people encounter, and decided I did not want to spend my life in a chemistry lab. For the first time in my life I felt lost. If I would not become a chemist, what would I do with myself? I flailed around for months, seeking a direction.
I had been introduced to the paranormal and spirituality a few years earlier. After forty hours of meditation training at age sixteen, I had dramatic experiences that demonstrated that everybody has innate extra-sensory perception abilities, and there is far more to earthly existence than meets the eye. From that moment forward I became an avid student of spirituality, and have studied that more deeply and intensely than all other subjects put together. When I was a teenager, studying Jesus' life and (what is now called) channeled material, I wondered what practical use any of it would be, but I was enthralled. Colleges did not offer degrees in mysticism and it did not pay the bills, but I have never studied anything as enthusiastically.
I was nineteen, and had dropped my organic chemistry, calculus and physics classes, knowing that my life would not be lived as a scientist. I went from the top of my class in college science studies to dropping all my classes. I felt that I was careening toward disaster, a rocket wildly off course, not knowing where I would crash. One night, after months of flailing around, I hit rock bottom. Although I had meditation training and was studying spirituality, I had never really prayed, at least in the standard way. That night, as I lay in bed, I beseeched with all my soul for somebody to give me a clue. I had never experienced a "higher power" before, and although I had studied spirituality intensely, I was not sure that anybody would hear my plea. My plea was this: "If anybody can give me a hint about what to do, I desperately need your input. Please give me a sign, I beg you."
I fell into a dreamless sleep. The next morning as I lay in bed, looking across the room, my first waking thought was a voice speaking inside my head. The voice said, "Have you ever considered studying business?" I had nearly no idea what the voice was talking about. "Business?" I thought. "That sounds like a great idea, but what is it?"
My only academic perspective at that time was learning "important" stuff such as chemistry and physics, or "loafing" and studying English, history or social science. I had no idea I could study business in college. My father's career was spent working for the government. I called the counseling center at my college and said, "Are there any classes at your college where you study business? Is there such a thing as a degree in business?" I had been following a science/math curriculum throughout my academic career, and had about zero knowledge of the business world. The only thing that I knew about accountants was hearing about them on the news every April 15th. The counseling center said, "Sure, we have a business curriculum. We have business counselors here. We will set up an appointment for you for next week." I was on my way.
The next semester I took Introduction to Business and Bookkeeping 101. My mathematical mind gobbled up the bookkeeping. My professor said that accounting paid well. I began my introduction to the world of business and capitalism. I was taught that accounting was the language of business, about how superior capitalism was to communism, and how business was a great force of light in the world. I learned about Adam Smith in my economics classes. I was taught about the wonders of free markets and the invisible hand of competition. In my idealism I ate it up. My zeal for learning and my talent was fully brought to bear upon my business studies.
During my next year of business studies I worked as a janitor in an office building, cleaning the offices of attorneys, accountants, investment advisers and other businesses. I retrieved the Wall Street Journal and other business publications out of the trash and read them. I was seeing how business could be an ideal vehicle to serve one's self and humanity. I was over-idealizing the situation. I was not completely naïve, remembering the "make your funeral plans" comment my mentor received. Yet, I was a babe in the woods. I began playing the stock market with my savings, playing the capitalistic game at age nineteen. I played casino stocks, short sold, bought options, started to play the commodity futures game. I was gambling with my college fund. Somebody up there was looking out for me, as I just about broke even in all my gyrations, with thousand dollar swings in one day.
I was at the top of my class in my business studies. I decided that I would pursue an accounting degree. I went to a community college my first three years, then off to the university, playing in the big time. There were national accounting exams given to the university students. I got the highest score in the university's history. I went from being the chemistry prodigy to being the accounting prodigy, but my last year in college wore me out. I became fed up with academia and the rote exercises that can be found in every college curriculum.
I graduated in 1981, during the worst recession in forty years. I went to college in California where I was raised, but I was originally from Seattle. I wanted to go home, and did. A California kid did not have a prayer of getting into the Seattle Big Eight firms (the world's largest and most prestigious accounting firms, as of 2003 only four are left) during a deep recession, one that hit the Washington State economy hard.
After a sobering experience of working for a small CPA firm the winter of 1982, and being laid off a few weeks after April 15th, it was evidently more important at that life juncture to pursue the proper career path than live where I wanted. I moved to Los Angeles and joined a Big Eight firm. My winter spent working at the small CPA firm was a brutal introduction to the profession, but working in downtown Los Angeles was a deep dive into the "real world." It was a trial by fire. Those were my life’s unhappiest years.
In America, downtown Los Angeles is the most conservative business district west of Manhattan, and as one of 700 professionals in my office I was thrown into a dog-eat-dog world. Those recruits fresh from college, as they began their CPA apprenticeship in the Big Eight, were called "Grunts," "Lambs to the Slaughter" and other terms. "Assume the audit position" was used to describe the auditor’s life. As an auditor I traveled throughout the Los Angeles region, spent several months on audits out of town, and worked in Skid Row Los Angeles for several months. I experienced events such as passing by a dead Mexican-American man on the sidewalk as I was walking to lunch, having sneezing fits for months because the air pollution was so fierce, being accosted by beggars every day and so forth. I became street-wise fairly quickly.
I was the first male in my family in a hundred years who did not serve in the military, but I experienced the corporate version of it. The regimentation was extreme. A mystical, non-materialistic vegetarian did not fit in. I was required to eat at restaurants everyday, and being a vegetarian was less acceptable back then than being a homosexual in the environment I worked in. I gave up being a vegetarian to work there, which affected my health. I was virtually forced to drink alcohol, and developed a bad habit that I gave up in 2000.
The lambs were assigned mentors in the firm's hierarchy to help groom their careers. The sage advice I received from my mentors (they were trying to help me, and I liked them) was that my shoes were not shiny enough, I was not dazzling them at the phony weekly cocktail parties, and if I wanted to get ahead at the firm I had to crawl over the bodies of my peers.
The people I worked for, particularly the men (there was not one woman partner in the office when I began) who had attained the lucrative and coveted position of partner, were human wreckage, virtually all of them. They nearly all looked at least ten years older than they were. Many drank heavily, and I could not imagine living their lives. Their average income was $150,000 per year (in 1983, in 2003 it is about $300,000). Many of my peers were determined to make it, and trampling each other on the way up was a minor hurdle in many minds. Not everybody was Machiavellian, but it was the most impersonal and least friendly working environment I have yet encountered.
The environment was bad enough, but what constantly nagged me were the challenges to my idealistic vision. I was not very bothered by the "I have a BMW, therefore I am" mentality that I saw in many of my peers and throughout the Los Angeles yuppie community, but I had a difficult time seeing how our audits benefited society. The collision of indoctrination and reality could be a harsh one for the lambs. I had been told that auditing provided a valuable safeguard against the excesses of capitalism. By performing audits of corporate America we insured that accurate financial statement information was being published, thereby ensuring a fair playing field in the capital and financial markets, but I was having a hard time seeing that happen. Here is a vignette to make it clearer.
I did not know what auditing was when I graduated from college. Part of adjusting to the “real world” was making sense of the income I made and how much money the firm received for my efforts. During my final year in college, I worked as a cook and dishwasher in a “greasy spoon" restaurant, making $3.50 an hour. With a diploma in hand, I made more than $9.00 an hour and was being billed out at $39. My first “busy season” (the winter months, when year-end audits are performed for corporations) was spent making photocopies, running errands and adding up columns of numbers. I was part of an army of auditors at a huge bank. Alongside me at the photocopier was a peer who had recently received his MBA at USC, and it was also his first busy season. He had the same disturbed sense of wonder that I did. Being an MBA, he was being billed out at $42 an hour. One day, after a morning spent at the photocopier, he said, “That stack of copies just cost the client more than a hundred dollars.”
The idealist in me tried making sense of my place in the scheme of things, and I wondered how I was contributing to society, particularly in light of the money that attended my efforts. I knew the party line about auditing being good for the business world and a benefit to society, but it was difficult to see it from the trenches.
After a few months on the job, when the busy season was over, there was a one-week training class for the new junior auditors. Near the week's end there was a “quiz the partner” session. A partner would come to the class and answer any question we had. We put our questions in a basket in order to have anonymous questions.
On that day, among the standard questions for the partner ("How much do partners make in the LA office?" "$150,000 annual average," the partner replied) was mine: "How does auditing increase the world's real wealth?"[1] There was a snort or two, then everybody began giggling in genuine humor, and I laughed with them, the question was so out of place for the setting. If somebody could have spoken for the group mind at that moment, it probably would have been approximately, "How delightful! Somebody still believes in the Easter Bunny."
The partner put on a straight face and gave the standard answer that auditing helped provide reliable financial information for the business community, so better investment and other business decisions could be made. A couple of years later I was on an audit with him, and saw how he really felt about the value of auditing.
I was with him on a savings and loan (S&L) audit. One day he was talking about an audit our firm had performed that blew up in our faces. As auditors, we issue "opinions" on our client's financial statements. That opinion is what the client pays for. It ends up on the client's annual report and their filings with the SEC (Securities and Exchange Commission). The opinion usually reads something like: "We audited XYZ Corporation’s financial statements and found them to be fairly presented in accordance with Generally Accepted Accounting Principles." In other words, we audited them and found them playing by the accounting rules. That is what we received a million dollars for, which was the standard fee for a large corporate audit in those days. Today, it is two or three times as much.
The audit opinion can state that the client played fair, while the financial statements themselves show a company on the ropes. That is not an audit failure, but if a company gets too close to the edge, there is a "going concern" principle that states if the company looks as if it may go out of business soon, the auditors are supposed to qualify their opinion. A qualified opinion is always bad news for any corporation, and auditors rarely issue them. Qualified opinions usually mean the firm is in serious trouble.
An audit "blowing up in our face" means that the auditors issued their standard unqualified opinion, and the company soon capsized. Auditors are not fortunetellers, but if a company goes out of business a few months after they issue "healthy" financial statements, and there is an unqualified audit opinion accompanying their statements, the auditors often are sued for a negligent audit. In some ways an audit is a crapshoot, because a future event that nobody foresaw can capsize the company, but the "deep pocket" theory means that shareholders and other folks left holding the bag will try extracting money out of somebody for the business failure. That is a risk of being an auditor. Partners physically sign the company's name to the audit opinion with a pen and ink. Every partner learns how to sign opinions with a signature that looks like every other partner's signature.
There we were, auditing an S&L that had melted down, blowing up in the faces of our predecessor auditors, and that partner who reassured me about the "Easter Bunny" was looking at the financial statement and audit opinion of another firm we audited that "blew up." He said, "That signature looks a little shaky to me." It was a joke about the partner's state of mind while signing the opinion, inferring that he felt in his bones that the opinion he was signing would someday haunt him.
Getting the Bad News about the Easter Bunny
There was an inherent conflict in my indoctrination versus reality. As auditors, we theoretically rendered independent opinions on our client's financial statements. Our clients paid our fee, and could choose another auditor if they wished. I did not understand that situation's implications in my early days. I was just trying to survive. In 1984, something happened that eventually made it clear. I helped audit one of the world's highest profile savings and loan (S&L) institutions. During my first two years at the firm I periodically heard a cynical sentiment regarding the worth of auditing, and no auditor ever relied on the work of another, but I had not yet figured it out. That S&L audit eventually made it clear. We were brought in to audit the S&L immediately after the previous auditors had been fired. That situation was called a "high exposure" audit. "High exposure" meant that the likelihood of the auditors being sued was high.
The previous several months had seen that highflying S&L run out of money. They were posting record revenues and profits, until one day they were unable to pay their creditors and depositors. Then it all came crumbling down. Suddenly, those record profits appeared illusory. There was a 1930s-style bank run, and the federal government stepped in to keep its doors open. The S&L's shareholders filed a several-hundred-million-dollar lawsuit against the previous auditors. I was the junior auditor on that "high exposure" audit. On an audit such as that, the lambs did not do the work, but my firm flew in real estate and banking experts from our offices across the nation, and managers and partners did work usually done by the lambs. I coordinated hotel rooms, rental cars and the administrative logistics of the audit. I was also the right hand of the partner who ran the audit. The senior manager who worked with him (who made partner a couple of years later) was my direct supervisor. Those two men were some of the nicest human beings I ever encountered in public accounting. The reason they were on that audit was probably because they were such nice guys. People were not exactly volunteering for the job. I was on the job as a lost waif in the office. Although I was the lowest man on the audit's totem pole, they treated me as if I was a peer. I was treated better than I ever was in the Los Angeles office.
On my first day there, my manager briefed me, telling me what lead to our audit. He said, "As usual, you can make the numbers say whatever you want to until the money runs out." I had heard it before, but did not really understand it. That S&L became one of the highest profile and earliest meltdowns of the entire Savings and Loan Scandal. The S&L had been doing creative accounting, and had concocted bogus transactions to hide their losses. They abandoned basic accounting principles. By itself, that was not the crime of the century, but was common corporate activity, unfortunately. It was our job to make sure that did not happen, applying Generally Accepted Accounting Principles (called GAAP in the profession) to their books. As we began auditing the S&L, it became obvious that our predecessor auditors had abandoned basic accounting and auditing principles, and allowed their client to bully them into signing off on fictitious financial statements.
The gist of the problem was this: the Holy Grail of capitalism is profits. Corporations only exist to make profits for their owners. Over the years, I have seen numerous instances of corporate executives making a sagacious statement that goes like this, "Gentlemen, you must not forget that we are not in the business of (fill in the blank; I have seen everything from "producing eggs" to "treating patients" to "making cars"), we are in the business of making money."[2] When the corporate elite makes those astute observations, they are repeated endlessly in corporate halls as mottoes to never forget.
With the drive for profit being the ultimate reason for a corporation's existence, corporate managers have the incentive to report the largest possible profits. There are principles of accounting, such as the conservatism principal, the revenue realization principal, the objectivity principle, the matching principle and many others that supposedly guide accounting practices, so profits are not overstated or counted before they are "in the bank." The Big Eight's very existence depended on laws passed during the 1930s in the wake of Wall Street's collapse and the Great Depression, designed to help ensure those events would never be repeated. Our job was to keep corporations honest in reporting their profits.
At the university, my auditing professor told us why the Big Eight partners made so much money. He said it was because sophisticated professional judgment was required to render an independent audit opinion. My professor said that such highly qualified professionals, with their sophisticated auditing practices, which entailed numerous levels of review, did not come cheaply. He said if the government took over the auditing profession, they would create bureaucratic guidelines so that a monkey could do an audit. They would produce substandard audit results and the profession would be ruined. With no frame of reference other than his, I believed it.
On that S&L audit, even I could see that our predecessor auditors were signing off on ridiculous accounting practices, things a lamb could have spotted. How could a highflying Big Eight firm, with its highly paid, pin-stripe-suited auditors, approve such phony financial statements? After a month on that audit, the partner in charge, my manager and I went to lunch. The partner said, "If you look at what (our predecessor auditor) approved in their audits, it is shocking what they signed off on. Yet, if we had been in their shoes, I'm not sure we would have done any differently." He was the nicest partner I ever knew, and his candor that afternoon was a major influence in helping me figure it out.
What he said did not fully sink in until years later, when the Savings and Loan Crisis became headline news in 1988. That partner was saying that the predecessor auditors had allowed themselves to be bullied by their client (the S&L) into signing off on bogus financial statements. How could they be bullied, with all those accounting standards, levels of review, and highly honed professional judgment? To put it bluntly: by a million-dollar audit fee. If an auditor proved too stubborn in applying GAAP to the S&L's financial statements, the S&L would merely hire a more pliant auditing firm. For a million-dollar fee, the partner who lost the account because he refused to see the financial statements the client's way could ruin his career.
A few years before that audit, the CPA profession was deregulated, in a sense. The "free market" ideology of the time, exemplified by Ronald Reagan and his administration, created the acceptability of doctors, lawyers and CPAs to begin getting "competitive," advertising and trying to take business away from each other. It brought capitalistic principles to the professions.
The notion of CPA firms rendering "independent" audit opinions became a farce. Those were the go-go years for Reagan's boys. Greed was a virtue in 1984. Michael Milken, Ivan Boesky, Donald Trump and other capitalistic heroes dominated the scene. By 1984, only two years after Reagan deregulated the savings and loan industry, the writing was on the wall. What we saw on our audit was typical throughout the industry. The S&L we audited was just one of the first to run out of money. What my manager said was true: as long as a company has money in the bank, it can get compliant auditors to sign off on virtually any financial statement. For a million-dollar audit fee, independence goes flying out the window.
That crime was far greater in the S&L industry. Take an industry such as energy, for instance. In theory, if Exxon goes out of business, its shareholders lose their money (this was originally written in 1998; in the 2002 update, I could have inserted “Enron” for Exxon). At least that is the theory. Capitalism, profits and market discipline all sound nice, but when a corporate giant is on the ropes, our government runs to the rescue with taxpayer money to bail them out. Americans older than me should easily remember the government bailouts of Lockheed and Chrysler. U.S. Government bailouts and interventions have propped up industries such as aerospace, automobiles, steel and semiconductors. In theory, shareholders take the risk if the business fails. In banking however, with deposit insurance, the government, which is ultimately funded by the taxpayers, guarantees the liabilities of the bank or S&L. Banking is a regulated industry, where the government has assumed a great deal of the risk. Bank and S&L liabilities are essentially guaranteed by public money. The deal for that protection was to adhere to certain regulations. Banks and S&Ls were limited in the kinds of loans they could make, the interest they could pay on their deposits, etc. The public was ultimately the rock that stood behind the bank, making that $100,000 of deposit insurance per account mean something.
If anything, the public accounting profession had a larger duty to perform independent audits on regulated corporations such as banks and S&Ls because a bank failure would ultimately risk the taxpayers' money, not just a bunch of rich shareholders' money. In a regulated industry there is an extra level of auditing and accountability, in theory. Along with fancy Big Eight auditors there are also governmental auditors (federal and state) looking over the bank's shoulders, making sure the public's interest was being looked after, and banks were acting prudently. Ronald Reagan, in the interest of "getting the government off of the public's back," began gutting the government agencies that regulated industries such as banking.
The nature of Reagan's deregulation was insane (or diabolically sane) and ushered in the S&L failure. Reagan "deregulated" the prudence side of the industry, letting S&Ls invest in almost anything they wanted, while letting them give out whatever interest rate to depositors they wished, while raising the deposit insurance from $40,000 to $100,000. Those acts dramatically shifted the risk from the S&Ls to the taxpayer. It let the S&Ls "go to Vegas" with speculative real estate deals, giving out whatever interest rate they wanted, and increased the weight of the bag the taxpayer would hold if it all came crashing down. It is said that organized crime rings avidly watched the deregulation bill make its way through Washington, rubbing their hands with anticipation. It was obvious to those with eyes to see where Reagan's "rescue package" was headed.
If my profession had been honest, and the auditing profession structured to eliminate the conflict of interest of corporations being able to hire any auditor they wanted, the S&L crisis would have never happened. The alarm bells would have been going off back in 1983 throughout the industry, and something would have been done about it. The S&L industry was already doomed because of the inflation of the 1970s, related to the oil price shocks of OPEC. Increasing computer technology also eliminated much of the reason for S&Ls to exist. The price tag to responsibly phase out the industry would have been less than $10 billion in 1983. The number did not start growing large until about 1986.
What happened was avoidable. The Big Eight was not responsible for creating the S&L crisis, which was the result of global political-economic factors, corrupt politicians, greedy S&L executives and the land owners who made the really big money in the scandal. Many books dissect the scandal. Although we did not create the crisis, our prostitution for the audit fee, which was profession-wide, helped a $10 billion problem become a $400 billion (in today's dollars) disaster.[3]
When it came time to protect the public’s interest, which was the only reason our profession existed, we were busy kissing our clients' backsides. As it stands today, the public accounting profession is worthless. More than half of the Big Six's (now Big Four) revenues come from those audits. Back in 1984, the annual U.S. auditing revenues of the Big Eight were a few billion dollars. In 2004 they were about $10 billion. The inherent conflict of interest that existed in the profession in 1984 is still there. They have made some minor attempts at reform, but auditors cannot render independent audit opinions if the auditee pays their fee, and can choose another auditor if they come up with the “wrong” answer. I have no confidence that when the next financial scandal looms on the horizon, the Big Six will sound the early alarm (again, the Enron Scandal happened four years after this was originally drafted, and now it is the “Big Four”). If they are financial cops, they are cops on the take.
Remember the movie Snow White? The Seven Dwarfs worked in a gem mine, and at day's end, they happily marched home, singing their song. Dopey was the last one out. He shut the door, locked it, and left the key on a peg next to the door. The Big Eight was as valuable in protecting the public’s interest as that door was in protecting the gem mine. I did not completely figure it out until the price tag of hundreds of billions of dollars was announced immediately after George Bush was elected in 1988. Bush's son Neil was on the board of Silverado Savings in Denver, and helped ride it into the ground to the tune of $1 billion taxpayer dollars, and the S&L scandal was kept quiet until George Bush was elected.[4]
Money does not evaporate in such a scandal. It goes into somebody's pockets. The S&L crisis was a defrauding of the public from beginning to end, and a great deal of criminal activity was engaged in, in addition to all those riverboat gamblers running S&Ls, lighting cigars with $100 bills and funding "see through" office buildings. There were S&L execs who went from one S&L to the next, looting it until it went under, then another S&L would hire them where the pattern was repeated, the CIA laundering drug money through them, and sheer Mafia gangsterism.[5] The scandal is dealt with more fully at this link.
The other main activity the Big Six firms engage in is tax accounting. I had largely figured out that game when I was still in college. I was determined that I would never do professional tax accounting. That goal lasted a couple of months, as that first tax season at the small CPA firm in Seattle saw me doing nothing but tax returns for my three-month stint there. The theory given for why professionals are needed so citizens can properly pay their taxes is that the deductions available under the tax code are a benign form of governance. The theory is that offering financial incentives for certain kinds of economic activities, and financial disincentives for others, is far less coercive than other methods of state power. That was what I was told in school, which is probably still the drill today. I believed it, even if I did not believe in it. I now realize that I was sold another bill of goods. For instance, the rationale for the capital gains deduction was presented to me as a way to encourage investment, risking capital for a higher return than mere interest at the bank, or with bonds. I believed it, with my capitalistic indoctrination.
As I have been waking up over the years, the left’s literature has allowed me to see that capital gains deduction in a new light. If somebody works at McDonald’s or drives a truck, the sweat of their brow is taxed at one rate. If somebody sits on their backside, "investing" their wealth in stocks, the money rolling in as passive income is taxed at a lesser rate. That is a neat scam. When I did tax returns professionally, I performed tax research, and one cannot spend much time doing that before finding tax laws so obscure that one wonders if they apply to even ten people. It becomes obvious that rich people write the tax laws. Legislators promoting appropriate economic activity did not write those obscure deduction laws. They are written at the behest of rich people (and large corporations), using their power to lobby congress with their wealth, giving them tremendous tax breaks.
How did I ever believe that baloney? All those tax laws and obscure deductions take a progressive tax system and eliminate its progressive features. Corporate income taxes have steadily declined during the past couple generations. The public accounting profession is a parasite. Its professionals spend years being trained in tax law so the rich can avoid paying taxes. During those glorious Reagan-Bush years, regressive features were increasingly added to the tax system. For instance, they kept raising the Social Security rate, which is a tax that begins at the first dollar people earn. The rationalization is that it is paying for the retirement of working people. The reality is that the increased flows into the coffers of government on raising Social Security rates gets appropriated to cover the federal deficit. The net effect was another transfer of money from the poor to the rich. All those tax cuts the Reagan-Bush people rammed through, while simultaneously raising a regressive tax such as Social Security, had a net effect of transferring money from the poor to the rich. Those kinds of mechanisms have made wealth in the United States so concentrated. In 1997 the richest one-percent of Americans had 39.1% of the wealth, a share that had doubled since the 1970s.[6]
On a global scale, the wealth concentration is far worse, although it is hard to append much responsibility to CPA firms. The richest 400 people in the world have about the net worth of the poorest three billion, for a wealth ratio of nearly ten-million-to-one. That is one effect of global capitalism and our global economy. It has been happening for the past five hundred years, as the West conquered the world. The global disparity in wealth has never been greater, and there is no sign it will get any better. The rich are getting richer as never before, and people are starving to death across the planet while Americans are the history’s fattest people.
The current system that has been carefully constructed is how the rich keep getting richer. On the federal level of the U.S. government, the tax breaks and subsidies given to the rich are more than three times larger than the transfers made to the poor. Fixed wages with unlimited profit potential (supposedly because the capitalists take the "risk") is another mechanism. In the end, brute force is what keeps the rich getting richer, as any nation that tries opting out of the global capitalist system is bombed, invaded or otherwise bludgeoned, such as Vietnam, Chile, Cuba, Nicaragua, etc., etc. Corporate propaganda is part of the system, as they own the media. The manipulation of the international banking system is another part of it. The phenomenon is multi-faceted.
Hitting Rock Bottom and Meeting Dennis Lee
For audits and tax preparation, CPA firms provide about zero public benefit, but take in about $20 billion per year in the U.S. If our government were honest, the Securities and Exchange Commission would have taken over the audit field long ago. CPA firms are so rich that they have their hooks quite deeply into the SEC. It is known in economics jargon as "capturing the regulator" which means that the government has been corrupted by the very industries it regulates, and no longer looks after the public interest. I finally realized that my profession was worthless.
The sixty and seventy hour weeks during the busy season of auditing took their toll. I began suffering from stress symptoms. There were many factors, but sixty-hour weeks, having to change my diet, attend endless phony social functions and having a hard time believing in what I was doing had a cumulative effect.
In early 1986, I was looking to get out of public accounting and find a job in Los Angeles in "industry." One day in February of 1986, I hit rock bottom. I was at the end of my rope, shaking from stress, with eyes that looked like a raccoon's, dreading the next day. For the second and so far last time in my life, I went to bed while sending out a desperate plea to the cosmos, asking for a clue. I had done my best, and felt backed into a corner with no way out. I even considered taking a clerical position, as long as it was close to home. What happened the next morning was not as dramatic as when the voice told me to study business, but during my first waking hour the voice snuck up on me, whispering, "Well, what do you have to lose? You can starve in Seattle as easily as you can starve here, and you would like it there better." It was like a brilliant day dawning after a long, black night. I was practically jumping up and down.
The manager I worked for on that S&L audit was helping me leave the company on my own terms. He put me on the payroll to stay at home and look for work as long as I needed to. I called him up that morning, which was a Tuesday, telling him that I was moving to Seattle. I arrived in Seattle the next Monday and moved in with my grandparents. I spent a day getting my résumé updated, and then began looking for work. On Thursday, I had a meeting with an executive search firm, which are called "headhunting" firms in the business. The recruiter told me that in a month or so I would easily find something to my liking.
I went home that afternoon, ready for the long haul of finding work. I was in my paradise, hiking in the Cascade Mountains every week. That voice was right: I would be far happier starving in Seattle than in Los Angeles. The next morning I was lying in bed at about 9 a.m., still asleep. The phone rang and I heard my grandmother's slow footsteps as she came to tell me that I had a phone call. It was the recruiter I had spoken to the previous afternoon. He asked me if I could be ready for an interview that afternoon with a "solar company." It felt as if a lightning bolt hit me. It turned out to be the company owned by Dennis Lee.
When I found out what they were doing, I bowled over the controller who interviewed me. There were no other contenders for the job after I was finished. A week later I interviewed with Dennis and was hired on the spot, to begin work the next day.
When I met him, Dennis was marketing a heat pump that he had sold for several years. A serendipitous cowboy invented a "solar heat pump" in 1974 during the first energy crisis. Standard heat pumps today get what is known as a Coefficient of Performance (COP) of between two and three. In 1986, they averaged about a two. That meant that for every unit of electricity used to run a heat pump, two units of heat would be delivered into a home. The heat pump Dennis sold got a COP as high as twelve, and had done as high as a COP of five in Minnesota in January. It was two-to-three times as efficient as standard heat pumps. Dennis had been selling them on the East Coast for years, where customers would switch from oil or gas heating to his heat pump, and they would save seventy percent in operating costs versus heating with fossil fuels. It is still the best heating system the world market has ever seen.
Dennis had a marketing plan that was sheer genius. For $4000 dollars he could fund the cost of marketing, manufacturing and installing his heat pump. He would sell the heat pump for $10,000, the customer would make a $4000 down payment that the federal government would refund to the customer, and the $6000 dollar balance would be paid by the customer over several years, based on proven savings. The customers risked none of their own money. Virtually everybody who ever heard of the deal went for it. What did they have to lose? For years, Dennis could not get any financiers to back his plan. Financiers, rich men and entrepreneurs got involved, but nobody ever saw the genius of Dennis' plan. Their attitude was almost universally, "This is a great piece of equipment, the price is $10,000 cash." They never realized that a customer would not part with $10,000 for a piece of equipment they were not sure worked. Dennis removed the customer's risk, but the money would not be completely collected for several years. Businessmen rarely think that far ahead, not when they smell the quick kill. When Dennis had his companies stolen time after time, the people who stole them thought the gold was the system, and promptly discarded Dennis' "crazy" marketing plans. They promptly all went out of business.
The Discover Card is a watered down version of a card Dennis invented years before he got into the energy business. As a marketer and entrepreneur, Dennis is an Einstein. I saw his genius immediately. Because of my mentor when I was young, I became a student of genius, and knew what it looked like. Genius is simple, and turns ideas upside down or inside out, looking at the problem without the presumptions that blind most people. Dennis definitely had that knack.
Soon before the Mafia and his business associates stole his company for the last time on the East Coast, that time even stealing his personal possessions, leaving him and his family with only the clothes on their backs, Dennis was on the brink of having a household name corporation put up $1 billion to carpet America with his heat pumps. The chairman of the board saw Dennis' genius. Finally, Dennis stood in front of somebody who understood. Just as they were getting to the deal's short strokes, his greedy business associates collapsed his company while stealing hundreds of thousand dollars from him. Soon after that, the Mafia stole what was left, and Dennis had to start again from scratch.
After a several month relationship with a rich business associate in Yakima who also did not understand, one day Dennis had enough. Mr. Rich was telling people that he did not need Dennis anymore. Dennis bid Mr. Rich goodbye, packed his family into a beat-up station wagon, and drove over the mountains to Seattle with twenty dollars in his wallet and no place to sleep. That was in October of 1984, and Dennis sold 1000 systems in a few months, and tried carpeting Puget Sound with them.
Dennis figured the job would only get done by doing it himself. His Seattle strategy was selling thousands of systems before he had financing, and maybe tens of millions of dollars of sales would finally get a financier's attention. In the meantime, he was trying to attract the electric companies' interest. He thought he would be their hero, bringing the energy conservation that their ads said they desperately needed. They rebuffed him at every opportunity. He was surprised, but would not let that stop him, and sold systems as fast as he could. The Renewable Energy Tax Credit expired in 1985, and no system installed after December 31, 1985 would qualify for the credit.
Although Dennis did not figure out who was behind the vendetta for a long time, the electric companies pulled the strings and wiped out his company, and a corporate hit man was responsible for the death of one of Dennis’ employees.
The most complete rendition of Dennis' Seattle experiences is in My Quest, written from his jail cell in 1988-1989.[7] By the end of 1985, Dennis' company had endured media smears, a fraudulent consumer protection lawsuit filed by the Attorney General's office, numerous break-ins and sabotages of their facility, bomb threats, theft of their phone equipment, attempted theft of all their records, surprise visits by the fire department and OSHA, a threatened investigation by the IRS, pressure being put on his financier, his suppliers, his customers, and his employees by various parties, such as the corporate hit man, the Attorney General's office and the courts. A fraudulent bankruptcy suit filed by the hit man and a few gullible employees he manipulated into filing with him capped off the circus. The Attorney General's office was involved with the hit man. They possessed documents he stole from the company, which they produced when Dennis threatened an FBI probe of their files.[8] The media splashed the company in the newspaper and the evening news, which scared away customers and employees, and shook up others, such as the financier. The electric companies were mobilizing all their forces to wipe out the threat of a superior technology.
When I joined the company in March of 1986, it was in its death throes. In June 1986 I witnessed the theft of Dennis' company, and my boss, the controller, engineered it, while the employees cheered. The financier had his company stolen two weeks before Dennis' in a move that the financier believes was part of a conspiracy.[9] I lost plenty of innocence back then. I received one paycheck before the company stopped making payroll. I was so on fire that I worked three months for free until the company was stolen. I was reverberating from the lightning bolt that hit me in March. Dozens of employees were hanging around the office, seemingly loyal to the cause. I felt a comradeship that I had never had before. I felt surrounded by people who were committed to making the world a better place, and saw Dennis' vision. When I saw that their loyalty was to their paycheck, I had a valuable learning experience, although not a fun one.
Dennis was essentially run out of Washington. A member of the Washington version of the SEC attended the shareholders' meeting where Dennis' company was stolen, where those "loyal" employees showed their true colors. The representative calmly watched it happen, subpoenaing Dennis immediately before the company was stolen, seemingly trying to find him at fault for having his company stolen.
After seeing the outrageous and criminal acts engaged in by the authorities and others, Dennis felt their next move would be for the police to "find" a barrel of heroin in his closet. He left the state in June, moving to Chicago and soon to Boston, trying to rebuild the venture. Although all I had seen was bloody ruin, my spiritual training came in handy. I could spot a great soul. I saw who Dennis was, and was sold on him. Of the hundreds of employees Dennis had in Seattle, I was the only one who followed him to Boston.[10] Months of working without pay had reduced me to moving back in with my grandparents, working as a temporary employee, and saving a few hundred dollars so I had gas money to drive to Boston. After years of trying to live in Seattle, I was leaving it to chase a crazy dream. It was one of the hardest things ever did. In November of 1986, with tears in my eyes, leaving behind a girlfriend who soon ended the relationship, I drove out to Boston.
I went to Boston with nothing more than the promise from Dennis that he had a floor I could sleep on. The day after I got there, Dennis and I met with a company that had developed a turbine that ran off a 200° F heat source. Dennis got the idea of hooking up his heat pump to that turbine and make "free electricity." It was a naïve idea at first, and the Second Law of Thermodynamics said it could not be done. I became far more involved than I thought I would. I raised money to get us going again, a couple months after I got there, and I brought in my old mentor to take a look at what we were doing. He thought we had a chance, and even gave his world’s best engine to Dennis, to try marrying with his heat pump panels to try making free energy, which my mentor thought was possible.
In Boston, in early 1987, Michael Dukakis was readying his run for the presidency, and one of the state's big political issues was the Seabrook nuclear power plant. Seabrook was in New Hampshire, next to Massachusetts. Dukakis was getting political mileage out of opposing the reactor, and if Massachusetts did not approve the evacuation plan for Seabrook, they could prevent it from going online. We had unwittingly landed in the middle of a huge energy controversy.
I first became aware of "Astroturf" organizations in Boston. An Astroturf organization is a fake grassroots organization, bankrolled by corporate America or other powerful interests, but camouflaged to appear as private citizens merely agitating for their own cause. The first Astroturf organization I encountered (at least that I knew was one) was called the Coalition for Reliable Energy. While we presented our first "Greatest Energy Shows on Earth," the Coalition for Reliable Energy began a media blitz on Boston television and newspapers. The Coalition presented itself as an amalgamation of grandmothers and concerned citizens, making sure that New England had reliable energy and that all energy sources were considered. At the end of their first TV ad, a grandmotherly figure mumbled, "and nuclear energy options." That happened in January and February of 1987.
In a rare instance of mainstream investigative journalism, just as the Coalition's ad blitz was firing up, the Boston Globe revealed that 95 percent of the Coalition's funding came from the Seabrook Association, which consisted of the electric companies that invested in the Seabrook nuclear power plant. The Astroturf organization was unmasked.
Probably, not many people took their ads seriously after that revelation, but the ad blitz kept coming all spring. By the time we left Boston in June 1987, the ads became brazen. They featured a thirty-something professional man telling the viewer, "You will have to pay for the Seabrook nuclear power plant whether you use it not, so why not use it?" It was perhaps the most flagrant exercise of corporate propaganda I have ever seen.
The Boston Globe continually ran front-page coverage of the Seabrook protests. Demonstrators chained themselves to the reactor's front gates almost daily. At that time, we were holding "free energy" shows, telling our audience that the best way to eliminate nuclear energy was to make it obsolete. We met with a local protest group that staged many of the protests. We presented them a plan for the electric companies to pursue free energy technology and end the nuclear insanity. Later, one of the group's high-ranking members told Dennis that their real motivation was not opposing nuclear energy, per se. The person bankrolling them owned land that could be sold at a high price for a hydroelectric project. They were proposing a hydroelectric solution, and their sponsor would get rich in the process. That was disillusioning. It appeared to be another Astroturf organization, although most of its members likely did not realize it.
At a show we had a quarter mile from Seabrook's front gates, Dennis announced his intention to buy the reactor. He proposed to use the containment vessel as a heat storage facility, using free energy machines to supply the electricity. The mouse roared. Before the electric companies in Washington wiped his company out, Dennis' stock in his company was worth $48 million. He barely escaped the state with the clothes on his back.
Dennis made a multibillion-dollar offer to buy the nuclear reactor, but to never put nuclear fuel in it. At the show, attended by about 200 people, Dennis announced his offer to the Seabrook Association. The next day he mailed his proposal. The Seabrook Association chairman of the board called our hole-in-the-wall office the next day, within minutes of receiving the package. He said he could come immediately to our office to discuss our proposal. That was a much different reception than Dennis received in Seattle.
Publicly, the Washington electric companies said they knew little about Dennis except that he was crooked and his technology was a scam. Soon after we arrived in Boston, a banker we encountered called the BPA to check out Dennis' story. He called the BPA switchboard, asking if anyone could tell him about Dennis Lee, which was a strange way of approaching a huge bureaucracy such as the BPA. The next day he received a call from the BPA's conservation department. The banker told us that the BPA man was extremely cautious, but admitted that, "For three months, all our entire department thought about was Dennis Lee." That was the same organization that hired the hit man, the same organization that publicly said "Dennis who?"
The Seabrook chairman invited Dennis to his office to discuss the proposal. The next week Dennis and his engineer (Mr. Engineer) went to the Seabrook Association's palatial offices, and were given the red carpet treatment. The chairman and his pals talked about working with Dennis and his free energy ideas, thinking they might work. Dennis said it was almost amusing to watch them in action. Those were not nice guys, but acted as if Dennis was a long lost son. Dennis could see their masks slip at times, and it was evident that they were playacting.
Later, when Dennis composed a press release of his offer for the chairman's approval, the chairman began backpedaling, and it became obvious that placating him was their goal all along. In Boston and California, we had friends on the inside, high in the electric company hierarchies, who told us things. We heard that New England's electric companies convened secretly to decide what response to give to a wild man selling free electricity machines. Instead of the snuff job Dennis got in Seattle for merely selling a heat pump, at the secret meetings the consensus was they might have to cooperate with us.
As far as I know, the Boston Globe has never mentioned Dennis. To add a weird touch to those days, electric company representatives attended our Greatest Energy Shows, something they admitted when Dennis met with them. Right after one show, in the Boston Globe's weekly science section they interviewed a scientist who thought we could mine moon dust, extracting an isotope of helium from it, thereby solving our energy problems.[11] It was as though they knew exactly what they were doing, and rubbed our faces in it. They ran front-page news of protests at Seabrook, while ignoring our show at the Seabrook gates. While we received the red carpet treatment from the Seabrook chairman, and while New England's electric companies held secret meetings about us, the Boston Globe ran an article about mining the moon to solve our energy problems.
I lost more naïveté in Boston by witnessing a media blackout on us, seeing Orwellian ads from the Astroturf Coalition for Reliable Energy, reading moon dust articles and other oddities. The electric gangsters in Washington had not forgotten about Dennis. The Attorney General's hatchet lady, who repeatedly lied and bloodied her hands while trying to destroy Dennis' company, quit her job soon after her final confrontation with him. She came to his office one day on a document-hunting expedition, but Dennis had her meet his employees, who grilled her for two hours about her underhanded actions toward the company. Much later, Dennis found himself sitting next to her on an airplane flight. He asked her how she slept at night, and she gave the Nuremberg defense, that she was only following orders. Then she said, "But you will notice that I do not work for them anymore." Her hands got too bloody, her conscience finally woke up, and she quit the Attorney General's office.
The Attorney General's office had a pinch hitter that sicced the authorities on Dennis everywhere he went after they ran him out of Washington. Ms. Pinch Hitter contacted the authorities immediately after Dennis arrived in Boston, and she duly warned a Middlesex County District Attorney Investigator that the criminal of the century was in his backyard. The investigator swaggered into Dennis' office a few days later, telling Dennis he looked forward to throwing him into jail, and other officious threats. In Ventura, a telling document surfaced regarding the attacks on Dennis. That Middlesex investigator wrote to the sheriff's deputy who finally threw Dennis in jail on fabricated charges. The investigator wrote:
"Mr. Lee was attempting to duplicate his Washington operation in our state. We were attempting to proceed criminally against Mr. Lee but, without clear cut violations of our law, could only proceed in the manner in which we did. I don't believe our AG completed their investigation before Mr. Lee left our state."[12]
In other words, the investigator tried jailing Dennis based on the word of Ms. Pinch Hitter, but failed to find a law that Dennis broke. Given enough time, they would have found something, but we left the state before they could attack. They could not find a violation in California either, but that did not prevent them from making it up. The Secretary of State's office was sharpening its axe as we were leaving Boston, trying to snare us in a securities law violation. They started a fishing expedition just before we left. The red carpet was going to turn redder with our blood if we stayed in Boston much longer.
In the meantime, I sent a Christmas card to the professor who inspired me to become an accountant. Mr. Professor was the best teacher I ever had. We kept in touch over the years, and I told him what his crazy student was doing in Boston. Over the years, Dennis' organizations have interfaced with tens of thousands of people. Dennis has had plenty of public exposure over the years, on TV and hundreds of radio talk shows. Millions of people have heard of Dennis in America. Mr. Professor's response to me was the rare time that somebody became excited about our project because of its potential benefit to humanity. Talk is cheap. Before it was over, Mr. Professor showed what he was made of. He displayed a level of integrity I have only seen in a few people.
Mr. Professor wanted to help bankroll the venture. I had tied into technical talent in California, and Mr. Professor was putting up more money. We moved to Ventura (where I was raised) in the summer of 1987. I would not have believed it at the time, but our experiences before Ventura were the easy days. In the fall of 1987, my mentor came forward with his hydraulic heat engine, and we started flying high. We were soon approaching gross revenues of a million dollars a month, selling informational kits on how to make, sell and install the heat pump.
On New Year's Day of 1988, we became involved with Victor Fischer, who had also invented a hydraulic heat engine and built some prototypes in Australia, prototypes coming closer to the Carnot ideal than any engine ever developed. On January 12, 1988, Dennis publicly announced that the technology was in hand that could make free energy a possibility. In the crowd was a deputy sheriff investigator, whom I will call Mr. Deputy. He talked to one of our administrative people a few weeks earlier. The Better Business Bureau was forwarding requests on us to Mr. Deputy, and our employee called him, asking what was happening. Our employee used to be a sheriff's deputy himself, and knew that if our company was doing something wrong, the investigator was legally obligated to tell us when we asked him. Mr. Deputy replied that all was fine and that he would stop investigating us.[13]
Mr. Deputy was in the audience on January 12th, and the next day he was readying a search warrant for a raid on our facility. On January 14th at about 10:00 a.m. I stood in our company's parking lot and watched ten cars speed into our driveway in a cloud of dust. Mr. Deputy, leaping out of the lead car, asked me if the building behind me was ours. The raid was on. Not only was Mr. Deputy guilty of entrapment, telling us three weeks earlier that we were not breaking any laws, but the raid was the first time I experienced felonious acts engaged in by law enforcement personnel.
The raid had a few purposes, as we discovered later. The first was the felony act: the raid was an espionage exercise. Thirteen armed deputies raided our facility, rampaging through our building and herding everybody into our conference room. We were photographed and had to produce identification before we could leave the building. All employees were arrested. Then they kicked everybody out of our building and occupied it for hours.
That building was where our technical material was. Our chief researcher's office (whom I will call Mr. Researcher) was located next to our machine shop and research area. In his office were technical details regarding the free energy prototypes we were developing (including Fischer's, and technical material on inventions other inventors had sent us), and Mr. Researcher's personal papers. The research facility had mirrored windows so people could not see into the building during daylight. Mr. Researcher and the machinist went behind the building where the mirrored windows were, after being kicked out of it. While standing behind the building, they suddenly saw into the building because it was momentarily brighter inside the building than outside. Why was it brighter inside the building? It was due to the repeated flash of a camera. When the camera flashed, they could see inside the building. The door to Mr. Researcher's office was open to the machine shop, and with each flash, they could see where it came from. The sheriff's deputies were in Mr. Researcher's office, rolling out the blueprints on his desk and photographing them. It was an outright espionage expedition.
About an hour later, hours before their official search began, they were seen taking boxes out of the building, loading them into a car and driving off. In those boxes were all the papers in Mr. Researcher's office. After they stole the technical data they suddenly became cooperative, and eventually allowed me to accompany them on their official search, while they sought the evidence that their warrant authorized them to seize. In their official search, they pointedly ignored Mr. Researcher's office. It was the last place they officially searched, and the receipt they left stated they removed only one piece of paper from his office: a parts list for the heat pump. The raid lasted from 10:00 a.m. to after midnight. The next morning, when Mr. Researcher got back into his office at 6:00 a.m., the wreckage in his office told a different story. His office had been cleaned out. They took every scrap of important paper that they could. The blueprints were too big to sneak out in the boxes, so they photographed them. Everything else important was taken, and there sat a receipt, saying they took only one piece of paper. That kind of outright, naked crime, committed by police officers, not only shocked me, but for the first time in my life I seriously harbored violent thoughts. Mr. Researcher was white in the face for weeks, and I thought he was going to keel over. He quit the company a few weeks after the raid, not able to handle how he had been raped. That was only the raid's first goal.[14]
The second goal was putting us out of business by seizing all our records. I was the controller, and they cleaned out my office to the walls. During the raid, as I was escorting Mr. Deputy around the office, I told him they could have whatever records they needed. I did not yet know what they had done to Mr. Researcher's office. Mr. Deputy said I could have copies of anything I needed to continue running the business. He tried convincing me that Dennis was a crook because of what happened in Seattle. When I told him that I was with Dennis in Seattle and knew what happened, he stopped that angle. I was relieved of my duties after several hours of escorting the deputies through our buildings. The next morning, I found that they had taken every scrap of documentation we had, and Mr. Deputy reneged on his promise of letting me have copies of our records. When he told me he was going back on his word, he had the audacity to tell me we were lucky they did not also take our computers. We did not even know who all our customers were after receiving their lobotomy. That alone nearly put us out of business. It was a carefully aimed deathblow.
The third goal was the legal one: gathering evidence for the "crime" that we committed. What was the crime? During the raid, I asked Mr. Deputy what we did to warrant thirteen armed deputies storming our building. He said we may have violated an obscure franchise law that nobody had heard of. Not one California lawyer in a hundred had ever heard of California Civil Code 1812.200, the Seller Assisted Marketing Plan Act (SAMP). It was known as a "worm farm" law, due to the short-lived worm farm businesses in the 1970s, where people put their life's savings into questionable business opportunities. The law was designed to regulate the sales of business opportunities. It was a law that required a business to register with the Secretary of State's office. To comply with the law, a business filed a one-page form with the Secretary of State's office. The form provided cursory information about the business, and the filing was accompanied by a fifty dollar filing fee.
There had been one prosecution in California's history under that law. It is what Dennis called a "Red Tie on a Tuesday" law. It was a law that nobody knew of, but through corrupt law enforcement it became a crime to do what everybody else did, such as wearing a red tie on a Tuesday. Of the million men who wore a red tie on Tuesday, you were the only one thrown in jail for it. Before Dennis' case was over, he got an affidavit from the lawyer who wrote the SAMP law. In a conversation with our attorney, the lawyer estimated that up to 100,000 California businesses could qualify under the law for its filing requirements. According to his affidavit, only 250 companies had ever made the filing, for a compliance rate of 0.25%.[15] Dennis was the second person ever prosecuted under those laws; the other was for a man selling Little League franchises, and his conviction was overturned on appeal. Dennis is likely the only person who will ever do prison time for "violating" that civil law.
We sued for civil rights violations and the theft of our technical material in the raid. We made noise. Thousands of people called the sheriff's department to protest. The next several months were nightmarish for me. Working with no records was a small fraction of what I suffered through during those days. The stress symptoms I suffered in Los Angeles came back soon after I raised the money in Boston, and friends began attacking me. I had to come to terms with possibly being murdered for my efforts, and I worked seventy-hour weeks. After the raid, my stress symptoms blossomed. I had to work sixteen-hour days just to survive.
What happened in Ventura caused a number of close family members to refuse to speak to me for several years. Mr. Professor, Dennis and his wife and I felt nearly alone in a world of insanity and darkness. By May 1988 I was becoming useless at work, just sitting there, quivering. I asked Dennis if I could take the summer off, not knowing if my body, mind and emotions could withstand such a situation again. He had a good idea of what I was going through. I was involved with my future wife by that time, and those events put our relationship through severe stresses.
In May, the same month I left the company, Dennis received an offer. It was not the first time he received an offer like that, and this tale will digress a little, with the kinds of offers that Dennis and others like him get.
Make Them an Offer They Can't Refuse
What the Attorney General's office did in Washington can easily be called a conspiracy. How much cooperation was going on between the electric companies, the Attorney General's office, the media, the federal bankruptcy courts and others? The local police refused to arrest or even investigate the BPA hit man, even after his actions caused one woman's death, when his accomplices in our company confessed to espionage on his behalf, and when documents he stole were later found in the Attorney General's investigative files on Dennis. The Attorney General's office hurriedly returned them to Dennis when he threatened them with an FBI probe. What exactly happened can be difficult to figure out. When bullets fly at you from every direction, it is legitimate to wonder if somebody is orchestrating the salvos.
When the Middlesex County investigator in Massachusetts admitted that he was investigating Dennis because the Attorney General's office in Washington contacted him, it made me wonder. It is possible that the attacks on Dennis were not coordinated, since capitalistic gangsters are the same everywhere.
I felt that the Attorney General's office contacting Middlesex County and siccing them on Dennis was not necessarily conspiratorial on the part of Middlesex County. I now know that low intelligence combined with zero integrity and vindictiveness is not that unusual in law enforcement. On the Attorney General's side, however, it was definitely conspiratorial. That does not mean that everybody was in on it, but there were people in Washington who knew exactly what they were doing, and sent their soldiers marching after Dennis. The BPA hit man knew exactly what he was doing and why. He was in on it. There is no conceivable explanation for his behavior other than him being a corporate hit man. Whoever hired him knew exactly what they were doing. However far that might venture into a worldwide conspiracy is debatable, but the hit man changing costumes and becoming a “noted Tesla researcher” after he helped wipe out Dennis’ efforts in Washington seemed part of a more comprehensive effort. The barrage of attacks by the Attorney General's office after Dennis left the state also has the whiff of a broader conspiracy.
It is possible, however, that it was merely a mean-spirited vendetta by the Attorney General (AG) to inflict vengeance on somebody who stood up to his attacks. Dennis made the AG suffer. When the AG's office attacked the company with their phony lawsuit and media blitz, Dennis responded. He bought a full-page ad in The Seattle Times that ran on October 18, 1985.[16] It enraged the public about the AG's actions. The AG's office was inundated with public protest. Dennis later heard what the AG's reaction was while he read Dennis' full-page ad. The man was livid.
Years later, Dennis heard that he became famous by standing up to the AG. It apparently was one of the two worst publicity black eyes the AG ever endured while trying to crush somebody. The other black eye came from wiping out an activist who tried ending the homeless problem with affordable housing solutions. The activist fought back, and his campaign aired the AG’s dirty laundry while he was running for governor in 1992, and may have been a key reason he barely lost. The woman who "pinch hit" for the hatchet lady who quit the AG's office was a prominent member of the AG's staff. When the AG ran for governor, the pinch hitter quit her AG position and joined his campaign. Perhaps siccing the authorities on Dennis everywhere he went was just vengeance by the AG, and his close relationship to the pinch hitter[17] gives evidence of the AG's personal interest in making Dennis' life miserable.
I have seen no evidence that the Massachusetts Secretary of State's investigation into our money-raising efforts in Massachusetts had anything to do with Washington. I have heard nothing about why they did it, but it was obviously instigated by somebody up high, because we were not doing anything that should have attracted their attention. It appeared to be a fishing expedition for something they could hang us on. I suspect that the electric interests in New England instigated it.
Somebody also instigated what happened in California. Mr. Deputy's investigative report regarding what got him involved with investigating Dennis is amazing reading. According to Mr. Deputy, he was minding his own business when a man contacted him who attended Dennis' Saturday show at our facility, where Dennis pitched the technology. According to Mr. Deputy, the man "said that he was bedazzled by the caffeine in the coffee, the sugar in the donuts and the speaker's presentation and really wasn't sure what you get for the money."[18] The man did not buy anything. He was not a complaining victim. That supposedly got Mr. Deputy hot on his career-making case. We were drugging our marks with coffee and donuts, and Dennis closed the deal on our bedazzled victims.
Mr. Professor knew somebody high-ranking at the local electric company. During the summer of 1987, the electric company knew very well about Dennis and what we were doing. Mr. Professor asked his friend what they planned to do about Dennis, and the man replied that the electric company had not yet decided. It looks as if Mr. Deputy's "investigation" in the fall of 1987 was related to the decision they finally made. We heard from other sources that the chairman of the board ordered the hit on us. Maybe it was not the chairman. I will never believe that when the deputies ransacked Mr. Researcher's office during the raid, stealing the technical material, that they did it for their own edification, to peruse at their leisure while watching Sunday football games on TV.
How far that bona fide conspiracy went, I cannot say. Not all the deputies at the raid knew what really happened. One was a former student of Mr. Professor, and had no idea what really happened that day. As Smedley Butler said, soldiers blindly following orders can serve evil as easily as "good." I doubt the thieving deputies knew who they stole the technical material for, or even cared. When studying covert actions by folks at the CIA, NSA etc., it becomes obvious that few see the big picture, except those at the top. Those in the chain of command work on a need-to-know basis, with strict compartmentalization, secrecy and the rest. Later events later made the picture clearer for me.
Conspiracies do not explain everything that happens, or even all that much of the suppression dynamic. That is too simple-minded, but I believe that the attacks on Dennis were not all isolated and unrelated instances of local energy companies protecting their revenue base. There is substantial evidence that supports arguments for an energy industry "immune system." The dynamics I have seen in energy I have also seen in medicine, particularly in the cancer racket. The more wealth and power vested in any particular industry or profession, the more ruthlessly it protects itself. Every industry and profession has an infrastructure designed to protect itself from competition. How far they take their defensive strategies, and how far they can take them, is dependent on how powerful that industry or profession is. The more concentrated that wealth or power, the more likely one will see conscious and ruthless activities designed to keep the competition at bay.
There is perhaps no more powerful industry than the energy industry. People can say that the military is more powerful, but it is obvious that the military is not running the show, but is the muscle used to keep the rackets flowing smoothly, and it is one of the biggest rackets itself. As Smedley Butler said, those order-following soldiers have little idea whose interests they really serve, which is part of the racket's design.
The geopolitical devastation the energy industry has inflicted on the planet is not pretty. In Nigeria, Indonesia, Saudi Arabia and other places, the ruling elite has a sinister relationship with the oil companies, and their domestic populations are repressed. Those situations make for unpleasant realizations regarding the connection between the oil those nations have, their repressive governments, the Western oil companies and the governments of Western nations.
If Americans think I am unfairly picking on America, part of the reason is that Americans can do something about America's behavior, and they are my target audience. Pointing out the flaws in the Soviet Communist system, and there were many, can be a rewarding exercise, but that does not excuse our murderous international behavior. As Noam Chomsky has said, we are responsible for the predictable consequences of our actions, not the actions of somebody in China, for instance.
Here is an example of blood on the West's hands that is not all America’s. In 1995, Nigeria's government executed Nobel Prize literature nominee Ken Saro-Wiwa and several others. Their ostensible crime was their activism for human rights and resisting the corporate practices of Shell-BP, whose operations are devastating the Nigerian environment, particularly the land of the Ogoni tribe, of which Saro-Wiwa was a member. In the case of Nigeria, Great Britain is the chief culprit, arming the dictatorship in neocolonial-style while the oil flows unabated from the region. Saro-Wiwa's execution, along with several other activists, was one of the greatest human rights outrages of the 1990s. The United States, Britain and other nations, such as South Africa, stood by and watched it happen. The tragedy continues. Nigerian literature Nobel laureate Wole Soyinka lived in exile with a price on his head for years. Genocide and devastation is OK as long as the oil keeps flowing. The American-sponsored genocide in East Timor was another instance of securing more cheap oil for the West.
Oil is not the only big prize, whereby the masses suffer greatly to keep the cheap energy coming. Coal is another, and Native Americans have suffered because uranium was discovered on their "worthless" reservation lands in the 20th century.[19]
With that teenage dream of revolutionizing the energy industry, I also realized that our energy production methods devastate the environment, are not sustainable, and harm many people. I also saw that our dependence on fossil fuels, particularly those Middle East "reserves," might lead to World War III someday. That was another monkey on my back. Free energy might just help save humanity from self-destruction. Brian O'Leary feels the same way, as do many others.[20] The U.S.-caused holocaust in Iraq and today’s fraudulent “War on Terror” is something that I have tried preventing for my entire adult life. For all the value of uranium, wood, hydroelectric energy and coal, oil has always been the greatest prize, and the industry wields tremendous international power.
In Boston, I began new levels of education. Just before Dennis made his public offer to buy out Seabrook, one of our merchants lined up an interview on a New Hampshire radio station. Dennis and I drove to the station for the interview. It was being taped for later airing. As we arrived, the receptionist told us to wait a minute, as our interviewer was "talking to a Senator." I thought nothing of it, and we waited for a minute. Then the man came out, welcomed us, and we entered his studio for the interview. It was a typical interview, with questions such as "So, Mr. Lee, you say you have a heat pump that gets high efficiencies, and you say you can generate free electricity with it. Wow!" It was a "gee whiz" interview. After he finished taping the interview, he turned off his professional reel-to-reel tape recorder. He was affable, with his leading man voice. He then said, "Off the record, Mr. Lee, what is going on here? Do you think you can really make free electricity? Are you trying to challenge them? Let's have a friendly chat. I want to know more." Just as he was saying that, he turned on a small desktop tape recorder. For the next half-hour, Dennis talked about how he was not threatening the electric companies, but wanted to work with them to end pollution and bring renewable energy to the world.
After our chat, we walked to my car. As we pulled away, Dennis said, "Did you see him turn on that small tape recorder after taping the show? That was the real interview. That tape is going to the Big Boys. They will never air our original interview." I looked at Dennis in shock and disbelief. "What?!" I stammered. Immediately, the wheels in my head were spinning a million miles an hour, trying to make sense of what he said. Dennis would later write that I looked at him as if he was crazy. Maybe it looked that way to him, but it was more like being told something shocking, not knowing what to make of it. As I sat there, driving the car in puzzlement, Dennis sighed and said, "This is going to be a long haul. Let me tell you some of what is happening."
Dennis told me what he thought was happening behind the scenes. It was during those days that I faced the possibility of being murdered for pursuing free energy. I decided that if it came to that, it did. Nobody lives forever, and I could think of nothing more worthwhile to pursue. If the energy gangsters murdered me, well, it happened. It is one thing to face such a situation in one's mind. It is another reality entirely to face it in real life.
Dennis thought the informal interview was the real one, and that the energy boys wanted to know what his attitude really was. They wondered if Dennis was a belligerent revolutionary or if they could work with him. It was the next week, I believe, when Dennis received the call from the Seabrook chairman. Our radio interview never aired. I bet the chairman himself heard that "informal" interview. It appears that Dennis was right.
Brian O'Leary is an ex-Astronaut, ex-colleague of Carl Sagan, the first human slated to visit another planet (Mars), and a free energy visionary. O'Leary's Miracle in the Void contains one of the best, most succinct summaries of free energy's suppression. Brian wrote of his encounter at a free energy symposium bankrolled by a multi-hundred-millionaire. Brian attended the symposium at the rich man’s behest and subsidy, and heard the rich man's marketing gurus tell why he was not committing significant funding to developing free energy:
"He explained to us that the situation was similar to that of a river. For optimal profits we want to catch the river where and when it flows fastest. Until then it would be foolish to put up much money now. Why spend millions of dollars now, with uncertain results, if we could hold back those millions until such time is truly ready to enter the marketplace and can outcompete the others?"[21]
Brian described his anger and awe. While humanity may be on the brink of self-annihilation, the rich man would wait on the sidelines as a vulture would, seizing the best opportunity to make a killing in free energy.
In those Boston days, as Dennis first made his "free energy" noise, we received our first offer. A group of businessmen came to our company and met with us. They offered ten million dollars for the rights to our technologies. It would have made us rich, but that was not our program. Our program was bringing free energy to the world, not being bought out and the technology shelved. We could not say for certain that was their goal, but it smelled similar to the stories I had heard when I was younger.
We did not accept their offer, but kept plugging away on a shoestring. We almost became involved with a household name marketing organization at about that time. They performed some shoddy investigation of our technology, tested a broken system, and decided against becoming involved with us. We were becoming desperate for money, but Dennis was relieved that we did not get involved, because it would mean losing his freedom.
In Ventura, Dennis hit on a program that worked. We ran ads in newspapers, such as USA Today, modestly titled "Free Electricity!" and we sent out videotapes of our pitch, offering to sell educational materials to market, manufacture and install the heat pump, and told them we were working toward free energy. People began mailing us checks for thousands of dollars. About all I had seen with Dennis was disaster until September of 1987, but Dennis said he had found the new rocket ship.
The program exploded. Money began pouring in from across the country. We were so buried in orders that we were more than a month behind in shipping them out. We went from a few volunteers to more than forty employees in about two months. The rocket was taking off. I did not see Dennis' glory days in Seattle, but I saw it in Ventura. It was like holding onto a rope tied to a rocket ship.
After the raid, as we tried avoiding the next deathblow, it gave us more credibility, not less, with the public. Many people had some idea how the system worked, and being attacked told many that we were onto something. Our sales increased, and in May of 1988 Dennis received a second offer. That one was different. Dennis was invited to meet some bankers in Chicago. Dennis met a CIA man who represented "European" interests and said that they would write Dennis a check. They would "put a '1' on it" and Dennis could put on the zeroes. It is one thing to hear the stories from people who approach you; it is another level of understanding when it happens to you.[22]
Dennis' integrity had already been tested many times, although he never got a "name your price and we will pay it" offer before. Dennis made a counteroffer: he would to put the zeroes on the check, but the money would go right back into the European interests' pockets, and they would be forced to spend that money on bringing free energy to the world! The CIA man was stunned. He sat there, speechless. After he recovered from his shock, he regained his friendly demeanor but said he was not prepared to accept Dennis' offer. He met Dennis in California a few weeks later, but never again mentioned the offer. The next month, Dennis was arrested with a million-dollar bail. Dennis thinks that his arrest was their response to his offer. I would have been a millionaire many, many times over if Dennis had taken that deal, but dealing with the devil never works out too well. I could not have lived with myself if we had taken that quiet money. That was the exact opposite of what we were about.
Such offers are never put on paper. I have now heard of many like it. Nobody goes to court to try enforcing those kinds of deals. Now that I have heard many stories similar to ours, from those with no reason to lie to us, I see the game. As Don Corleone did, they make you an offer you can't refuse. If you refuse their offer, they destroy you. Here are other stories told to us or myself, from people we believe.
A few weeks after we came to California in the summer of 1987, Dennis ran "Free Electricity!" ads in the Los Angeles Times. In those ads, he was looking for salesmen. One evening, Dennis and I were in Mr. Professor's office (we had not gotten going in California yet) and Dennis was calling the ad leads. As I worked alongside him, Dennis talked to a sales lead that told Dennis that he was the marketing director for a company that made cars that got 100 MPG. He said the company no longer existed because the founders were in prison. The government prosecuted them for fraud. It was the standard "protect the consumer" angle. The man said the prosecution's star witness claimed that he was an important engineer for their company, who worked for them for years. The "engineer" testified to the company's fraudulent practices. Nobody at the company had ever seen the man before. Forged payroll records were produced at the trial to "prove" the witness worked for the company. The man told Dennis, "You don't know what they'll do to you!" Dennis told the man "Admit it, you called me because you believe some people have the guts to do it. You want to see me succeed." Dennis was jailed less than a year later.
With the national exposure that Dennis receives from time to time, we became a magnet for others like us, and they came, telling familiar stories. Our experiences were far from unique. After the raid, and before Dennis was arrested, we had a number of people approach us, telling their tales. Here are two more.
One man told us of living in a chiropractor's back office for two years. His friend taught at a California State University. He developed a chemical method to extract platinum from ore considered unmineable. The process promised to make platinum much more available, hence cheaper. Experiments yielded nearly unbelievable results. They became involved with the big money boys, some famous old New York money. They were financed and began using the process to mine in the California desert. They bought the necessary mining equipment with the New York money. Suddenly, the bank seized their funds, and the sheriff was beating their door down for violating a law that nobody had enforced since the nineteenth century. The two men fled in a panic. The teacher's truck was found abandoned in the desert. He was never seen again. The other man slept in the back of a chiropractor's office for two years in order to stay alive. The New York money now owns the land where the mine was.
One man showed up at our office in a limousine. He told us that he once owned a windmill facility in the Southwest that actually worked, not an investment scam used to get federal tax breaks. He was selling electricity, competing against the electric companies. One evening he was working late at his facility, and he received a phone call. The caller told him that if he did not immediately leave the premises and never return, his family would be dead by dawn. The caller made it clear that he was serious and could deliver on his threat. The man took out his calculator and did some figuring. His net worth was about $400 million, and he had invested $35 million in the windmill project, about nine percent of his net worth. It was not worth it. He packed up his briefcase and left the premises, never to return. At our business he said, "I wish you the best, but you do not know what you are up against."
Those people had no reason to make things up. They were relating their traumatic experiences to people who would listen, not ridicule, and perhaps heed their cautionary tales. I now know how they felt.
One thing decried as an "urban legend" by the "skeptics" is the high MPG carburetor. I had an engineer friend who was designing and building his own high MPG carburetor. The basic flaw with today's carburetion systems is that they introduce liquid into the combustion chamber, and therefore the gasoline cannot completely ignite. Coming out the tailpipe are the results of combustion and uncombusted fuel, now completely vaporized as it exits the exhaust pipe. If carburetors can be designed to inject vaporized gasoline, the combustion will be more complete, and more energy released. All high MPG carburetors work on that principle, and are called vapor-injection carburetors. My friend was building a vapor injection carburetor and sent away for lists of patents on them. The ones he saw marketed were poorly designed, and he thought he could do better. He got back quite a list. Practically every patent was in the name of auto companies and other large corporations. He wisely abandoned his project.
One corporate coworker of mine was a U.S. Department of Justice investigator early in his career. He worked undercover, and sometimes he rotated into other duties. He was assigned one of the Justice Department's more mundane tasks: responding directly to public inquiries. It was crummy work, but somebody had to do it, and the low-ranking people got that duty. The phone calls came into the Justice Department and were recorded. One day he responded to a caller who said that an American automobile company had threatened his life. My buddy called the man back, figuring it was one more paranoid tale, but he could not lightly dismiss alleged death threats. He called and said, "Sir, what evidence do you have that (the car company) is going to kill you? The man replied, "Because they told me so. Showed right up at my house and told me so." When he asked why, the man replied, "Because I invented a carburetor that gets more than one hundred miles a gallon."
As the conversation continued, my buddy realized the story was becoming difficult to dismiss, and he decided to visit the man. He got on a plane and flew to his house. The man invited him to his garage to see his carburetor. The man said that the car company tried buying it from him. When that strategy failed, they threatened him. Then they tried both tactics at once, culminating with a man showed up with a half million dollars in cash in a sack, telling him to take it. He was told that if he did not take it, he would be killed. The investigator began taking the case more seriously, and asked what the man wanted the Justice Department to do. He said, "I want you to protect me!"
The investigator looked more deeply into the matter, and the man was apparently telling the truth. Here was the Justice Department's response, as delivered by my buddy,
"We cannot protect you forever, unless you move away and change your identity, which we can help you do, but if you try selling your carburetor again, they will find you. We suggest that you settle the matter with them."
The man settled with them, when given those options. He let them buy it out, and it was a pretty good deal, better than the earlier ones, probably because he got the Justice Department involved. The deal was for a million dollars a year for fifty years, payable to his heirs in the event of his death. My buddy told me that the oil companies funded it. My buddy was not a wild-eyed, paranoid lunatic. He was a corporate big shot who performed the investigation himself, somebody I worked with for five years. I imagine that man's carburetor was on the list of vapor injection carburetors that my engineer friend received. Another buddy who worked for General Motors told me a similar tale, as have others.
I had an encounter with Tom Bearden, the leading theorist of free energy. Richard Hoagland presented a conference in Seattle in September 1998 in which Bearden and the astronomer Tom Van Flandern also presented their theories and data. It was an interesting conference. There were question and answer sessions. None of my many submitted questions were answered, but Bearden answered somebody else's question regarding the suppression of free energy. I have immense respect for Bearden's experiences in the field and what he knows. Bearden spent about twenty minutes answering the question, and when he finished the audience was stunned.
Bearden is aware of a global infrastructure that suppresses free energy research, development and marketing attempts. He said it was not the oil companies, per se. The oil companies were in the business of finding oil, extracting it, refining it and selling it. They do not bother themselves with suppressing alternative energy, at least not the efforts Bearden described. Bearden said that some oil company owners, however, were extremely vigilant, and they were behind the suppression of free energy. He said they had developed the global infrastructure that wiped out free energy innovations.
Bearden may not see the entire picture (if anybody does), as our experiences were related to the electric companies, not the oil companies, but Bearden's opinion is not to be taken lightly. Bearden said that the small group of oil company owners (Rockefeller agents are nearly guaranteed to be involved) have built a sophisticated organization that keeps its ear to the ground, keeping tabs on free energy efforts and making sure they never succeed. He said they were experts in "game theory." Bearden said he might write a book about it someday.
Bearden said they build dossiers on all free energy researchers and pioneers. They study each individual for weaknesses. Does a man have a weakness for attractive women? Does he smoke pot? What angle can they use on him? Can they direct an inventor toward his organization whose personality will clash with the others? Bearden said their game theory was a discipline of strategy, probability and outcome, whereby a free energy pioneer is similar to the king in a chess game, and maneuvering him into checkmate is the goal. Those people working for the oil company owners (it may extend to all energy companies) spend their careers derailing free energy threats. It is only when clandestine moves fail that they escalate the strategy. Death threats, prison terms and violence only happen when the game reaches higher levels.
Here is a good place to insert a quote from Machiavelli:
"And one should bear in mind that there is nothing more difficult to execute, nor more dubious of success, nor more dangerous to administer than to introduce a new system of things: for he who introduces it has all those who profit from the old system as his enemies, and he has only lukewarm allies in all those who might profit from the new system. This lukewarmness partly stems from fear of their adversaries, who have the law on their side, and partly from the skepticism of men who do not truly believe in new things unless they have actually had personal experience of them."[23]
Bearden told the crowd of an event that happened to him, demonstrating how the secret teams operate. Bearden has been involved with numerous companies for years, trying to get free energy developed and working with many free energy inventors. He has seen working free energy prototypes, but the game theory boys have been actively mischievous, making sure that nothing gets far along. One company Bearden worked with was looking for money. A person approached their company, presenting his credentials as a high-flying financial whiz who could get the money, but was really a plant from the secret team. He approached the Justice Department, telling them that he hired on with Bearden's company, but as he got deeper into their organization he realized that they were crooks, going for a big scam. He told the Justice Department that he would help them nab Bearden and friends if he got immunity.
Unbeknownst to the Justice Department (likely) or Bearden and gang, the secret team plant pieced together a financial deal. It involved offshore bank accounts, relatively anonymous organizations and other shadowy aspects. It seemed like a relatively straightforward deal to get legitimate money, but probably came from a money laundering operation for the drug lords or CIA. The money was not "clean," but unless Bearden and gang performed a thorough investigation, they would never know. The plant put the deal together, but told the Justice Department that Bearden and friends were putting the deal together, and that he was the chump they hired to finalize it. The Justice Department was lured into the deal, rubbing their hands, ready to nab Bearden and his partners.
The secret team plant presented the deal to Bearden and friends, telling them that he found the money. They merely had to sign their name and the big money was theirs, making their noble free energy dream a reality. Bearden's funny bone quivered. It did not smell right. He had been there before and told the company president that the deal smelled suspicious, and to not sign it. They did not. In the next room were U.S. marshals, handcuffs ready, waiting for Bearden and friends to sign the documents. If Bearden and friends had signed the deal, they would have gone to prison for twenty years or so. They could nearly hear the groans from the secret team plant and marshals in the next room when Bearden's friends took his advice and did not sign.
Bearden told that story as an example of their non-violent Machiavellian methods to derail free energy inventors. Then Bearden told what happened when those "benign" game theory tactics failed. Only then would inventors and entrepreneurs get anonymous phone calls, telling them to stop their efforts if they wanted their family to live through the night. Their homes and businesses might mysteriously burn down at night. Bearden told of the friendly buy out offer. The inventor would be approached, asking if a few million dollars would be enough to buy out his technology. If the inventor or entrepreneur proved recalcitrant, he would get the offer he could not refuse: "If you don't take $10 million to buy you out, we will kill you and your family." Bearden's stories sounded very familiar. He said that $10 million was the going rate the last he knew, and knew an inventor friend who he thought was forced to "bite that bullet" fairly recently. They use big carrots and big sticks. How can they offer a carrot to a multi-hundred-millionaire building a windmill farm? They usually cannot, so they move straight to the big stick. I have also heard nightmare tales of them carrying through on their threats, where entire families have been murdered, their houses set on fire and then bulldozed. Those extreme measures can permanently derail certain free energy threats, but are only undertaken sparingly as they attract too much attention, as a world unaware of their suppression efforts is their best protection. Their methods have worked very effectively for at least the past sixty years.
For several reasons, I rarely use names when writing about these matters; the anonymous’ fear for their health and their families’ is a primary reason. Also, naming names can get me killed. I have seen many lives destroyed while on my journey, and many still live in fear today, all these years later. Several more people have to die before I can name many more names in my work, but it is now “safe” to mention Sparky Sweet by name, as his tale is famous and he died in 1995.[24] Sparky was Bearden’s friend and a successful research scientist whose work may be partly based on that of General Electric scientist Gabriel Kron. After retiring from General Electric, Sparky kept researching in his specialty of magnetism and eventually developed a prototype that generated a million times more energy than went into it. Even though some call him a “maverick,” he was anything but, and went to great lengths to interest the energy establishment in his work. A limitation that plagues most inventors and engineers is their political-economic naïveté. R. Buckminster Fuller wrote about that problem, and Sparky was naïve about what the energy interests’ reaction would be to mailing working prototypes to them. Their official response was silence. Instead of a tickertape parade for solving the world’s energy problems, he was hounded to a grim end. The Big Boys were interested in his work, all right, but their attention was limited to putting him under surveillance (including showing him pictures that they took of him through the walls of his home), sabotaging his efforts to bring his technology to the public and making death threats that eventually drove him into hiding and a lonely and possibly violent end.
Sparky’s fatal “heart attack” may well have been a natural one, but the spooks who use technology where they can photograph people through the walls of their homes can also shoot them with a microwave weapon which can induce a heart attack as they sit at their kitchen tables. Another free energy comrade may have experienced one of those spook-induced heart attacks while in his home, but he survived it and did not figure out what probably happened until years afterward. The spooks are experts at killing people and making it seem like an “accident” or “natural causes.”
One of Dennis’ technical advisors from the Ventura days was invited by the now-defunct International Tesla Society to visit Sparky in the late 1980s. Sparky lived in the Los Angeles area, not far from Ventura, where the fireworks began for us. When they met, Sparky was aware of what had happened to Dennis and voiced his sympathy. Sparky then showed Mr. Advisor his device. Mr. Advisor related to me the awe he experienced while watching it operate as ice formed on it. Sparky then related his experiences while developing his device and offered to make Mr. Advisor his partner, as Sparky knew him by reputation. Mr. Advisor, having lived through the Ventura nightmare, had no desire to repeat the experience and had retired from the alternative energy scene. He declined Sparky’s offer. Sparky still wanted the benefit of Mr. Advisor's mind and lent him the textbook he wrote to describe his prototype's function and the theory behind it (some of which is on the Internet today). Mr. Advisor was impressed, and told me that the math was particularly elegant.
When I heard Steven Greer say in 2004 that the Big Boys told him that they paid off 10,000 people at an average of $10 million each over the past sixty years or so, it made perfect sense to me. Ten million dollars times ten thousand people is $100 billion in quiet money. I would not be surprised if the Big Boys spent another $100 billion on their global surveillance efforts and snuff jobs. That is a pretty penny, but is a pittance at the level they play at: keeping an entire planet enslaved to the scarcity paradigm. Greer also knows a fair number of billionaires, and when any have tried devoting funding or other help to a free energy effort, they have immediately received threats, the kind that windmill entrepreneur did. Again, it is difficult to dangle to effective carrots to the rich, so the Big Boys go straight to their big sticks when the rich poke their noses into the affair.
A high-profile friend of mine once received a demonstration from the spooks. He was transported, blindfolded, to an underground location where they demonstrated free energy, anti-gravity and other technologies, along with an explanation of why such technologies will remain underground for now. That friend has proven his integrity to me many times - he has not abused me with a fanciful tale. But very few can tell such a story, and virtually no one will tell it publicly. Those spook technologies my friend saw were probably developed at least partly by back-engineering “captured” extraterrestrial craft, the kind I have now seen with my own eyes. What my friend saw neatly aligns with what Steven Greer’s 400-plus UFO witnesses have to say.
Here is my final anecdote from the free energy milieu. A fellow traveler once told me about his early experiences in the free energy field. He had a mystical awakening while a college physics student, and used his new insight to create a working free energy prototype. Within hours of getting his prototype to work, he received a “men in black” experience where the spooks descended on his lab bench, confiscated his prototype and incarcerated him. He was dazed when released, wondering what the heck had just happened. He eventually became indignant and planned to redevelop his prototype in secret. Years later, he rented a hole-the-wall lab under an assumed name and worked in the utmost secrecy. Immediately after he got his new prototype to work, the same “men in black” treatment happened again! He then stopped trying to make prototypes, and his free energy path has since taken a different direction. When I heard him say that, I imagined that the Big Boys must have a technology that can detect when anybody on earth taps into that energy field. In 2005, I heard from somebody whose opinion I respect on these matters, and he said that, indeed, the Big Boys have satellites in orbit that can tell when anybody taps into that field. Then they send their “men in black” after them to eliminate the threat of free energy. I have seen other weird evidence of the global control mechanism that the Big Boys have developed.
The technology the spooks possess is apparently about a hundred years ahead of what is on the market today. The American military has technology that is "only" about ten years ahead of what is on today's market. The spooks apparently have technology that can create holographic illusions that the people think are real events, not virtual reality. That is in the "way out" category not explored much on this site, because I have presented information people can pursue for themselves, and have avoided impossible-to-demonstrate information that is usually derided as "conspiracy theory."
That all-too-real scenario of the Big Boys’ global control mechanism can seem depressing, but if enough people began waking up and caring about something beyond their egocentric existences, the Big Boys could not maintain their tyrannical grip over humanity for long. Finding and educating those people was why I made my website.
The math and physics that underlie zero-point energy and other unorthodox alternative energy technologies are not subjects that average Americans can easily study. What laypeople can study relatively easily, however, is why Dennis' heat pump was the world's best heating system and why my mentor’s engine was the world’s best for powering an automobile. There are only so many hours in a day and years in a life, and I decided long ago to focus on studying the political-economic aspects of this situation, and this site’s material is easily studied by laypeople, if they devote the effort to it.
This section will conclude with a quote from Victor Marchetti, the first ex-CIA employee to really go public with what they really do, and The Brookings Institute's advice to NASA in 1960. Marchetti said:
"The purpose of the international conspiracy is to maintain a workable stability among the nations of the world and for them, in turn, to retain institutional control over their restive populations. Thus, for these governments to admit that there may be…technological capabilities obviously far superior…could, once fully perceived by the average person, erode the foundations of earth's traditional power structure. Political and legal systems, religious, economic and social institutions could all soon become meaningless in the mind of the public. The national oligarchical establishments, even civilization as we know it, would collapse into anarchy. Such extreme conclusions are not necessarily valid, but they probably accurately reflect the fears of the 'ruling classes' of the major nations, whose leaders (particularly in the intelligence business) have always advocated excessive governmental secrecy as being necessary to 'preserve national security.' The real reason for the secrecy is, of course, to keep the public uninformed, misinformed, and, therefore malleable."[25]
Soon after NASA was founded, it commissioned The Brookings Institute to write a report on the social implications of space exploration. The report was delivered to NASA in 1960. The report ended with some shocking recommendations and observations.
The report warned of the implications of discovering signs of intelligent life elsewhere in the universe. It said that religious fundamentalists would be "electrified" by the discovery of life elsewhere, and said that scientists and engineers might be the most threatened of all by the discovery of intelligent life elsewhere, if it was significantly more advanced than ours. Those scientists and engineers:
"might be the most devastated by the discovery of relatively superior creatures, since these professions are most clearly associated with the mastery of nature, rather than with the understanding and expression of man. Advanced understanding of nature might vitiate all our theories at the very least, if not also require a culture and perhaps a brain inaccessible to the ear