Celebrating 25 Years of Scoop
Special: Up To 25% Off Scoop Pro Learn More
Top Scoops

Book Reviews | Gordon Campbell | Scoop News | Wellington Scoop | Community Scoop | Search


The Community Wizard of Sebastopol – Part 2

Mapping the Real Deal…
The Community Wizard of Sebastopol

Part Two of Three
By Catherine Austin Fitts

With Special Thanks to
Caroline W. Casey
And the
Reuniting Magic & Money Tour

How knowledge behaves as an economic resource, we do not yet fully understand…We need an economic theory that puts knowledge into the center of the wealth-producing process. —Peter F. Drucker

IMAGE: Map Of Sebastopol


( Click Here for Part One

In Part One, we met the Community Wizard of Sebastopol, a community banker who is a quiet leader within his hometown of Sebastopol, California. Like thousands of Community Wizards throughout America, he loves people and organizes his life around people and relationships. He is a worthy steward of the resources in a place. Community Wizards have earned what the Chinese call t'ien ming ---“the mandate of heaven. [1]” A place has a soul and an intelligence that is independent of any person or organization. Community Wizards know this and delight in cultivating the soul and intelligence of the place they call home.

Advertisement - scroll to continue reading

Are you getting our free newsletter?

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.


The Greater Power of a Wizard’s Desire

The Popsicle Index is my rule of thumb to assess the economic well being of a place. It is the % of people in a place who believe that a child can leave their home, go to the nearest place to buy a popsicle (an ice cream) and come home alone safely. In the 1950’s when I was a child, the Popsicle Index was very high, the Dow Jones Index was about 500 and our debt per person was very low.

Today, the Dow Jones is over 8,000 while our Popsicle Index is very low and our debt per person is very high. In a nutshell, the military industrial complex has engineered corporate and banking wealth at the cost of our physical and financial security. We have financed the rise of large banks and multinational corporations and high volumes of consumption in a manner that has caused our debt to skyrocket and our Popsicle Index to fall.

Our legal system has become a gaming tool to serve the private partnership between our financial capital and criminal behavior. [3] The rule of law in our country is a powerful myth – but a dying one. Enron is a metaphor --- one that has stolen from every person in this part of California. [4] Enron taught many lulled into sleep by corporate media what those of us who worked on the inside of Washington and Wall Street have known. Centralized power and profits have risen not as a result of fundamental performance or productivity but of rigging markets through federal government enforcement and regulatory powers, covert intelligence, corruption and increasingly amounts of subsidy. [5]

A study of the history or narcotics trafficking and the War on Drugs will illuminate how it works. Our economic model is not capitalism but economic warfare in which increasingly anything goes. Why do citizens tolerate a low Popsicle Index or allow our media to avoid the illumination of who and what is making money from a low Popsicle Index? Because we are afraid that we and our family will he harmed if we insist on transparency and accountability from our government officials, media leaders and our neighbors and ourselves.

One of the things that gives this Community Wizard of Sebastopol his power is that he has lived long enough to remember how it feels to live and work in a world blessed with a 100% Popsicle Index. He can recall the magic and the sweetness of a world where people talk to each other on the front porch or the stoop, where children play freely and neighbors care for each other. He treasures the memory of a world ripe with trust and accountability – a world where we focus on building up that which is practical and immediately useful and which unifies us.

These memories and a burning desire to set things right stirs deep in the hearts and minds of thousands of Community Wizards across America. This power unified, unleashed and supported can be a mighty force --- far more powerful even than the forces that keep the Popsicle Index low.

IMAGE: Donna Reed And Jimmy Stewart---It’s A Wonderful Life


The Five Community Financial Drains

I went to Sebastopol to speak with brilliant visionary activist and radio talk show star Caroline W. Casey about how we reunite the magic of our spiritual lives and culture with the practical day-to-day workings of our time, money and resources. While I was there I gave a workshop on the ways that communities are financially drained and how we can turn that around by “voting” with our time and money in the marketplace for those who respect the rule of law.

According to Bureau of Economic Analysis statistics, the average American has approximately $32,000 of income and $37,000 of expenses. We have been closing the resulting drain of approximately $5,000 a year by working harder, selling assets and borrowing more money. As our finances are drained, corporate and bank wealth rises by an equivalent amount.

There are five financial systems engineering this $5,000 per person per year deficit within our communities. Community Wizards --- being “people people” as opposed to “money people” --- often do not see these financial manipulations clearly. As a result, they have tried to overcome them by working harder, a strategy that can not work without a clear map of the global and local financial landscape and intentional actions to get the magic of compound interest working for --- not against --- the Wizards.

1) Centralized Government

The more we pay the federal government, the more our Popsicle Index goes down. That means that federal investment has a negative return on investment and, as a result, so does our economy. As citizens in a republic, we are rewarding failure and it is draining us. [6]

Every community pays significant taxes and fees to the federal government, supports growing amounts of federal credit and carries a responsibility for expensive and burdensome federal regulation and enforcement. In the first year of the Bush II Administration, 85% of the federal budget was managed by agencies that were not in compliance with the laws requiring audited financial systems and reliable financial systems. [7]

In addition to not complying with the laws to provide agency financial transparency, the federal government refuses to provide transparency about how federal resources work within a place, what banks and corporate contractors are paid to collect and manage what data and operations within a place or to measure federal operations by meaningful place based performance standards. Such place based transparency and performance standards are essential for citizens to manage their constitutional responsibilities on a time feasible basis. Private efforts to promote place based transparency through "Community Wizard" type software tools have been targeted and stopped by federal enforcement. [8][9]

That drain is becoming more and more significant. For example, the Department of Housing and Urban Development (HUD), where I served as an Assistant Secretary reported undocumentable adjustments of $59 billion in fiscal 1999 and refused to find out what money was missing, to get it back or to publish audited financial statements for that year as required by law. [2] In the summer of 2000 the chief of staff to the HUD Senate appropriation subcommittee chairman expressed their concern to me that HUD was being run as a criminal enterprise. The committee subsequently recommended a significant raise for HUD’s budget, which was approved by House and Senate.

Of the $3.3 trillion in “undocumentable adjustments” missing from HUD and Department of Defense accounts during the last five published fiscal years, all relate to taxes and fees collected in our communities as well as expenditures and operations implemented in our communities --- many of which in my experience as Assistant Secretary of Housing rewarded unproductive behavior by both corporations, private organizations and individuals. Now, all levels of government are struggling under significant deficits while no effort is made to get back our missing money. [11]

The federal government’s historical complicity in domestic narcotics trafficking and financial fraud ---including in connection with the federal mortgage credit programs—is another symptom of a system that is draining citizens rather than providing essential services or adding value on some reasonable basis. [12]

A falling Popsicle Index is the federal government’s ultimate performance indicator. The more we pay since WWII, the more the Popsicle Index goes down.

2) Central & Centralized Banking, Currency & Debt

Our bank deposits are increasingly managed by large banks that are not circulating our funds within our community. Our deposits are collected with our federal credit. They are then used to finance our government, again supported by our credit, and to provide loans to us through our credit cards and other expensive mechanisms. This financial flow does not make sense. Digital technology means that we can function without expensive middlemen who are using our credit to direct significant profits with little or no contribution or value.

We also have no need for fiat currency managed by a privately controlled central bank and government depository, the New York Federal Reserve and the Federal Reserve Board of Governors, or for a few to have the rich benefit of the resulting flow of data about how the money works in our communities or their manipulation of the gold markets that turns off our financial “smoke alarm.” [13]

The federal credit has been used to finance our negative return on investment economy, both through our currency, US treasury operations as well as on and off balance sheet credit of the federal government, which is a significant guarantor of mortgage markets. Meantime, efforts to promote transparency and positive return on investment standards in federal mortgage credit programs and to support locally controlled privatization have been targeted and stopped by federal enforcement. [14] No doubt there is a connection between the US banking and financial system’s leadership in global money laundering – laundering $500 billion to $1 trillion a year, according to the Department of Justice --- and the political insistence on preventing place based transparency and reengineering warranted by fiduciary management of government resources.

The result is a banking system that drains equity from communities and promotes a culture lacking in responsibility and accountability.

3) Centralized Savings & Investments

Large corporations financed at low cost with our pension fund and retirement savings are buying market share out from under our small businesses and farms. Meantime, efforts to permit small business to tap equity markets and enjoy aggregation benefits through local “mutual funds” have been targeted and stopped by federal enforcement. [15] This partnership of equity capital and federal enforcement has created a financial prison for small business and farms. Large corporations win in a rigged game that we subsidize as it drains our skills, jobs, and enterprises and returns a below market yield on our pension funds and savings. Pump and dump stock market fraud like Enron and mortgage bubbles are emptying our savings from our pension funds while our small businesses are starved for equity capital despite their ability to return a sound investment yield.

4) Centralized Purchases

Retail franchises and chain stores have helped to consolidate our purchases into large publicly traded corporations. As this happens, our purchases generate no equity for our families, our neighbors and us. If we look at our media attention and purchases, we are often “voting in the marketplace” for those corporate investors who are draining us financially, using government to steal from us or abdicating their responsibility to report on what is happening. We are “voting” for those who cause our Popsicle Index to do down and our debt to go up.

5) Centralized Narcotics Trafficking and Organized Crime

The growth of hard narcotics trafficking and related organized crime has been significant to political control of places in a manner which supports corporate consolidation of markets and government power. [16] According to the Department of Justice, the American financial system launders $500 billion - $1 trillion a year. That works out to approximately $1,800 – $3,600 per person. Every year we pay more for government enforcement and prisons, yet organized crime only grows. The reality is that the military-industrial complex finances covert operations and black budget with narcotics trafficking and HUD financial fraud in our own backyard. [17][18]

WH Auden once said that, “evil is unspectacular and always human and shares our bed and eats at our own table." We protest the war machine when it is in a foreign land, but we pretend not to notice when Lockheed Martin and JP Morgan-Chase manage HUD in a manner that makes the Popsicle Index go down in our neighborhood. [19] Indeed too often, a HUD grant or related foundation award buys our silence or that of our local leadership or Congressional representatives.

Nicholas Negroponte once said, “In a digital age, data about money is worth more than money.” Our financial drains have been facilitated by the use of digital tools and telecommunications to centralize financial data and transactions. Our purchases and federal taxes have financed turning over large and expensive amounts of our data to those who increasingly use it as the primary intelligence to capture the equity associated with it.

The opportunities available to a team of Community Wizards start with building a solari ---a locally controlled databank and investment advisor--- to reestablish local mastery of the knowledge about “how the moneys work.” [20] It is here where the Community Wizards will forge one of their most powerful alliances – with a new generation of digital tool makers and technologists who are building the communication and transaction networks like Affero.com and products like Venture Collective.org and GoldMoney.com which can support Community Wizards as they communicate and transact locally and globally with or without corporate systems – based on free choice in real markets.


(Click Here For Part 3

In Part Three, we learn how we harm ourselves by our tendency to only support people who are given a “good housekeeping” seal of approval by the people who profit from the drain of our community. This puts us at risk, particularly because of our dependency on federal and centralized credit and our economic inability to service our debt. If we organize to support our Community Wizards and to start a solari in our community, we can turn things around by retiring debt, creating jobs and building small business strength --- and address many of the issues of corruption that concern us. It all starts with supporting our Community Wizards.


[1] Eventually this concept would gain a wider application in ancient China. By Confucius' time, the t'ien ming applied to everyone and their obligations to see to the welfare of the people they are related to. The Mandate of Heaven, through which Heaven worked out its efforts to guarantee the well being of humanity, applied to each and every obligation and action one took and so represented what might be called the moral order of the universe. Allied with this idea was the concept Ming, or destiny. Heaven also ruled the physical world: earthquakes, sickness, wealth, rain, etc, but it ruled the physical world directly. All things that happen in the physical world are the direct result of Heaven's actions and are completely out of human control. The proper venue for human action, then, is in the realm of t'ien ming . These two concepts, t'ien ming, or the moral order of the universe, and ming, or the physical order of the universe, combined make the Tao, or "Way" of Heaven.
----Richard Hooker
[3] Picture of the Chairman of the NYSE, Richard Grasso, hugging a FARC Commander in Colombia in 1999, Scoop Media,
[4] See “Mapping the Real Deal: The Real Deal About Enron – an Interview with Catherine Austin Fitts” by Daniel Armstrong, SRA Quarterly, February 2003, http://www.sandersresearch.com/html/MappingtheRealDeal/2003/CAF1033/CAF012003.htm
[5] See “The Myth of the Rule of Law,” Catherine Austin Fitts, SRA Quarterly, November 2001, http://www.solari.com/gideon/q301.pdf
[6] See “The Myth of the Rule of Law,” Catherine Austin Fitts, SRA Quarterly, November 2001, http://www.solari.com/gideon/q301.pdf
[7] “The Missing Money: Why the Citizens of Tennessee Are Working Harder & Getting Less” by
Catherine Austin Fitts, Scoop Media, http://www.scoop.co.nz/mason/stories/HL0207/S00031.htm#a
[8] Summary of Events, Solari, http://www.solari.com/media/summary.html
[9] “On the Money Trail: the Dangerous World of Catherine Austin Fitts” by Mari Kane http://www.metroactive.com/papers/sonoma/09.05.02/fitts-0236.html ; 'AntiTrust': Redefining the Killer App” by Uri Dowbenko, http://www.steamshovelpress.com/altmedia6.html
[10] “Why is $59 Billion Missing From HUD” by Kelly Patricia O’Meara, Insight Magazine, http://www.insightmag.com/main.cfm?include=detail&storyid=208636
[11] “The Missing Money: Why the Citizens of Tennessee Are Working Harder & Getting Less” by Catherine Austin Fitts, Scoop Media, http://www.scoop.co.nz/mason/stories/HL0207/S00031.htm#a
[12] “Stanley Sporkin: Bio & Selected Iran Contra Background”, Solari, http://www.solari.com/media/SporkinBio.html Also, see “The Myth of the Rule of Law,” Catherine Austin Fitts, SRA Quarterly, November 2001, http://www.solari.com/gideon/q301.pdf
[13] See Real Audio of Gold Anti-Trust Action (GATA) Speech at the National
Press Club (February 12, 2002) http://www.gata.org/cspan.html
[14] Summary of Events, Solari, http://www.solari.com/media/summary.html
[15] Summary of Events, Solari, http://www.solari.com/media/summary.html
[16] “Narco Dollars for Beginners: How the Money Works on the Illicit Drug Trade” by Catherine Austin Fitts, Narco News, http://www.insightmag.com/main.cfm?include=detail&storyid=208636
[17] “Stanley Sporkin: Bio & Selected Iran Contra Background”, Solari, http://www.solari.com/media/SporkinBio.html
[18] Community Wizard map of South Central LA, Tony Soprano reinvents government, HUD style, http://www.solari.com/Sopranoswithmap.pdf?0cv=CB20
[19] See “The Myth of the Rule of Law,” Catherine Austin Fitts, SRA Quarterly, November 2001, http://www.solari.com/gideon/q301.pdf
[20] “Solari & the Rise of the Rule of Law” by Catherine Austin Fitts, SRA Quarterly, September 2002,


Catherine Austin Fitts is the President of Solari, Inc. ( http://solari.com) and a former Assistant Secretary of Housing – Federal Housing Commissioner in Bush I. She is currently litigating with Ervin and Associates (acting on behalf of the government ) and the Department of Housing and Urban Development. If you would like to support her litigation efforts, you can through Affero/ Venture Collective: http://www.solari.com/vote.php
If this “Mapping the Real Deal” was useful for you, you can leave comments and send a gift to Catherine Austin Fitts and Scoop Media through Affero: http://svcs.affero.net/rm.php?skid=smc
and receive future columns for free by e-mail - see... Free My Scoop to sign up.

Anti©opyright Catherine Austin Fitts, March 2003

© Scoop Media

Advertisement - scroll to continue reading
Top Scoops Headlines


Join Our Free Newsletter

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.