New York in the Age of Corruption ---
On Saturday, August 13, 2016 at 12:34:25 PM UTC-5, Perplexed wrote: > > > Very interesting story. The US Attorney referenced (Bharara) is the one > who is allegedly investigating Hillary and the Clinton Foundation now. I > must say I was surprised that an Obama appointee brought down the state's > third most powerful democrat recently. > > AUGUST 09, 2016 > > > <http://www.judicialwatch.org/bulletins/new-tammany-hall-new-york-age-corruption/#> > > > [image: AY1a][image: AY1b] > > > *De Blasio, Clinton cronies are carving up the city. Right, developer > Bruce Ratner * > > > *By Micah Morrison* > > > In New York City, the controversy plagued Atlantic Yards development > appears to be heading for trouble again. That could create problems for > Mayor Bill de Blasio and presidential hopeful Hillary Clinton. Allies of > both Democrats have profited mightily from the project. > > > For over a decade, Atlantic Yards has been at the center of heated > disputes over power, profit and privilege in New York. Does the site serve > the needs of the taxpayers who financed its development? Or is it > primarily a giant boondoggle generating torrents of cash for well-connected > insiders? > > > The 22-acre, $5 billion Brooklyn site of planned residential, commercial > and park space is home to the Barclays Center sports arena and sixteen > high-rise buildings in various stages of development. According to recent > *news > reports from Moscow* > <http://russialist.org/billionaire-tycoon-prokhorov-to-sell-all-russian-assets-russia-prokhorov/>, > > Barclays Center owner Mikhail Prokhorov is under Kremlin pressure to sell > all his Russian assets. Prokhorov’s U.S. holdings could be next. > Prokhorov’s fall would reverberate from Moscow to New York, where U.S. > Attorney Preet Bharara is making development deals a centerpiece of a > sweeping anti-corruption crusade. > > > New Yorkers have been here before. > > > “I seen my opportunities and I took ’em,” the plain-speaking Tammany Hall > politician George Washington Plunkitt said in 1905. The corrupt Tammany > political machine dominated New York City politics for a century, its > chicanery extending into every corner of civic life. Bribes, kickbacks, > fraud, extortion and graft were the order of the day. Today, New York is > witnessing the birth of a new Tammany Hall. Plunkitt’s heirs are seeing > their opportunities and taking them on a colossal scale. > > > The center of the new Tammany is Mayor de Blasio’s City Hall. But de > Blasio is no Boss Tweed, old Tammany’s criminal genius. De Blasio has > emerged as more pawn than prince of the city: insecure, in over his head, > buffeted by moneyed players he cannot seem to resist and presiding over > accelerating pay-to-play scandals that have cast a pall of political death > over his administration. > > > Atlantic Yards offers a case study of how the new Tammany system has > evolved. It’s local: extending from dealmakers to a cadre de Blasio calls > his “agents of the city” and to Albany’s notorious “three men in a room.” > It’s international: the deals stretch from New York and Washington to > Russia and China. And it’s sophisticated, powered by the global economy, > the influential New York real estate industry, and non-profit entities > manipulated for personal and political gain. > > > But the central scam of the new Tammany system would not be unfamiliar to > old Tammany’s Plunkitt: public money for private profit. Plunkitt called it > “honest graft”—gaming the system to the benefit of the powerful and > well-connected, with crumbs for the common folk. > > > [image: AY2] > > *Atlantic Yards, Brooklyn, NY. Artist’s rendering.* > > > *DEMOCRATIC PARTY TIES* > > > Real estate developer and Democratic Party heavyweight Bruce Ratner is the > central figure in the battles over Atlantic Yards. Smart, tough and > tireless, Ratner is a master of honest graft. He has been charged with no > crimes, but has repeatedly courted controversy with unfulfilled promises of > public benefits, multi-million-dollar paydays, and links to crooked > politicians and their enablers. > > > Ratner has close ties to de Blasio and Clinton. Hillary Clinton’s > presidential campaign headquarters is in a Ratner building in Brooklyn. > Ratner and de Blasio lobbied hard to bring this year’s Democratic National > Convention to the Barclays Center. De Blasio was an important early > supporter of Ratner’s Atlantic Yards bid. A longtime donor to Democrats, > Ratner backed de Blasio’s mayoral campaign. Ratner figured in the 1996 Bill > Clinton campaign finance scandal as a guest in the Lincoln Bedroom and at a > White House “coffee” event. Harold Ickes—the powerful Clinton adviser and > lobbyist identified by federal prosecutors as “the Svengali” behind the > campaign-finance scandal—is an influential mentor to de Blasio. > > > The City of New York is Ratner’s biggest tenant, leasing over one million > square feet of office space, according to federal filings. The federal > government is his fourth largest tenant. > > > The go-between for de Blasio and Ratner is Jonathan Rosen, a political > consultant and a central figure in the mayor’s “agents of the city” > controversy. In May, de Blasio rejected a media request for email > correspondence between the mayor and Rosen, as well as four others > associated with his political campaigns. Four of the five now work as > consultants or lobbyists with business before the city. The fifth, Patrick > Gaspard, is the U.S. ambassador to South Africa and a former political > operative at the powerful Service Employees International Union Local > 1199—the only major union group to back de Blasio’s 2013 mayoral bid. > > > According to published reports, Rosen is under investigation by Bharara > and Manhattan DA Cy Vance in connection with de Blasio fund raising and the > mayor’s non-profit organization, Campaign for One New York. Rosen’s firm, > BerlinRosen, was paid about $700,000 by de Blasio-related entities. Rosen > also has been on Bruce Ratner’s payroll for years as a spokesman and > adviser for Atlantic Yards. In 2012, Crain’s New York Business noted that > Rosen was a “top strategist” for Ratner. > > > De Blasio is fighting disclosure of the activities of the five men, > advancing the novel claim that they are “agents of the city” whose > communications with the mayor should be private. Judicial Watch has filed > Freedom of Information Law requests for the Rosen and Gaspard emails, but > has been rebuffed in its requests for timely production of the material. > “We have appealed the decision of the mayor’s office and will take it to > court if necessary,” said Judicial Watch Director of Litigation Paul > Orfanedes. “Clearly in this case, the public has a right to know.” > > > [image: AY3a][image: AY3b] > > *Former NY Assembly Speaker Sheldon Silver, U.S. Attorney Preet Bharara* > > > *THREE MEN IN A ROOM* > > > Rosen, the strategist for Ratner and de Blasio, also was a top adviser to > a major figure in the annals of New York corruption: Assembly Speaker > Sheldon Silver. Silver played a key role in Atlantic Yards. He was one of > the notorious “three men in a room”—the governor, speaker, and senate > majority leader—wielding power in Albany. > > > “If you’re one of the three men in a room, and you have all the power and > you always have and everyone knows it,” U.S. Attorney Bharara said > following Silver’s arrest on corruption charges, “you don’t tolerate > dissent because you don’t have to. You don’t allow debate because you don’t > have to.” > > > In New York, “three men in a room” is a kind of shorthand for corruption > in the state capital. But in the case of Atlantic Yards and other > high-dollar dealings of state government, it’s a fact: three men in a room > exercise complete control over billions of dollars of state funding. > > > The lucrative lever of their power—a cash cow for the new Tammany > system—is called the Public Authorities Control Board. According to court > testimony, it has no staff, no offices, and has approved “billions of > dollars of bond sales.” In a 2006 meeting that lasted just five minutes, > the PACB approved Ratner’s Atlantic Yards proposal, despite mounting public > opposition to the project. > > > The price tag: $4 billion. > > > PACB approval opened the door for Ratner to receive taxpayer-backed > benefits and financing. The benefits included an immediate cash injection > of $100 million for “new infrastructure” such as “streets and sewers,” > according to testimony by a state budget official in a lawsuit, and a later > $511 million sale of tax-free bonds. > > > In a 2006 letter to the three men—Silver, then-Senate Majority Leader > Joseph Bruno and then-Gov. George Pataki—State Comptroller Alan Hevesi > warned that the PACB had authorized “nearly $9.5 billion in State-supported > financing during a less than 30 day period” and was on track to spend > another $5.6 billion in the days ahead. > > > Of the three men and the state comptroller, only Pataki escaped a > corruption indictment. Silver and Hevesi went to jail. Bruno was charged > and later cleared. > > > Silver, the pivotal PACB vote on Atlantic Yards, had a close relationship > with Ratner. After PACB approval, Ratner contributed $58,000 to a > Silver-controlled committee and helped raise $1 million for the > Metropolitan Council on Jewish Poverty, led by a close Silver ally, William > Rapfogel. Rapfogel was later convicted of stealing more than $7 million > from the Metropolitan Council. > > > The alliance between Ratner, Rapfogel and Silver was a family affair. > Rapfogel’s wife was Silver’s chief of staff. Rapfogel’s son was a lawyer > for Ratner. > > > Ratner crossed paths with other corrupt politicians as well. A Ratner > lobbyist, Richard Lipsky, pleaded guilty to funneling over $250,000 to a > powerful state senator from Brooklyn, Carl Kruger, in exchange for > political favors. And in Yonkers, two political figures were convicted in a > bribery case involving a changed vote to support a Ratner development, > Ridge Hill. > > > Ratner and his Forest City companies were not charged with any wrongdoing > in the cases. Controlling interest in Ridge Hill later was sold to an > Australian company and Ratner was awarded an $11 million “development fee” > for the project by the Forest City board of directors > > > *EMINENT DOMAIN, PRIVATE GAIN* > > > In 2009, Ratner won a court battle to use Albany’s eminent domain power to > seize control of the Atlantic Yards site, promising thousands of good jobs > and affordable housing units. Ratner’s opponents argued that he was in it > for the money and that there would be little public benefit—one of the > standards for an eminent domain seizure—from the project. Civic groups > protesting the development were steamrolled and homeowners were forced out. > > > Ratner received state-backed financing and $726 million in “special > government benefits”—your tax dollars at work—to help finance the Barclays > Center portion of site, according to *an analysis by the city’s > Independent Budget Office*. > <http://www.ibo.nyc.ny.us/iboreports/AtlanticYards091009.pdf> > > > <http://www.ibo.nyc.ny.us/iboreports/AtlanticYards091009.pdf> > > The benefits included “direct contributions of cash, capital investment > and property; access to tax-exempt financing; exemptions from property, > sales, and mortgage taxes, and below market sale” of Metropolitan > Transportation Authority land, the IBO report said. > > > Despite all that, Barclays looked like a loser for the city. The arena > would “cost the city nearly $40 million more in spending” than it would > generate in tax revenues, the report said. > > > In 2010, Ratner began to cash out. He sold a major stake in Barclays and > the Brooklyn Nets basketball team to the Russian mogul, Prokhorov, for $223 > million. Last year, he transferred the rest of his share for an additional > $285 million. > > > [image: AY4] > > *Breaking ground at China-controlled “Pacific Park.” Center, Bruce Ratner, > Bill de Blasio; right, Greenland CEO Zhang Yuliang* > > > *THE CHINA CONNECTION* > > > Meanwhile, China had come calling. > > > In 2014, Ratner sold an ownership stake in Atlantic Yards (excluding the > Barclays site) for $208 million. The buyer: Shanghai-based Greenland > Holdings, a company controlled by the Chinese government. > > > In a move of Orwellian audacity, Ratner and his new Chinese partners > promptly changed the name of the site from Atlantic Yards to Pacific Park. > Greenland “now reaps the benefit of the subsidies, tax breaks and cheap > land that Forest City Ratner wangled for the project in the 2000s,” wrote > Norman Oder, a Brooklyn journalist who chronicles the project on the > *watchdog > blog, Atlantic Yards/Pacific Park Report* > <http://atlanticyardsreport.blogspot.com/2016/08/not-just-logistics-bypassing-brooklyn.html> > . > > > Among the properties now under the control of China: 664 Pacific Street, > which is slated to include a new seven-floor New York City public school. > > > At a groundbreaking for a new 298-unit “Pacific Park” building touted by > the mayor’s office as “100% affordable housing,” de Blasio declared that > the development “offers the chance to have a huge number of affordable > units that people in this community can live in.” > > > The New York Daily News reported that rent for most of the units, which > would be offered through a lottery, would run between $2,500 and $3,500 a > month. “Only in New York,” the paper wryly noted, “could you win an > ‘affordable housing’ lottery and still wind up paying almost $3,500 in > rent.” > > > *VISAS FOR SALE* > > > Ratner and his Chinese partners have raised hundreds of millions of > dollars through the controversial EB-5 U.S. visa program. Under EB-5, a > foreigner putting up $500,000 becomes eligible for a green card to live in > the U.S. The purpose of the program is job creation. Each investment of > $500,000 in a so-called “targeted employment area,” according to government > estimates, creates ten full-time jobs. > > > Sales of EB-5 green cards in China were brisk. > > > “Project developers have raised some $577 million at below-market interest > rates,” noted Atlantic Yards watchdog Norman Oder. China “is profiting by > marketing a scarce U.S. public resource—green card slots under the EB-5 > program—to its own citizens.” > > > Ratner and his Russian partner Prokhorov are also in the EB-5 business on > Long Island, where they control the rebuilding of Nassau Coliseum—another > project mired in Tammany-style controversies. “$90 million in low-interest > [EB-5] loans,” Oder reports, are “expected from immigrant investors more > concerned with green cards than any financial return.” > > > A report by the Government Accountability Office warned that the EB-5 > program created “unique fraud and national security risks.” Sales of the > visa have tripled in recent years, creating “additional opportunities for > fraud,” the report noted. Sources of funds for the visas could come through > the “drug trade, human trafficking, or other criminal activities.” > > > And those ten-jobs-per-green-card the program is supposed to create? > Reporting of economic benefits of the program “is not valid and reliable,” > the GAO warned, “because it may overstate or understate results.” > > > Ratner did not respond to a Judicial Watch request for comment about his > financial positions in Atlantic Yards, his relationship with political > figures charged in corruption probes, Rosen, Prokhorov, Greenland Holdings > and the EB-5 program. > > > *BHARARA IN THE CROSSHAIRS* > > > Ratner’s promises of public benefits from the Atlantic Yards project—the > basis for much of the city, state and federal bounty bestowed on him—have > gone mostly unfulfilled. There are few good jobs at Atlantic Yards. “Jobs > were overpromised at the start and since then have been oversold,” said > blogger Oder. > > > Affordable housing has not materialized. “There’s a huge disconnect > between current construction and the promises de Blasio and Forest City > have long made for affordable units,” Oder said. “Two ‘100% affordable’ > buildings are skewed to middle-income households, with more than 60% of the > apartments going to households earning six figures.” > > > But Bruce Ratner has done okay. His company is worth $10 billion. His > personal net worth has been estimated at $400 million. After leveraging > more than $1 billion in taxpayer assistance, he walked away from > responsibility for Atlantic Yards, transferring control to a Russian mogul > and the Chinese government. > > > Ratner’s friend and tenant Hillary Clinton appears to be on her way to the > presidency, so she has done okay too. Knowing her will be helpful when all > those federal office space leases come up. Bill de Blasio has done okay > too. As mayor, he presides over an $82 billion budget: plenty of money to > be made there in office leases and a favorable City Hall attitude to new > development projects. De Blasio’s agents of the city have reaped millions > in consulting contracts from organizations eager to do business with the > city. The real estate business is doing great—profits are up, big time. > > > Public money, private profit, promises unkept: in that sense, the old > Tammany system is not much different from the new one. It took reformers > decades to crush old Tammany. In April, in a sharp warning to de Blasio and > Governor Andrew Cuomo, U.S. Attorney Bharara *told Common Cause New York * > <https://www.youtube.com/watch?v=nWwP3aihOe8>that he would “keep looking > hard at corruption,” not just in the legislative branch, but in the > “executive branch too, both in city and in state government.” > > > He’d better look fast. U.S. Attorneys serve at the pleasure of the > president and Bharara has made powerful enemies. When the new president > takes office in January, the number one wish of the new Tammany Hall will > be to get rid of the troublesome reformer. > > > *Micah Morrison is chief investigative reporter for the watchdog group > Judicial Watch.* > > > -- -- Thanks for being part of "PoliticalForum" at Google Groups. For options & help see http://groups.google.com/group/PoliticalForum * Visit our other community at http://www.PoliticalForum.com/ * It's active and moderated. 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