IS OUR MOGULS CULT SWAMP FEVER BREAK AT LAST?
By Bob Hennelly
“The secret to great success that you cannot account for is a crime that was never discovered, because it was done right.”
As the country’s legal system nearly collapses as it attempts to hold a former president accountable for alleged serious crimes and a lifetime of misdemeanors, we are focusing on the target of our full attention like never before. Still, we might be wise to take a look at how our admiration for wealth makes figures like Donald Trump possible.
Although there is now a tendency to blame it all on him, it would be worth taking a step back and seeing that he is just one man in a pantheon of charging tycoons we have raised. quasi-demigod status because we confer a kind of omnipotence on them. We can’t really get past Trump unless we face our own dark side that makes it possible for him and his ilk.
The truth is, there is a platinum-plated conveyor belt at the heart of the American Dream Machine that our societal greed greases. In a state like New Jersey, where much of the wealth is concentrated, there is a real admiration for these personalities who know what they want and are ready to do anything to get it. We love Tony Soprano for a reason. Call it our bulk shadow.
We elected two former Goldman Sachs partners as governors.
THERE IS GOLD IN THE MUD
There is perhaps no better example of how our state’s political leaders of both parties are so enamored with great wealth than the way Trenton was played by a motorcade of developers who promised a mega mall in the Meadowlands. He was first tagged during the McGreevey era as Xanadu then it was revived by Governor Chris Christie as American Dream Meadowlands.
It seems we never do enough due diligence on them because “the stakes are so high”.
Consider how relieved the state of New Jersey was in the summer of 2006 when Tom Barrack, CEO of Colony Capital LLC, traveled to the New Jersey Meadowlands to “rescue” Xanadu, aka the mega-mall American Dream, in tax difficulty. The project was started by Mills Corporation, the Virginia-based developer that ran into a Securities Exchange Commission investigation and eventually filed for bankruptcy.
Mills Corporation’s board of directors included Charlie Black, of the infamous global lobbying firm K Street Black, [Paul] Manafort & [Roger] Stone whose client list included Donald Trump and strongmen like Jonas Savimbi from Angola and Ferdinand Marcos from the Philippines.
Mills, a major political donor to both political parties, had successfully convinced Governor James McGreevey and the New Jersey Sports and Exposition Authority, headed by George Zoffinger, that Xanadu, with its proposed 14-story, 2-storey indoor ski dome, 2 million square feet of entertainment and retail space could help revive the state’s sports complex and retain the Jets, Nets and Devils.
MOGUL TO THE RESCUE
In a 2006 article titled “Reprieve for Troubled Xanadu Entertainment Complex in Meadowlands,” the New York Times reported that Colony Capital was “privately owned and owned hotels and casinos around the world, including Hilton Casinos and Resorts. in Atlantic City. Its principal, Tom Barrack, was featured on the cover of Fortune magazine last October as “the world’s largest real estate investor”.
“Barrack made deals with Saudi princes, Texas oilmen, a Caribbean dictator – even with Donald Trump”, this same sycophant Fortune profile recounted in 2006. “He bought the Fukuoka Dome, Japan’s Yankee Stadium, in part because he calculated that the titanium for the retractable roof was worth as much as the purchase price. He bought and sold the Plaza Hotel in New York, making a quick profit of $160 million, and the Tony Savoy chain in London, bringing in another $270 million. Even Trump recovers: “Tom has an incredible vision of the future, an ability to see what is going to happen that no one else can match”.
Describing Barrack as a “swashbuckler who moves at a furious gallop while exuding an aura of calm,” Fortune recounted how, in 1976, he turned his ties with Saudi princes into a hugely profitable three-way deal with the murderous Haitian dictator. Jean-Claude “Baby Doc” Duvalier.
“The princes of Barrack said they could arrange for the kingdom to grant the reduction to Haiti; all they needed was for Haiti to reciprocate by extending diplomatic relations and most favored nation status to Saudi Arabia,” Fortune said. “At the palace, where the plump Baby Doc sat on a throne, Barrack presented the virtues of the deal. In the middle of his call, Baby Doc interrupted him. ‘Can I try the watch?’ he asked, referring to a $200,000 diamond-encrusted Piaget watch that one of the princes wore. The prince accepted. When Barrack finished, Duvalier asked another question: “Can I keep the watch?” Baby Doc got the Piaget and opened the door for Saudi oil to come to Haiti.
In August 2010, Barack’s Colony had to throw in the towel to complete the beleaguered mall project that had already burned $2 billion and was built on land owned by the New Jersey Sports and Exposition Authority. Along the way, public pension funds in Iowa, Mississippi, Alaska, Texas and New York all were burned for hundreds of millions in pursuit of Xanadu’s promised high rate of return, then American Dream Meadowlands, which never seemed to materialize.
Meanwhile, the state of New Jersey, through the Democratic and Republican administrations, continued to double down on its “investment” in the project, believing it was too deep to get out. This has resulted in the plowing in of hundreds of millions of dollars in the form of state grants, direct and indirect, as well as improvements to state roads and railroads through the Port Authority. of New York and New Jersey.
Of course, this was done over the consistent and prescient objections of Jeff Tittel, then with the Sierra Club. In 2011, it fell to Governor Chris Christie to enlist the legislature to double state support for the Swamp Mall on behalf of Triple 5, the Canadian developers of the Mall of America.
“It’s the American diet, because it’s about taking care of developers at the expense of New Jersey taxpayers,” said Jeff Tittel, manager of the New Jersey Sierra Club at the time. “Today the Senate sided with special interests regarding the financial health of our state. Teachers, police and firefighters are being laid off, but we’re giving hundreds of millions of dollars in welfare to a developer canadian.”
Under the terms of the agreement, according to Tittel, Triple Five secured tax increment financing that “would allow tax money to be reinvested in development rather than paid to the state, while the installation will require always state and municipal services such as the police.”
This can, Bloomberg News reported American Dream, led by Triple 5 of Mall of America, lost $60 million in 2021, attracting $173 million in revenue versus $232 million in expenses. According to Bloomberg, the embattled project generated sales of $305 million, or 15% of the $2 billion forecast in 2017 for the first year of operation.
In addition to the exterior construction loan, American Dream holds “$290 million in municipal bonds backed by sales tax and $800 million in municipal debt backed by payments in lieu of property taxes. The mall reported total liabilities of $2.6 billion and about $500 million in equity.
And what happened to Tom Barrack, only one in his long line of Xanadu/American Dream pitchers?
Last week, with the storm swirling around the raid of former President Trump’s Mar-a-Largo compound, it was easy to miss criminal proceedings in Brooklyn where a judge denied Barrack’s motion to remove his bracelet from home confinement ankle when his federal corruption trial starts next month.
Barrack, a longtime Trump associate, advised his 2016 campaign, led his summary inaugural committee and acted as an outside adviser to the highest levels of the Trump administration regarding Middle East issues. “Barrack introduced Trump to his former campaign manager, Paul Manafort, and facilitated conversations that strengthened Trump’s ties with Saudi Arabia and the United Arab Emirates, helping realign the Middle East,” Forbes reported. in 2018.
In July last year, Barrack was charged along with two other men for allegedly participating in “a conspiracy to unlawfully advance and promote the interests of the United Arab Emirates in this country”, according to prosecutors.
“These arrests serve as a warning to those who act at the direction of foreign governments without disclosing their actions, as well as those who seek to mislead investigators about their actions, that they will be brought to justice and face the consequences. “said Acting U.S. Attorney Jacquelin M. Kasulis for the Eastern District of New York.
Barrack’s lawyer argued that Barrack’s $250 million bond, one of the largest ever put in place, should be sufficient according to the Daily News. The judge didn’t believe him.
“Even with the current financial and travel restrictions, Barrack is a man of significant resources with an extensive network of contacts around the world,” Judge Brian Cogan wrote. “Faced with a potential prison sentence of at least a decade, at age 75, it would not be surprising if Barrack decided that he would rather take a chance and flee, despite his extensive family ties and long residence in his home. community. This risk only increases as the trial approaches.
Trump is not the problem. It’s the archetypal ‘swashbuckler’ we raise.
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