Goldmine and Shaft

As the Council moves forward today to ratify one of the shabbiest deals in NYC's history, the Related Companies' "theft" of public property, it is important to make a number of key points. Most importantly the City Council failed in its most fundamental oversight task, the needed careful scrutiny of the no-bid contract that Related wangled because of its CEO's relationship with Deputy Mayor Dan Doctoroff.

The failure to do the proper due diligence results in the council's ratification of a 99 year lease that allows Related to pocket around $40 million a year while city tax payers get a $2 million a year bone thrown their way. It also results in the shameful eviction of 23 BTM merchants and their hundreds of workers with absolutely no provision for their relocation and, hence, their survival.

Not content to aggrandize a real estate company that has assets of over $10 billion the council has also agreed to allow BJ's, a retailer with a shabby labor record, into the new mall as an anchor tenant. In doing so the council would like to portray this midwiffery as a triumph because, in its negotiations with Related, it has gotten the Wal-Mart wannabe to accept food stamps and WIC.

What a travesty! Let's get this logic deconstructed. A non-union employer with a history of disgusting labor practices, one whose standard business model redlines poor people, is allowed to come into the Gateway Mall if--can you believe this?--it agrees to do what every single other supermarket in the trade area does as a matter of course (there are 59 of them).

Some councilmembers want to present this as a negotiating triumph. No mention of the fact that in bringing this oversized non-union retailer into the South Bronx you are putting the livelihoods of 15,000 unionized supermarket workers at risk, as well as the threat it poses to the 59 markets, the majority of whom are Hispanic-owned.

All of which brings us back to the question of special interests. This deal, from start to finish, is a case study of how special interest politics works. A friend of a high-ranking elected official is brought in and the normal open bidding processes of public property transfers are suspended on his behalf. Said friend, the owner of a multi-billion dollar real estate company then proceeds to seed the Bronx with manna from heaven the likes the borough hasn't ever seen before.

Elected officials who once opposed the real estate giant suddenly experience an epiphany, a kind of divine revelation, and become the company's biggest booster. And finally the City Council, charged with oversight and review, manages to quickly approve the deal in a record 8 days while simultaneously ignoring the questions that led one council member to wonder whether Related was, "a fourth branch of government."

After this fiasco we can only wonder how the legislature is going to conduct integrity in government hearings when the mayor sends this initiative across City Hall for debate. We can't wait for all the ironic posturing. It all calls to mind Machiavelli's observation that it is better for The Prince to appear good than to actually be good. We couldn't think of a better lesson in how NYC government actually works.