Forest City Enron?

With every bubble, comes a burst. And with every burst, a symbol of the excesses is 'executed' in public court. In the 80s, after the collapses of Drexel Burham, it was Michael Miliken** . More recently, Enron and Martha Stewart. The Real Estate market is a long way from bursting, and its assets are a little more solid than empty promises of future earnings, but all the excesses that come with a 'hot' market are certainly here - the desire for money is so insatiable that laws are overlooked or sometimes, broken.

As NoLandGrab reports, there's what's now being called a 'Federal Conspiracy Probe' up in Yonkers, and Forest City Ratner still piously claiming, amid a hailstorm of subpoenas to various council members that they're as honest as a Quaker. It seems odd doesn't it, that all of these politicians are being subpoenaed, the sole beneficiary is Forest City, yet Forest City coos 'Gosh, who, us?!, impropriety?!'.

The odd thing about these big, out of scale, voraciously greedy projects that Forest City has advocated is that they violate the most basic common sense urban planning principles, zoning laws that we made in reaction to such schemes and their effect - both physical and psychological - on the community, and Forest City seemingly glides through the law and processes meant to check bad development with ease. Yet the thought that 'some thing's a little funny here' hasn't occurred to anyone in the mainstream press . Why? I can speculate; Ratner's an insider of the New York establishment, and while they're happy to string up some hicks from Texas, they have a different standard for their own.

Gargano's being investigated, Forest City's very bad project is being investigated, yet Mike Bloomberg, perhaps unaware of the dirty subways, over crowded schools, increasing pollution, crumbling infrastructure, is tossing 200 million to a billionaire developer so that he can buy land that he's already getting at 100 million below it's value. Elliot Ness, where are you?


(**I remember, when I worked in an investment house shortly after graduation - -post Miliken, post boom, a sales assistant reminding me that Miliken's sales assitant spent more time in jail than Miliken. Similarly, during the John Gottfriend bond scandal at Solomon Brothers, the clerk who executed the orders was unceremoniously fired on the spot, while Gottfriend walked away with 100 million for his trouble. So are the ways of Wall Street.)