Louis Proyect: The Unrepentant Marxist

May 30, 2008

Crane collapses, corporate greed and the mob

Filed under: capitalist pig,economics,real estate — louisproyect @ 2:42 pm

This morning as I was walking up 3rd Avenue from my high-rise on 91st street to get the crosstown bus on 96th street headed to the west side of Manhattan, I noticed a number of police cars headed east of 3rd Avenue. After I got on the bus and was crossing through the park, a fire engine headed east in the opposite lane. This was an unusual occurrence, so much so that the woman sitting next to me on the bus asked me what was going on. Was there a big fire or something? I said I didn’t know and made no connection to the fire engine and the cop cars and the accident that loomed ahead.

About 9:40 each day, I go to the online edition of the NY Times to see how the stock market is doing. I don’t own any stocks but I am curious to see how the capitalist system is doing. This is what awaited me:

A crane toppled and collapsed onto a high-rise apartment building on East 91st Street on the Upper East Side on Friday morning, tearing off balconies and leaving a swath of damage, in the second Manhattan crane collapse in two months. One person, the operator of the crane’s cab, was killed and at least one other has been pulled from the wreckage, but that person’s condition was not immediately known, a law enforcement official said.

I called my apartment frantically to see if my wife was okay. She rarely walks over to First Avenue, 2 blocks east, unless she is with me en route to a restaurant in the evening but I was still worried. She answered the phone and told me that she was okay. That was a relief.

This has been the second such incident to occur in Manhattan in the last 3 months. In March, a crane collapsed on East 51st street killing four construction workers and injuring a dozen others. It was subsequently revealed that the site had not been inspected properly:

A city crane inspector faces felony criminal charges after he falsely claimed to have inspected a crane 11 days before it collapsed on the East Side, killing seven people and causing a wide swath of destruction, city officials said yesterday.

While the city’s top building official asserted it is “highly unlikely” a real inspection before the collapse would have prevented the tragedy, critics said the allegation was indicative of the Building Department’s lax approach to inspections.

Edward J. Marquette, 46, a crane inspector with the city Department of Buildings, was arrested Wednesday night after “things didn’t add up” with an inspection report he filed on the crane, said Department of Investigation Commissioner Rose Gill Hearn. Marquette had been sent to inspect the crane in response to a complaint that it had not been properly secured.

“According to our investigation, Marquette made false statements on his route sheet, indicating that he had inspected the crane,” Hearn said. “He has admitted to DOI that he did not inspect the crane on March 4th.”

It is related to the construction industry’s greed and a city government that favors the construction industry, even when liberal municipal politicians raise a stink when such accidents occur. Building inspectors are always taking bribes, going back to 1871 when the NY Times filed a report on ”Disgraceful Corruption in the Department of Buildings.” It described a meeting of 25 architects, ”uptown builders” and house owners who released an 11-point petition charging the department with ”tyranny” for habitually taking bribes. One $1,400 check was sent directly to James McGregory, the agency superintendent, to speed construction of a five-story structure.

I started writing this article about an hour ago. An update on the NY Times online edition provides new information:

According to city records, the company that is building the Azure is the Leon D. DeMatteis Construction Corporation of Elmont, on Long Island. A call to the sales office of 1765 First Associates L.L.C., a subsidiary of DeMatteis, was not immediately returned.

City records show that the building has been the subject of several complaints from residents who have called the city’s 311 hot line. On May 20, a caller complained about the crane, saying that its platform extended across the sidewalk and well into traffic. A Buildings Department inspector responded but determined there was no violation.

DeMatteis, it turns out, is my very own landlord. My building was in the Mitchell-Lama program that provided affordable housing to middle-class New Yorkers and tax abatements to the landlord. After the building satisfied its 20 year obligations to Mitchell-Lama, it was privatized. The tenants conducted an intense struggle with DeMatteis to maintain affordable rents that ultimately failed to achieve its goals. The wife and I feel like we are hanging on at the edge of precipice.

As this December 26, 1991 New York Times article indicates, the DeMatteis corporation is exactly the kind that would prosper in the city today.

New York Cancels Builder’s Contract, Citing Reports on Mob Ties


New York City has revoked a $1.2 million contract with a major construction company that officials say concealed and altered reports about possible ties to organized-crime figures.

The contract was awarded in July to the Leon D. DeMatteis Construction Company of Elmont, L.I., to supervise the building of a $67 million jail annex on Rikers Island. But in a decision made public this week, the city said the company had withheld “troubling” information about its business associations and had submitted an altered copy of a report concerning its possible ties to reputed organized-crime figures.

Michael C. Rogers, the director of the Mayor’s Office of Contracts, who revoked the contract, said in an interview that the city would also move to disqualify the DeMatteis company from seeking other municipal contracts.

A spokesman for the company, Martin J. Steadman, called the decision to cancel the contract “assassination by innuendo.” He said the company was considering bringing a lawsuit seeking to restore the contract and “to protect and preserve our reputation.”

Mr. Steadman said Mr. Rogers’s findings were based on allegations that had been previously investigated and rejected by Federal prosecutors in New York and the authorities in New Jersey.

In August the New York City Comptroller, Elizabeth Holtzman, urged Mayor David N. Dinkins to cancel the contract, which had been awarded by the Department of General Services to the DeMatteis company to oversee the design and construction of the 500-bed jail annex.

Ms. Holtzman said the company’s chief executive officer, Frederick DeMatteis, had been the principal owner of the Cedar Park Concrete Corporation. Cedar Park, she noted, had been identified in a Federal trial as a company used by Mafia leaders to rig concrete contracts in the early 1980’s.

Mr. DeMatteis has acknowledged being a business partner from 1984 to 1988 in the Metro Concrete Company in New York with the son-in-law of Paul Castellano, the former head of the Gambino crime family who was killed outside an East Side restaurant in December 1985.

In a report, Mr. Rogers said that Mr. DeMatteis has never been accused of criminal wrongdoing. But he said that when the company applied for the contract, it did not disclose in a background questionnaire that it had been the subject of law-enforcement investigations.

Mr. Rogers also said that in response to Ms. Holtzman’s objections, the DeMatteis company submitted an altered copy of a report that had been prepared by the office of the New Jersey Attorney General about Mr. DeMatteis’s business dealings with reputed organized-crime figures.

Officials of the company said that the report was mistakenly revised by a lawyer who had represented the company in New Jersey and that there was no attempt by the company to deceive the city.

“The cases in which information was not disclosed here are just too numerous to be explained away,” Mr. Rogers said in his report. “When the totality of circumstances is considered, the picture that is presented is that the DeMatteis Corporation is not a responsible vendor.”

In the late 1980’s the DeMatteis company built a $28 million jail and a $19 million Sanitation Department garage for the city. It has no other current contracts with the city.

The company, one of the largest residential and commercial builders and developers in the New York region, constructed the Museum Tower, a luxury apartment building above the Museum of Modern Art on West 53d Street, and the Confucius Plaza apartments on Chatham Square in lower Manhattan.

Evidently, DeMatteis was not qualified to build an annex to the Rikers Island jailhouse but qualified enough to erect a high-rise 2 blocks from my home, endangering the lives of workers and local residents. An annex should have been built just to house the DeMatteis family and they should have thrown away the key.


It turns out that the crane company involved with the East 91st street accident, owned by one James F. Lomma, has some track record.

The New York Times, September 18, 1999
Crane Secured for Storm Falls, Killing a Worker in Chelsea

A huge crane collapsed at a Chelsea construction site yesterday morning, killing one worker and injuring three others after the crane operator tried to hoist the boom without releasing special restraints intended to prevent an accident once Hurricane Floyd reached the city, officials said.

The 383-foot red steel crane, which had become a fixture in the bustling neighborhood, buckled under the restraints, tumbled backward and crashed at the corner of 24th Street and the Avenue of the Americas just after 7 A.M., crushing a carpenter who was having breakfast on the sidewalk before heading to work at the site.

The man, Kenneth Preiman, 43, suffered severe head injuries and was pronounced dead at the scene, where the crane knocked over a traffic light and a lamppost and left a hole a foot deep in the sidewalk…

A field supervisor for Laquila/Pinnacle said both the crane operator and the victim worked for the company, which is based in Mamaroneck, N.Y. Laquila/Pinacle has been subcontracted to create the concrete superstructure for the 29-story, $75 million apartment building, which is scheduled to open in the spring. The crane belonged to New York Crane, a subsidiary of Lomma Construction.

The New York Times, March 17, 2008
Fall of Six-Ton Support Caused Crane to Topple

The spectacular collapse of a towering crane on the East Side began when a massive piece of steel designed to secure it to a new high-rise building came loose and pancaked on top of a second support nine stories below, shearing it free and creating a fatal imbalance that sent the 22-story crane toppling across a two-block swath of Turtle Bay, officials said on Sunday.

Officials were focusing their investigation in part on the way the steel piece — called a ”collar” — was being installed, including whether a series of hoists and nylon straps used to hold it temporarily in place were strong enough to sustain its weight, said Patricia J. Lancaster, the buildings commissioner. Building officials estimated the weight at 12,000 pounds.

Meanwhile, work crews and rescuers swarmed over the site of the disaster, on 51st Street and 50th Street just east of Second Avenue. They began to remove portions of the broken crane’s white lattice tower, one leaning against a 19-story building on 51st Street and another, which had broken off and tumbled through the air, lying across a demolished four-story town house on 50th Street.

Four construction workers — a crane operator and three riggers who were helping to ”jump” the crane, or increase its height — were killed. Three people were missing. On Sunday, as hope dwindled, firefighters, including a unit that specializes in building collapses, continued to search for signs of life. ”We’re still calling it a search operation, though with each passing hour, things are getting more grim,” said Nicholas Scoppetta, the fire commissioner.

The crane was owned by New York Crane & Equipment Corporation, but it had apparently been leased to one of the contractors involved in the project.

NY Times, May 31, 2008
Investigators Look at Equipment, Not Crane’s Operators

Investigators are focusing on a bad weld as the possible cause of an accident on Friday in which the top of a crane snapped off, crashed into a building across the street and killed two construction workers, the city’s acting buildings commissioner said.

Investigators were also trying to determine whether a crucial part of the crane — the rotating plate that connects the cab and boom at the top to the tower — had been removed from a different construction job a year ago after developing a dangerous crack, another city official said.

Questions about the history and condition of the turntable may turn the focus of the investigation to its owner, New York Crane, which was also the company that owned the crane that collapsed on March 15 on East 51st Street.

That accident occurred under very different circumstances, when sections were being added to increase the crane’s height. Investigators believe that the crew making the crane taller may have made mistakes in the way they supported a huge steel collar high up on the crane. The collar fell, knocking out the cranes supports and causing it to collapse onto nearby buildings.

James F. Lomma, the owner of New York Crane and Equipment, did not return calls left at his office in New Jersey or on his cell phone.

January 30, 2008

Capitalist pig of the month

Filed under: capitalist pig,real estate — louisproyect @ 8:59 pm

Ira Rennert: capitalist pig of the month

This may be just the first in a continuing series based on the time I have available and on the availability of suitable candidates—I imagine that the second condition will be a lot easier to meet. It is written in the spirit of Keith Olbermann’s “Worst Person in the World” awards that he hands out on a fairly regular basis on his MSNBC cable show. As you can imagine, Bill O’Reilly is a multiple recipient. My approach will be somewhat different. I am far more interested in highlighting the sins of the super-rich, who are after all the ones who pay the piper. I should add that Ira Rennert received “The Awful Truth” award of the year in 1999 from Michael Moore (more below), so in a sense I am following in both of their footsteps.

As some of you will recall, I have referred to the Real Estate section of the weekly New York Observer as a kind of scandal sheet in which various shady characters are reported as buying or selling hugely expensive apartments. This included Jack Barnes and Mary-Alice Waters, the two leaders of the Socialist Workers Party, who sold a loft near party headquarters in the West Village last year for nearly 2 million dollars. The article was titled “Communists Capitalize on Village Sale—Get $1.87 M. for Loft”.

Earlier this month, Max Abelson, the Observer’s real estate reporter scooped the Barnes and Waters transaction, reported on another big sale (“Big Deal! Big-Hearted Baron Ira Rennert Buys Daughters Spreads in 740 Park, 778 Park for $60 M.-Plus)

Brooklyn-born Ira Rennert has an oceanic $185 million Hamptons compound, a few infamous smelting plants in Peru and Missouri, and a billion-dollar fortune from junk bonds and Hummer vehicles.

He also has something of a generous streak: Two sources told The Observer that Mr. Rennert has bought two of New York’s most expensive apartments, at two of the best-bred co-op buildings, for his two daughters…

Mr. Rennert, meanwhile, has his own multiunit spread nearby at 625 Park Avenue, plus his 63-acre oceanfront property—“the largest home in America,” The New York Times wrote in 1998. He’s also been known for a different kind of excess: According to a 2003 BusinessWeek article, the E.P.A. has ranked his Renco Group—a conglomerate based on mining and smelting—as the country’s 10th-biggest polluter.

The news that this scumbag is buying 60 million dollars worth of apartments for his useless offspring goes hand in hand with the fact that his corporation is the country’s 10th biggest polluter. With one he poisons the air and water and with the other helps turn Manhattan into a theme park for Eurotrash and hedge fund managers.

Ira Rennert’s 78,000 square foot house

Although the Observer does not mention it, there was quite of resistance to Rennert’s 78,000 square foot weekend retreat from his Hamptons neighbors, including the rich and powerful. On August 24, 1998, the Scottish Daily Record reported:

Eccentric Ira Rennert’s massive home is set to be twice the size of the White House when it is completed.

But millionaire locals, who include Steven Spielberg, have dubbed the plans “a monstrosity” and vowed to fight them every step of the way. Rennert, 63 – who made his fortune building Humvee military jeeps – calls his proposed palace Fair Field.

The 100 million pounds monster building is set to take up 63 acres on ocean-front land.

It will have 39 bathrooms, 29 bedrooms, a kitchen the size of a restaurant, garage space for 200 cars and a huge power plant.

And if the residents get bored, there will be two tennis courts, two bowling alleys, a 164- seat cinema, a basketball court and two outdoor sports pavilions.

But neighbours in the posh Hamptons area of New York state have set up a pounds 50,000 fighting fund in a bid to halt the project.

Movie director Spielberg is being joined by tycoons Mortimer Zuckerman and Donald Trump in his opposition to the plans.

When you have Donald Trump lining up against you on the basis that you are just too ostentatious and vulgar, then you have really broken free from the earth and sailed straight into the stratosphere.

As might be expected, a target as tempting as Ira Rennert invited the scrutiny of Michael Moore, who also has finely tuned antennae for capitalist pigs. On November 13, 1998, the NY Daily News reported on Rennert’s bid to prevent Moore from documenting his excesses.

A rich industrialist who is building one of the biggest private houses in America went to court yesterday to stop “Roger and Me” film maker Michael Moore from documenting his edifice complex.

Millionaire financier Ira Rennert filed a lawsuit to bar the ambush interviewing that is Moore’s hallmark, as the mischievous movie maker prepares a satire about Rennert whose 25-bedroom, 39-bathroom oceanfront digs has even his wealthy neighbors on Long Island’s East End alarmed.

Yet part of the suit, which was filed Tuesday in Manhattan Supreme Court, was abruptly withdrawn yesterday afternoon by Rennert.

The complaint had contained a sworn affidavit from Joanne Rullan, a receptionist at The Renco Group, the holding company for Rennert’s business empire, in which she charges she was assaulted by Moore on Nov. 5.

In 2000, Rennert made a bid to take over the RJB coal mining company in Great Britain. As The Independent reported in an article titled “Sex Offender Heads Renco Bid For Rjb”

on August 27 of that year, predatory investments seem to go hand in hand with sexual predation:

ONE OF the top executives at US company Renco Group, now in talks to take over RJB Mining, is a convicted sex offender who has just completed three years’ probation after admitting “sexual misconduct” with a teenager applying for a job with the company.

Marvin Koenig, the 70-year-old executive vice president and right-hand man to the group’s controversial founder, Ira Rennert, pleaded guilty to two counts of sexual misconduct concerning an incident in 1995.

Mr Koenig lured Pearl Higgins (not her real name) into his offices in New York’s Rockefeller Center one evening, after having offered her a $ 10 an hour clerical job.

Manhattan District Attorney papers allege that Mr Koenig pounced on her with a knife, forcing her to have oral sex before raping her on the boardroom table. The petrified teenager called the police and Mr Koenig was arrested on three counts of rape in the first degree, a class B felony which carries up to 25 years in prison.

Showing the utter disjunction between professed religious beliefs and one’s ethical behavior, Rennert is an orthodox Jew. As such, it should not come as any big surprise that he is a supporter of the most rightwing parties and causes in Israel. As the Zionist state becomes more and more isolated in the world, it finds that it can only rely on orthodox Jews and Christian fundamentalists for hard core support.

On February 10, 2003, the Jerusalem Report revealed how Rennert and other wealthy American Jews (including the equally disgusting Ronald Perlman who I reported on here) flout Israeli laws in order to fund their favorite rightwing politicians:

Six names emerge repeatedly in conversations with those in the know about American funding of Israeli politics: Edgar and Charles Bronfman, former Seagram’s owners; Slim-Fast diet food founder S. Daniel Abraham; Saban, cosmetics heir-philanthropist Ronald Lauder, and Ira Rennert, chairman and CEO of The Renco Group, which specializes in metals and makes the HUMVEE all-terrain vehicle.

Edgar Bronfman, president of the World Jewish Congress, his brother Charles, a noted philanthropist (and former chairman of The Report), and Abraham (a former Report part-owner), have been involved in political efforts at the left side of the Israeli political spectrum, with people like Shimon Peres and Barak. In the past, Saban reportedly donated hundreds of thousands of dollars to the campaigns of both Barak and former defense minister Yitzhak Mordechai. (Edgar Bronfman, Saban and Abraham did not respond to repeated interview requests.)

Lauder is close to former prime minister Benjamin Netanyahu, and reportedly paid the million-dollar-plus fee collected from the 1996 Netanyahu campaign by U.S. mega-consultant Arthur Finkelstein. A spokeswoman for Lauder declined to comment on his current contributions or what he had done in the past. She told The Report via e-mail that “since Mr. Lauder won’t make campaign contributions in Israeli elections, he isn’t able to offer any commentary on what others may do.”

Rennert, who is known as a big financial supporter of right-of-center candidates and causes, often donating through NPOs, also declined to comment.

La Oroya, Peru: victims of Rennert’s pollution

Evidently, some religious leaders­—closer in spirit to the holy texts than Rennert—decided to appeal to his better instincts, a mission that seems inspired more by a desire to put pressure on the greedy slob than actually change his behavior. In a web-only article that appeared on the Nation Magazine website last June, Sara Shipley Hiles described how “Religious Leaders Challenge a Polluter“. It is worth quoting in its entirety.

It’s a long way from the thin air of an impoverished mountain village outside Lima, Peru, to the tony atmosphere of the Hamptons. But a group of religious leaders from Peru recently traveled to New York to tell billionaire industrialist Ira L. Rennert that even if he can sleep at night, comfortably ensconced in his 110,000-square-foot estate in Sagaponack, God is watching.

The clerics want Rennert to improve health care and dramatically decrease emissions at a metals smelter in La Oroya, Peru, a town high in the Andes Mountains where thousands of children are suffering from lead poisoning. The smelter, known as Doe Run Peru, is a subsidiary of Rennert’s $2.4 billion private holding company, the Renco Group.

Peruvian Roman Catholic Archbishop Pedro Barreto publicly called upon Rennert, a well-known philanthropist and supporter of Orthodox Jewish causes, to honor his religious faith and work harder to solve La Oroya’s pollution problems.

“Our main purpose was to invite Ira Rennert to become a leader in social responsibility, under the assumption this is an ethical and moral issue,” Barreto said, during the group’s three-city visit to the United States this month.

Rennert declined to meet with Barreto and his colleagues, referring them to a local representative for the smelter in Lima. The religious delegation–which included an evangelical pastor, a Jewish leader and several Catholic nuns–instead visited with various religious agencies during the stop in New York City.

Calls to Rennert’s office at Rockefeller Center asking for comment on the visit were referred to Victor Belaunde, a Doe Run Peru spokesman in Lima. Belaunde said that company officials met with the religious leaders June 8 in Lima and updated them on ongoing environmental improvements.

Company officials claim Doe Run Peru has already committed more than $107 million to clean up the smelter in the decade since Renco acquired the facility. The company pays $1 million annually to fund a health program run by the government’s health ministry, Belaunde said. He added that the smelter is now in compliance with Peruvian standards for lead emissions.

Despite these investments, a recent study by St. Louis University scientists found that 97 percent of children in La Oroya are lead-poisoned, a condition that can cause mental and physical deficiencies. And a new report from LABOR, a Peruvian non-profit group, found that emissions of lead, arsenic and sulfuric acid have actually increased in the past two years, according to Friends of La Oroya, a group supporting the religious leaders’ delegation.

The city of 33,000 people has been declared one of the world’s ten most polluted places by the Blacksmith Institute. Visitors to La Oroya first notice that the surrounding valley looks like a bomb crater, stripped bare of vegetation by acid rain. Then they notice the massive Doe Run smelter complex, which bathes city in choking fumes and toxic dust that contains cadmium, arsenic and lead.

To combat the dust, Doe Run organizes cadres of women to wash public streets and encourage children to wash their hands. The company has delayed some mandatory environmental work that was originally required to be completed in 2006. Now the work is set to be done by 2009, but even then, according to the company’s own study, many children in the town will still have blood-lead levels well above the acceptable standard.

“In the last few years the pollution in the air is worse, the soil has become infertile and the water has become polluted,” said Sister Mila Diaz, a Dominican nun from La Oroya who was part of the religious delegation. “We don’t want to fight with the company. We don’t want the company to close their doors. What we want is for them to comply with the promise they made to clean the air.”

The religious leaders’ tour also stopped in St. Louis, where Doe Run Peru’s former parent company, Doe Run Resources, has its headquarters. Company officials there declined to meet with the group, saying that Doe Run Peru is no longer its subsidiary; the Peruvian company now reports directly to Renco.

In addition, the group visited Herculaneum, Mo., where Doe Run operates the largest lead smelter of its kind in the United States. Longtime environmental activist Tom Kruzen took the group on a “toxic tour” to see the neighborhood where Doe Run was forced to buy out more than 140 homes surrounding the plant.

“You can pray all you want,” Kruzen said of Rennert, “but if you’re doing bad things to people, or if your endeavors do bad things to people, then you’re not a moral person.”

Rennert has grown rich using a formula of buying dirty companies, taking out steep loans and paying himself princely dividends, as documented in articles in Forbes and Business Week. Several of his companies have filed for bankruptcy, allowing Rennert to buy back assets for pennies on the dollar. Rennert’s empire of mining and manufacturing firms also includes AM General LLC , the maker of HUMVEE military vehicles and the gas-guzzling Hummer, as well as a magnesium producer and a steel manufacturer.

The wealthy financier also has given widely to charitable and civic causes. Rennert and his wife, Ingeborg, have contributed to restoring the Western Wall Tunnels in Jerusalem, where the visitor’s center bears the name “The Ingeborg and Ira Leon Rennert Hall of Light.” New York University has an endowed professor of entrepreneurial finance in Rennert’s name, and the Rennerts donated between $1 and $1.9 million to the World Trade Center Memorial .

At one time, Rennert lent his name to the Torah Ethics Project, an effort to remind Orthodox Jews of the importance of “living in accordance with the highest ethical standards.” A statement on the project’s website urges moral behavior in all business and personal matters that “adds luster to God’s sacred name.”

Rennert’s supporters have included Elie Wiesel, the Nobel Peace Prize-winning Holocaust survivor. At the prestigious Fifth Avenue Synagogue in New York, where Rennert is chairman, Rabbi Yaakov Kermaier defended Rennert’s reputation.

“I’m not really familiar with any of his business operations,” Kermaier said in an interview. “I know him as a person of extraordinary generosity and unimpeachable personal integrity.”

Congratulations, Ira Rennert, you are the Unrepentant Marxist’s capitalist pig of the month.

UPDATE: Marxmail subscriber Colin Brace wrote today: Louis, I heartily endorse your nomination. Rennert is a world-class bastard. Here is what I wrote several years ago on my short-lived blog about the activities of his company Doe Run in Peru.

August 22, 2007

Flipping Out

Filed under: real estate,television — louisproyect @ 6:16 pm

Jeff Lewis: gay, OCD, New Age real estate flipper

On July 31, NY Times TV critic Gina Bellafante looked askance at a new reality show called “Flipping Out” on the Bravo cable network, which is based on the goings on of a Los Angeles real estate company run by one Jeff Lewis. Lewis is a 36 year old gay man with Obsessive Compulsive Disorder (OCD) who specializes in “flipping” houses. Bellafante concludes her review with the following observation:

Mr. Lewis’s houses look like the generically upscale ones found in House Beautiful. He doesn’t possess style; he copies it. What he does have, by his own admission, is obsessive-compulsive disorder, and the show’s producers, to their credit, do not treat his O.C.D. as if it were a winning asset, the key to whatever success he has had. Like many sufferers of the disorder, Mr. Lewis ignores the real mayhem right there in front of him, so fixated is he on the idea, say, that all the bottles of water in his refrigerator be stocked so that the labels always face him. This is a task dispatched to one of three assistants, from whom he demands formal, written apologies when they behave insubordinately.

For years now, the comic detective series ”Monk” has equated O.C.D. with intuitive brilliance. We’ve long required a corrective interpretation, and ”Flipping Out” is it. Mr. Lewis isn’t a genius of anything. He’s just a delusional jerk.

Unfortunately, Ms. Bellafante does not get “Flipping Out.” I have begun watching reruns this week and saw the latest episode last night. It is simply the funniest thing I have seen on TV since “Curb Your Enthusiasm,” containing the same kind of absurd situations and characters. Since the characters on “Flipping Out” probably have no idea how comical they are, the humor is sharper in some ways than “Curb Your Enthusiasm” which has begun to imitate itself.

In one episode, Jeff Lewis directs one of his assistants to take his pet Angora cat, named Monkey, to an animal acupuncturist. This is Los Angeles, after all. Although the goal is to get the cat to mellow out, it throws a fit in the acupuncturist’s office and takes a bite out of the assistant’s hand. Finally, they subdue the cat and stick needles into its coiled body, wound tight as a steel spring. The unhappy animal looks like a rabid porcupine. On the way home, he berates the cat which is still hissing angrily in its carrying case. The contrast between the New Age pretensions of the people involved with this nonsense and the angry cat is almost as great as that between Jeff Lewis’s real estate ambitions and the reality of a declining real estate market in Los Angeles.

This discrepancy between the star’s lofty goals of becoming a millionaire and the real estate meltdown is what gives the show its dramatic tension. As a “flipper,” Lewis must turn over a house as quickly as possible in order to stay liquid. He is constantly in battles with potential buyers who want to drive down the price of a house he has put on the market or with his assistants who seem oblivious to his predicament. Nearly all of them are working in real estate until something better comes along–in the same way that others bartend or wait tables, until they make their big breakthrough as actors or writers. This is Los Angeles after all.

You can watch video clips of “Flipping Out” on the Bravo website. I particularly recommend the episode that includes Monkey having a fit at the pet acupuncturist.


July 27, 2007

The Housing Question

Filed under: real estate — louisproyect @ 5:00 pm

My apartment building

Alison Rogers, the author of “Diary of a Real Estate Rookie,” was asked by salon.com: “Why are we so fascinated by real estate?” She answered:

It’s a sport. It’s like a way of watching baseball where we can see the standings. It’s voyeurism and gossip and social standing and architecture and beauty.

That is why the New York Observer’s real estate section has become one of the paper’s most attention-gathering sections. The paper was once published by insurance magnate Arthur Carter, as was the Nation Magazine. Under his watch, the Observer could be counted on for gossip about the left, including the Nation Magazine’s Eric Alterman who was described in an Observer article as having a “brainy-little-kid quality, with large fish-like eyes behind glasses.”

Under the new owner Jared Kushner, a Zionist with connections to the ultra-orthodox Lubavitcher sect, that tradition continues in–oddly enough–the real estate articles of Max Abelson who reported on July 10th that the leaders of the Socialist Workers Party, a couple by the name of Jack Barnes and Mary-Alice Waters, just sold their West Village loft for $1.8 million. Abelson writes:

If bow-tied, cigar-mouthed Republicans can have nice seven-digit, six-room co-ops, don’t a few old Manhattan communists deserve multi-million-dollar real estate, too?

A two-bedroom loft at 380 West 12th Street, a 109-year-old building on a cobblestone block by the Hudson River, was sold by American socialist leaders Jack Barnes and Mary-Alice Waters. Their buyers, a Sony BMG Music Entertainment vice president and his fiancée, Stephanie Jakubiak, paid $1,872,500.

In analyzing the significance of all this on the SWP mailing list on Yahoo, Richard Fidler pointed out that this was just a case of senior party members enjoying a customary perk:

As I recall, the SWP, looking ahead to their retirement years, purchased condominium apartments that were inhabited by senior staff comrades. In my days in New York, in the mid-1970s, there were a number of older comrades living in such condos on the Lower East Side. These were comfortable but not luxurious apartments in modest high-rise buildings, typical working-class accommodation in that city. But, as I understood it, they belonged to the party, de facto, even though the title may have been registered in the names of individuals.

I once visited some of these “senior staff members” at their apartment in Chelsea, no doubt paid for by my dues. It belonged to resident philosopher George Novack and long-time feminist and anthropologist Evelyn Reed and was not far from my studio apartment in the West 20s. As I recall, it was a cozy one-bedroom that would probably go for $2700 per month today. Evelyn made us watercress sandwiches and gin-and-tonic as we gossiped about personalities in the Trotskyist movement of the 1930s like James Burnham. I felt like I had stumbled into Dorothy Parker’s round table at the Algonquin Hotel.

I could never imagine myself ever living like them. I was 23 years old and dead-sure that the US would become socialist by no later than 1980, 1985 at the latest. I could care less about where I was living and only saw it as a place where I could crash after a full night of antiwar organizing. In my studio apartment, I had a mattress on the floor and a canvas director’s chair and that was sufficient.

Ten years later I had grown tired of not having a place I could call home. I had been pressured into leaving New York City and making the “turn to industry” in Kansas City, my birth place. It turned out to be an unmitigated disaster. One morning as a spot welder was all I needed to convince me that this was not for me. When the turn was first announced, somebody reassured me that I could still be a member of the party if it didn’t work out. When George Novack had washed out of a defense plant, the SWP was quite forgiving. As one of the few genuine intellectuals in the party, there was a place for him. With the super-proletarian atmosphere in the party in the late 1970s, it was clear that there was no place for me. Not that I was a genuine intellectual. I had dropped out of graduate school in 1967 and had never written for the party journal. If I would ever find the time to write anything, it would be the Great American Novel. As should be obvious, I was a slave to illusion even then. If it wasn’t socialist revolution by 1985, it was becoming the next Hemingway. I have learned to settle on being Louis Proyect living under capitalism, snarling at the ruling class all the while. The rewards are much more modest, but at least they can be relied upon.

After saying goodbye to the SWP in late 1978, I moved back to New York and found a beautiful and spacious apartment in a subsidized Mitchell-Lama building on the Upper East Side that I could finally call home. I have been there ever since but face being priced out after the building opted out of the program in 1998. My rent was $640 when I moved in and is now $2300. Despite having an income of more than $100,000 per year (I make $75k and my wife makes about $25k as an adjunct professor), we face being forced out of Manhattan. In some ways, my situation is not that different than those who are being forced out of their homes by the real estate shake-out nationwide. They are victims of a credit bubble, while I am a victim of New York being transformed into a playground for hedge fund managers.

Five years ago I could have bought my apartment at an insider price of $299k. It is now priced at over $700k on the open market. I would have made a killing like Jack Barnes and Mary-Alice Water but I simply couldn’t afford it. My mother was still in her house upstate, maintenance for which was costing me about $300 per month on average, my wife was not working, and I had vain hopes that my rent wouldn’t skyrocket after the building exited Mitchell-Lama.

Each day I read the NY Times to find new reports about tumbling real estate prices–everywhere except in New York of course. Five blocks from my building on the corner of 86th Street and 3rd Avenue a new high-rise building called The Colorado is under construction. A huge billboard at the site advertises two-bedroom apartments starting at $1.8 million, the same price that Jack and Mary-Alice sold their condo for.

As part of the class struggle, real estate has a way of impacting peoples’ lives in a fundamental way–where they live. When it comes to jobs, it is somewhat easier to bamboozle the worker–especially in white collar positions like my own. If you get a shitty raise or get fired, it is your own fault. You didn’t “perform” well enough. For blue collar workers, there is no pretense involved. You will lose your job because General Motors needs to improve its bottom line. With housing, you get more or less the same thing. The landlord will raise the rent or the bank will foreclose because it needs to protect the bottom line. It doesn’t really matter to them if you are on the street after living in the same place, as I have been, for the past 28 years.

In the 1930s, long before there were massive trade union struggles, the resistance of working people to eviction manifested itself. On June 3, 1931 the heading of a NY Times article read:

44 Reds Arrested in Eviction Protest
Police Surprise Band of 100 Moving Dispossessed Family Back into Tenement
East Side Crowd Watches
Communists Sing “Internationale” While Undoing Marshal’s Work
All Freed in Night Court

By contrast, today’s foreclosures meet with virtual no resistance. Perhaps that will change when the tempo of the foreclosures steps up.

In another astute observation on workers, socialism and housing, Richard Fidler referred to a series of articles in the SWP newspaper from the 1980s when it was still somewhat readable:

One was ideological: a confusion between what you propose as a social solution for society, and what you may be inclined to do as an individual in actually existing capitalist America. I was reminded of this back in the 1980s when Doug Jenness wrote a series of articles in The Militant on the housing question, based largely on Engels’s wonderful pamphlet on that issue. Doug argued that workers were crazy to buy houses. His argument was not based on the practical economics of home ownership (e.g. the tax deductions for mortgage interest Walter [Lippmann] refers to – something we don’t have in Canada), but rather on the Marxist critique of private home ownership, and the need for social housing, to be regarded as a social right not a property right. Great argument, but as advice for individual workers it substituted abstract theory (“program”) for real life realities.

Turning to Engels’s “The Housing Question,” there’s still a lot that sounds current especially the following, which will assume more and more weight as the housing crisis deepens and a Hillary Clinton takes over the White House:

It is perfectly clear that the existing state is neither able nor willing to do anything to remedy the housing difficulty. The state is nothing but the organized collective power of the possessing classes, the landowners and the capitalists as against the exploited classes, the peasants and the workers. What the individual capitalists (and it is here only a question of these because in this matter the landowner who is also concerned acts primarily as a capitalist) do not want, their state also does not want. If therefore the individual capitalists deplore the housing shortage, but can hardly be persuaded even superficially to palliate its most terrifying consequences, then the collective capitalist, the state, will not do much more. At the most it will see to it that the measure of superficial palliation which has become standard is carried out everywhere uniformly. And we have already seen that this is the case.

July 24, 2007

Life-style of communist leaders?

Filed under: real estate,sectarianism — louisproyect @ 11:37 pm

a revolutionary career does not lead to banquets and honorary titles, interesting research and professorial wages. It leads to misery, disgrace, ingratitude, prison and a voyage into the unknown, illuminated by only an almost superhuman belief.

–Max Horkheimer

NY Observer, July 15, 2007
Communists Capitalize on Village Sale—Get $1.87 M. for Loft
by Max Abelson

If bow-tied, cigar-mouthed Republicans can have nice seven-digit, six-room co-ops, don’t a few old Manhattan communists deserve multi-million-dollar real estate, too?

A two-bedroom loft at 380 West 12th Street, a 109-year-old building on a cobblestone block by the Hudson River, was sold by American socialist leaders Jack Barnes and Mary-Alice Waters. Their buyers, Sony BMG Music Entertainment vice president Ole Obermann and his fiancée, Stephanie Jakubiak, paid $1,872,500.


Jack Barnes

“I don’t want to hurt the sellers’ feelings at all, but they definitely had a funky style in terms of how they did the apartment,” said Mr. Obermann. That means there are sliding stained-glass doors, plus a wall of bookshelves. (Ms. Waters is the president of publishing house Pathfinder Press, which publishes Marx and Trotsky, and Mr. Barnes, too.)

Mary-Alice Waters

“Personally, our tastes are different and we’ll probably do something different,” the buyer said. “It will be open, airy, simple, whereas when it was done 15 years ago there was a lot of light-colored wood shelving.” He’s adding six or so wireless speakers, “a nice music system.”

Edward Ferris of Brown Harris Stevens was the listing broker.

It isn’t clear when Mr. Barnes and Ms. Waters bought the place or how much they paid, but city records date back to 1993, when apartments were massively cheaper.

Unlike most people in six-room lofts, Mr. Barnes once met with Kim Il-sung, the late North Korean president. The leader “conversed with the guests in a cordial and friendly atmosphere and arranged a lunch for them,” a report published by the BBC in 1990 said. “US Socialist Workers’ Party, led by its National Secretary Jack Barnes … presented him with a gift.”

So what is the couple like? “We only met Mary-Alice, and she was incredibly friendly, interesting, had a nice warm way about her, seemed like a very nice woman,” Mr. Obermann said. “She mentioned she really liked to cook, they would have friends over—it’s like a social space.”

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