PUBLISHED : THURS, 24 JUL 2014, 11:31 PM
UPDATED : SAT, 26 JUL 2014, 08:30 PM
The demise of the Moreland Commission : The high price of avoiding a fundamental overhaul of the broken political system
In the lengthy The New York Times report about the Cuomo administration's relentless obstruction of the independent investigations once being conducted by the now-defunct Moreland Commission, the newspaper of record finally named names : that Gov. Andrew Cuomo was apparently serving the best interests of large campaign contributors -- amongst them, the Real Estate Board of New York ; the Extell Development Company, developer of the $2 billion luxury condominium tower on West 57th Street in Midtown Manhattan ; and the donors to the Committee to Save New York, a controversial 501(c)(4) charity group that acted as Gov. Cuomo's political arm -- instead of the best interests of voters.
As federal prosecutors piece together the pattern of activities over a period of time that may have broken state or federal laws, which form the corrupt political machinations that thwarted subpoenas, concealed political activities, and altered reports -- leading to the politically-motivated, premature closure of the Moreland Commission to Investigate Public Corruption, voters are left having to examine the high price society pays to keep corrupt politicians, like Gov. Cuomo, in office. What keeps the broken political system so corrupt and corruptible ?
With the media fallout from the lengthy article in The New York Times and a possible federal investigation threatening to end Gov. Cuomo's political career, voters will probably not be shocked, once they learn the answer.
Intimidating, retaliating, and controlling officials or witnesses
Gov. Cuomo's power, it is now being revealed, stems from his control-freak nature, his need to badger his opponents into submission, his need to stack the political deck in his favor from the outset. One way he does that is by relying on help from powerful lobbying groups, like the Real Estate Board of New York, or REBNY as it is known for short. REBNY is a powerful lobbying group of extremely wealthy real estate developers. They are also a source of large campaign contributions at both the city and state levels. The lengthy article in The New York Times was perhaps the second time over the course of a decade when REBNY got singled out for scrutiny for its role in packaging large campaign contributions to political candidates in apparent exchange for special, insider access to government officials, who determine government policy or shape laws that impact the real estate industry. The last noteworthy time when The New York Times came close to outing REBNY was when reporters identified real estate developers as amongst the largest campaign contributors to the early-identified New York City mayoral candidates in the 2009 election cycle. Real estate developers were rushing to donate maximum amounts of campaign contributions before new restrictions were set to take place, which would limit the amount of money that business interests seeking business before the city could donate to candidates for public office. That previous article was a reflection of the realities in New York City politics, namely, that when real estate developers seek municipal approval for zone-busting real estate projects -- from the controversial, tax-payer assisted Hundson Yards project, to the $1 billion luxury condo conversion of St. Vincent's Hospital -- the city's politicians always acquiesce to developers' demands. Money not only buys insider access, but it apparently buys approvals of the city's development permitting process, a fact that The New York Times doesn't always make clear.
Obfuscation is the trick that keeps voters in the dark to the pattern in political corruption. Some of the same corrupt developers, who donate to Gov. Cuomo, also make campaign contributions to municipal politicians, all in an effort to game the broken political system. Two members of the Rudin family, owners of Rudin Management Company, made campaign contributions to Gov. Cuomo's campaign committee in the sum of $35,000. Other contributions, totaling $50,000, originated from a limited partnership in the name of the address of a Rudin office building on Park Avenue. The leader of the Rudin family is William Rudin, a board of director of both REBNY and a powerful Chamber of Commerce-like group known as the Partnership for New York City, or PFNYC for short.
In the 2009 New York City mayoral election cycle alone, owners of Rudin Management Company made contributions nearly totaling $30,000 to the campaign committee of former City Council Speaker Christine Quinn. These campaign contributions were made in the lead-up to Rudin's application for what eventually became a $1 billion luxury condo conversion of St. Vincent's Hospital. The hospital, in Speaker Quinn's Council district, needed her approval in order for the rest of the City Council to act in nearly unanimous lockset to rubber-stamp Rudin's zone-busting permit application. Tens and tens of thousand dollars in campaign contributions explains why healthcare activists heard, "We'll see you after the election," from the Cuomo camp in 2010, and heard nothing from former Speaker Quinn after her troubled reelection in 2009.
A decade ago, when the wealthy landlords of several of the city's Mitchell-Lama buildings were contemplating exiting the affordable housing program, REBNY lobbied the New York City Council -- and won -- a package of low-cost loans for the wealthy landlords that did nothing to expand affordable housing to New Yorkers. Instead, the financial benefit of such packages, on top of existing Mitchell-Lama subsidies and tax breaks, was to pad the bottom line of the city's wealthy Mitchell-Lama landlords, and that decade-old, low-cost loan package was spun as a way to incentivize wealthy Mitchell-Lama landlords to voluntarily remain in the affordable housing program without any newly-won guaranteed rent caps, much less rent reductions, for low- and moderate-income tenants. Whatever REBNY wants, REBNY gets.
To the corrupt enablers of the broken political system, reforms, of any kind, need to be blocked
Overseeing REBNY for almost three decades now has been Steven Spinola. In the lengthy report in The New York Times, Mr. Spinola was singled out for having written a controversial memo to REBNY members, asking the membership to make campaign contributions to Democrats in the State Assembly, a move that the Moreland Commission's chief of investigations, E. Danya Perry, found to be indicative that large campaign contributors believed that making political donations could determine legislative outcomes. The wealthy landlords and developers, who comprise REBNY, invest tens of thousands of dollars in political candidates over the course of their careers, amounts that can sometimes reach six figures for a single politician. Like all bean counters, real estate interests expect a return for this investment. That's why no major zone-busting real estate development has ever been turned down in New York City over the last decade or so, with the possible exception of former Mayor Michael Bloomberg's plan for a West Side stadium. That project was doomed from the start, because it would have competed with the wealthy Dolan family's interests in Madison Square Garden. In New York real estate circles, wealthy interests rarely want to create conflict between competing interests, because any conflict would draw scrutiny to the unseemly lobbying process that developers would rather keep below the public's radar. Fixing the outcome of zone-busting real estate permit applications depends on keeping the broken political system in place, where large campaign contributions can have an influence in legislative or zoning application processes -- outcomes upon which big business interests can rely.
According to the lengthy report in The New York Times about the demise of the Moreland Commission, Gov. Cuomo was trying to avoid any scrutiny of his real estate supporters, for example, the REBNY lobbying group or Extell, the real estate developer. Like Rudin, Extell is another wealthy real estate development company that has made sizable campaign contributions on both the municipal and state levels. A partial listing of campaign contributions by individuals with connections to Extell shows that over $16,000 in campaign contributions were made to former Speaker Quinn's mayoral campaign committee and that a partial listing of still yet other donations were made to Mayor de Blasio's winning mayoral campaign committee of at least $6,000. More on the role of Extell on influencing building policy under the de Blasio administration later.
On top of trying to avoid scrutiny of developers, Gov. Cuomo and his enablers, including Regina Calcaterra, manipulated the workings or censored the work product of the Moreland Commission. Even though the Moreland Commission has been shut for several months, some media reports indicate that Gov. Cuomo continues to pay Ms. Calcaterra her full executive director salary, even though the commission is now disbanded, raising questions amongst political bloggers as to what exactly Gov. Cuomo is paying Ms. Calcaterra to do, i.e., remain quiet about the background political machinations that drove the Moreland Commission into the ground ?
But the corruptive influence that appears to drive the political machinations for the Cuomo administration is not limited to the real estate industry. Another group, the PFNYC, has also exerted great influence in the Cuomo administration, according to government reform activists. The PFNYC is a powerful group of business executives from some of the nation's largest corporations, which operate out of New York City. Together, REBNY and the PFNYC were heavily involved in the Committee to Save New York, or CSNY for short, a pro-Cuomo charity group that raised over $16 million in contributions to advocate in support of several political issues. CSNY disbanded before the group was required to disclose the sources of its contributions.
The PFNYC, a member group of CSNY, is headed by Kathryn Wylde, the media's go-to-person for pro-business talking points. Ms. Wylde was a chief advisor to former Speaker Quinn, according to one political blogger, and her influence can be felt across the political spectrum in New York government. Although Gov. Cuomo vehemently denied that he was a shill for the PFNYC, there's no realistic way possible that pro-business groups would raise over $16 million and spend most of it on TV commercials supporting the Cuomo administration's agenda if the pro-business groups weren't expecting something in return. When Gov. Cuomo denies a quid pro quo on a scale of this magnitude, he is not being fully forthcoming with voters. That Mr. Spinola at REBNY and Ms. Wylde at the PFNYC can raise these amounts of contributions without public scrutiny is tantamount to government, but yet nobody calls for an end to the loopholes that allow lobbying groups to game the political system in their favour. No elected official, not even those whose campaign planks purportedly represent "progressive" values, dare to close the loopholes and champion for campaign finance reforms. No politician on the take from wealthy landlords or real estate developers dares to overhaul the corrupt municipal process that reviews billion-dollar zone-busting real estate development deals known as the Uniform Land Use Review Procedure, or ULURP for short. Here's why.
Millions of dollars in 501(c)(4) money and hundreds of thousands in campaign contributions are meant to block reforms
The only way that big business interests can keep fixing the outcome of permit applications and legislative processes is keep in place a system where only big money campaign contributors get insider access to elected officials. This is the roadblock to a complete overhaul of the broken political system, and it is this roadblock that very few media outlets fully expose. The lengthy article about Gov. Cuomo's backroom machinations to sabotage the Moreland Commission named a few names, like Mr. Spinola, REBNY, Extell, and the CSNY. But notice how Ms. Wylde and the PFNYC were left out. Also left out were the possible corrupting influence of $17,500 in campaign contributions made to Gov. Cuomo's campaign committee from the wealthy Kestenbaum family, founders of the Fortis Property Group, which eventually won the zone-busting development rights to convert Long Island College Hospital, or LICH, into what could amount to a billion dollar luxury condo complex in the fancy Cobble Hill section of Brooklyn. Official government policy outcomes always match the relentless pattern of campaign donations. The fix is in.
For years, thousands of healthcare activist from across New York City have been frustrated by newspaper articles by the hospital beat reporter, Anemona Hartocollis, who has never -- not even once -- mentioned how big real estate developers are corruptive influences that secretly cheer for the early closure of community hospitals across the city in order to bid pennies on the dollar for redevelopment rights to real estate sites that can gross revenues of several hundred millions to perhaps into the billions. Behind the media bias in articles like these, many healthcare activists and political bloggers believe, are the powerful business interests of REBNY and the PFNYC. It isn't just big business interests, which try to influence the media to disconnect the dots back to big business interests ; elected officials don't want that kind of scrutiny, either, because of the paper trail that large campaign donations link elected officials back to big business interests. If in respect of the Moreland Commission, the governor was able to successfully steer the Moreland Commission members away from troublesome links to the CSNY, then it wouldn't be that much more difficult for big business interests and elected officials to team up to steer the media away from troublesome links between former Speaker Quinn and Rudin Management Company in respect of the $1 billion luxury condo conversion of St. Vincent's.
Behind why voters can be deceived is the unshakeable public perception that the media does not fully report the whole truth about political corruption. The voter anger at former Speaker Quinn in her own Council district in 2011 was a harbinger that her political career was over. This voter anger was never fully reflected in media reports at the time. A close parallel to today is the growing political anger in Brooklyn, which is now directed at Mayor Bill de Blasio, over the closure of LICH in his very own borough. After the lessons learned from the spectacular failure of former Speaker Quinn's mayoral campaign, some media outlets have woken up to the voter dissatisfaction that hospital closures create amongst voters, meaning the sense of Mayor de Blasio's betrayal of the LICH community is slowly emanating from Brooklyn to the rest of the city, but still no thanks to key reporters at The New York Times, like Ms. Hartocollis. The larger story about hospital closings, which the media fails to report, is that Gov. Cuomo exacerbated these hospital closings under his controversial Medicaid Redesign Team, a panel that was steered to recommend draconian cuts to Medicaid, so much so that some of the Medicaid cuts are now being challenged in court. The hospital closings made under the Medicaid Redesign Team were spearheaded by Gov. Cuomo's hatchet man and Wall Street banker, Stephen Berger, but this fact is not widely reported by the media, misleading voters into thinking that hospitals are failing for business or commercial reasons, instead of the fact that hospital closures are actually central to Gov. Cuomo's austerity program. It's not that former Speaker Quinn or Mayor de Blasio are excused for their failed efforts to save St. Vincent's or LICH, for example, but that former Speaker Quinn and Mayor de Blasio have refused to fully educate voters about the power play dynamics playing out in political back rooms, decisions they make no doubt under the influence of big money contributions by real estate interests vying for lucrative luxury condo conversions of the real estate assets of failed hospitals.
Meet some of the victims targeted by the broken political system enabled by Gov. Cuomo and his supporters : Whistleblowers, activists, voters, and even some government officials
On the same day when Seema Kalia was set to testify before the Moreland Commission in 2013, at the invitation of Ms. Calcaterra, Ms. Kalia says, she was arrested and hauled to Rikers Island, where she was locked up for almost six months. Ms. Kalia's arrest prevented her from testifying before the Moreland Commission about financial improprieties, which, she says, involved institutions, such as Trinity School and the law firm Wachtel Lipton Rosen & Katz, with political ties that could be traced back to Gov. Cuomo. Prior to her arrest and incarceration, Ms. Kalia provided a summary of her expected testimony to Ms. Calcaterra during a telephone conversation that they had shared. The issues of corruption, which Ms. Kalia expected to bring before the Moreland Commission involved potential tax improprieties, amongst other issues. Ms. Kalia had attempted to reach out to the Moreland Commission with her information after the district attorney for Manhattan, Cyrus Vance, refused to investigate, Ms. Kalia said. Like with other whistleblowers, who had separately tried to directly contact Moreland Commission members about corruption after local authorities refused to investigate, the Moreland Commission never formally promised to investigate Ms. Kalia's referral. Part of the retribution Ms. Kalia has had to endure since blowing the whistle on corruption has been the loss of custody of her children, some political activists believe. Under normal circumstances, it would be difficult to believe that the Cuomo administration or the institutions implicated in Ms. Kalia's testimony would go to great lengths to retaliate against a witness, but the Cuomo administration has a definite pattern of hostility toward whistleblowers.
In 2013, Gov. Cuomo's director of state operations, Howard Glaser, publicly excoriated a state engineer, Mike Fayette, in an act of public retaliation for Mr. Fayette's unauthorized communication with the press. The year before, the Cuomo administration objected to a critic of the state’s Office for People With Developmental Disabilities, Jeffrey Monsour, being appointed to serve on a panel discussion on developmental disabilities. The Cuomo administration reversed its objection after criticisms of the administration's backlack were published by The New York Times. Also in 2012, Gov. Cuomo himself publicly retaliated against Ravi Batra, a founding member of the state's Joint Commission on Public Ethics, or JCOPE for short, creating a hostile environment for Mr. Batra, who resigned in protest over allegations that Gov. Cuomo attempted to steer control over JCOPE. From compromising the investigations of the Moreland Commission or JCOPE to retaliating against whistleblowers, these are examples of a pattern of corrupting political activities relating to Gov. Cuomo's obsession with keeping his official acts in alignment with the expectations of big business donors to his campaign committee.
The unmistakable pattern of political activities points to how the Cuomo administration seeks to manipulate or restrict the communication by whistleblowers or state employees set to speak before panels or with the media. Retaliation is commonplace. Like each of Mr. Monsour, Mr. Fayette, and Mr. Batra, Ms. Kalia has been excoriated in the media. As federal prosecutors reportedly investigate the political machinations of the Cuomo administration to thwart the investigations of the Moreland Commission, left unreported is how are each of these whistleblowers going to receive justice. Will Ms. Kalia see her charges investigated and her children returned ? Will Mr. Monsour and Mr. Fayette be guaranteed workplaces that are free of hostility and retaliation ? Can the other commissioners serving on JCOPE be assured of independence from the Cuomo administration ? And can the Cuomo administration amend its public statements about Mr. Batra, to restore public confidence in the integrity of whistleblowers like him ?
The Cuomo administration's apparent political backlash directed at critics isn't isolated to a few, vocal activists. The broken political system overseen by Gov. Cuomo and enabled by his generous campaign contributors also runs rough shod over large sections of the general public. Residents of low income housing, for example, become ensnared, too. Extell, the real estate developer, was founded and is headed by Gary Barnett, a member of REBNY's executive committee and board of governors. Mr. Barnett through his company, Extell, is represented in the media by the lobbyist and campaign consultant, George Arzt. Mr. Arzt is a controversial figure in New York politics, because, over the last several years, he has made over $90,000 in campaign contributions to various politicians, knowing that money is the corrupt grease the spins the squeaky wheels of government.
Recently, Extell won approval from the city's Department of Housing Preservation and Development to segregate tenants of affordable housing units to through separate entrances of apartment buildings. The separate entrances approved for low- and moderate-income tenants is colloquially referred to as the "poor door." How could the de Blasio-Mark-Viverito administration, one which likes to advertise its "progressive" aspirations, approve such a regressive and discriminatory practise ? It all comes down to the influence that large campaign contributions by donors, like Extell, and the corrupting influence of lobbyists, such as Mr. Arzt, exert over the political process. Since Gov. Cuomo is owned by Extell, the Democratic governor is in no position to check the de Blasio-Mark-Viverito's new "poor door" policy, effectively leaving unchallenged Extell's discriminatory new entrance policy. The announcement of Extell's controversial new policy came as Mayor de Blasio was departing for a 10-day vacation that includes stops along the Italian Riviera. Real estate developers get exactly what they want.
Left unchecked, the broken political system that allows even corruption-fighting investigation panels, like the Moreland Commission and JCOPE, to become corrupted, works to further undermine the public's faith in the democratic process and in the judicial system. Who will volunteer to serve on future Moreland Commissions if high-ranking state officials can obstruct the commissioners' independent investigations ? Ms. Perry, the Moreland Commission's former chief of investigations, fought back against the meddling by the Cuomo administration. Now, Ms. Perry, as well as other Moreland Commission members, such as Kathleen Rice and William Fitzpatrick, may very well have to account for their actions before federal prosecutors, a task that will no doubt clear the names of some, based on the reporting of the Cuomo administration's serial acts of obstruction. However, this is an undue burden that should not have to accompany public service, and it will act to deter future public servants from coming forward to accept similar government appointments.
Also left unexamined is why Gov. Cuomo chose the vehicle of a Moreland Commission to conduct his investigation into corruption in Albany. Why a Moreland Commission, and why not task the state's attorney general's office with this task ?
Again, the public is left in the dark about the political machinations that touch upon the state's judicial system. The state attorney general, Eric Schneiderman, holds an elected office. To run for office, Mr. Schneiderman seeks the endorsement of the same corrupt political operatives that are responsible for enabling government and campaign corruption. Mr. Schneiderman seeks endorsements from the county chairs of the Democratic Party, political clubs, and other politically-active nonprofit groups. Mr. Schneiderman relies up campaign consultants and political lobbyists for electioneering work, and Mr. Schneiderman must raise campaign contributions to fund an expensive state-wide election campaign. Two readily-identifiable limited liability companies related to the real estate developer Tishman Speyer bundled at least $70,000 in campaign contributions to Mr. Schniederman's 2014 campaign committee. Rob Speyer is Co-Chief Executive Officer of Tishman Speyer, and he also serves as Chairman of REBNY. Anytime an office holder must rely upon contributions to a campaign committee, that generally opens the door to that elected official being potentially owned by his or her campaign contributors or other political operatives. Indeed, as the political scandal of the demise of the Moreland Commission has befallen upon the Cuomo administration, Mr. Schneiderman, who himself appointed some of the commissioners, has made the politically-calculated move to remain silent, to the detriment of voters' interests.
The same criticisms apply to the various local district attorneys around New York State. Any of these local district attorneys could have opened up investigations into the various examples of government or campaign corruption across New York state, but the district attorneys don't, for the very same reasons that the state's attorney general is conflicted about investigating and prosecuting cases of government or campaign corruption : cases consisting of violations of local or state law that involve the potential for the prosecution of significant political or government individuals pose special problems for local and state prosecutors, precisely because local and state prosecutors belong to the same corrupt political system that breeds government and campaign corruption, leaving only federal prosecutors relatively independent enough to mount such investigations and to bring such cases, if warranted. Given how the Obama administration has politicized the Department of Justice, government reform activists and political bloggers are gambling that Preet Bharara, the U.S. Attorney for New York's Southern District, has the fortitude to see through a massive investigation into government and campaign corruption that could potentially yield a once-in-a-century renewal in government integrity.
The false choice proposed by The New York Times
On the day the lengthy report was published in The New York Times, the media worked itself into a stampede, hopping on the bandwagon to report about the Cuomo administration's apparent obstruction of justice in the proceedings of the Moreland Commission. The day after, the editorial board of The New York Times published an editorial, presenting voters with a choice : keeping their elected representatives in office, or voting them out.
This is a false choice.
Voters don't just have a choice to vote out corrupt elected officials. They also have a choice to demand an overhaul of this broken political system. The continued short-sightedness by The New York Times points to how voters are not fully informed about the true depths of corruption in government.
In last year's mayoral election, the voter backlash against the perceptions of community betrayal and public corruption during the 15 years of former Speaker Quinn's political career became co-opted by a Super PAC, NYC Is Not For Sale. The voter backlash and the Super PAC's co-opting measures played out for the public and the media to see. However, the media was limited in its ability to fully scrutinize the behind-the-scenese political activities and finances of the Super PAC, which were apparently being coordinated with official campaign committees and which involved controversial sources of funding and the sharing of other resources that cast questions about impropriety and possible illegality over the activities of the Super PAC. But these questions were largely raised after it was too late -- either after Mayor de Blasio had taken the lead in opinion polls or after he had won the Democratic mayoral primary. The deliberate lack of media scrutiny of Mayor de Blasio's campaign resulted in voters getting another neoliberal hack Democrat for mayor, who espouses the racist broken windows theory of policing and whose administration approves separate-but-equal poor doors for residents of affordable housing units.
Similarly, just voting Gov. Cuomo out of office based on voter backlash to his record of corruption and neoliberalism isn't enough. Voters must elect a change agent outside of the corrupt two-party system. Leftists need to leave the Democratic Party. As advocated by this blog, voters are encouraged to look at the record of Green Party gubernatorial candidate Howie Hawkins. Mr. Hawkins' campaign platform calls for ideas that would overhaul the broken political system by ending opportunities for corruption. His proposals for reform include a Clean Money bill that would fund full public campaign financing, meaning, a ban would have to be instituted on all private campaign donations. This radical step is the only way to cut out the undue influence of Mr. Spinola, REBNY, 501(c)(4) charity groups like the CSNY and the mayor's corrupt Campaign for One New York, Ms. Wylde, the PFNYC, Extell, Rudin Management Company, and other big money campaign contributors that enable corrupt politicians, like Gov. Cuomo, therefore keeping the political system broken and corruptible to big money donors. Even in the face of one week's worth of intense media scrutiny and even a possible federal investigation, big money real estate interests have cavalierly denounced any intention to stop funding big money donations to politicians, like Mr. Cuomo. REBNY is unapologetic for apparently fixing the legislative outcomes based on their large campaign contributions.
While you check out Mr. Hawkins' platform, look up other issues you care about. You might find his untethered approach to overhauling the corrupt political system refreshing. If Mr. Hawkins campaign is not for you, then please support a campaign with idea that match his for boldness.
Voters have more options than just voting Gov. Cuomo out of office.