Sweetheart Capitalism: Daley Nephew And Obama Pal Squander $68 Mill In City Worker Pension Money
Crony capitalism isn't free market capitalism; it's wink-wink capitalism, where "some animals are more equal than others." These are the politically connected animals -- those connected to exactly the right people to position them under where the money comes out.
Tim Novak writes in the Chi Sun Times about two politically connected real estate speculators who took big risks with other people's pension money:
A real estate venture created by President Barack Obama's onetime boss and a nephew of former Mayor Richard M. Daley squandered $68 million it was given to invest on behalf of pension plans for Chicago teachers, cops, city employees and transit workers, a Chicago Sun-Times investigation has found.The five public pension funds haven't made a dime on the investments they made nearly a decade ago with DV Urban Realty Partners, a company created by Obama's ex-boss Allison S. Davis and Daley nephew Robert G. Vanecko, records show.
In fact, the financially troubled pension plans have lost most of the money they gave DV Urban, which used the money to invest in risky real estate deals, primarily in neglected neighborhoods.
It invested in eight real estate deals that, for the most part, had gone belly up by Dec. 31, 2015, when the investment deals with the Chicago pension plans expired.
Though the pension funds lost out, DV Urban and its affiliated companies got about $9 million of the pension money for management fees. And they were in line for more until pension officials, facing losses, got a court order in 2012 to remove Davis and Vanecko from managing the retirement investments.
Yes, they had to pry them off that money spigot.
File this, too, under, "Obama Unaware".
Radwaste at March 2, 2016 12:36 PM
Corruption? In Chicago? Somebody alert the media!
Gee, risky investments in neglected neighborhoods didn't make any money. What are the odds?
But the pension fund managers can feel good because they invested in "neglected" neighborhoods.
The pensioners have no money to buy food or heating oil, but they invested in "neglected" neighborhoods, so they can sleep soundly on those cold nights in apartments warmed by the good intentions of the government fund managers (who are sleeping in apartments warmed by heating oil purchased with the money they made managing the now-broke pension funds).
Conan the Grammarian at March 2, 2016 1:48 PM
The corrupt always assume that society will absorb their corruption without notice. "It's only a little bit from any one person. It won't make any difference to anyone." (Which is, interestingly, the same rationalization used for a lot of tax increases.) But this is only true in a robust economy. The combination of the way that corruption tends to expand without limit ("why should I work for a living when corruption is easier and more lucrative?"), and the economic policies that the corrupt push in order to enable more corruption, always winds up killing the proverbial goose.
Of course, nowdays, once the inevitable economic collapse occurs, the corrupt pivot seamlessly to "victim" status, and keep on doing what they're doing. If they've killed their own goose, well, there's always someone else's.
Cousin Dave at March 2, 2016 4:24 PM
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