Mr. Clean

by hilzoy

From the NYT:

"Donald R. Diamond, a wealthy Arizona real estate developer, was racing to snap up a stretch of virgin California coast freed by the closing of an Army base a decade ago when he turned to an old friend, Senator John McCain.

When Mr. Diamond wanted to buy land at the base, Fort Ord, Mr. McCain assigned an aide who set up a meeting at the Pentagon and later stepped in again to help speed up the sale, according to people involved and a deposition Mr. Diamond gave for a related lawsuit. When he appealed to a nearby city for the right to develop other property at the former base, Mr. Diamond submitted Mr. McCain’s endorsement as “a close personal friend.”

Writing to officials in the city, Seaside, Calif., the senator said, “You will find him as honorable and committed as I have.”

Courting local officials and potential partners, Mr. Diamond’s team promised that he could “help get through some of the red tape in dealing with the Department of the Army” because Mr. Diamond “has been very active with Senator McCain,” a partner said in a deposition. (...)

Mr. Diamond finally bought the land for $250,000 in 1999. He obtained an unusual guarantee from the Army that provided a generous water allowance outside the standard allocation process — a bonus that continues to rankle municipal officials on the dry Monterey Peninsula.

“Those guys got a sweetheart deal,” said Michael Keenan, whose family bought the housing complex from Mr. Diamond for nearly $30 million two years later. Mr. Diamond acknowledged turning a profit of $20 million."

Could this have anything to do with the fact that Diamond is a "longtime political patron" of McCain (e.g., he has raised over 250,000 for McCain's Presidential campaign), and "unabashedly solicits support for his business interests from the recipients of his campaign contributions"? Not according to McCain's spokesperson:

"A spokeswoman for Mr. McCain, Jill Hazelbaker, said the senator, now the presumptive Republican presidential nominee, “had done nothing for Mr. Diamond that he would not do for any other Arizona citizen.”"

Quick: move to Arizona!

Comments

[Ugh]

WTF? Hasn't the Pentagon ever heard of this peculiar thing called an "auction"?

Really, just WTF? I suppose being on McCain's good side is worth more in terms of getting the funding the Pentagon wants than whatever $X million they would have gotten from selling this land at market prices, but this kind of bullsh!t giveaway happens way too often, at both the national, state and local levels.

[cleek]

here, let me save the trolls some effort:

Rezko!Rezko!Rezko!

[Jesurgislac]

Hey, I have a friend who lives in Arizona. I'll let her know that John McCain will be happy to help her get sweetheart deals from the Pentagon, even though she is not only not a Republican donor, she's not even a Republican voter.

[OCSteve]

Having spent time at Ft. Ord in the early 80’s, I can say that there was some premo coastline property that would have made any real estate developer drool. However, most of the base was not somewhere you’d want to put in a development. And Seaside was not a great town. In fact it was a pretty crappy town way back then (drugs, crime, etc.) and I assume it only got worse. A lot of the base was impact area (potential unexploded munitions) and it’s also a highly contaminated Superfund site.

Still, even considering all that, there is no way I can imagine anyone getting any significant portion of that virgin coastline plus special consideration on the water issue for only $250k, even at 1999 prices.

[Slartibartfast]

Dunno about California coastline prices, but here where I live you can't even get a lakefront lot, period, for under a half mill. Unless it's one of the more scurvy lakes.

Stipulating that there's some extremely shady dealings going on here, I'm still left wondering exactly what Diamond got for his $250k. The implication is that it was the housing development, but he'd already bought that before McCain entered the picture.

So far as we know, anyway. I'm not sure that it matters, though; the taxes on any regardable chunk of land would come to that much.

And...REZKO!!!!1!

To make cleek happy, ennyway.

[The Modesto Kid]

Kind of interesting that McCain would endorse "any other Arizona citizen" as "a close personal friend". He gets around I guess.

[KCinDC]

Hilzoy, how could you leave out this bit?

Mr. Diamond, for his part, said Mr. McCain had only done his job. “I think that is what Congress people are supposed to do for constituents,” he said. “When you have a big, significant businessman like myself, why wouldn’t you want to help move things along? What else would they do? They waste so much time with legislation.”

[hilzoy]

KCinDC: I plead jetlag. I figure I only have a few more days to use this excuse, so why not get all the mileage I can from it?

Seriously, I can't believe I didn't put that in.

[DSA]

'Extra power wipes disinfectant' 'dispense like a tissue, but clean like a towel!!!'

[Dan Miller]

Hilzoy, get some rest! You also missed the following gem (no pun intended) from Mr. Diamond:

Mr. Diamond is close to most of Arizona's Congressional delegation and is candid about his expectations as a fund-raiser. "I want my money back, for Christ's sake. Do you know how many cocktail parties I have to go to?"

[Charles Bird]

The land swaps are much ado about nothing. They had broad political, business and environmental support (cite), including from the likes of the Sierra Club and the Wilderness Society. Regarding the letter to the City of Seaside, Captain Ed excerpted the following paragraph, which does not appear in the NYT truncated image:

Let me state at the outset that I desire no action to be taken on this matter which would be inconsistent with existing rules, regulations, and ethical guidelines, or that could possibly be construed as unfair or inappropriate. Nor do I expect preferential treatment for any single interest. I expect only such action which is in the best interests of the country.

It would have been nice to see the letter in its entirety. Rutenberg seems to have it out for McCain, judging by this and his previous expose, that 7,500-word piece of damn-little on Isemangate.

[Gary Farber]

Charles:

Regarding the letter to the City of Seaside, Captain Ed excerpted the following paragraph, which does not appear in the NYT truncated image:

Let me state at the outset that I desire no action to be taken on this matter which would be inconsistent with existing rules, regulations, and ethical guidelines, or that could possibly be construed as unfair or inappropriate. Nor do I expect preferential treatment for any single interest. I expect only such action which is in the best interests of the country.

Nice to see you, Charles; you should come by far more often.

However, the point of this excerpt escapes me: is it that since McCain said, for the record, that he intends nothing unethical, that that clears up the matter? Or what?

And I'm inclear that if corruption, or excessive favor, is implied, that the notion that it might be environmentally clean corruption ("They had broad political, business and environmental support (cite), including from the likes of the Sierra Club and the Wilderness Society") would be relevant: how would that work, exactly? What relevance would the endorsement of the Wilderness Society and the Sierra Club have to whether McCain engaged in corrupt or unethical behavior, exactly?

[OCSteve]

Charles Bird: It would have been nice to see the letter in its entirety.

I agree – the NYT, who would a thunk it? I agree with most of what Ed said (especially the part about starting with Reid if you want to investigate Senators and land deals), and with Tom Maguire:

Secondly, it is absurd to think that McCain and his developer buddy pulled a fast one - the closing and redevelopment of Fort Ord got Presidential attention, was subject to Senate legislation, and had a member of the California Congressional delegation overseeing it. In addition, the Fort Ord Reuse Authority won a planning award in 1998, so they weren't utterly stupid and corrupt, at least that year.

I won’t try to get Tom’s links through the spam-n-ator here - you can find them over there. See especially the Fort Ord Reuse Authority site and the link on the affordable housing squabble. It reinforces some of what I recalled this morning on the problems a developer would face there (highly contaminated Superfund site, unexploded munitions).

That $250k sale price with special water rights still smells – but I think now there is less there there than on first reading the NYT article.

[OCSteve]

One lousy link and I’m caught in the spam filter. How is it that some folks still manage to post 3-4 links in a comment? If anyone wants to release it – I was agreeing with Charles (and Ed and Tom McGuire) after more reading…

[Nell]

I have nothing to add about the Ft. Ord issue, only a point about journalism in the 21st century:

This is not the only case in which the NY Times has failed to offer its readers a link to the source documents; Josh Marshall complained about it in some other story in the recent past.

That's getting to be more and more irritating; the internet is here to stay, and real journalism involves providing source documents when a story relies on them. Period.

[Charles Bird]

...is it that since McCain said, for the record, that he intends nothing unethical, that that clears up the matter? Or what?

Well, I'm not sure what would clear the matter up for you, Gary, but McCain wrote a letter that said nice things about Diamond, and then McCain expressly stated that he expected the city to take whatever actions they deemed in the best interests of the country, and McCain expressly stated that he expected no preferential treatment for any single interest.

And I'm inclear that if corruption, or excessive favor, is implied, that the notion that it might be environmentally clean corruption...

I don't know what you mean by that, Gary, because I don't see where McCain behaved corruptly, and the NYT didn't raise the barest whisper that McCain personally profited from these ventures, unlike some (Harry) politicians (Reid). The land swap was a win-win situation for all concerned parties, and business and environmental groups were on the same side for a change. The public was in favor because it expanded a natural forest at no cost and the tax base increased because of the guy's development.

I've worked peripherally on some land swap deals up here in WA State. For some long-ago arcane reason, Weyerhaeuser and other timber companies owned alternating sections of land, with the state owning the other sections. On a map, the ownerships looked like a checkerboard. The parties involved wanted land swaps, and environmental groups were in favor of them because contiguous state ownership was better for wildlife and ecosystems, and timber companies could more easily do what they do.

Whether Diamond got a "steal" from these purchases, I can't tell from the article. One side says X and the other Y. These kinds of deals can be incredibly complex, especially for a place like Fort Ord. I just did a consulting assignment for a California based developer who wants to purchase 185 acres of riverfront property in a city near here. On the face of it, the price looks low, but there was a landfill on 45 acres, a sawmill on another 45 acres, and another sawmill on another ten acres. The soils have poor load-bearing capacity, there are wetlands all over the place, there are stormwater detention issues because of the location along the river, railroad tracks need to be re-routed, the city had to finish an overpass and make certain other infrastructure commitments, the state is working on widening the freeway and re-doing all the interchanges, the property needs major road and utility extensions, and the list goes on. The city doesn't want the property because they don't have the expertise, and the only kinds of buyers for these projects are the big ones who can handle the risk and long development timeframes (around a decade for this project), as well as the capital to finance it. A similar deal is being done in Tacoma at an old Asarco smelter site.

[dr ngo]

I have no opinion whatsoever about this particular deal, but I am strongly of the belief that the paragraph quoted by CB (as omitted by the NYT) is "ethical boilerplate" and has no evidentiary value at all.

"I expect only such action which is in the best interests of the country." Of what corrupt action - in the USA, not in more openly cynical (less overtly hypocritical) societies - could this not have been said?

And probably was said, by some crook, in most cases. As well as by honest people in others. Ethical boilerplate, folks.

Nothing to see here. Move along.