I’ve written here previously about the smell of corruption arising from the cozy relationship between the Postmaster, the Richard Blum real estate octopus CBRE, and Sen. Feinstein, centering on the sale of historic US Post Office properties into private hands. Now comes investigative reporter Peter Byrne in a recent issue of the East Bay Express and nails it: He writes:
• CBRE appears to have repeatedly violated its contractual duty to sell postal properties at or above fair market values.
• CBRE has sold valuable postal properties to developers at prices that appear to have been steeply discounted from fair market values, resulting in the loss of tens of millions of dollars in public revenue.
• In a series of apparently non-arm’s-length transactions, CBRE negotiated the sale of postal properties all around the country to its own clients and business partners, including to one of its corporate owners, Goldman Sachs Group.
• CBRE has been paid commissions as high as 6 percent by the Postal Service for representing both the seller and the buyer in many of the negotiations, thereby raising serious questions as to whether CBRE was doing its best to obtain the highest price possible for the Postal Service.
• Senator Feinstein has lobbied the Postmaster General on behalf of a redevelopment project in which her husband’s company was involved.
Blum’s CBRE has already sold 52 pieces of Post Office real estate, and Byrne’s research found that the private buyers in the majority of cases paid substantially less than the assessed value of the properties. The assessed value in most instances is way below the fair market value, so private buyers are getting public property dirt cheap. Details are in Byrne’s article, which is part of an e-book, available here.
This scam has been Standard Operating Procedure in the worldwide privatization racket since before Margaret Thatcher. First, the public is taxed to pay private contractors, often at huge profits, to build the properties. Then, when the political climate is right — and, Obama notwithstanding, it is right now — these public assets are sold off for dimes on the dollar (or, in the case of the former Soviet Union, just given away) to well-connected financial oligarchs. Like the increase in the wealth of the top one per cent and the corresponding pauperization of the middle class in recent decades, this dynamic has nothing to do with the operation of the free market, and everything to do with the tightening grip of rich bastards on the levers of government.
The game is happening all over the country, and one of its ground zero locations is right here in Berkeley. One hopes that the city fathers and mothers will vindicate Berkeley’s progressive reputation by standing up and saying: “The Fuck Stops Here.”