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Frank McCourt's sleight-of-hand
At last, someone takes a closer look at how the Dodgers owner has been able to bankroll his business operations and over-the-top lifestyle. Basically, he borrowed, then leveraged, then borrowed some more. The LA Weekly's Gene Maddaus sums it up this way: "For a very successful real estate developer, he has actually developed very little." Examples abound of McCourt's sleight-of-hand, going back to the 1970s with Boston real estate developer Jim Craig.
"The two fought over a piece of land that would become the cornerstone of McCourt's real estate empire, and the collateral for his purchase of the Dodgers. Their parting was not amicable. 'It's one of those sad cases,' Craig told the Weekly recently. 'You have people who are that ambitious and have the brains. It's just too bad they don't have the scruples to go along with it.' Craig went on to earn a degree in education when he was 65 and finished his career as a teacher in the Boston public schools. He is now 85, and has been legally blind for the last 15 years. One of the last times Craig saw McCourt was in a men's room, nearly 30 years ago. As they stood side by side at the urinals, Craig said, 'Frank, I really would never contemplate doing any business with you ever again.'"
Which city is wealthier: NY or L.A.?
Sorry, local boosters, it's NY by a mile. The New York metropolitan area had 667,200 people holding $1 million or more in investment assets in 2009. That tops any metro area in the country, and it's a 19 percent increase from a year earlier, according to the consulting firm Capgemini. The L.A. metro area placed second, with 235,800 millionaires, up 13.3 percent. After L.A. comes Chicago, Washington, and SF. While all cities in the top 10 showed percentage increases from 2008, they were all down from 2007, before the recession started to be felt. Houston had the highest growth among the top 10, Detroit had the lowest, with L.A. the next-lowest.
Of course, numbers like these can be sliced and diced in all sorts of ways. The Capgemini report looked at MSAs, or Metropolitan Statistical Areas. Locally, that includes much of L.A. and OC counties, but if you're looking at just counties, the results are likely to be different. Another consulting firm did a wealth survey a couple of years ago that found L.A. County to have more millionaires than any other county in the nation. So there. Suffice it to say that there are plenty of millionaires in both locales. Anywhere, here are the top 10 MSAs:
1) New York
2) Los Angeles
4) Washington D.C.
5) San Francisco
10) San Jose
Making sense of the LAX concessions mess
The L.A. Weekly correctly calls it a "food fight," the battle for the hugely lucrative airport concession business. HMS Host has had most of that business since 1965, but its main competition, SSP America, was selected by the airport staff following a lengthy review. Host, which wound up dead last in the scoring, promptly protested the decision, saying that Los Angeles World Airports, the operating arm for LAX, wasn't playing by the rules because its people favored SSP.
Normally, the Airport Commission would have the final say, but because the board's president, Alan Rothenberg, has a connection to Host (he's on the board of California Pizza Kitchen, which is part of Host's bid), it's the City Council that will make the decision. And that's led to the predictable lobbying, with Council member Janice Hahn receiving $40,000 from the concession companies during her failed campaign for lieutenant governor, according to the Weekly.
I haven't the first clue which side would do a better job. SSP seems to have a more interesting selection of restaurateurs - Nancy Silverton, Joachim Splichal, and Susan Feniger and Mary Sue Milliken, among others - but Host claims that SSP's offerings will be too expensive for the traveling public. It has also insinuated that SSP's parent company is in financial trouble. (British-based SSP is privately held, so I'm not sure where they're getting their information from.) There's a lot at stake for the concession companies - something like $600 million - but I'm not sure it's that big a deal for everyone else. Passengers talk about wanting to have a better selection at the airport - that is, fewer greasy fast-food joints - but there's a reason why McDonald's and the others make so much money: Lots of people like that gunk, including those waiting for planes.
The real shame is that the City Council has been brought into the picture. The council, after all, does very few things well these days - and determining a bid of this size and complexity would appear to be well above its pay grade. The worst case scenario would be to acquiesce to Host's objections and force the airport to rebid the contract. That would mean delays of months, perhaps years. So I guess my vote is for SSP. Get some fresh blood into the operations, and maybe things will improve.
SoCal is part of Top Secret America
"The top-secret world the government created in response to the terrorist attacks of Sept. 11, 2001, has become so large, so unwieldy and so secretive that no one knows how much money it costs, how many people it employs, how many programs exist within it or exactly how many agencies do the same work."
There's a lot to sort through, but the most interesting part of the report is a database that lays out the 1,271 government organizations and 1,931 private companies that do work related to counterterrorism, homeland security, and intelligence. In the L.A. area, there are 169 company locations and 64 government locations. Many of the companies I found have Web sites, but good luck figuring out what any of them do for the government. As for the government locations, most appear to be connected with the Department of Defense, Department of Homeland Security, and FBI.
How to decipher jobless numbers
The headline number is bad: L.A. County lost 15,000 payroll jobs between May and June, with education and government taking especially big hits. Statewide, 27,600 jobs were lost. But the story is not quite so bleak. Much of the job loss last month came from the phasing out of Census workers. Take Census out of the picture and the state would have reported an overall increase in the number of payroll jobs.
Some of the gains might come as a surprise – manufacturing picked up 7,300 jobs, probably reflecting the production of goods that are being shipped overseas. Also adding jobs was the trade and transportation sector, which makes sense because traffic out of the ports of Los Angeles and Long Beach were up substantially in June. So that’s a positive. The leisure and hospitality sector added 3,400 positions (summer hiring), and movie and television production saw an increase of 2,000 jobs (22,000 jobs over the past year).