Monday, December 14, 2015

WSJ's Absurd Attack on @RealDonaldTrump

I consider Donald Trump a very dangerous presidential candidate. He strikes me as the type that as president could put in place all kinds of totalitarian measures and have an enthusiastic group of supporters.

That said, the latest attack on Trump is absolutely absurd.

WSJ in a lead editorial titled, Trump and the Goodfellas, lashes out at Trump for, get this, buying cement from firms controlled by the Mafia. As if there were cement companies in NYC in the 1980s that weren't controlled by the Mafia.

Writes WSJ:
Donald Trump says he’ll succeed as President because he has succeeded in business, so it’s appropriate to scour his business record. One area in particular that deserves scrutiny is his business relationship with companies controlled by the Mafia.

The reporting on this has so far been scanty, and we have no new revelations. But Mr. Trump was active in construction in the 1980s, when federal racketeering cases highlighted the influence that a “club” of mobsters exerted over large construction projects in New York City. In one 1988 trial, Anthony “Fat Tony” Salerno, boss of the Genovese crime family, was among those convicted in a scheme to control and profit from the concrete contracts for numerous buildings in Manhattan, including Trump Plaza....

Mr. Trump has never been accused of a crime, and his see-no-evil, he-had-no-choice explanation worked for him as a businessman. The question is whether this is adequate for someone who wants to be President.

The question is especially apt for GOP primary voters because Democrats would surely raise it in the general election. Mitt Romney lost in 2012 in part because Democrats trashed his stellar business record in private equity. Better to vet Mr. Trump’s business record now than next October.
Is WSJ really serious? Here is what FORTUNE Magazine wrote in 1988:
 A CONCRETE-POURING job like Manhattan's new $486 million Jacob K. Javits Convention Center, completed two years ago, should have drawn a flock of bids. Not in New York City. Only two came in for the mammoth structure designed by I. M. Pei. Thecontract was awarded to S&A Concrete Co., a concern partly owned by Anthony Salerno, first among the nation's organized crime bosses, who is now serving a 100-year prison sentence for being part of the Mafia's ruling Commission. S&A thought the job could be done for a shade over $30 million. The only other bid was a suspiciously high $41 million. A Connecticut contractor spent three months working up a bid that would have been under S&A's, then dropped out at the last minute after a visit and a couple of phone calls from a Salerno lackey. Says Thomas Galvin, former chief executive of the convention center and now president of Xerox Realty Corp.: ''It was an open secret that concrete was Mafia-controlled.''...

NEW YORK CITY'S maze of statutes and byzantine building codes makes the construction industry highly susceptible to Mafia infiltration. Tortuous permit requirements for demolition, excavation, hoisting, and other on-site operations, as well as the endless approvals needed from myriad municipal departments such as the Department of Buildings, City Planning Commission, Department of Environmental Protection, Department of Transportation, Fire Department, and Landmark Preservation Commission, plague the whole construction process with seemingly infinite bureaucratic obstacles. A racketeer with control over suppliers, union officials, and city inspectors can vastly improve the speed and efficiency with which buildings rise in Manhattan....

.So great were the anticipated spoils that three other organized crime families -- the Gambinos, Colombos, and Luccheses -- horned in on Salerno. The result was a cartel secretly manipulated by the four Mafia families. Two Mafia-controlled firms producing ready-mix -- Transit-Mix Concrete Corp. and Certified Concrete Co. -- were part of it too, plus a half dozen participating contractors, who did not make but simply sold and poured the concrete.
What was Trump supposed to do, buy a wheelbarrow and pour cement himself?  It wasn't like Trump was working with the mob to shake down people. The guy was building buildings and needed cement.

It's what all NYC builders had to deal with. FORTUNE again:
John L. Tishman, 62, chairman of the 90-year-old Tishman Realty & Construction Co., which has built some 75 Manhattan skyscrapers, also denies knowledge of contractor complicity but concedes that ''there are some abuses in labor.'' Does Tishman mean the Teamsters, notorious for mob connections? Tishman, who is a student of psychic phenomena, glares at his questioner and snaps, ''Look, you said Teamsters. I didn't. I may believe in the afterlife, but I want to stay here awhile.'' The Goldstock report reveals that Harry Gross, a Teamster racketeer, and Philip Doran, a Teamster business agent convicted of attempted grand larceny and bribe-taking, were on Tishman's payroll up to 1985. The company says the two men were assigned to their jobs by the union. Tishman believes, as do others in his business, that the biggest impediment to building in New York is not corruption but the exasperating logistics. He has a point, but the problems also encourage the proliferation of fixers. Narrow city streets do not provide much storage space for building materials, so steel beams, concrete, brick, and glass must be trucked to the job on a precise schedule geared to when they will be used. Construction sites in New York are enclosed by wooden fences, and Teamster foremen are posted at the gates to check the union membership of all drivers delivering materials. These foremen can withhold labor and disrupt deliveries. That power gives mob-run unions a lot of leverage over an industry that employs 100,000 workers in New York City alone.
It seems like more than anything, the Mafia was able to cut through bureaucratic red tape that made it difficult for builders to build---and they managed to get the workers to work without dragging out jobs. As Trump told WSJ:
We asked Mr. Trump about these ties on his recent visit to the Journal, and his answers are worth hearing at length. Mr. Trump recalled that in Manhattan there were perhaps three concrete companies and “virtually every building that was built was built with these companies.” He added that “a lot—all of these people—were somehow associated, according to what I read, I don’t know it for a fact.”

Since the Mafia is in the business of stealing, we figured Mr. Trump would be angry that he had to build a “mob tax” into the cost of his projects. But he seemed to be a satisfied customer.

In his stream-of-consciousness way, Mr. Trump described the concrete companies of that era: “You know, Wall Street Journal didn’t write about these guys but these guys were excellent contractors. They were phenomenal. They could do three floors a week in concrete. Nobody else in the world could do three floors a week. I mean they were unbelievable. Trump Tower, other buildings. They would do literally—and you’d say how can you do three? They’d set it, pour it; before the concrete was even dry, they would be putting forms on the floor working off the steel beams, okay?”

Notice the absurd linkage to stealing, Trump was building a damn building, not involved in any stealing.

The only revelation in this WSJ article is how bad the establishment wants to get Trump, so much so that they bring up this "connection" between Trump and the Mafia.



  1. Anyone who's ever purchased trash service from New York region all the way over to Chicago, and finally Las Vegas has "connections with the Mafia" by the WSJ's metrics.

    Heck, if you've ever spent any time in Vegas the odds are 90% likely that some of your money went to old Mafia operations that were "legit".


  2. Someone should send the WSJ the clip from the Rodney Dangerfield film "Back to School" where his character takes on the economics professor for not understanding the realities of construction.

    Thornton Melon: Oh, you left out a bunch of stuff.
    Dr. Phillip Barbay: Oh really? Like what for instance?
    Thornton Melon: First of all you're going to have to grease the local politicians for the sudden zoning problems that always come up. Then there's the kickbacks to the carpenters, and if you plan on using any cement in this building I'm sure the teamsters would like to have a little chat with ya, and that'll cost ya. Oh and don't forget a little something for the building inspectors. Then there's long term costs such as waste disposal. I don't know if you're familiar with who runs that business but I assure you it's not the boyscouts.
    Dr. Phillip Barbay: That will be quite enough, Mr. Melon! Maybe bribes, kickbacks and Mafia payoffs are how YOU do business! But they are NOT part of the legitimate business world! And they are certainly not part of anything I am doing in this class. Do I make myself clear, Mr. Melon!

    1. I love "Back to School".

      You forgot the punch line to the whole exchange:

      Dr Phillip Barby: "The next question for us is where to build our factory?"

      Thornton Melon: "How 'bout fantasyland?"