August 13, 2014
Source: Shutterstock
Back then there was a lot of union pension fund money available. Most notoriously, there was the Teamsters” stash, run for years by Jimmy Hoffa, although he was stepping back a little from active management due to being on trial or in jail most of the time. The Teamsters liked investing in upscale Southern California golf courses: La Costa resort north of San Diego, where the PGA long played its Tournament of Champions, has an interesting history.
So, the Teamsters secretly loaned millions to the developers of the Beverly Hills CC.
But the Teamsters weren”t just arm’s-length investors. They liked to get involved in projects where there was an angle, such as the whole project being dirty from the get-go, with people with names like Ice Pick Willie involved behind the scenes.
In the 1970s another hiker explained to us what had happened to the forlorn wasteland. First, Beverly Hills homeowners had organized against the city’s attempts to condemn the property they needed for the club’s access road. The residents had raised the argument of “ecology,” or, as others would deride it, “not in my backyard.”
These were new concepts in the late 1960s. Before then, people just accepted anything involving bulldozers as being good for the economy. For folks who remembered the Depression, “good for the economy” was powerful persuasion.
But by the end of the 1960s, the economy was already good, especially in Beverly Hills. Thus, California, which had been wide-open to development during the governorship of Pat Brown (1959-1967) became the hardest place to build during the terms of his son Jerry Brown (1975-1983 and 2011-?).
But the real problem with the Beverly Hills CC, the hiker informed us, was that all the crooks behind the scenes were skimming so much that it had run out of money to pay off the nascent environmentalists. The organizers couldn”t get loans from legitimate financiers to finish construction because they kept getting arrested for inauspicious scams like drilling spyholes in the ceiling of the Friars Club to cheat Zeppo Marx at cards.
The bulk of the population of Southern California had come from law-abiding northern Midwest states such as Iowa, or from the cotton states of the South, where the crime tended to be disorganized. The Italian-Americans who moved to L.A. were generally looking to get away from the kind of neighborhood life that looks less dreary in a Martin Scorsese movie than in reality.
But the vast exodus to Los Angeles of Chicago and New York Jews brought along some of the consigliere caste from those cities” underworlds. Bugsy Siegel, who was rubbed out in Hollywood in 1947, and his protégé Mickey Cohen represented the cruder side of the rackets in L.A., while Sidney Korshak, a Chicago Outfit lawyer who knew everyone and was never even indicted because he never wrote anything down, was the nearly invisible epitome of the high end.
Hollywood Hills real estate seemed like the ideal opportunity to legitimize dubious dough. But it was hard to drop the old ways.
Thus, the financing of the Beverly Hills Country Club was mobbed up from the first property purchase, in which Irving Davidson, lobbyist for the Batista, Trujillo, and Somoza regimes in the Caribbean and for capo Carlos Marcello in New Orleans, was deeply involved. (Michael Gross’s book Unreal Estate: Money, Ambition, and the Lust for Land in Los Angeles explains the machinations.) When the insiders” cash ran down, Martin bailed out of the project, and Jones came to look back upon it as the most painful might-have-been of his career.
The big pile of dirt sat unused for many years as the Teamsters took it away from Davidson and the other founders and gave it to their pal Allen Glick of Las Vegas. A character based on him was played by Kevin Pollack in Scorsese’s Casino, so you know that didn”t turn out well.
How much has changed since then?
A lot. For example, rich people don”t need union pension funds to play golf.
Yet perhaps one change is much like what’s happened to the illegal drug business over the last few decades. Instead of criminals inventing new drugs, respectable pharmaceutical companies now market legal drugs that do much the same thing if you can find a doctor to write you a prescription (which you probably can). So it’s okay.
Similarly, leftist historian Rick Perlstein pointed out in The Nation that the tax avoidance strategies of President Obama’s mentor and commerce secretary, Penny Pritzker, are quite similar to the ones that once got her Chicago ancestors (friends of Korshak and Hoffa) in trouble with the Feds.
But now the Chicagoans are the Feds.
So it’s okay.
