Pelosi's Presidio Plan: Plutocracy in "Environmentalist" Clothing

by Justin Raimondo

Republican candidate for Congress
8th Congressional District

I. Historical Overview: What is a "Trust"?

The Pelosi plan for the Presidio is embodied in the word she uses to describe the administrative entity that will take control of this valuable property: the new entity, described as a "public- private corporation," will be called the Presidio Trust.

The word "Trust," in this context, has an interesting political history: the "trusts," you will remember, were those mega-monopolies that dominated American economic and political life during the days of the robber barons. The Sugar Trust, the Iron Trust, the Oil Trust: these were the bogeymen of American progressive politics, rapacious animals whose hunger for profits had to be tamed by anti-trust legislation.

The trusts were the product of government--business collusion on a grand scale. Political machines controlled by the trusts seized control of government, cartellized the economy, and divided up the spoils. Protected, nurtured, and made possible by government intervention in the market, these great monopolies constituted an American plutocracy that not only jealously guarded its political and economic power, but never let an opportunity to expand it go untried.

The proposed legislation, supposedly transitioning the Presidio to the civilian economy, is but the latest example of this ceaseless search to expand the power and profits of an economic elite utilizing the power of the state to grant monopolistic licenses. In form, and in essence, Pelosi's Presidio Trust is a direct descendant of the monopolistic Trusts of yesteryear, a textbook case of State Capitalism in action, in which private profit and the ideology of the "Public Interest" meet and merge in such a way as to fatten the pocketbooks of the economic elite.

II. The Presidio Trust: A Model of State Capitalism

The Presidio Trust is being touted in Congress, not only by Pelosi but by some deluded Republicans, as a measure that will save the government money and offload the "burden" of such an incredibly valuable piece of real estate onto a "semi-private" group, a "private-public" corporate entity answerable to nothing and no one: not shareholders, not the voters, nor their elected representatives. While Rep. Nancy Pelosi insists that her plan has nothing to do with privatization, that is how it is being sold to Republicans on the Hill: as a way to slough off federal resources that generate no revenue.

But just what kind of a "privatization" is this when resources are simply handed over to the politically-connected, the already- wealthy, and the power-lunchers and power brokers that lunch at Le Central? What this phony "privatization" amounts to is nothing less than outright looting. What it resembles is nothing so much as the "privatization" campaign going on in the former Soviet Union, where yesterday's commissars are today's "entrepreneurs": yesterday they held the whip, today they hold the mortgage.

The Trust would be controlled by a seven-member Board, appointed by the President. Unaccountable to any public agency, required only to submit the most "general" annual reports to Congress, and "advised" by the Golden Gate National Recreation Area Advisory Commission, the Board will in effect be granted ownership of the most valuable real estate in the Bay Area. These seven people, political appointees all, will then be free to dispense the goodies to their friends and sycophants.

Among the goodies: aside from a choice location and protection from competition, these include federally-guaranteed loans for tenants who want to renovate old buildings or construct new ones.

This sets the stage for a veritable orgy of corruption in this City, especially with the inauguration of the new regime at City Hall, one which promises to give new style and meaning to the word graft. As they say, "it is no accident" that Pelosi and Mayor Brown are two of the biggest wheels propelling the Burton Machine forward in its never-ending quest for total power--and total patronage. With the recent elevation of Michael Yaki, Pelosi's aide-de-camp, to the Board of Supervisors, and the Brown-Pelosi alliance cemented, the potential uses of the Trust to build the power base of the local political bosses (in this case, Democrats), are all-too-obvious.

The great irony of this bold rip-off, this handout to the local Democratic Party bosses, is that it is being engineered and supported by a Republican-controlled Congress. Remember, however, that Willie Brown had no trouble manipulating an ostensibly Republican- controlled State Assembly: is it really all that much of a stretch to imagine that his reach extends into a Republican- controlled Congress he regularly denounces?

I would say to Newt Gingrich and the Republican congressional leadership: is this what the Republican Revolution is all about: another pay-off for Willie Brown and his many friends and associates, another source of mordida for a corrupt and self-consciously decadent political machine? The single greatest consequence of the Pelosi legislation, especially as amended by the Republicans, will directly and perhaps personally enrich the Burton Machine, its operatives, and its political and financial supporters.

Under the original Pelosi plan, the handing out of the mordida would have been a bit more discreet, and more political-ideological. The Trustees would have been chosen from the big nonprofits, who would doubtless have granted their co-thinkers and allies in the nonprofit community the choicest Presidio franchises. The Republican amendments transform what would have been a moderately lucrative source of political pay- offs into a veritable fount of potential corruption on a scale heretofore unimagined. For the GOP amendments have not only eliminated the provision that forbids Trustees from having any financial interest in tenants or properties, they also stipulate that the Trustees must possess knowledge of and experience in "city planning, real estate development, and resource conservation."

That is a very interesting juxtaposition of qualifications. A city planner, of course, is supposed to be a public servant, and resource conservationists are allegedly these public-spirited citizens who want to preserve nature for the enjoyment of all. But the real estate developer is not acting, or pretending to act, in the "public interest. "The real estate developer is an entrepreneur, whose business is not the public good, however that may come to be defined, but his or her own private profit. And that is how it should be. However, when real estate interests insinuate themselves into the administration of the Presidio, they will inevitably conflate their own financial interests with the public interest.

In this way, in the name of "environmentalism" and cost-cutting, a new monopoly is created, not by the robber barons of untrammeled capitalism, as the leftist myth asserts, but as the creation and creature of government. Under Pelosi's plan, 1,480 acres of prime San Francisco real estate are being handed over to private interests in the name of the "public interest." This is clear in the description of the Trust's mission, as stated in the legislation, which would be to "enhance the financial viability of the Presidio . . . maximize the amount of revenues to the federal government . . . and facilitate the cost-effective preservation of historic buildings."

This represents an uneasy compromise between handing out the goodies to the well-connected and simply selling them to the highest bidder. That these two groups are often the same simplifies the problem enormously. In the Presidio Trust, a federally-subsidized (The subsidy is the original transfer of the land from the federal government to the Presidio Trust) and monopolistic quasi-private entity is being set up by a Congress supposedly committed to free market economics: what is, in effect, a socialist enterprise, in the tradition of the TVA and other New Deal boondoggles, will be signed into law by a left-right coalition of Nancy Pelosi and Bill Clinton on one side and Newt Gingrich, and his fellow "revolutionaries" on the other.

Principled Republicans say: no! I would address my future colleagues in the House--especially the radical and principled freshmen class--and ask them to entertain another proposal, one rooted in Republican principles of budget cuts at the federal level, and a radical decentralization of power to the local level.

III. Decentralization and Privatization: Trust the People, not the Trust

What, then, is the alternative to Pelosi's giveaway of the Presidio? If we don't want to auction off pieces of the Presidio to private interests, if we want to preserve it for the people of San Francisco to enjoy for many generations to come, then how do we set it up so that we save the federal government tax dollars and still manage to enjoy an untouched (and untouchable) Presidio?

The answer is by applying the principles of the Republican Revolution, the central one of which is the devolution of power. Instead of giving the Presidio away and dumping it into the hands of a corporate/political elite accountable to nothing and no one, the Presidio must be returned to the people of San Francisco. Instead of being delivered to the tender mercies of an appointed Board of Trustees, the Presidio should be managed by an elected board of guardians, whose mandate is to manage this priceless natural resource in the interests of the local community. This board would be elected at large by the people of San Francisco every four years, in a nonpartisan election. Unlike the Pelosi Board of Trustees, which is only required to hold two public meetings a year, all meetings of this elected Board would be open to the public, and would be structured so as to allow for questions and comment from the public. This board would be accountable--not to some politician, or special interest, such as the real estate industry, but to the voters. That's the way we like to do things in America, and it is one aspect of the populist-progressive tradition that needs to be revived and strengthened.

The populist and progressive movements that arose at the turn of the century were a rebellion against the rule of the Trusts and the domination of American economic and political life by plutocrats, the J. P. Morgans and the Rockefeller interests, who had been plundering the country. Centered here, in California, and throughout the West and Midwest, the great populist rebellion forced major reforms, and introduced radical innovations in the structure of government, including popular referendums in which voters could directly decide the vital issues of the day. The movement against Pelosi's Presidio Trust, and for a locally- controlled -and-administered Presidio Park, is a continuation of that same California populist tradition.

The argument for denationalizing and decentralizing the administrative apparatus of the Presidio is firmly rooted not only in the populist-progressive tradition of democracy and accountability, but in modern conservative Republican principles, specifically the principle of decentralism. The Republican Congressional program, the "Contract With America," calls for bloc grants and state control, in the name of decentralizing decision-making and local experimentation. Why not decentralize and denationalize the administration of the Presidio by turning it over, lock, stock, and barrel, to the local community?

Pelosi's obsession with keeping the Presidio within the national park system has necessarily tied its fate to whatever is happening in Washington. With a Democratic majority firmly in the congressional saddle, or so she thought, it was safe to assume that the federal government would keep picking up the tab. The 1994 congressional elections dispelled this illusion rather quickly. The end result of Pelosi's doctrinaire adherence to the principle of federal control of the Presidio has been a disaster for preservationists. For the legislation creating the Trust, in its final form, stipulates that the business enterprise known as the Trust would have to be self-sufficient within 15 years, or the entire property would be turned over to the General Services Administration and sold to the highest bidder.

The lesson of this episode is that only the people of San Francisco can be trusted as the ultimate guardians of the Presidio. In the long run, the task of preserving the Presidio as open space is up to the people who live here. If we have to fight this battle in Washington, rather than here on our home turf, the odds are stacked against us. While real estate developers and big business interests could just as easily get their hooks into local politicians, and could theoretically launch a campaign to grab the Presidio by running their own slate of candidates for an elected Board, such a scheme is unlikely to be successful in this City. The chances of such a coup are far better if the battle is waged at the federal level.

There are many ways in which funding for the maintenance of the Presidio and its historic buildings could be raised, considering its popularity with the tourists. Costs could also be radically cut, depending on the model adopted by the democratically-elected Board. It is entirely possible that a no-growth Board could let the Presidio revert to a more informal, natural state, like a somewhat overgrown English garden. This would be far preferable to any development.

It is also conceivable that a small portion of the land could be sold or leased to the highest bidder in order to raise enough cash for maintenance at a higher level. While this option may upset environmentalist purists, at least it has the advantage of being fully under local control, with the long-term goal of preserving virtually all of the Presidio intact.

IV. Pelosi Can No Longer Deliver the Goods--But a Republican Can

In an article which sought to whitewash the essentially dubious nature of the Pelosi legislation, Amy Linn writes in the San Francisco Weekly that opponents of the Trust "are not likely to convince the Republican House and Senate to embrace a vision of the Presidio as a park/homeless shelter that is financed by the federal government." No, but a Republican congressman could convince them that the federal government should butt out, and that the power to make decisions about the way we live must devolve not only to the states but to the counties, in this case San Francisco country.

The fact of the matter is that Nancy Pelosi can no longer deliver the goods. What she has delivered, in the form of the Presidio Trust, is a disaster and a betrayal. The whole concept, even in its original form, is so fraught with the potential for private profiteering and cronyism that it is inconceivable that it was not created expressly for those purposes.

Contrary to the protestations of Pelosi supporters, there is a realistic alternative to the Presidio Trust: local self- management. Supplemented by the kind of ecological volunteerism possible only in San Francisco, and of course greatly enhanced by the much-touted "can-do" leadership of our new Mayor, the people of San Francisco can take back their land from the feds and guard its natural beauty as a monument to the wild, untrammeled spirit of the City by the Bay.

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