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Former Romney Super PAC Man And Gristedes CEO Will File For A Mayoral Bid Today

Over the summer, for my ‘Mitt Loves N.Y.’ series, John Catsimatidis was one of the few profiled donors that reached out to me for an interview. We conversed over the phone about his $50,000-plus donation to Restore Our Future – the super PAC that tried (and failed) to guarantee Romney a seat in the Oval Office.

On the FEC filings, the money came from Catsimatidis’s United Refinery Company, a gas pumper that boasts a $2.3 billion or so profit. He told me that “the Obama administration was 100% wrong” for not drilling nearly enough and proposing a gas tax (which never really happened); in other words, his donation to Mitt Romney came with the stipulation, ‘Drill, baby, drill.’ So much for that.

The NYU-dropout-turned-supermarket-and-oil-billionaire described himself on his website as “the personification of the American Dream.” And he may be right: his family came to Harlem from Greece when he was young and, when he was in his early 20s, he opened a small supermarket Uptown. Within a few years, he would turn it into the Red Apple and Gristedes empire we know all too well. The company’s net worth is now somewhere near $4 billion or so.

Oh yeah, and, today, he’ll file papers to conduct an exploratory committee for the Mayorship of New York City next year.

Echoing a Romney-like message, Mr. Catsimatidis told the Daily News that he wants “to do [his] part to have New York go to the next step” since he’s already “made it to the top.” This managerial platform is exactly what the NYC Republicans are looking for; hence why MTA chairman Joe Lhota has given a mayoral run much thought. That inclination comes against the Democrats favoring social advocates in high City Hall positions, like Christine Quinn and Bill de Blasio.

But, in terms of political aspirations, Mr. Catsimatidis is a former Democrat who entered business and left successful. Therefore, he’s now on the Republican ticket – sound like anyone familiar? He has one rule, though: if NYPD commish Ray Kelley runs, he will back out.

He has the support of Manhattan GOP head, Daniel Isaacs, but, unlike Bloomberg, he will actually accept donations from the general public if he were to run. Also, unlike Bloomberg, he runs a billion-dollar refining company and used a super PAC to funnel thousands of dollars into oily dreams, not same-sex marriage initiatives. So there’s a few differences to be made between him and the Hozziner.

And this is not the first time Catsimatidis has mulled over a mayoral run. In 2009, he was seriously considering it until Bloomberg laid down the third-term idea. But, next year, no Bloomberg; only those who want to face him in contested runs: “I’ll primary anyone who’ll primary me,” he told the News. Primary as a verb, not a noun.

Will a billionaire Mayor hand the reigns over to another billionaire? Fire up the bankrolls.

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N.Y. Doesn’t Love Mitt: SuperPAC Valve for Romney Dries Up

Throughout the summer, our ‘Mitt Loves N.Y.’ series followed the money trails of New York’s wealthiest citizens, all of which ended in Romney’s campaign war chest. The donors we profiled donated a million or two each month since it was made clear around April that Mitt would be their man to defeat Obama in November.

And that all stacked up in the ex-Governor and ex-Bainman’s favor: with all the money combined, it was easily proven that this election would be the most expensive to date for both parties. The SuperPACs were raising corporate money from a select handful of individuals that would have FDR rollin’ in his grave; less than double digits in the millions was frowned down upon and marked as a failure in the monthly reports. At one point, the Republican campaign was raking enough cash to make the incumbent President worried for his life – the Obama team sent out e-mails with subject lines more desperate for unfiltered money than a crackhead on payday.

My series solely concentrated on donors giving to the SuperPAC, Restore Our Future. If there is to be any historical document on the future that reflects upon the Citizen United decision’s impact on American democracy, Restore Our Future would be case study numero uno. The organization was pulling in absurd donation amounts almost weekly that blew other SuperPACs, like Crossroads GPS (Karl Rove) and Americans for Prosperity (Koch brothers), clear out of the financial water.

However, through a culmination of hurtful gaffes, citizenry-distancing and not-that-shitty economic numbers, Romney has found himself falling behind Obama on all fronts: poll numbers, economic approval ratings and, most importantly, SuperPAC money.

To which we can safely say: N.Y. no longer loves Mitt.

It went (and still goes) without saying that Mitt was and is the SuperPAC candidate. Any rational voter can find this out by simply taking a quick peak at financial disclosure documents. However, its influence is bipartisan: even though Obama opposes Citizens United, he still reaps the benefits of it with his version of Restore Our Future, Priorities U.S.A. But still, Mitt’s campaign relies on the money much more so than the President; one electoral necessity the Republican truly lacks is the force of grassroots donations – something Obama made a centerpiece of his election (and, now, re-election efforts) in 2008.

So this news hits the Massachusetts man right at home: for the second month in a row, Team Romney was raising less money ($66.1 million this month) than his opponent ($84.2 million, mind you). This was due in part by the inability of SuperPACs like Restore Our Future to continue to push big numbers in the face of voter and media backlash. And, as we know, this fundraising’s foundation lies in the enormous pockets of the One Percent. With this in mind, we see a pattern arising from the ashes: the wealthy are no longer happy with their frontman.

Over the past thirty days, Restore Our Future only had $6.3 million left in its bank account; for those who followed ‘Mitt Loves N.Y.,’ this number is laughable compared to what it was making in the early months of summer (for reference: the group is nearing the $100 million mark, in total amounts raised). The $6.3 million it raised was just below the $7 million that its rival, Priorities U.S.A. raised.

And the SuperPAC has a spending problem. Most of that $100 million has been blown on advertisements in battleground states, in which Obama is boasting wide margins, and it doesn’t seem like this trend will slow down anytime soon, especially with the debates coming up next week. In terms of money, the Romney campaign, after taking out a $20 million loan to make it through the general election, is worried for the future.

There’s several points that can be made here. The first is the mentality of the One Percent: from what we know of their extravagant lifestyles, it seems odd that they would suddenly shut off their money valves for the Republican candidate. Are they running out of money or are they tired of throwing money at a lost cause? With golden parachutes galore in mind, the former seems hard to believe.

Also, the way I threw those numbers around in this article says something about what Citizens United has done to the election process – it has desensitized us. I should be sweating and panicking when typing “raised only $6.3 million…”, not using it as a point to say they haven’t raised enough.

The final point, and this is surely the most important, is the projections we have placed on the SuperPACs.

It’s pretty much common sense now that Romney is in dire straits with the American voter – his ’47 percent’ comment still hasn’t left the national psyche, his tax return release came too late and, no matter the economic news, 50% of the country still approves of the job Obama is doing. No matter what Mitt does, his opponent seems to rise from the occasion, looking better than ever.

That says a lot about the SuperPACs. The scared declarations that democracy no longer exists under the swarm of corporate cash flow is met with the harsh reality that this money is not doing anything for Romney. Now, it’s to the point that he’s actually losing it all in the final days. Does this mean we were worried too much about the corporate influence in elections? Did we forget about how the basic mantra of an election, which is, you have to be liked to get elected?

I do not want to get sucked into the “Romneys toast” media narrative that has dominated the headlines the past few weeks. It’s senseless and gives talking heads too much power. We will have the answers to all these questions on November 7th. Just wait and then we’ll talk.

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NY AG Eric Schneiderman’s Subpoenas Aimed at Private Equity Firms, Bain Capital & Romney Donors Included

In a few weeks, this might be the Issue of the Election or the Story That Brought Romney Down. At this point, only time can tell.

Yesterday, the New York Times reported that New York Attorney General Eric Schneiderman has begun to send out subpoenas to investigate the tax situations in numerous private equity companies situated in the Big Apple, including Bain Capital, Republican hopeful Mitt Romney’s coup de grace and the subject of his Horatio Alger story.
According to the piece, the legal action is focused on the belief that these private equity companies “converted certain management fees collected from their investors into fund investments;” in a simpler diction, the companies are charged with writing off millions of dollars worth in taxes – Bain saving almost $200 million that could have gone to the state government’s tax base.
The investigation rides off the coattail of a trove of documents Gawker leaked last month that gave us all a glimpse into the dark, shady world that is Bain Capital and private equity. Downsizing, leveraged buyouts and dollar signs were in abundance as well as long lists of management fees skirted off into the capital gains domain. But although the documents provide the basis for the AG’s argument, the subpoenas came before the leak and have no connection to them.
Nonetheless, a look inside what made Mitt rich beyond belief with illegal implications could be destructive in the eyes of voters…. especially when all of his friends are involved, too.
Throughout the summer, the Voice provided you with the ‘Mitt Loves N.Y.’ series (written by yours truly) in which we profiled some of the richest Romney bankrollers in the Big Apple. One of the biggest discoveries that I found was this enormous web the Republican candidate had weaved across the private equity field; a circle of friends that reaped in treasure chests full of cash flow for the campaign. As I have mentioned before, fellow private equity profiteers seem to stick together.
So when I received word of Schneiderman’s investigation, I immediately recognized several of the names; I had written all about ’em just months before. With these connections established, this legal undertaking transforms into an enormously widespread indictment of the Romney SuperPAC known as Restore Our Future and the monies siphoned into Team Romney, all of which ties back to the Candidate himself. But all it takes is one crack, right?
Here are a two of the other donors now involved in Attorney General Eric Schneiderman’s ongoing investigation, with references to the names mentioned in the Times article. Check out the profiles for further insight into the Romney Web:
1. Kohlberg, Kravis, Roberts & Co. – Henry Kravis
2. Apollo Global Management – Marc Rowan
Now, Schneiderman’s motive for the investigation is still unknown; as an Obama supporter and an official leading the President’s mortgage crisis unit, he has been chastised for being too politically involved as a law enforcement agent. However, the Attorney General of a state cannot enforce federal tax law; therefore, the physical gains of the investigation would just be a shit ton of additional (and much needed) tax revenue for New York.
Be sure to keep this story in mind. It goes without saying that this will not be the first time you hear about Gotham’s reckoning before November.
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Mitt Loves N.Y.: Sean Fieler

With Mitt Romney as its de facto candidate, the roster of Restore Our Future, Romney’s designated Super PAC slush fund, reads like a laundry list of New York City’s wealthiest denizens. And, according to the Center for Responsive Politics and contrary to popular belief, Super PAC’s are receiving a huge majority of their donations from these single individuals rather then enormous corporations.
 
So, here at the Voice, we’re going to tell you a little bit about our neighbors, one donor at a time:
 
As Mitt returns from what many pundits from across the ideological spectrum have dubbed an epic fail of an abroad trip to London and Israel, we settle back in our profiling seats and dig further into the SEC filings of Restore Our Future.
While we’ve been gone, the SuperPAC released an ad touting the Presidential candidate’s ‘superb’ handling of the Salt Lake City Winter Olympics in 2002. And, while they’re busy with all that jazz, we’ve been looking into our next subject, Mr. Sean Fieler.

Like a handful of ‘Mitt Loves N.Y.’ targets, Fieler’s career demonstrates an interesting mash-up of wealth and traditional values. However, he stands apart from the rest with a thought pattern that shows flairs of Ron Paul and Chick-fil-A. As the Chairman of the hedge-fund titan Equinox Partners LP, Fieler has found himself on the fringe of the ‘investor-intellect’ label.

Although he is a native of Princeton, New Jersey, on the SuperPAC’s filing this past July, Fieler is listed as a ‘Financial Analyst’ at Equinox Partners with an office up all the way on the 27th floor of the Swiss Bank Tower on Fifth Avenue. In addition to this flashy one-time donation of $50,000, Fieler has given the gift that keeps on giving to numerous other Republican causes, including the New York Republican Federal Campaign Committee and the RNC. But, besides the donation to Restore Our Future, these facts are sort of irrelevant in regards to the Bigger Picture.

Fieler joined Equinox Partners LP in the mid-90s, when the hedge-fund boom was rapidly consuming Corporate America. In 2001, he was named a managing member – a title he still holds today. To understand just a sliver of the mentality America held in the early 2000s, at the onset of the War on Terror and a decade of faux prosperity, it was reported in 2002 that Equinox was planning to open its first offshore fund in Bermuda to boost profits. This was long before offshore became synonymous in our national discussion with tax evasion and greed.

Soon enough, with the help of his partner, William Strong, Fieler was reaping a 13.3% compounded return for Equinox by observing global businesses and successfully buying securities at a superb discount. While we understand that this is all Wall Street talk, the only thing you need to know is that a 13.3% compounded return, in the hedge-fund universe, translates into three cherries on the corporate slot machine. But let us return to what we mentioned briefly in the opening paragraphs: the Ron Paul and Chick-fil-A comparisons.

What connects Fieler to the Texas Congressman and libertarian soothsayer? As an advisor to The Gold Standard Now, Fieler has made it his life-long ideological goal to bring some sort of accountability to the shadow force known as the Federal Reserve. He has penned up op-eds in the Wall Street Journal about monetary policy and is chairman of the American Principles Project, a non-profit that trumps the idea that we must return to the gold standard. In an interview with goldmoney.com, he praises several Tea Party candidates for making significant ideological progress on the issue.

Moving on to Chick-fil-A nexus, Fieler is also a sitting member of the Institute for American Values, which oversees the Center for Marriage & Families. On its website, the company’s mission statement reads,
“The Center for Marriage and Families seeks to study and strengthen marriage as an institution that opens social opportunity, nurtures bonds between parents and children, organizes the care of the vulnerable from the beginning to the end of life, and enables the whole person to thrive.”
 
With that in mind, the organization comes off as a group that is vastly worried about the state of marriage in the United States, arguing that single motherhood leads to poverty, wedding as an institution is in danger of destruction from a changing society and other points that would make the Stepford Wives proud. We point out his inclusion in this group as a juxtaposition to his other position as an advisory member of the National Bible Association. Their motto? “The secret is in the Book.”
What’s more frightening then a hedge fund and the institution of marriage? We have no idea.

Unfortunately, this will be the last installment in our ‘Mitt Loves N.Y.’ series. Throughout all the profiles I’ve written in regards to Restore Our Future’s wealthy NYC denizens/donors, it comes to a point where I start to repeat myself and the themes that go along with the Citizens United beat. And, as a writer, that is a red flag to start afresh. However, we hope you enjoyed all of our works in this series – and will take the information into account come November.

 
Until then, cheers and, for this election, may God help us.
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Mitt Loves N.Y.: Henry Kravis

With Mitt Romney as its de facto candidate, the roster of Restore Our Future, Romney’s designated Super PAC slush fund, reads like a laundry list of New York City’s wealthiest denizens. And, according to the Center for Responsive Politics and contrary to popular belief, Super PAC’s are receiving a huge majority of their donations from these single individuals rather then enormous corporations.
 
So, here at the Voice, we’re going to tell you a little bit about our neighbors, one donor at a time:
 
The Delivering Alpha conference in New York last month invited the wealthiest hedge-funders, stock profiteers and private equity extraordinaires to speak about the state of finance. It’s the sort of event that gives Occupy Wall Street protestors nightmares. Henry Kravis, Co-CEO & Co-Chairman of Kohlberg, Kravis & Roberts, was a keynote speaker and told the crowd his thoughts on the public perception of his (and Romney’s) call to arms:

“In the ’70s and ’80s, what private equity did is it changed corporate America. It started holding companies accountable and for the first time owners started thinking like managers. I’m not sure [Romney] needs to be defending private equity per se because he comes from Bain and, in the private equity world, he will get a lot of arrows shot at him.”

Luckily, this disparity of trust in the shadowy sector didn’t stop the man whose net worth of $4 billion clocked him in at #88 of Forbes’s list of U.S. billionaires from donating to the cause.  In July, Kravis poured $200,000 into the Restore Our Future SuperPAC. And, knowing Kravis’s past, there’s probably plenty more where that came from.

Kolhberg, Kravis and Roberts (KKR) LLP was the product of an exile. In the mid 1960s, Henry Kravis and his cousin George R. Roberts joined the ranks of the now-infamously-defunct bank known as Bear Sterns. There, the men met Jerome Kolhberg, a manager who was high up in the corporate hierarchy, and the cousins quickly assumed the positions of partners. But, they had a different agenda on their minds that separated them from the rest of the banking world.

Soon enough, the trio began what they called “bootstrap investments” – the three would offer companies leveraged buyouts to boost productivity and delete inefficiency; in other words, they have a keen eye for private equity. Their first major deal in 1964 was the acquisition of Orkin Extermination Company; harkening back to his Delivering Alpha monologue, the transaction is now in the financial history books as one of the first successful leveraged buyouts in American financial history. The higher-uppers at Bear Stearns got wind of what the three were doing and deemed it unorthodox behavior, leading the trio to leave the company and form a company up by Columbus Circle that now oversees assets worth over $65 billion.

And how’s Bear Stearns been doing? Well, you know how the story goes.

Along with ventures into the retail market, Europe’s debt, major lobbying efforts and partnerships with other enormous Romney equity donors like Clayton, Dublier & Rice, this monetary success runs off the coattails of some of the biggest acquisitions in corporate history, one of which was later translated into a book and an HBO movie. Barbarians at the Gate, written by the investigative journalists John Heylar and Bryan Borrough, chronicles KKR’s takeover of RJR Nabisco; Andrew Ross Sorkin, the New York Times mind behind the 2008 financial expose ‘Too Big to Fail,’ said it was the best business book out there. And that says a lot coming from him.

If the title of the movie/film is unsettling, you should know that the price for Nabisco was somewhere around $24.88 billion – the highest price paid for a company up to that point in our history. And Kravis blew his own record out of the water just a few years ago when KKR swallowed Energy Future Holdings for $45 billion. This deal has gone down as the most expensive corporate takeover in history. Calling Gordon Gekko…

Okay, enough of the hyperboles and dollar signs; they get us nowhere if we can’t connect them to the Bigger Picture or, in this case, national politics. Kravis has always been a mainstay of the Republican world, arguing against taxation of private equity assets, supporting Papa Bush and John McCain and dabbling with the Republican Leadership Council, a “non-profit” organization that is fueled off that whole corporate, quasi-rugged individualism. This naturally led him to support Mitt as a candidate; a man in the Oval Office that shares the same work experience and views on private equity taxation as you is a political match made in Heaven.

Kravis, as well as several other donors in this public service series, is a member of the Council on Foreign Relations and has created a fund for up-and-coming entrepreneurs called the Henry R. Kravis Prize in Leadership, given by his alma mater Claremont McKenna College. In his words, “A real entrepreneur is somebody who has no safety net underneath him or her”… just a shit ton of private grant money.

See, what is so enthralling about the private equity field in this Presidential election is Mitt”s emphasis on how it proves he can rejuvenate the economy. Yet he is fearful of Bain attacks, deeming them immoral and playing the part of the bullied underdog, even though he is surpassing Obama by huge amounts in regards to donations. And this money is coming from absolute titans like Kravis – the Daniel Boone of private equity who cashed in on the same tricks of the trade as Mitt, just at a greater pace with much more money involved.

It’s a clusterfuck of unbelieavable financial connections and electoral emotions. With ‘Mitt Loves N.Y.,‘ we try to explore the underworld of that nexus, minus the migraines.

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Mitt Loves N.Y.: Robert Rosenkranz

With Mitt Romney as its de facto candidate, the roster of Restore Our Future, Romney’s designated Super PAC slush fund, reads like a laundry list of New York City’s wealthiest denizens. And, according to the Center for Responsive Politics and contrary to popular belief, Super PAC’s are receiving a huge majority of their donations from these single individuals rather then enormous corporations.

So, here at the Voice, we’re going to tell you a little bit about our neighbors, one donor at a time:

In the second edition of ‘Mitt Loves N.Y.,’ we profiled Bruce Kovner – the millionaire financier behind Caxton Associates was an eclectic blend of One Percent rugged individualism and outstanding philanthropy. The facets of an obscene personal fortune mixed with charity tends to always produce a love-hate relationship.

(And we haven’t checked on Kovner in a while: turns out he’s been making news lately with a donation of $300,00, along with his wife Suzanne, to YG Action Fund, a smaller pro-Romney SuperPAC that is fronted by House Republican Majority Leader Eric Cantor. Looks like he’s doing just fine.)

But back to what we were saying: when a profiteer flashes his or her generous side, we are desensitized to the facts – we became dogs who follow the shiny ball placed in front of our eyes. This isn’t necessarily a bad thing; money works in mysterious ways, especially when there is a shit ton of it to go around.

But why mention Kovner? The Caxton man is old news in relation to how far we’ve come with this series. However, his personal and professional life bear a striking similarity to our next target: Mr. Robert Rosenkranz.

Should we start with the good news or the bad news first? It’s Saturday so we’re in a great mood; let’s start with the sunny vibes.

In 1985, Rosenkranz used his profits to start the appropriately-named Rosenkranz Foundation. Working on behalf of conservative think tanks Kovner frequented as well, like the Manhattan Institute and the American Enterprise Institute, Rosenkrantz’s non-profit organization seeks to inspire the public to discuss the matters of the day. And he has done just that only a few blocks from the Voice‘s headquarters with the Intelligence Squared U.S. debate series, an event hosted at NYU’s Skirball Center.

Along with all of this charitable fun, Rosenkranz has an affinity for Asian art. His Foundation has endowed a bunch of exhibits on the subject at the Guggenheim, where his wife, Alexandra Munroe, is the Senior Curator of Asian Art, and he has bankrolled a few collections and book series at his alma maters, Harvard and Yale. He is also a member of the Council on Foreign Relations and the Film Society of Lincoln Center.

Okay, moving on to the impending rain clouds. On 1105 North Market Street in tax-friendly Wilmington, Delaware, just blocks from the infamous 1209 North Orange Street that houses thousands of corporations, lies the headquarters of Rosenkranz’s financial brainchild, Delphi Financial Group, Inc. Described as a “financial services company focused on specialty insurance and insurance-related business” on its website, the Yale graduate started his business, which now oversees $8 billion worth of assets, soon after leaving an economist post at the foreign policy think tank known as the RAND Corporation.

Just like his buddy Mitt, Rosenkranz started two private-equity firms called Acorn Partners LLC and Pergamon Advisors LLC. We have no idea where the names for these types of things come from, either. And, as we’ve mentioned before about the private equity community, the members involved like to stick together: in March of this year, Rosenkranz donated $150,000 to Restore Our Future.

Let’s dig a little deeper, shall we? The Delaware tax havens have been referenced a few times in our series – the New York Times‘ Leslie Wayne did a great profile of the corporate scene there last month – because it is the home of many of these donors’ companies. Why? The tax code there acts as a shield against the collectors at the IRS; it’s like a Cayman Islands for those unwilling to travel a few miles south.

Well, in the past year, the judges of the state have been getting a little angry at these companies for using the leniency to their advantage, thus leading to shady transactions at said enterprises. Naturally, Rosenkranz’s Delphi is of concern. This year, the “corporate chieftain” decided to sell his company to their current owner, Tokio Marine Financial.

But he wanted a little bit more out of the deal then everyone else, even though, technically, he has a 49.9% share hold of the company. Instead of the mathematically deduced amount, he demanded that he received a whopping $110 million more than the other suckers involved. And that number is a result of negotiations that shaved off about $50 million. Also, Sam Glassock III, the Delaware judge on his tail, noted that, in other “troubling” side deals, Rosenkranz tried to suck out another $57 million from the deal. Because, in total, $167 million is not enough for the Chairman.

These demands run completely in opposition to the Delaware tax code and Delphi’s charter, which limits the amount of power Rosenkranz can have over his own company – a financial Magna Carta, if you will. Hence why the courts are on his case now. To sidestep that, he attempted to rewrite the charter in which there was only one winner in the end. We’ll leave you to guess who that is.

We told you that it’s a love-hate relationship, right?

(The Voice reached out to Delphi Financial but the e-mail provided no longer exists and the telephone number provided endlessly rang.)

Tune in next week for another installment of “Mitt Loves N.Y.” Another week, another donor. Democracy can really hurt sometimes.
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Mitt Loves N.Y.: Henry Cornell

With Mitt Romney as its de facto go-to candidate, the roster of Restore Our Future, Romney’s designated Super PAC slush fund, reads like a laundry list of New York City’s wealthiest denizens. And, according to the Center for Responsive Politics and contrary to popular belief, Super PAC’s are receiving a huge majority of their donations from these single individuals rather then enormous corporations.
 
So, here at the Voice, we’re going to tell you a little bit about our neighbors, one donor at a time:

In regards to cash flow, times are looking tough for the Obama campaign. The subject lines of the Obama campaign’s e-mails are starting to look more desperate than the plot line of a Jon Cusack movie from the Eighties. “I will be outspent,” read the last one. Yes, Mr. President, you are… by millions.

In the month of June, Romney raised $105 million, surpassing his challenger by nearly $40 million. The sheer numbers paint an election cycle that will be the most expensive one to date in American history. And, it also illustrates the weight in which the Citizens United decision has shifted in Mitt’s favor: Priorities USA, the Democratic version of Restore Our Future, has pulled a little over $14 million – a measly number in the absurd world of politics in the year 2012, compared to the nearly $63 million slush fund Restore has scrounged together.

With this ‘Mitt Loves N.Y.’ series, we’ve shown you the reader some of the faces behind these numbers. And we’ll continue to steamroll them out because, as these figures have shown, it’s the least we can do. Next up: Goldman Sachs golden child, Henry Cornell.

As far back as this might seem, there was a time at the beginning of the Obama Presidency when the masses were coming full circle with the reality of where their tax-payer’s dollars were actually headed. After Bush’s TARP had finally taken effect, this siphoning was clear: into the wallets of the bankers that had just blown the economy to smithereens. It was the scenario that unleashed the Tea Party, the Republican backlash of 2010, later Occupy Wall Street and a line of attack against the Obama administration for letting the biggest financial crime not only slip under the radar but proliferate into a treasure chest for its benefactors. And Cornell was one of them.

The vampire squid bank has employed Cornell since 1984; since then, he has risen to the top of the tribe, achieving the throne of Partner, Managing Director and Chief Operating Officer of its Merchant Banking Division, where he oversees all real estate and infrastructure investments. Although his actual compensation package is unknown, he, like any other profiteer, he has placed his name on the boards of the Whitney Museum, the Council on Foreign Relations, a handful of corporations, his alma mater Grinnell College and the Asia Society. He is also chairman of the Citizens Committee for New York City – the community-building organization that offers grants and workshops to grassroots projects across the Five Boroughs.

After Lehman Brothers and Bear Stearns hit the fan in the summer of ’08, the bank received a combined total of $18.4 billion from the U.S. government to bail itself out. In February of 2010, Gawker reported on how Goldman execs were using their “taxpayer-financed windfalls.” Let the luxurious spending spree begin.

With his bonus, Cornell demolished the 4th floor of his $11.5 million penthouse (and historical landmark) up on East 80th Street in order to build a larger 5th floor as well as a subcellar in the building. While this was happening, he was busy developing what would become the Henry Cornell Winery in Santa Rosa, California – an enormous piece of land that would include  10,000 cases of wine and a 10,400 square foot wine cave, presumably to hold all that vino. Spending the ordinary man’s hard-earned dollar could not get much more stereotypical than that, unless Cornell somehow bought out Nantucket Nectars.

And, now, two years later, as Goldman continues to push record profits, Cornell has donated a smidgen of what he has left to Restore Our Future – a decent contribution of $150,000. With the bonus in mind, his intentions seem clear: to be left alone by the White House with his renovated loft and winery on the West Coast.

We’ll have that Bush tax cuts for the middle class argument another time, America.

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Mitt Loves N.Y., Special Edition: Bob Diamond

In a special edition of ‘Mitt Loves N.Y.,’  we are taking our coverage overseas to report on an event that almost happened. It was a story that, thankfully for Mitt, went ignored for the most part by the lamestream media.
 
With a tip-off from the Voice’s Steven Thrasher, we stumbled across a little dinner that the Romney’s had put together with a plate price tag of $75,000. But here’s the strange part: it was in London… during the Olympics (the family will already be there to support Ann’s $77,000 horse, Rafalca, who is running with the U.S. equestrian team).

Now, Presidential fundraising abroad is not exactly unusual: in 2008, Rudy Giuliani, Candidate Obama and Bill Clinton all had donor get-togethers in other countries. Even this past Fourth of July, Valerie Jarrett, Obama’s senior adviser, had a big ticket event for the President in Paris. One must remember that only U.S.-born citizens can contribute to elections, according to the FEC. The dinners mentioned above were targeted at U.S. ex-pats, who still can technically donate to a campaign.

As we have seen repeatedly in our series, the SuperPACs do not abide by civil law: the organizations live by their own rules; a set of windy provisions that are unclear due to the ambiguous Supreme Court decision in Citizens United. And, for that reason, it was reported in February that about 6.4 percent of donations to the major SuperPACs were from unknown and untraceable sources.

Except, for this now-revoked dinner invitation, the source of cash was absolutely clear. The maitre’d’s name was Bob Diamond and, as of this past Tuesday, he is resigning from the CEO position of Barclays due to a Parliamentary investigation into the bank’s bogus lending practices and fixed interest rates. And so the story begins.

Since being instated on Jan. 1, 2011, Bobby D. had one mission as the CEO of Barclays: to expand its investment banking sector into a major player of the global market. Unfortunately, as with many other well-known Wall Street stories, high ambitions are chock full of loopholes. In other words, him and his team of profiteers didn’t exactly use the most legal means to get to the top. And it landed them with a record-breaking $455 million fine from the Financial Services Authority last month. So what exactly did they do wrong?

The whole controversy surrounding Diamond’s shameful step-down is based on a little something called the LIBOR, which is the London Interbank Offered Rate – the amount of interest set by the British Bankers’ Association that enables banks to borrow funds.

In order to comfort traders, increase profits and act as if the bank was performing up to par, Diamond and Co. tweaked their LIBOR submissions, thereby manipulating the interest rates to their advantage. And, as Matt Taibbi from Rolling Stone reports, the LIBOR submissions are worth up to around $10 trillion in loans. That’s a lot of money to be fucking around with.

Along with the fact that many other banks were involved, it is evident what a huge shit show this is. Diamond and other top figures will be under intense scrutiny in Parliament – a legislative body that, in comparison to Congress’s hearings on anything financial, actually comes off as a functioning guardian of the law. Once the other banks are reprimanded, a domino effect will occur, possibly leading to trials of interest rate manipulation on this side of the pond.

Yes, the crimes of Wall Street have been globalized; the term ‘loophole’ can be translated into many other languages and that’s a damn shame. But that’s not why it is important in our case.

We are here to zoom in on the expensive (and presumably, well-planned) dinner for Mitt with Bob Diamond as its host. It is one thing when we profile the major donors of Restore Our Future and see that their excessive lifestyles of wealth and luxury may not exactly be the most moral but this is different: Diamond actually was caught doing something extremely legal.

This is the closest Mitt has come to the fire of his financially intertwined past (unless we choose to overlook the fact that John Paulson is a main bankroller of Restore Our Future – a man who robbed the housing market blind and the only thing us New Yorkers got was an auditorium in NYU’s Stern School of Business.) And it is no surprise that Romney cancelled the dinner event immediately; just months before November, the last thing his campaign needs is a blatant connection to a story like this. But, the idea that the dinner existed, even after the $455 million fine was thrown on Diamond’s company, is enough for us.

You know, it’s one of the saddest realities in our democracies to see anyone running for the most powerful throne in the world in bed with the bad guys. But, it’s even more sad that we actually know about.

Tune in next week for another installment of “Mitt Loves N.Y.” Another week, another donor. Democracy can really hurt sometimes.

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NEWS & POLITICS ARCHIVES THE FRONT ARCHIVES

Mitt Loves N.Y.: Marc Rowan

With Mitt Romney as its de facto go-to candidate, the roster of Restore Our Future, Romney’s designated Super PAC slush fund, reads like a laundry list of New York City’s wealthiest denizens. And, according to the Center for Responsive Politics and contrary to popular belief, Super PAC’s are receiving a huge majority of their donations from these single individuals rather then enormous corporations.
 
So, here at the Voice, we’re going to tell you a little bit about our neighbors, one donor at a time:
 
With an M.B.A. and B.A. from the Wharton School of Business at the University of Pennsylvania in hand, Marc Rowan spoke to the alma mater – one that has pumped out an alumni class that  – with guidance and charm.

The interview came in November 2009, just a year or so after Lehman Brothers and Bear Stearns begged Wall Street for forgiveness while leaving Main Street in shambles. And Rowan’s advice rides off of that bankrupt dynamic, echoing Naomi Klein’s The Shock Doctrine: “Mostly, as I’ve said, we see the best returns following chaos.”

We never said it was good advice… unless you’re going into the private equity business. With a $70,000 donation to Restore Our Future this past month, totaling $135,000 over the past few months, Gowan is banking on his buyout brother in arms storming the White House.

As with the rest of Romney’s top donors, especially the ones we’ve covered so far in this ‘Mitt Loves N.Y.,’ Gowan ranks high on those infamous billionaire lists Forbes puts together for the rest of us to ogle in despair. This time around, our subject reached #303 on the 400 list with a value of $1.5 billion this past March.

His wealth comes from a little company he started 23 years ago called Apollo Global Management up on West 57th Street – an equity company that boasts a $51 billion worth in assets. In the same business as Bain Capital, Rowan and Co. made billions the ol’ fashioned way: buying companies with “a relatively small portion of equity and a relatively large portion of outside debt financing,” which is also known as a leveraged buyout (this term has been more or less replaced  by ‘private equity’).

Using that logic, the “chaos” remark makes complete sense: when companies are failing, the equity game is a buyer’s market. This is what landed Rowan a comfy spot on the Director’s Board at the hotel-selling Wyndham International, suitcase-selling Samsonite U.S.A. and a handful(s) of other high-brow companies.

With his wife Carolyn, Rowan occupies a $7.7 million penthouse on 927 Fifth Avenue. He just sold his Hamptons beachfront mansion in what Curbed NY marked down as “the biggest sale as yet recorded for 2012” – a whopping $28.5 million price tag. But some of that money is being put to good use: Rowan is a Director of the National Jewish Outreach Program, an organization that seeks to establish a positive religious community amongst unaffiliated Jews. Also, he has a post at his old stomping grounds; at Wharton, the businessman serves as a member of the Undergraduate Executive Board. According to its roster, the Board is a line-up of alumni that made it big.

Rowan’s Apollo Management went public in March 2011, boosting profits and its already high IPO value. But Apollo was born from the ashes of another. Drexel Burnham Lambert was the archetypal equity company of early New Wall Street fame that was, at one time during the Reagan Era, equally as powerful a player as Goldman Sachs is today. In 1986, the buyout shop had made $545 million – we’re not mathematicians or anything but counter in inflation and you’ve got yourself billions.

It tanked around the time of the Savings and Loans Crisis in the late 1980s, when plagues of insider trading and junk bond trading became rampant (search: Gordan Gekko, Oliver Stone, Wall Street). Forced into bankruptcy in February 1990, the company flipper and his fellow Lambert colleagues, Leon Black and Joshua Harris, jumped ship from Burnham and started Apollo just months after.

When they see chaos, they know how to handle it.

(The Voice reached out to Apollo Management for information regarding Rowan’s connections to Romney. We were given no response).

Tune in next week for another installment of “Mitt Loves N.Y.” Another week, another donor. Democracy can really hurt sometimes.
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NEWS & POLITICS ARCHIVES THE FRONT ARCHIVES

Mitt Loves N.Y.: John Catsimatidis

With Mitt Romney as its de facto go-to candidate, the roster of Restore Our Future, Romney’s designated Super PAC slush fund, reads like a laundry list of New York City’s wealthiest denizens. And, according to the Center for Responsive Politics and contrary to popular belief, Super PAC’s are receiving a huge majority of their donations from these single individuals rather then enormous corporations.
 
So, here at the Voice, we’re going to tell you a little bit about our neighbors, one donor at a time:
 
At the end of April, the rogue millionaire John Paulson had a little gala for Mitt. The guy that raked in on the housing market’s collapse invited the mega-wealth of New York over to his townhouse on East 86th Street to shower Romney with donations.
As sirens blasted outside and security efforts stifled the media, a group of “older white people, mostly men” huddled around the Presidential candidate to talk business.

One of these men was John Catsimatidis. On his own website, Catsimatidis describes himself as the “personification of the American dream.” Dropping out of NYU to throw hope into the supermarket business, Catsimatidis opened his first Red Apple supermarket in the Upper West Side in 1969. In two years time and only 24 years old, he had opened ten across Upper Manhattan and was making $25 million. The rest is investment, real estate and property re-selling history. (According to Forbes, he’s now worth around $2 billion).

And, that night, he told The Daily Beast that he and his fellow profit-seekers were “fighting for the soul of America.” The Voice spoke with Mr. Catsimatidis and asked him what this soul-searching election was really all about.

“Washington is smoking grass,” Catsimatidis told me over the phone, “This [Obama] administration is 100% wrong.”

If you’ve ever done your grocery shopping at a Red Apple or Gristede’s, a fraction of your money has gone into Catsimatidis’s pockets. The Greek-born New Yorker is the owner, founder, President and CEO of the Red Apple Group, a company that ranked #98 on Forbes’s list of America’s largest private companies, placing right behind the Hearst Corporation. Its net worth: 3.8 billion smackers.

So how did Red Apple make all that money with Gristede-level prices? The hodgepodge company is invested in “oil & gas operations (refines oil; convenience stores; real estate; supermarkets” because nothing goes together better than Slim Jim’s and crude oil.

The “oil & gas operations” lies in Catsimatidis’s ownership of United Refining Company – a Pennsylvania-based industrial gas marketer that has a huge operation running out of 823 11th Avenue. The company pushed a profit of $2.3 million in 2009 and continues to ship about 70,000 barrels before you even wake up in the morning.

Over the past few years, Catsimatidis has been throwing around chump change to both Democratic and Republican candidates – from Charles Rangel to Olympia Snowe, the donations range from $1,000 to $2,500. But that’s his individual contributions: when he’s donated to Restore Our Future, he has used the Big Oil guise of United Refining to give over $50,000 to the Republican candidate.

Why? Because, in Catsimatidis’s opinion, the current administration is not oily enough. “Have you ever seen our commercials? Our company [United Refining] brags our gasoline is made from 100% American oil. Trust me, people believe in buying American. Drill more in Canada, the U.S. and the Gulf of Mexico – we could turn around our deficit and become completely energy independent.”

Catsimatidis’s main beef with the Oval Office revolves around a European-style gas tax – a proposal that, like many other campaign promises made, Obama has toyed around with half-heartedly. But the petroluem fine has fallen flat on its face in the EPA-killing eyes of a Republican-led House (the grass-smoking Washington that Catsimatidis was referring to before). Whether it will proliferate in the coming years or not, the millionaire is convinced that a Romney administration will simply “do better” by preventing an excise tax that doesn’t even exist yet.

Hence the $50,000 treasure chest. Start pumping.

Tune in next week for another installment of “Mitt Loves N.Y.” Also, check out past profiles of John A. Griffin and Bruce Kovner. Another week, another donor. Democracy can really hurt sometimes.