January 31, 2014

Field of Schemes

Putin lackey Dmitry Medvedev, 5'4", talks turkey
with oligarch and Brooklyn Nets owner Mikhail Prokhorov, 6'8"
From Field of Schemes, a blog devoted to chronicling the innumerable ways that the rich guys involved with owning stadiums and/or sports teams rip the rest of us off.
Brooklyn Nets project wants to raise more cash by selling more green cards 
Posted on January 31, 2014 by Neil deMause 
Atlantic Yards Report had a long story yesterday (it doesn’t have any other kind) about how the Brooklyn Nets‘ arena developers are looking to do another round of EB-5 financing, the mechanism that allows foreign investors — mostly Chinese, in this case — to jump the line for green cards if they’ll extend interest-free loans to U.S. development projects in blighted neighborhoods. It’s well worth a read if you’re interested, especially for the bit about how the Chinese government will actually be benefitting from this as a co-investor, but I just wanted to call out this quote it pulls from an article last year by Dartmouth business professor John Vogel: 
One of the oddities about the EB-5 program is that the U.S. government is giving out the green cards, but the entrepreneur who puts together the investment gets the money. This scheme seems inefficient and open to corruption. If our government really believes that it is a good idea to sell green cards, maybe we should drop the pretense that this is a job creation program. It might be more efficient to have the money go directly to the U.S. Treasury and reduce the deficit by billions of dollars a year. 
This is actually an excellent way of looking at it: Green cards are a public asset, one that the government mostly chooses to give away in order of application, but which here are being handed out in exchange for investment cash. In other words, the government is selling green cards, but it’s not getting the money — that’s going to private developers. 
Now, you can say that it’s encouraging private development in places that need it (though it’s tough to imagine anyplace that needs a hand in promoting development less than Brooklyn), but still, is that the most efficient way to get housing built?

The chief developer of Atlantic Yards is Bruce Ratner.

The only thing the citizens of Los Angeles can boast about as a self-governing citizenry is that L.A. hasn't had an NFL team in a couple of decades.

The most high profile tenant is Brooklyn Nets owner Mikhail Prokhorov, a 6'8" Russian oligarch worth $13.2 billion. Prokhorov got rich in 1996 by auctioning off to himself for a nugatory price a government-owned company that produced 1/4th of the world's nickel output.

Is it really too much to ask that professional sports leagues such as the NBA or the English Premiere League in soccer not sell franchises, especially potential flagship ones in major cities, to Russian white collar gangsters? (Perhaps flagship newspapers shouldn't sell a large share of their stock to Mexican oligarchs either.)
     

41 comments:

Glossy said...

A memorable photograph of Prokhorov meeting with then-Russian president Dmitry Medvedev.

Anonymous said...

That's as bad as noticing that lots of athlete scholars are really not that scholarly:

http://www.newsobserver.com/2014/01/30/3578294/a-former-unc-dean-recalls-athletes.html

Anonymous said...

That would be discriminatory. Gangsters pretty much own everything else, including the banking cartel. So why exclude sports?

Icepick said...

Is it really too much to ask that professional sports leagues such as the NBA of the English Premiere League in soccer, not sell franchises, especially potential flagship ones in major cities, to white collar gangsters?

Yes, it would be, given that blackmailing cities for new stadiums is the one skill all American sports franchise owners MUST have. (I assume it's the same for the EPL but I have no idea, and don't really care.)

Ross said...

Nice to see the Field of Schemes blog get a mention here.

"
(I assume it's the same for the EPL but I have no idea"


Not to the same extent because EPL sides can't credibly threaten to relocate.

"and don't really care"
Oh, right.

Eric said...

Is it really too much to ask that professional sports leagues such as the NBA of the English Premiere League in soccer, not sell franchises, especially potential flagship ones in major cities, to white collar gangsters?

I'm all for it if it means I don't have to build stadiums with my tax dollars. In the end it doesn't matter who owns sports franchises.

Glossy said...

I should say that that photograph was first brought to my attention by Anatoly Karlin who runs a great blog about Russia called Da Russophile.

Albert said...

It's not as big as the NBA or English Premier League, but Vladimir Romanov, the owner of Heart of Midlothian (Hearts) in the Scottish Premier League, out crazies both Prokhorov and Abramovich.

Here is his background, from Wikipedia:

"Even before the dissolution of the Soviet Union, Romanov had started to make money during the late 1980s through manufacturing.[1][4] His wealth greatly increased during the early 1990s after state enterprises were sold off to the highest bidder.[4] Romanov was amongst those who founded Ūkio bankas, which was the first private bank to be founded in Lithuania.[1][8] Through his private investment group UBIG,[8]
Romanov has business interests including aluminium,[9] textiles,[1] property[1] and television.[10] These activities are carried out in Lithuania, Ukraine,[4] Bosnia and Herzegovina,[4] Belarus,[9] Russia[4] and Serbia.[11] His wealth has been variously estimated at £260M,[4] £300M,[1] and £200M in the 2008 Sunday Times Rich List.[12]
UKIO Bankas was closed by the Lithuania Central Bank on 12 February 2013 and its 'good' assets transferred to Šiaulių bankas. Investigations continue into allegations of fraud, embezzlement and money laundering according to the Bank of Lithuania. Romanov has declared himself insolvent.
"

Prior to Rangers going bankrupt, Hearts were the only club in recent memory to finish as high as second, doing so in the 2005-2006 season which was Romanov's first as their owner (the Scottish Premier League for decades has been more or less a fight between Rangers and Celtic with all the other teams vying for third). But, as of June of last year, they too entered into bankruptcy, owing the bankrupt company Ukio Bankas £15 million.

On top of all of that, Romanov has a habit of issuing crazy public statements. I would have liked to watch whatever Scottish PR employee that filtered through try to explain to their paranoid, minor Russian oligarch boss why accusing the league of match fixing was a bad idea, only for it to fall on deaf ears (and result in a £25,000 fine).

Anonymous said...

For the curious, Prokharov's family background:

"Mikhail Prokhorov was born in Moscow on 3 May 1965. His father was a senior official in the Soviet State Sports Committee and his mother, Tamara, who had a Jewish mother, was a researcher at the Moscow Chemical Materials Institute. “She was a chemical engineer and she was very good at it”, her son Mikhail said later. “I was very far from that. If we needed something repaired at home, my mother, she was the best”. His father, Dmitry, grew up in Siberia and was one of eight children in a family of kulaks – affluent Russian peasants persecuted by Lenin and Stalin. He grew up in extreme poverty, but attained relative privilege in the Soviet State Sports Committee after studying law. According to Prokhorov’s sister, their father was invited to join the KGB in the late 1950s but declined after their mother threatened to leave him if he agreed." (http://russianmind.com/content/mikhail-prokhorov-oligarch-presidential-candidate)

So, he's one quarter Jewish. Since the ancestry is on the maternal side (his mother had a Jewish mother), that makes him Jewish according to both the state of Israel (which uses the Nuremberg definition of who is a Jew and grants right of return to quarter Jews)and to the Orthodox Rabbinate in Israel (which requires descent in the maternal line and/or Orthodox conversion).

Albert said...

@Ross:

Well, Wimbledon FC were allowed to move to Milton Keynes without surrendering their position in the football league. That wasn't the first division, but it caused quite a controversy.

AFC Wimbledon, started by the residents of that district of London, have a very nice story, being founded in 2002 and climbing back into the Football League by 2011. They're still in League Two and currently sit in ninth place. Climbing up to seventh and then winning the League Two playoffs to gain promotion and face Milton Keynes next season is unlikely, but within the realm of possibility.

Luke Lea said...

Great reporting! Or, in this case, reporting reporting. I nominate Steve Sailer, if not for a Nobel Prize, then at least as the best journalist in America.

David said...

The incentive for government officials to give away green cards and tax breaks to private-sector crooks as well as be their hatchet men (for example, using public domain) is...what? Creating a few low-wage jobs at local hamburger stands and in the town's hospitality industry? (Forget concessions, which sometimes go 100% to the owner[s].) What could the incentive be? I dunno. Maybe it has something to do with kickbacks?

You mean to tell me that government officials are corrupt? Sounds like a conspiracy tbeory to me.

Btw, if you think your taxes don't pay for tax breaks, you must live in an area where services (like roads and schools) are cut in dollar-to-dollar proportion to those cuts...or else where borrowing against future tax revenue is a strange and foreign concept.

Dave Pinsen said...

In Arthur C. Clarke's Childhood's End, the 10 foot tall or whatever devils/aliens had special conference rooms set up where their seats were sunken so humans could meet them across the table and sit eye-to-eye. Prokhorov deliberately does the opposite in that photo of his meeting with Medvedev. He's got his office chair jacked up so high, he can't even fit his thighs under the desk. And he's got Medvedev in a cushiony, low chair.

Steve Sailer said...

So that's Prokhorov's office, not President/Prime Minister Medevev's?

Dave Pinsen said...

"So that's Prokhorov's office, not President/Prime Minister Medevev's?"

My mistake: I just took another look at the expanded photo and it looks like they're both sitting on the same type of chair. It's probably Medvedev's office, judging by the flags and the eagle thing on the wall.

Usually a difference in height isn't so apparent between two men who are both sitting down (e.g., 6'5" De Blasio and 5'7" Mike Bloomberg). Maybe Prokhorov has an exceptionally long torso, even for his height.

theakinet said...

EPL teams are clubs, not franchises. Anyone can form a club, win their way to the top league from the lower leagues new clubs get placed in.

Corn said...

About that LA not having an NFL team... I heard on the radio this morning (Illinois here) that there is talk of the Rams moving back to LA

sunbeam said...

Dave Pinsen wrote:

"Usually a difference in height isn't so apparent between two men who are both sitting down (e.g., 6'5" De Blasio and 5'7" Mike Bloomberg). Maybe Prokhorov has an exceptionally long torso, even for his height."

That photo desperately needs a photoshop. You really ought to submit that to the Fark boards.

Glossy said...

Dave Pinsen,

I think that pic was taken in the Kremlin, i.e. on Medvedev's turf.

It's difficult to imagine someone as short as Medvedev or Putin becoming a president in the US in the TV or Internet ages, and even if he did, the White House would have never allowed a photo op like this to take place. But the show business/governing ratio of politics is different in Russia. Russia is run by its government to a greater extent than Western countries and the looks of its top government officials play a smaller role in their career advancement than they do in the West. Steve recently recalled that Kennedy was dressed better than Khruschev - same phenomenon.

Yes, Putin often looks great outdoors, but that's a fluke. It had nothing to do with him getting to be president.

Dave Pinsen said...

"Anyone can form a club, win their way to the top league from the lower leagues new clubs get placed in."

Yeah, but how often is it that billionaires buy or start some podunk club, instead of buying an established, dominant team?

Icepick said...

"and don't really care"

Oh, right.


Might have been more accurate to say, I don't care enough to look it up myself. Now if someone knows the answer and will tell me, I'm happy to listen.

So thanks, Ross!

anony-mouse said...

As long as the government doesn't subsidize them, I'd say that buying sports teams would be the least bad use of gangsters' money.

Icepick said...

As long as the government doesn't subsidize them, I'd say that buying sports teams would be the least bad use of gangsters' money.

Are you kidding? They might shave points and ruin Vegas!

Eric Ruttencutter said...

Don't look now, but Stan Kroenke just bought prime LA real estate, perfect for a brand new state of the art football stadium. The Rams may be coming back to you.

Jeff W. said...

"It might be more efficient to have the money go directly to the U.S. Treasury and reduce the deficit by billions of dollars a year."

The EB-5 system is designed to move money very efficiently from the pockets of immigrants into the pockets of politicians via the Ratner conduit. Do you want to wreck a system that is working perfectly as designed?

countenance said...

Big news in St. Louis is that Kroenke is buying out some acreage in Inglewood, California as a bargaining chip to get the taxpayers to renovate the dome in St. Louis.

I call bluff.

Inglewood is Bell Curve City. A pro stadium there would be the same problems as the Coliseum for USC games in South Central.

Kranky isn't going to move the Rams back to LA just to plant them in the ghetto, where people tailgating in the parking lot are surrounded by the third world.

notsaying said...

Why should we sell green cards at all?

What is a few billion dollars to us? It's like a millionaire who has gone bankrupt prostituting themselves for a dime.


If we don't want to grow our underclass, why do we want to import addtions to our white collar criminal class? Right now I understand that many of the men are staying in the home country and sending the family over here. If and when things get too hot for them at home and the men come here, we will have a group of rich jobless criminals. What will they do with themselves but think of ways to rip Americans off? Well, I guess they could target immigrants here from their home country instead.

Suggesting that we gain anything by selling visas shows just how much our elite are losing their sense of what America is about and who owns it, which is all of us, not just them.

Anonymous said...

>> grants right of return to quarter Jews

As does Ireland. What other countries are also on that list?

LemmusLemmus said...

"Is it really too much to ask that professional sports leagues such as the NBA or the English Premiere League in soccer not sell franchises, especially potential flagship ones in major cities, to Russian white collar gangsters?"

Well, in British soccer they have the "fit and proper person test", but it's sometimes criticized for being too lax.

jody said...

nobody cares about the nets, which is why he was able to buy them. definitely not a flagship team by any means. they had trouble selling out their home games when they were in the finals. it would be like somebody buying the islanders.

the trend of teams being bought by rich foreigners with no attachments to the US and shady agendas, is one to watch of course.

Reg Cæsar said...

Irony buffs might want to check out what the Nets were called in their very first season.

Felix said...

Suggesting that we gain anything by selling visas shows just how much our elite are losing their sense of what America is about and who owns it, which is all of us, not just them.

Oh, but in the case of rich Chinese sending their families here we do get something: more cute Asian girls!

Reg Cæsar said...

A year or two ago I got curious and discovered half the grounds used in the Premiere League that season date from the 19th century. A clear majority are older than Wrigley or Fenway. (What's third-oldest now? Dodger?) That's what you get when clubs can't threaten to move.

The only new, publicly built stadium was Manchester City's, and that wasn't built for them, but to attract the Olympics. (They got the Commonwealths instead.) City merely took advantage and abandoned Maine Road.

We Montreal Expos aficionados could have warned them about the wisdom of that move.

It was fun to mock United and Chelsea for being bought by an American and a Russian, respectively. Then an Arab bought City. I almost burned my scarf.


Anonymous said...

that makes him Jewish according to both the state of Israel (which uses the Nuremberg definition of who is a Jew

The state of Israel doesn't consider everyone eligible for the right of return to be Jewish. Paternal quarter Jews also qualify for right of return, but the Orthodox rabbinate, the entity that really controls Jewish status designations, would not consider them Jewish. Prokhorov would actually be a tricky case. The Israeli government might accept his maternal grandmother as Jewish, but the Orthodox rabbinate has been known to insist on proof that the Jewish ancestors were Orthodox Jews before accepting their descendant as a Jew. Half-Jews whose Jewish parent and grandparents are/were non-Orthodox sometimes run into this problem.

pat said...

There are currently 124 SNPs that effect height. Most of them have a miniscule effect on height but they are well known and available to the public. It seems likely that soon someone will commercialize this knowledge and sell a service that makes your baby taller. That's not controversial. It is almost inevitable.

My question is - "How tall"?

In this posting's context is 6'8" too tall or not tall enough? Sooner of later in the developed world a man's height will be his choice the same way a woman's bust size is now. Porn stars choose huge breasts but most women, even movie stars, are content to have merely very large breasts.

I don't know what it feels like to be 6'8" but I was once 6'7" and I liked it a lot. Before the accident I was 6'4" but I had a pulled Achilles tendon. It hurt when I walked. The doctor prescribed heel lifts. The little ones that are used to equalize mismatched leg lengths did nothing for me so I tried the real 'elevator lifts' used by Pacino and Downey Jr.

I got three inches of extra height. I strode around like a God. It was fabulous. But I only did it one day. They threw my back out and that pain was worse than that in my heel.

So based on my own experience I suspect that when human height comes fully under our control there will be a lot of guy's about the size of Prokhorov.

Albertosaurus

Mr. Anon said...

"Glossy said...

I think that pic was taken in the Kremlin, i.e. on Medvedev's turf."

You mean Putin's turf. Medvedev is just the handyman - Putin is the landlord.

Anonymous said...

There are currently 124 SNPs that effect height.

I think you meant 124 known SNPs. And how much of the variation in height is accounted for by those SNPs?

Anonymous said...

As a guy from a state with an insecure, air headed governor who ignored the persistent 70% public opposition to funding a stadium for a New Jersey billionaire now convicted of racketeering, I say let the Chinese fund these playgrounds in exchange for EB-5 visas. I can't possibly see how that is worse than what we've ended up with.

Anonymous said...

"Yeah, but how often is it that billionaires buy or start some podunk club, instead of buying an established, dominant team?"

There are only a handful of "dominant" teams, already owned by billionaires, so what usually happens is that the new billionaire joining the league buys an already established, but non-dominant, team, and pours money into it to make it one of the new dominant teams (see for instance, Chelsea, Manchester City, etc.).

Billionaires don't buy podunk clubs or create new clubs from scratch and move them up the pyramid, because new clubs or tiny clubs don't already have huge, pre-existing fan bases, which the bigger clubs do have. There are already hundreds of existing professional and semi-professional clubs in England (92 in the top four divisions) so there isn't much room for new clubs.

Think of English football like College football in the USA - it's been around since the 19th century and there are lots and lots of teams with big, well established fan bases. In theory new clubs can move up, in practice they don't move up very much unless for some reason they already have a fan base of some kind (see for instance AFC Wimbledon or FC United of Manchester).

If one were a bilionaire looking for a "bargain" or "fixer-upper" project, rather than buying a big club already in the Premier League, the thing to do would be to buy a club with past history of success but fallen on hard times (say, Leeds United or Nottingham Forest) and pour money into it to get it into the Premier League. These sorts of clubs have big, existing fan bases but because they've been out of the top flight for a long time they aren't "sexy" anymore and don't tend to attract the attention of billionaires.

Anonymous said...

Admission to the civil Hebrew nation is completely separate from the issue of solemnizing a marriage therein.

Dozens of thousands of Russian non-Jews arrived in Israel over the past 30 years; some by virtue of being married to a Jew; some by lying about being Jewish; some by whatever. There's two large Russian Orthodox churches in the city of Afula (plus several others around the country). They all receive a normal subsidy from the Ministry of Religious Affairs, as do all houses of worship.

It is possible to find the entire spectrum of expressed-opinions about the advantages of having these Russians here.

To my knowledge, none of them has ever been caught in a treasonous act, and they ==do== show up at the conscription-office when called. And they are not (unlike, say, the Sudanese) noted for violence. Probably that explains why I cannot recall seeing or hearing any calls for expulsion.


Currently, there is no civil marriage. Religious courts of the various sects have complete authority over their own adherents.

It is not terribly un-common for folks to fly to Cyprus for a coupla days to get legally married if the local religious court(s) refuse to solemnize. These foreign marriages are 100% recognized by the Population Registry Authority.

Arguing about establishing civil marriage here is a long-running participatory sport and hobby horse of the more strident types of personalities.

1231 said...

L.A. Weekly is publishing stories that are based on bull-shit and lies, such as it published about Hollywood's best film producers and financiers, Remington Chase and Stefan Martirosian.