The Real Estate Empire Strikes Back

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Fellow Democrats,

     Our March program will be former LA City Council Member Mike Bonin discussing the article he co-wrote with Occidental College professor Peter Dreier for the February 12 issue of The Nation, entitled “LA’s Corporate Class Wants to Reverse Progressive Gains.” I encourage you to read it before our meeting and to bring your questions.

     Bonin and Dreier recount the unexpected election of LA Council Member Nithya Raman in 2020. Raman did not hire consultants, did little direct mail, and organized first-time voters including many renters, ultimately winning more votes than any Council candidate in LA history. Landlords and conservative homeowner groups immediately launched a recall. When it failed to make the ballot, the Council leadership gerrymandered her district to reduce the number of renters and give her more conservative voters. Council Members including Nury Martinez and Kevin de León were caught discussing this on the notorious Fed Tapes

     Raman’s victory inspired Council Members Hugo Soto-Martinez and Eunisses Hernandez to run and win in 2022. Like her, they defeated establishment Democratic incumbents by running in a new lane on the left. 

     Kenneth Mejia ran for City Controller that year and won more votes than any candidate for any office in LA history with an innovative grassroots campaign that seemed inspired by Alexandria Ocasio-Cortez, Edward Tufte, and anime. 

     LA voters passed Measure ULA in 2022. Written in part by Peter Dreier, it taxes sales of property worth more than five million dollars to fund rent subsidies and eviction defense.  

     For Bonin and Dreier, these progressive victories in LA City were based on organizing renters. Renters are a majority in LA. On average they are younger than homeowners and have been in their residence a shorter time. Over half of LA renters are what the Federal government calls “rent-burdened,” paying more than 30% of their income on rent, and over 30% of LA renters pay more than half. People newer to a place are less likely to be familiar with its politics or part of its networks. Those forced to spend a third or more of their incomes on housing will not be able to make large political donations or have much time to volunteer. However, if the majority can be roused to vote in their collective interest, the system built on their exploitation will shake.

     This happened in LA, and the establishment is fighting back. One of the major funders of the City of LA backlash is Douglas Emmett Inc (ironically listed on the New York Stock Exchange as DEI). They are one of LA’s largest landlords and are currently fighting to evict almost 600 residents from the Barrington Plaza apartments under the pretext of renovations, the largest eviction in LA in decades. Then-Council Member Bonin opposed this when it was proposed in 2021, and Emmett began making massive political contributions to Traci Park (Bonin’s eventual replacement), and against Nithya Raman, Measure ULA, and Karen Bass.

     Bass’ unsuccessful rival for Mayor in 2022, mall landlord/developer Rick Caruso, is another major figure in the backlash. Caruso only registered as a Democrat shortly before running and has a long record of donating to anti-choice groups and other right-wing causes. As Chair of USC’s Board, he helped cover up numerous scandals, including the sexual abuse of patients by George Tyndall, a gynecologist working at the student health center.

     Bonin and Dreier document real estate investors including Caruso and Emmett joining reliably reactionary groups including the Chamber of Commerce, the Police Protective League, the California Apartment Association, and the Apartment Association of Greater Los Angeles to stop the progressive movement. They focus on the formation of the Thrive Los Angeles Political Action Committee, which currently boasts a website full of platitudes, has endorsed Raman’s opponent Ethan Weaver, and whose largest donor is the Hollywood Chamber of Commerce.

     Like Caruso, Weaver is a former Republican and does not appear to have changed his worldview or sources of support. These candidates have recognized that it is impossible to be elected as a Republican in Blue cities like Los Angeles and instead are attempting to run as Democrats while opposing our platform and organizational base and using their wealth to move the party leadership to the right. After Rick Caruso sponsored the LA County Democratic Party’s “Chair’s Holiday Party” fundraiser in December, the endorsement committee, appointed by the Chair, recommended that LACDP endorse Weaver against Raman, a recommendation overwhelmingly overturned by the elected members. There has also been a proliferation of right-wing Democratic Clubs, such as the Blue Wave, which appears to exist only to support Weaver.

     The parallels between what Bonin and Dreier describe in Los Angeles and what we are experiencing in Culver City are probably already clear, but I will spell them out.

     Meghan Sahli-Wells was elected to our City Council in 2012. Two years later she was joined by Thomas Small, and two years after that by Alex Fisch and Daniel Lee, creating the progressive majority that passed rent control and renter protections, began the process of closing the Inglewood Oil Field, moved the city to 100% clean power, and broke the Chamber of Commerce’s century-long hegemony.

     Members of the Culver City Community Coalition and the Culver City Action Network, most of whom were also members of this Club, formed Protect Culver City Renters to advocate for rent control. This group, which I am proud to have played a small role in, surveyed renters, drafted ordinances based on their input, and brought them to the Council with overwhelming evidence. They were adopted in 2019 and went into effect in 2020. Council Members Fisch, Lee, Sahli-Wells, and Small voted in favor, Göran Eriksson against.

     Landlords and other housing profiteers immediately financed the oddly named Protect Culver City PAC, led by Ron Basillian, an alt-right troll fresh off a 90/10 loss as Karen Bass’s 2018 Republican opponent for Congress. Their hired signature-gatherers lied to enough residents to get Measure B, which would have repealed rent control, on the ballot. It was supported by Council Members Albert Vera Jr. and Göran Eriksson, and now-Council Member Dan O’Brien. Four of the six officers of Culver City Democrats United, our local “Blue Wave” affiliate, were part of the anti-renter coalition, along with the Chamber of Commerce and the lead author of the ballot argument against Measure E. Despite their best efforts to keep Culver City the worst place in LA County to be a renter, Measure B was defeated in November 2020

     Voters in that election also approved Measure RE, a real estate transfer tax like Measure ULA, although the proceeds of RE are not devoted to housing support but go to the General Fund. Measure RE was largely the work of former Mayor Alex Fisch, a lawyer and a deep student of housing economics and policy.

     At the same time, then-Mayor Daniel Lee was fighting for a minimum wage for healthcare workers. Southern California Hospital, formerly Brotman Hospital, had long had a reputation for poor care and as a bad place to work. When it was bought by Prospect Medical Holdings, a private equity firm, both declined further, as private equity is focused on extracting money from its assets with no regard for their service quality and long-term viability. Lee attempted to put the City’s weight behind the hospital’s workers, who had risked their lives almost constantly during the first year of the pandemic without adequate resources or support, opposing a corporate “stakeholder” and Chamber of Commerce member.

     For these transgressions Fisch and Lee were threatened with a recall, whose supporters overlapped significantly with Measure B’s. Like the recalls of Raman, Bonin, and District Attorney George Gascón, it failed to make the ballot, thanks in part to this Club’s powerful opposition.

     Fisch was also the primary author of 2022’s Measure BL, which updated the City’s business license fees for the first time in decades. It passed with over 60% of the vote despite dishonest campaigning by the Chamber of Commerce and the Downtown Business Association which claimed it would raise rates. In fact BL established a more progressive rate structure, in which larger businesses paid fees based on a higher percentage of their income while smaller ones paid a smaller percentage and the majority would pay nothing at all. BL reduced or eliminated business license fees for the majority of Culver City businesses and the groups that claim to advocate for those businesses used their dues to lie to them and voters about that.

     In Culver City, tenants of The Meadows, a large apartment complex in Fox Hills, are facing a “renoviction” like that at Barrington Plaza. Like Emmett, The Meadows demanded an exemption from the relevant renter protection laws and are suing because it was not granted. I am not a lawyer, but as best as I understand it, their argument is: “we bought this property before the laws were passed, so the laws don’t apply,” and I am pretty sure that is not how laws usually work. This would have been a valuable argument for anyone who owned a bar in 1919, for example.

     Where LA has Mall King Rick Caruso, Culver City has Michael Hackman, a billionaire developer and landlord of studio properties. He owns the Culver Studios, which is leased to Amazon, as well as the Culver Steps, which combines office space (also leased to Amazon) with restaurants, a grocery store, and assorted beauty and health businesses. Outside Culver City his properties include the CBS Television City complex on Fairfax, just across from Caruso’s Grove.

     In the last Culver City City Council election, Hackman spent nearly $600,000 funding a PAC to elect Dan O’Brien (No Party Preference – the only non-Democrat on the Council) and Denise Renteria (who became a Democrat shortly before running but appeared with MAGA Senate Candidate Mark Meuser at a fundraiser for Protect Culver City) and giving generously to every organization which backed these candidates, including the Culver City Chamber of Commerce PAC, the Culver City Coalition (not to be confused with the Culver City Community Coalitionfunny how these things keep happening!), Common Sense Culver City, and Culver City Neighbors United.

His PAC passed $5000 of his money on to Protect Culver City, covering nearly all their 2022 campaign spending while keeping his name off their paperwork.

     None of this is illegal, but it is ugly. As Bob Dylan said, “Money doesn’t talk, it swears.” We cannot outspend the billionaires, but we can at least expose them and their crew. The truth is on our side.