News out of San Francisco seems pretty alarming these days. Widespread homelessness, open air drug use, soaring property crime, and major retailers like Nordstrom and Whole Foods shuttering their massive and once impressive stores. The situation is even more dire than what’s been reported in the corporate media. According to a real estate trade, the downtown Westfield Mall where Nordsrom is pulling up stakes had a 52.8 percent vacancy last year.
The leases of two other major tenants are coming up for renewal, and if they opt to bail, it will be lights out for the Westfield Mall, which in 2016 had a 96 percent occupancy. Meanwhile, nearly a third of San Francisco’s downtown office space is empty, the city’s worst vacancy rate on record.
As for criminal activity, the corporate media emphasizes that violent crime isn’t quite as bad in San Francisco as other cities. Maybe according to the hard statistics, but the recent murder of Debra Hord underscored San Francisco’s criminal horrors. As reported by the San Francisco Standard, Hord was a beloved homeless woman known in her neighborhood for random acts of kindness. She was brutally murdered during a suspected robbery attempt in March where her head was slammed to the ground, sustaining a head injury from which she didn’t recover.
Robbing and killing a homeless woman – it doesn’t get lower than that. You can read about the tragic story here.
The good news is that the Bay area’s one percenters are doing just fine. The Standard reports that Atelier Crenn, a 12-year-old French restaurant run by Dominque Crenn, last week introduced a new membership club called Crenn Collection where for $3,800 a single member can enjoy guaranteed reservations for a calendar year, provided they are made 72 hours in advance. The cost for a dual membership is $5,800.
As they say on the late night informercials, there’s more. Club members are guaranteed an open table each night at the adjacent Bar Crenn, access to private parties the restaurant is calling “bespoke events,” cooking demos, and a concierge on call to fulfill “Crenn-related requests.” It also comes with a gift box.
A ginsu knife?
I imagine that Atelier Crenn is a mighty fine restaurant, particularly as it was awarded three Michelin stars, the only female run restaurant to have been bestowed that honor. But I wonder how in a city where human suffering is pervasive a restaurant can charge $3,800 for the privilege of a guaranteed reservation three days in advance, while promoting “humanity” and “sustainability” among its core values.
One can argue that a $3,800 restaurant membership is a bargain for the one percent. Sho Restaurant, located atop Salesforce Park, was hoping to charge memberships for as much as $300,000. Even in the Bay area, the one percenters might have their limits.
SFGATE recently reported that construction seemed to be proceeding rather slowly, if at all. The restaurant’s media folks didn’t respond to SFGATE’s request for comment, an ominous sign.
L.A.’s Haves and Have Nots
The growing wealth disparity in my West Los Angeles neighborhood is also increasingly obvious. Run-down single-story homes are selling for well more than $1 million and are promptly torn down and replaced seemingly overnight with towering properties. I’m fascinated by the construction because whenever I pass by, I see workers seemingly sitting idly and, voila, a week later someone has moved into the finished property.
At the same time, crime and homelessness are rising dramatically in my neighborhood, given the increasingly dire postings on NextDoor warning about violent attacks, break-ins, and stolen catalytic converters. A few weeks ago, there was a late model Mercedes on my street with the tires removed. The incident happened around the same time that a car with the engine running was abandoned in front of my house, which the police told me was stolen. The thieves left the vehicle so they could steal the one parked in my neighbor’s driveway.
Homeless encampments in my neighborhood are expanding like rabbits, sometimes making it impossible to take leisurely walks. The other day a makeshift shelter occupied the entire width of a sidewalk, forcing me to choose between walking my dog on the road or through a back alley.
Given rising interest rates, countless layoffs, and a looming recession it makes me wonder who are the fortunate who can still afford to spend more than $1 million to tear down a home and then fork out millions more to construct another.
History shows that when wealth becomes overly concentrated in the hands of a privileged few, bad things will happen. America’s moronic legacy media deems California a “progressive” state when in fact the state is regressive, suffering a death by 1,000 cuts administered by well intentioned but misguided politicians.
Political ineptitude is rife in Michigan, New York, and Congress, and conditions for the rise of a despotic leader promising to make capitalism fair again are as fertile as Marshall, Michigan farmland on which Ford Motor Co. is building an environmentally harmful electric battery plant so buyers of its luxury EVs can qualify for lucrative tax breaks.
If I was part of the one percent, I wouldn’t be comfortable with the status quo.
I’ve long been opposed to capital punishment, but the looming bankruptcy of Envision Healthcare as reported by the Wall Street Journal has made me receptive to the possible return of guillotines. If you aren’t readily familiar with Envision and the great harm its caused U.S. healthcare and emergency room physicians who want to practice ethical and responsible medicine, that’s most unfortunate.
For some background on Envision, I’m going to turn it over to Maureen Tkacik, possibly the only living person whose disdain for private equity rivals mine.
From Tkacik’s May 12 column in The American Prospect.
This week, The Wall Street Journal broke the news that the notorious surprise billing mill Envision Healthcare would file for Chapter 11 bankruptcy protection as soon as this weekend. The company, which has been on the brink of bankruptcy for more than three years, was heretofore owned by KKR, the monstrous private equity firm that health inspectors have frequently cited for imposing such cruel austerity upon its large chain of group homes that they are regularly found operating without a single staffer to care for patients.
When KKR in 2018 paid $5.5 billion to become the fourth major private equity firm to own Envision, the company was seen as a money-printing machine—albeit one whose quarter-billion dollars in annual interest payments wiped out all the operating profit the company generated in 2017. But when the federal No Surprises Act reined in the profit margins emergency rooms were allowed to rake in on surprise bills, KKR took measures to bail itself out by dubiously ring-fencing the company’s still-lucrative ambulatory surgery business and turning the core ER business into what is colloquially known as a “ShitCo,” whose bonds last week traded at pennies on the dollar.
Before being relegated to the ShitCo heap, Envision, formerly known as EmCare, was one of the defining companies of 21st-century American medicine. Perhaps more than any other institution, EmCare invented the modern American emergency room in all its dilapidated, understaffed, price-gouging misery. And if nothing else, its outlandish billing practices and dire working conditions radicalized a whole generation of doctors against the tyranny of the profit motive.
Tkacik’s insightful column is business poetry, and I encourage you to read it in its entirety. My only value add is KKR’s meaningless $10 billion writeoff of its Envision investment. Despite the loss, the Wall Street Journal reported that the KKR fund Envision is in still has a net annualized return of 19%.
That tells you the obscene profits private equity firms enjoy raping and pillaging companies for their own benefit while their mega rich partners enjoy lucrative tax breaks for the carnage.
Among my biggest concerns is automotive safety, and the AP’s Tom Krisher is the only auto writer I’m aware of who writes about the issue. Following Krisher made me instantly appreciate that the National Highway Traffic Safety Administration’s demand that ARC Automotive of Knoxville recall 67 million airbag inflators in the U.S. because they could explode and hurl shrapnel is potentially a very, very, big deal.
Krisher is well versed on the subject, having published this article a year ago about ARC’s airbag inflators. A class action lawsuit was filed accusing ARC and GM, Ford, and Volkswagen of knowingly selling vehicles containing airbag inflators that are at risk of exploding. Two deaths and at least four injuries have been linked to explosions.
The NHTSA has been investigating the issue since 2015 but Krisher quoted an unidentified agency source saying the issue was extremely complex. In 2016, the NHTSA accused ARC Automotive of missing deadlines and failing to report crash information and test results required by law. The failures “raise serious questions regarding the quality and integrity of ARC’s air bag inflators,” the agency wrote in an Oct. 4 letter to the company.
ARC is again challenging the NHTSA’s decision and judgment.
The NHTSA is grossly underfunded. David Friedman, a former NHTSA acting administrator who is now a vice president at Consumer Reports, told Krisher the agency needs a “slam dunk” case before seeking recalls because of threats and lawsuits that automakers have filed in the past.
“That’s one of the things that’s broken in the system,” Friedman said.
GM is taking the NHTSA seriously. On Friday, it announced it would recall 994,763 Buick Enclave, Chevrolet Traverse and GMC Acadia vehicles from the 2014 through 2017 model years with air bag parts produced by ARC Automotive.
According to to this 2019 New York Times story, it cost $100 at the time to replace a Takata airbag that was recalled because of a faulty inflator. If the NHTSA prevails with its demand for a recall of 67 million ARC airbags…
I’ll let you do the math.