When government officials play the Olympic lottery, taxpayers lose. That has been the disastrous experience of host cities around the world. (Forbes magazine even dubbed the post-Olympic financial burden the “Host City Curse.”) So, why did President Obama and his White House entourage head to Copenhagen, Denmark, this week to push the unsuccessful, fiscally doomed Chicago 2016 bid? Political payback.
Bringing the games to the Windy City was Chicago Mayor Richard M. Daley’s “vision.” The entrenched Democratic powerbroker - in office since 1989 - wanted to cap off his graft-haunted tenure with a glorious $4 billion bread-and-circuses production. The influential Daley machine backed Mr. Obama for the presidential primary. Mr. Obama lavished praise on Mr. Daley’s stewardship of the city. Longtime Daley cronies helped pave Mr. Obama’s path to 1600 Pennsylvania Avenue. Then they tried to return the favor for their hometown boss.
Senior White House adviser and Obama consigliere Valerie Jarrett is a Daley loyalist who worked as his deputy chief of staff, deputy corporation counsel and planning commissioner. She hired the future first lady of the United States, then-Michelle Robinson, as a mayoral assistant. Ms. Jarrett went on to serve as president and CEO of The Habitat Company, a real estate firm with a massive stake in federally funded Chicago public-housing projects.
One of those public-private partnerships, the Grove Parc Plaza Apartments, was run into the ground under Ms. Jarrett’s watch. Federal inspectors graded the condition of the complex a bottom-of-the-barrel 11 on a 100-point scale. “They are rapidly displacing poor people, and these companies are profiting from this displacement,” Matt Ginsberg-Jaeckle of Southside Together Organizing for Power, a community group that seeks to help tenants stay in the same neighborhoods, told the Boston Globe last year. ” ‘The same exact people who ran these places into the ground,’ the private companies paid to build and manage the city’s affordable housing, ‘now are profiting by redeveloping them.’ ”
Coincidentally enough, Grove Parc - now targeted for demolition as a result of years of neglect by Mr. Obama’s developer friends - sat in the shadows of the proposed site of the city’s 2016 Olympic Stadium. Ms. Jarrett served as vice chair of Chicago’s 2016 Summer Olympics bid committee before moving to the White House, where she helmed a new “White House Office on Olympic, Paralympic and Youth Sport” with an undisclosed budget and staff.
It’s not just taxpayers in cash-strapped Chicago who should be worried about this field of schemes. Crain’s Chicago Business reports that Ms. Jarrett and Chicago 2016 committee member Lori Healey met recently with federal officials at the U.S. Department of Housing and Urban Development “to discuss financing options” for the estimated $1 billion Olympic Village.
The administration, Ms. Jarrett said, would be “willing to meet and listen” to any federal subsidy proposals. Hey, what happened to Mr. Obama’s tough rules on interest-conflicted lobbying by his administration officials?
A majority of Chicagoans who live in pay-for-play-plagued Cook County opposed public funding for the Olympic party. The city has more than a half-billion-dollar deficit - and just received word that its Olympic insurance policy would have covered only about $1.1 billion of the $3.8 billion operating budget drawn up by Mr. Daley. Cost overruns, fraud and union-inflated contracts are inevitable. White House spokesman Robert Gibbs defended Mr. Obama’s all-out campaign for Chicago’s 2016 Olympics bid by claiming America would see a “tangible economic benefit.”
But as is always the case with sports corporate welfare disguised as “economic development,” an elite few would have benefitted far more than others.
Take senior White House adviser and Obama campaign guru David Axelrod. He’s been a Daley loyalist since 1989, when he signed up as a political consultant for the mayor’s first run. Mr. Axelrod’s public relations firm, Chicago-based AKPD Message and Media, pitched in work for the Chicago 2016 committee. It is unknown how much AKPD received for its services - or how much they would have made in future income had the bid been successful. AKPD currently owes Mr. Axelrod $2 million.
The head of the Chicago 2016 bid committee was Patrick Ryan, chairman of the Aon Corporation and a co-chair of Mr. Obama’s deep-pocketed presidential inaugural committee. Also on both of those committees were: Obama confidante Penny Pritzker, who, in addition, chaired the Olympic Village subcommittee and is president of Pritzker Realty Group - a mega-developer in Illinois that could’ve reaped untold millions in project work if the Daley machine/White House campaign had succeeded. Former Pritzker executive and Obama campaign treasurer Martin Nesbitt was also on the bid committee - and serves as Mr. Daley’s chairman of the Chicago Housing Authority.
Michael Scott Jr., another bid committee member, was “trying to develop a for-profit real estate project that would sit within feet of the cycling venue if Chicago wins the 2016 Summer Games,” according to the Chicago Tribune.
It took a crony-filled White House to raise a proposed Chicago Olympic village. Mr. Daley and Mr. Obama would have gotten the glory. America would have gotten the bill.
Michelle Malkin is the author of the recently released “Culture of Corruption: Obama and his Team of Tax Cheats, Crooks & Cronies” (Regnery 2009).