The Miami Herald, Collapse and the Financial Crisis Inquiry Commission: too little, too late ... by gimleteye

A principal theme of this blog is to highlight and to expose connections between the Miami economic elite and the housing boom that took flight in the late 1990's and ended with an historic crash. Although this, the worst economic crash since the Depression, had many fathers and mothers across the nation (ie. Texas, Nevada, Arizona, California), the epicenter of the crisis was here, in Miami. Yes. We finger point on this blog: BankUnited, City National, and others thrived through the financing of "what the market wants"; a euphemism for a nightmare landscaped with crappy subdivisions, gated "communities", and soul-less places. Most mainstream media accounts neglect the key point of Eyeonmiami: that the crisis could not have happened without the active support of enablers far from the villains on Wall Street.

In particular, the land use policies and politics of the late, great boom originated in South Florida, where an earlier generation of entrepreneurs had figured out the components of scalable housing developments that characterize the built landscape: condominiums on the ocean front and platted subdivisions in the ring suburbs. Although the conclusions of the Financial Crisis Inquiry Commission, issued last week, are unsurprising-- namely that the crisis was avoidable-- the mainstream media continues to avoid the closer analysis of what I describe as the Growth Machine: the network of local real estate speculators, lobbyists, mortgage and title companies, engineers, and politicians who facilitated first the massive overdevelopment of South Florida and then its inevitable collapse.

A good place to start would be a critical analysis of the county commissioner now fighting for her political life: Natacha Seijas (VNS). Seijas, the bulwark of the developer lobby in Miami-Dade, was the key county commissioner who helped order contracts at Miami International Airport in the 1990's. There, minority contract requirements were used to feather the nests of speculators who were also housing developers and ran political campaigns. Seijas also controlled the zoning decisions of the board of county commissioners: the key to minting millionaires from land speculators and developers in platted subdivisions outside her Hialeah district. To find the local cogs in the wheel that spun the Growth Machine, look no further than Seijas and the organization of business interests; from small bit players, feeding into trade associations, their lobbyists (like Greenberg Traurig) and the results benefiting major corporations. Organizing public works and infrastructure to benefit shareholders of private corporations: it is no different at Miami International Airport than in the suburbs. (Take Parkland, the new massive mega-development idling its time on some bank's balance sheet.)

In the weekend edition of the Financial Times, the Burmese independence hero Aung San Suu Kyi was quoted, "Sometimes I think that a parody of democracy could be more dangerous than a blatant dictatorship." Her words deeply resonate through this Miami era. Civic activists have witnessed that parody of democracy time and again from the dais of the county commission where the manipulation of zoning (like the efforts to move the Urban Development Boundary) focused the energy of speculators and insiders and turn due process into a charade. Some of those activists in Miami-Dade, who attempted a recall of Seijas just a few years ago, were treated to exactly the tenor of a blatant dictatorship; obstructed from collecting recall signature petitions, spied upon, and harassed by Hialeah police (including false arrest) with no consequences from law enforcement. None.

To know the principal, local actors of the housing boom and crash, explore the contributor list to Natacha Seijas' defense today. It is the same cast of characters who promoted the political order that reef wrecked the economy -- the patriarchal cartel that promoted "The Ownership Society". Yes, the financial crisis was preventable. The question might have been asked in the winters when then Fed Chairman Alan Greenspan and his wife looked for the best parties in Miami with local developers and speculators: they convinced each other that there was nothing wrong at the time. Nothing wrong with the fruits of speculation, lost wetlands, and a rapidly diminished quality of life that now makes it difficult to attract jobs to Miami. Nothing wrong with the lobbying culture or any aspect of the Growth Machine. On these connections, the Miami Herald was silent. And while the Herald agrees today on its oped page with the conclusions of the Financial Crisis Inquiry Commission, the city's only daily newspaper continues to shield its eyes-- and the complicity of former publishers-- from the inquisitive, critical role it could have played for readers and voters but didn't, when it counted.