Billionaires Behaving Badly: Connecting the Dots to the Hudson River Park Board

For many a West Village resident, the most hair-raising revelation in Kevin Roose’s New YorkMagazineexpose, “The One-Percent Jokes and Plutocrats in Drag: What I Saw When I Crashed a Wall Street Secret Society,” is the interlocking membership rolls of two powerful organizations—Kappa Beta Phi, the no-longer-so-secret fraternity for highly successful financiers, and the Board of Trustees of the Hudson River Park (HRP).

One holder of dual membership is billionaire Michael Novogratz, chair of the HRP Board. Roose describes an altercation with Novogratz at the annual dinner of Kappa Beta Phihe infiltrated two years ago. During one of the acts put on by new initiates, who are required to perform before the members in drag, Roose blew his cover when he pulled out his phone to record a particularly crude and self-congratulatory parody. Novogratz, sitting next to him, shouted, “Who the hell are you?”Adhering to his publication’s code of ethics, Roose identified himself as a reporter, upon which Novogratz “grabbed my arm and wouldn’t let go… eyes bloodshot, neck veins bulging.” Other Kappa members then rushed over and tried to convince Roosethat “what I’d seen wasn’t really a group of wealthy and powerful financiers…making light of the financial crisis and bragging about their business conquests at Main Street’s expense,” before ushering him out the door.

Novogratz is also a principal at Fortress Investment, a hedge fund that has controlling interest in St. John’s Terminal, a four-story, three-block-long, 1.3 million-square-foot behemoth on West Street opposite Pier 40, and a dazzling profit-making opportunity under the new law, written and promoted by HRP Board members, that allows for the transfer of air rights in the Hudson River to developers.

Then there’s Diana L. Taylor, chair of the Hudson River Park Trust since 2007. She was listed as one of eight “Exalted High Council”on the dinner program. She is also a member of the investment committee of Wolfensohn and Company, a global financial institution that manages more than $1.5 trillion in assets. James D. Wolfensohn, founder of her company and former president of the World Bank, is on the full membership list of Kappa Beta Phi, as are HRP Board members Mitchell Rudin, CEO of U.S. Commercial Operations of Brookfield Office Properties, and Michael Bloomberg, who is represented on the HRP Board by an employee of Bloomberg Philanthropies.

More than the often misogynistic or homophobic parodies, even more than the jokes about tycoons stuffing their pockets with bailout money while the common folk got taken for a ride, what is truly disturbing about this article is the conclusion Roose draws about his experience of being a fly on the wall witnessing plutocrats at play. He writes that “the upper ranks of finance are composed of people who are completely divorced from reality,” that they are a “fear-based organization of executives who had strong ideas …but would never have the courage to voice those opinions in a public setting.”

Well, now they have been voiced. Although some may dismiss this latest revelation of the true nature of the 1% with a jaded “Thus it has always been,” for the defenders of our precious waterfront park one thing has irrevocably changed. When the time comes for investors and developers with self-serving connections to go for the gold—those lucrative air rights transfers—it won’t happen in the dark. We know now, who you are.

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