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Belmont Club

The Philadelphia Story

January 15th, 2013 - 1:05 pm
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The video above shows a Philadelphia union keeps non-union engineering contractors off the premises. He tries to sneak past them to do his job and they crush him against the fence until he passes out. Then they laugh at him. When not similarly engaged they also use tire-busters and direct threats. Maybe that’s not news. What is news is that the video was collected by the Pestronk brothers, a pair of developers, who used it and similar surveillance videos to fight back. No they didn’t go to the police. They took the videos to the public.

Matt Pestronk is 35 years old, a former college and high-school wrestler, with close-cropped hair, a coal-stove build and a broadly outspoken demeanor. “F**k them,” he says at one point, joking about his union adversaries. “We can take any of those guys.”

Michael is 31, also a former high-school wrestler, with a shaggy artist’s mop of hair and a slightly more politic personality. “I’d be happy to use all union guys,” he says, “but the numbers have to work.”

“The numbers have to work”. The point the article in Philly Mag is trying to make is that justice in America is as often driven by dollars and cents as it is by high minded principle. When excessive greed runs into the necessity of getting something done, something has to give. Stuff happens until the numbers work.

The problem in Philadelphia was that a group of special interests had cornered the market for too long. “We have Cleveland rents and New York construction salaries,” one source told the magazine writer, Steve Volk.

Class A office space here rents for about $26 per square foot, about the same as Cleveland. Yet our unionized construction workers earn wages competitive with those in rich real estate markets like San Francisco, Chicago and New York, where rental rates can be double those found here. A Philadelphia carpenter makes nearly twice as much as his counterpart in Washington, D.C., where similar space rents for almost twice as much. The housing market fares no better. A 2008 report by Econsult found it to be unprofitable to build in most of Philadelphia, ranking it below even Madison, Wisconsin, as a desirable place for new construction.

In the face of those unworkable numbers the developers and the unions got to negotiating in a manner that is perhaps not often taught in business school. Here’s a sample of their banter.

Michael Pestronk says that last January he was driving in his car, guiding a potential creditor to his company’s offices in Germantown, when he noticed the banker’s wasn’t the only car following his.

Fred Cosenza, a high-ranking Building Trades official, declined to comment for this story. But Pestronk says that Cosenza had tailed him for a couple of weeks before that day. Fearing Cosenza might spook the banker, Pestronk picked up his cell phone. “I need to stop for gas,” he lied to the banker, giving directions to go on to the office without him.

Pestronk pulled into a Sunoco at Wissahickon and Rittenhouse. But instead of stopping at a pump, he tooled out the other side of the lot and parked behind Cosenza, who had pulled over on the side of the street.

Pestronk says that when he emerged from his car and confronted Cosenza, the union man looked startled but quickly composed himself. “Hi, Mike!” Cosenza said cheerily.

“Fred,” Pestronk said, “what are you doing?”

“I’m just out for a drive,” Cosenza replied.

“Don’t play dumb, Fred. You’ve been following me for weeks.”

“Did you just call me dumb, Mike?” Pestronk says Cosenza answered. “’Cause if you did, I’ll smack the shit out of you.”

“All right, Fred,” Pestronk said. “I’ll see you around.”

Steve Volk asks “by now, it might be appropriate to wonder how anything ever gets built in Philadelphia. The answer is that out of custom and self-interest, an unofficial compact has emerged by which this city’s Trades, developers and politicians have learned to get along.”

If the Pestronk brothers “soon earned recognition as a canny development team”, it was not because they overwhelmed the unions with their moral superiority, but in part because they learned to use Internet technology, media savvy and employ whatever other means they needed to persuade the guys who ran the city that it was easier to be reasonable than take the trouble to get them out of the way.

The numbers had to work.

The movies may have given audiences the wrong idea. It’s not always the good guys that look like Tom Cruise who’ve contributed the most to the progress of American justice and equality. It was very often individuals who fought back because they felt they were being cheated out of a dollar. The guys who saw the need for law and order in Dodge City or new construction in a Big City were fundamentally outraged about the numbers being wrong.

Recently Facebook has been abuzz with news of the death of Sheikh Aifan Sadoun Aifan al-Issawi. Sheik who? Well Sheikh Aifan Sadoun Aifan al-Issawi was a Sunni who helped Americans tremendously during the surge in Iraq. He was killed by a suicide bomber along “five others near Fallujah on Tuesday afternoon.” And a lot of guys who knew him from back then are sorry he’s passed

Those who remember him on Facebook recall him as a “complex character” who might not entirely meet with the approval of politically correct society. But if he did then he probably would not have been of much use in Anbar.  If you put a handlebar mustache on him and replaced his headgear with 10-gallon hat the late Sheikh might have had a lot in common with some Western frontier lawmen in the 19th century.

The unions, you will not be surprised to learn, have taken a blowtorch to the Pestronks. But recently they backed off and now are negotiating with the two brothers. This has not gone unnoticed in Philadelphia.

The Pestronks may already be entering rarefied air, their primary importance symbolic. “I think the Philadelphia market is sitting there on the table,” says McMahon, the contractor and board member from ABC. “If the Goldtex site is a success, I think it will send a message that all that’s needed is a strong, willing owner, and you can build in Philadelphia without the unions. It doesn’t really matter what the Pestronks do next, because they already set out a template.”

Those videos, published online, now need only inspire imitators—other developers interested in quelling the unions’ most aggressive intimidation tactics. As a result, Philadelphia is at a tipping point—teetering on the verge of its own Arab Spring….

“Tell me,” says Matt Pestronk, grinning as he stands beside his brother, cement pouring into the basement of their open-shop w­orksite. “Do we look like we’ve lost?” 

Maybe not this time. But there’ll be a next time, and a next. And maybe someday they’ll meet someone faster on the draw than themselves. But in the meantime they’d have blazed a trail. Philadelphia will have changed somewhat for their having been around.

When Thomas Jefferson wrote, “the tree of liberty must be refreshed from time to time with the blood of patriots and tyrants” he may have put the case too high. By casting the question in terms of such lofty principle it gave the impression that liberty was all about truth, justice and the American way.

Maybe in reality it has always been about making the numbers work.

Not virtue, but a healthy amount of self-interest, the unswerving desire to get your due, the grim determination not to let someone get the better of you could be the real mainspring of American liberty.


The Three Conjectures at Amazon Kindle for $1.99
Storming the Castle at Amazon Kindle for $3.99
No Way In at Amazon Kindle $8.95, print $9.99

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