Big Bob’s Big MistakeThe Dark Herald
UPDATE: A criminal investigation has been opened on Disney and the former members of the Reedy Creek Improvement District.
Hoo boy! This was bad.
I briefly touched on this last night in an update on my last post. This will be more involved.
First, I need to give you some background info, and it’s extensive. Skip the italicized part if you’re already familiar with it:
In 1957 Walt Disney was brokering the rescue of two Los Angles institutions that were in deep trouble, the Chouinard Art Institute, and the Los Angeles Conservatory of Music. Walt was combining them into a new institution that would become Cal Arts. But Disney got bitten by a very strange bug, this creation of a new art college got him thinking about The Legacy of Walt Disney and got him planning something much bigger called Seven Arts City. It would have been a combination of a college dedicated to the arts, a museum, a shopping center with fine dining available, and (this is the important part) a planned community. It was to be a city of art students and working artists. It would also be a showhouse for model homes like the Monsanto House of the Future.
Walt was in his late fifties and would become angry when people mentioned the subject of death in any circumstances to him. He was starting to worry constantly about what his legacy would be.
At this point, you have to take a look at who Walt Disney was, and what he wanted to be. He was first and foremost a product of the Midwest lower-middle class. He believed in America and the Big American. He wanted to be mentioned in the same breath as men like Ford, Edison, and Carnegie. Nobody looked at their robber baron failings back then because no one wanted to, it wasn’t good for a society to create flaws in the pillars that were holding it up.
Walt had been extremely interested in art when he was a boy, but his father had no use for his son’s talent despite the fact that even as a kid he was able to sell his work. His uncle Mike was a railroad engineer and Walt became fascinated with trains and indeed most things mechanical. He tried to fake his way into the Army in WWI but got DQ’ed due to his age. He drove an ambulance for the Red Cross instead. He was very close to his older brother Roy, whose lifelong job would become keeping Walt out of trouble.
Walt Disney had some amazing blind spots. He honestly believed that his biggest gift was being able to bring people together on a project. He felt he could do that because he always knew what was best for them.
By 1957 Walt knew at the back of his mind that there was more road behind him than in front of him. He had a public image as Uncle Walt the great American storyteller. He had gone from producer to minor studio mogul. Created the first full-length animated feature and made a fortune doing it. He had built the best amusement park in the country. However, in the final analysis, he was deeply insecure. If you’ve been poor enough to know what it’s like to fear a knock at the door because it might be someone who has a right to demand money you don’t have, then you will never feel rich no matter how much money you have. Trust me on this point. You will always feel like it could all vanish in a heartbeat. There is a feeling that it just isn’t real.
The question that had started to gnaw on him like a starving dog with a meaty steak bone was, ‘is Uncle Walt all I will ever be?’
“Imagine only being remembered for creating a mouse.” – Walt Disney
Big Americans like Carnegie and Rockefeller left institutions behind them with their names plastered on them, not a weekly TV show. More and more, Walt Disney wanted his legacy as a Big American.
Seven Arts City was originally supposed to be that legacy, but it didn’t work out. It only became CalArts but that was the kind of setback he knew how to deal with. If something big failed then Walt would always go BIGGER.
Disneyland had been an unbelievable success however it had a major problem. While everyone wanted to go, not everyone could. This was circa 1960, and airlines were heavily regulated, so adjusting for this, that, and, the other the price of air travel from New York to Los Angeles for a family of four carried was about $5,000 in today money. While 2/3’s of America’s population was east of the Mississippi only 10% of that market even had the option of coming to the Happiest Place on Earth. An east coast Magic Kingdom was a no-brainer.
One of the issues that Walt saw with Anaheim was that just outside Disneyland’s gate was mile after mile of cheap, sleazy ripoff businesses that he felt made his park look cheap just by being near it. It looked like the kind of carnival atmosphere he detested and wanted Disneyland to be no part of. And there he was surrounded by it.
He wanted a lot of land for his new park, enough that he could set up a major buffer zone between his new park and hucksters. You would be driving on Disney’s land for a while before you got near the front gate.
But he also needed that land for something else. Something much bigger and far grander. At the end of the day Disneyland East was an afterthought for him. He’d leave that to other men. He needed space for his dream city of the future. Seven Arts City had expanded in his mind to become the Experimental Prototype City Of Tomorrow.
EPCOT was to be Walt’s legacy.
His last years were an obsession with planning this city. And he needed control to bring his dream to life. Control of everything. Control of every aspect of its construction and of the lives of the people who would live in it. He knew he could bring it all together because that was his gift, he knew what was best for everyone.
Florida was only too happy to grant Reedy Creek to the Disney corporation. Orlando was geographically central to Florida but that was all it brought to the party, it was just swampland. The Florida legislature happily turned all planning authority over to the Reedy Creek Improvement District. Disney is the only company in America that could build a nuclear power plant if it feels like it. In truth, it was part of the original city planning because Mister Atom was still our friend in 1966.
As I said, Walt Disney needed control of the people who would live in it. Like anybody else, he could personally function well with about 150 people but beyond that number, people became sort of unreal to him. And a damn nuisance. A lot of the 1940 strike, he brought on himself. He was still trying to manage his company like there were only a couple hundred people working at it instead of 1,200. He eventually solved his strike by firing half of his company.
Walt loved persons but couldn’t stand people. This is kind of a drawback when you are building a city as it tends to be loaded with them.
There was a grandeur to his dream. EPCOT was going to be a machine for living. That is probably the easiest way to think of it. It was a culmination of Walt’s interest in arts and mechanics.
New York City World’s Fair was where Disney World was born. Walt built pavilions for the biggest companies in America. Companies he knew he would need to help build EPCOT. He wanted them to build facilities in EPCOT and the staff would live there.
This meant there would be two cities, which he named Bay Lake and Lake Buena Vista.
GE, Westinghouse, Monsanto, RCA, and some other American corporate tombstones like Kodak were interested. They would have factories at Bay Lake and their workers would live in the residential community of Lake Buena Vista.
New York City planner Robert Moses was amazed by Disney’s plans for EPCOT. He thought Disney was going to create the first city free of pollution, noise, and traffic accidents.
The basic layout of EPCOT was supposed to be the world’s first jet port in the south, the cities in the middle, and the Magic Kingdom in the north. The cities were supposed to have a radial design with a central hub. Incoming traffic would be segregated with trucks on a lower road and personal vehicles on a higher road. But Walt didn’t want his residents to have cars, so he was going to keep the cost as prohibitively expensive as possible. People would be getting around between the high-density housing and factories via People Movers. For that matter, people in the Monsanto Houses of Tomorrow wouldn’t be allowed to have cars either. The vague plan was for electric vehicles and they would get rented out to the residents for weekend trips. No need for them in during the weekdays. Who would want to leave paradise?
There would be no retirees either. Employment was a requirement to maintain residence in EPCOT. A second community for retirees was projected for somewhere else eventually.
The city was to be built using the utilidors that were eventually used in the construction of Disney World’s Magic Kingdom. Since Reedy Creek is nothing but swamp you can’t really dig down at all without hitting water immediately. Consequently, EPCOT hub was going be, in effect a gigantic building.
At the center was the Cosmopolitan Hotel, going outward would be the restaurants and shopping district. The next ring out would be administration buildings, fire stations, stadiums, hospitals, post offices, libraries, museums, and of course a center for the arts. Tying it all together would be a communication system called WEDcom which would be something close to an analog internet.
The next ring out would be a green belt with parks and playgrounds, churches and schools. Walt was also planning to change the education system completely. Getting rid of tests and replacing them with a gaming system.
The final ring would be the low-density housing, meaning the Houses of the Future. The residents would get to work by taking People Movers. No streets in these cul-de-sacs, although there would be almost no private lawn space either. All the green stuff was the property of EPCOT. The houses would be independently powered (no idea how). And all of them would be heavily automated. Trash cans were all connected to a vacuum system called AVAC. All the houses would have cable TV rather than ugly TV antennas.
EPCOT personnel could at any time enter the home for an inspection. Appliances would be replaced at EPCOT’s whim. And in a lot of ways, the residents would be on exhibit.
The problem of course was human beings. They would want to vote on things and select their own appliances and things like that. Walt would have none of it. EPCOT residents would have no right to vote in local matters. That was a huge legal issue even at the time and Walt was determined to not pay attention to it.
Walt wanted EPCOT to be twenty-five years ahead of its time…forever. Both expensive and impossible.
In late 1966 Walt Disney was hospitalized and before the new year arrived Uncle Walt was dead at the age of 65.
The reason I went through all of that was to drive home the point that the Reedy Creek Improvement District was never intended to be a fraud. However…
In 1967, the Florida legislature created the special taxing district called the Reedy Creek Improvement District. Roy Disney was now the CEO of the Walt Disney Company, and when asked about Epcot, he replied, “Walt is gone now.” There was no attempt to build it. Consequently, he was happy to smooth over the legal problems that would be created by his late brother’s “no voting thing,” by agreeing to let the residents of the cities of Bay Lake and Lake Buena Vista be in democratic control of the Reedy Creek Improvement District.
The world’s cheapest gated communities were promptly established. These two cul-de-sacs with doublewides on them became the cities of Bay Lake and Lake Buena Vista. These cities have powers of a genuine a municipality like Chicago to include the ability to issue billions in tax-free municipal bonds for construction projects which was what made Reedy Creek such a goldmine for the Walt Disney Company. Then there were all the other things Disney could do without having to jump through any governmental hoops. Building permits were a barely observed formality, experimental construction materials that hadn’t been approved for use anywhere else could be used to build things in Disney World and then they could declare them as proven. Although that occasionally bit them in the ass when rides disintegrated ahead of schedule. They didn’t have to obey things like housing density laws, which meant that Disney World Cast Members living in on-property housing were stacked up eight to a room in conditions that are worse than fucking Hong Kong.
Employees, (selected for their loyalty and obedience to Mickey the Great Terrible), are installed in these “cities.” And they are the ones who in theory control the Reedy Creek Improvement District.
This was clearly and obviously a legal fiction.
HOWEVER, it was a legal fiction that Disney absolutely and under all circumstances had to observe. The Chinese wall separating the Walt Disney Company from the Reedy Creek Improvement District had to be as big as the Great Wall of China.
And yesterday Bob Iger bulldozed through it.
During the question-and-answer portion of the Disney Annual Investor Meeting, an already flustered Bob Iger answered a question that at first seemed like it was from a friendly or at least neutral quarter.
An Ameriprise Financial Advisor asked, ‘What are you doing to protect stockholder value because of the Reedy Creek problems with the State of Florida?’
Iger went into a long and rambling answer that demolished fifty years of carefully cultivated legal fiction. He briefly and biased covered the history of the Florida Anti-Grooming law and Disney’s hysterical reaction to it. And then said, ‘The governor of Florida got angry and decided to retaliate’, (here is the kill quote) “including the naming of a new board to oversee the property and the business.”
Disney’s Chinese Wall was completely blown up.
It is ended. It is over.
Bob Iger acting in his capacity Chief Executive Officer at an official stockholder function effectively admitted that the Reedy Creek Improvement District was directly connected to the Walt Disney Company. There was no effort at conflation at all. “…oversee the property and business.” He has now stated that the two were inseperable. It was unbelievable.
Legally, Ron DeSantis did not punish the Disney Company at all, not even a little bit. He dissolved a special tax district with absurdly overreaching powers and replaced it with one that had the normal powers you’d expect a Florida special tax district to have. Legally, Disney wasn’t affected at all because the Walt Disney Company had no legal control over Reedy Creek.
Yes. Yes, I know it was an obvious sham but before the law, it was not a sham. However, when the Chief Executive Officer of the Walt Disney Company admits that there was no separation between these two entities, then Disney just lost the tent pole of any legal argument they had.
The silly shit that Disney got up to right before the old district was disbanded probably just took one in the head. The “cities” of Bay Lake and Lake Buena Vista can now be dissolved without any difficulty at all. IF that happens, the billions owed in municipal “tax-free” bonds will instantly be dissolved and land on Disney. Oh, and those tax-free bonds would then become taxable debentures.
This could easily be interpreted as a confession of securities fraud, so I honestly don’t have clue what will happen next.
Here is an editorial by the YouTuber Legal Mindset, who is an actual Florida attorney and it is worth a listen.