Press

See my Letter to the Editor in the November 25th edition of the Stuart News by following this link:

http://www.tcpalm.com/news/2012/nov/25/letter-crony-capitalism-in-martin-county-offer/

Tom and Polly Campenni are among the "Fat Cat" Sponsors of Catsablanca...Here's Purring At You, Kid. The event, which benefits the shelter, adoption, and community education programs of Domino's Cat Rescue League, will be held on Friday, November 30 at the Mariner Sands Country Club in Stuart, FL. The evening will include cocktails, dinner, charity gaming (and the chance for winners to compete for fantastic prizes in the grand finale raffle), a silent auction and more surprises. Tickets are available at the website (www.dominoshouse.org) or by calling 772-341-7454.

Tom and Polly Campenni were the "Main Course" sponsors for the Community Awareness Dinner benefitting the House of Hope in Stuart, FL. The event was held in St. Mary's Pittenger Center and included a social hour with the music of St. Joseph's School Jazz Band, dinner featuring the same kind of meal that someone at a community kitchen might receive prepared and presented by volunteers from HOH partners at local houses of worship, and a program recognizing significant people and organizations who partner with the House of Hope in the accomplishment of their vision.

See Tom's Letter to the Editor in the Stuart News (a Scripps publication) by clicking the link below:

http://www.tcpalm.com/news/2012/oct/23/letter-st-lucie-rivers-life-sacrificed-to-sugar/

Pardon Our Dust!

Renovations are underway at House of Hope's main Stuart facility, with improvements to office and meeting space, the food pantry, and computer systems.

When the dust has settled, the new space will feature:

A Welcome Center and space for employees, interns and volunteers to provide services under an umbrella called Project HOPE (Helping Others Progress through Empowerment). Project HOPE unifies and strengthens all of House of Hope's services, including Martin County's largest food pantry operation; financial assistance with rent, utilities, prescriptions and medical costs; assistance with clothing, furniture and appliances; case management; and information and referral.

Room to offer trainings, including preventive health care, smoking cessation, nutrition, diabetes education, household budgeting, life skills, vegetable gardening, job seeking and interviewing.

A new way for people to use the food pantry that promotes dignity and reduces waste.

Renovations are being funded through grants from individuals and family foundations. Andrew M. Hunt presented a challenge grant of $25,000, which so far has resulted in an additional $25,000 in contributions from the Oristano Foundation, the Pedersen Family Foundation, and Tom & Polly Campenni. Another $50,000 is being sought to cover all the costs of renovation, technology and program enhancements.

Tom Campenni is volunteering as the construction overseer, and architectural services were donated by Mark Corson.

When we hear that the real estate market is improving or that the real estate market has taken a turn for the worse, what exactly does that mean to the average person? The media often portrays the market as if it were the same from Maine to Washington State. That is not only confusing to the general public but just wrong. Unlike stocks or bonds that have the same price regardless of the geographical location of the seller or buyer, the price for similar types of property can be sharply different from community to community. A house in Greenwich, Connecticut can sell for $1,000,000 while its twin in Rockport, Illinois can fetch less than 100,000. So that old adage "Location, Location, and Location" is still very relevant. Even in the same town, two exact homes in different neighborhoods can be worth different amounts.

The market can also be quite different for commercial property. Office space can lease for $10 per square foot in Albany, NY but comparable space in Philadelphia can go for $30 per square foot. Again, even in the same commercial area, rates vary depending on the desirability of the location. And, to make matters even more fluid, the desirability of neighborhoods can change over time from good to bad and then bad to good.

The point is that there is no such thing as a national or even regional real estate market. Many things can influence the price of property. That is why it is very important for prospective buyers and sellers to do their homework before engaging in any transaction. You can begin that education by using online resources, but to make sure that the information is current and correct, you should seek out a local Realtor.

By using a Realtor to help source a property, the investor can be assured that he or she is dealing with a professional who knows the local market. Not all licensed real estate agents are Realtors. Realtors are professionals that have gone several steps further by adhering to a code of ethics, joining a professional organization and earning additional credentials through education and experience to bring a higher level of service to their clients. The smart business person always seeks council from a professional expert, so the smart business person should work with a Realtor.

See Tom's Letter to the Editor in the Stuart News (a Scripps publication) by clicking on the following link:

http://www.tcpalm.com/news/2012/oct/02/letter-government-needs-to-stop-picking-winners/

I have been a small business owner for my entire business career. Most of those small businesses have been real estate ventures of come type such as real estate brokerages, property management and owning different types of real estate. But I have also owned and been involved in insurance, restaurants, bars, garment factories, hotels, building and general contracting, convenience stores, food marts and gas stations. I was a partner in my first small business, a diner, at age 18. Even while I worked as an employee in someone else's small business, I owned and operated several of my own at the same time.

I have only worked for one large corporation, and I hated every minute of the time spent there. I was employed for less than a month before I quit. I felt as if I were in prison. My boss was someone who had been in his position for many years, and he was counting the days so he could begin his impending retirement. Some of my co-workers were spending more time thinking up ways of not doing their jobs than actually performing their jobs. I was a nameless and powerless spoke in a wheel. When I realized that I had more authority and responsibility in my after-school jobs than in that behemoth of a business, I knew that I wanted to be my own boss at all costs even if it meant never playing with the big boys in the corner offices. So when you hear someone say a "mom and pop" operation, I am that business owner.

Some of the businesses I had were out-and-out financial disasters. Others became very lucrative. Most, though, just allowed me to make a decent living. I never started one in my garage that ended up being an Apple Computer. All of my businesses were just small operations. A few times when I felt the business was becoming too big, I either sold it or cut back. I wanted to know everything about the operation. Even if I did not possess the skills to do every job myself, I wanted to be able to at least understand what was needed to succeed in performing that particular job in my shop.

Why does someone like me decide to toil as an owner-operator and chief bottle washer than pursue a career with IBM? There are several reasons for taking the plunge into a life of entrepreneurship. When I was growing up most of my family, including my parents, were owners or employees of small businesses. My father went from owning a bar to being a bartender for someone then owning another bar again sometimes within weeks. That is why today I understand that failure is not defeat if one learns and tries again. We were a working class first generation and immigrant family looking to earn a decent living. For someone without skills or fluent in English or familiar with American customs, owning your own small business is the only way to grab for the brass ring. Small business ownership is in my genes. Even though I went to college and could have gone a different path, my personality and characteristics nudged me toward entrepreneurship.

Small business ownership is not for someone who doesn't want to sweep the floors or carry out the trash. It is not for someone that wants to go home after their shift and leave business worries on their doorstep. It is not for someone that wants a guaranteed two week uninterrupted vacation each year or a pension or health insurance. It is not for someone who doesn't possess a little of the dreamer in his soul. To be a successful small business owner, you need to be a romantic pragmatist, with a strong ego who can get out of bed in the morning day after day, week after week and year after year. You need to be self-motivated and confident that whatever happens, you can handle the day's problems.

During this crazy political season, the four candidates for president and vice-president are extolling the virtue of small business people as job creators and the backbone of the United States' middle class. They poetically tell the electorate that this policy or that policy is what is needed. It would be nice if one of them had ever owned a small business. The only person that states he had a job in a small business is Congressman Ryan. In high school, college and for a short time after graduating while waiting to be employed by the federal government, young Paul toiled at McDonalds, as a waiter and a trainer.

Mitt Romney at least made a fortune in the private sector. I guess you could call his boutique firm, Bain Capital, a small business. But I bet he never swept the floor trying to save the money on a cleaning person. He may have built that fortune but it wasn't with the proceeds of his house being mortgaged to the hilt to allow him to pursue that dream. He had contacts and referrals from his father and mother. Governor Romney went to Harvard Business School and Law School. He worked hard and diligently for everything he accomplished. But Mitt is certainly not one of the guys from the neighborhood who made good. I doubt he can understand what it is like to be sweating out collecting what is owed to you so you can pay your employees that week.

President Obama apparently didn't even have a job while in high school or college. Harvard and Yale is where he learned about private enterprise. He never experienced being a stock clerk at the corner hardware store or the kid that delivered the pies from the neighborhood pizzeria. His knowledge of small business comes from being a customer. He never invested his savings into opening a dry cleaner or even a law office. While his running mate, Joe Biden, might speak as if he knows how it is to work the factory line, he has been in politics his entire adult life. His greatest financial risk is if the Republicans shut down the government and he misses his paycheck.

The myth, we hear from our candidates, is that as small business people we are going to add jobs to the economy, that we are the job creators. It has and continues to be my firm belief that hiring additional employees is the last thing any smart small business person wants to do. I would much rather work harder and keep that person's salary. I would much rather spend money on technology to be more efficient. A robot or computer program never walked out or didn't come into work. Small businesses are not Fortune 500 companies. A small business owner has no bruised ego with not having thousands of employees under him. It might sound good to say I own a company that has 10 employees but I would rather have 5 employees and have more money in my pocket. That is the only way I will ever have a raise.

That is not to say that I don't hire additional employees. I am not going to lose business over staffing issues. Additional employees have to have a benefit directly to me…not the macro economy of the U.S. It is true that small businesses hire the bulk of American workers. It is also true that small businesses jettison the most workers because most small businesses fail. The great thing about the United States is that failing is no barrier to trying again. Small business people get up, analyze why they failed and open a new business.

Another myth is that small businesses will expand by hiring more employees. That may be true for a very few business startups like Microsoft, but for the vast majority growth is measured in increases of one or two employees not hundreds. If I open a 24 hour a day 365 day convenience store no matter how successful it is, I will only employ so many workers. Even if I buy another store a mile away and staff it; have I increased the number of people working? The answer is probably not. Because if I hadn't open that convenience store someone else would have. Sometimes, especially for small businesses, it really is a zero sum equation.

Our politicians need to stop making scape goats and heroes and concentrate on facts. The first fact is, Mr. President, I did build that business by my own ingenuity and hard work. However, Mr. Romney, I needed to count on the government to provide security, infrastructure and the rule of law to be successful. When I opened my first business more than 40 years ago, I never worried what I would pay in taxes if successful, I only worried about success. The tax rate never stopped me from going into business. Going into business is what I do just like an actor acts and a clergyman prays. What I so need of my government is consistency in laws, and tax rates and regulation. For my planning purposes I want to know what I can expect, today, tomorrow and next year.

I don't mind being regulated. I've been a New York City property owner and building manager, I have lived with the stupidity of rent regulation. I've succeeded and prospered in spite of it. What I want to see is smart regulation. Any regulation or law that requires thousands of pages to explain its meaning becomes meaningless. Simplicity is the key to enforcement. It is not productive for the economy to have lobbyists, congressional staffers and attorneys writing arcane laws and regulations. That only ends up employing people in those nonproductive occupations. At the end of the day, it adds no new products to the American economy.

I think most Americans and the majority of small business owners agree with my sentiments. I would like my elected officials to reflect the American electorate. Perhaps we need fewer graduates of Harvard, fewer lawyers and career politicians running for office. Harry Truman was a farmer, a citizen soldier and a failed small business man before turning to elected offices. A little practical world experience would make for a better president.

Thomas F. Campenni CPM CCIM represented the owner in the leasing of a store at 134 West 37th Street in the Chelsea area of Manhattan to AZ Yashir Bapaz Inc. for a women's sportswear store. The lease is for 5 years at a minimum rent of $800,000.00 for that period.

I live in Stuart, Florida, which is part of Martin County. As in most of the United States, our economy is in the doldrums. South Florida's economy is probably in tougher shape because of our heavy dependence on real estate development and construction. There is no facet in our lives where that real property does not play a role. It is vital to the economy of the nation. While real estate is one of the important legs on which our economy stands, the dependence on the one facet of land development from farmland to city is what has put the economy of Florida into such free fall. The local economy will not get better until we stop resorting to the same real estate development of the past.

For over a hundred years, Florida has been legendary for its boom and bust cycles. Our land booms are spectacular and our busts just as renowned. On the heavily populated east coast, Florida's development occurred late in relation to the other east coast states. Climate, topography and geography isolated the state until the 20th century. While today Florida has 19 million people and is the fourth most populous state, in 1900 our population of 528,500 people was just above New Hampshire and Vermont on the eastern seaboard.

In what section of the state people lived has dramatically changed over the same period. In 1900, 70% of the population lived in the northern third of the state while only 8% lived in South Florida. While the United States was settled and explored from east to west, Florida was settled from north to south with much of that area under populated. In the 1930 census (the first census after formation of the Martin County), Martin had a population of 5111. It wasn't until 1990 that we had over 100,000 people.

So why is it that Florida's economy has more severe boom and bust cycles than most of the rest of the nation? Our main industries today are agriculture, tourism, trade with Central and South America and land development. Our exponential population growth is due to people wanting the "Florida lifestyle." As the population increased, farmers decided it was more advantageous to develop their property for subdivisions than to continue producing crops and livestock. For the past seventy years, our state and local governments decided it was easier to allow the building of hundreds of thousands of new homes and shopping centers than to encourage a more diverse business development.

I have been a licensed real estate broker for over 40 years. I have bought, sold, owned, leased and managed residential and commercial real estate during that period. I am licensed in several states including Florida. I am both a CPM and CCIM and have taught different real estate at several schools in my career. If there is one thing I understand, it is the business of real estate. I know how vital the real estate industry is to a community. But government has only concentrated on one facet of that industry to the detriment of creating an integrated real estate and business economy.

To the south and north of Martin County land development has gone awry. Whether through greed, arrogance or stupidity, our politicians have allowed the sensitive environmental eco-system of Florida to be paved over. While construction added many jobs to the economy, those jobs are short term. Once the structure is built, those workers are out of jobs. There has been no economic planning for the future…only the present. Development for the sake of development is idiotic. Economic benefits go to the few and the tax payer is left with the bill of unchecked real estate expansion. If there are too many homes and commercial properties being built, then the value of all those properties will continue to fall. It is the simple law of supply and demand.

What has saved Martin County from having a similar fate as our neighbors is our Comprehensive Plan. Development for the foreseeable future should be confined within the Urban Services District. As I drive down Federal Highway (US Route 1), I see so much vacant and underutilized property for development and re-development. It is foolish not to take advantage of the infrastructure already in place.

We, as the residents, do not need our elected officials to be lobbyists for the development interests. We do not need them to stretch and change the rules to accommodate land speculators. It is preposterous to think that certain people and industries need "fast tracking", tax subsidies and reducing or waiving of fees. Wouldn't a smarter plan be to have a level playing field for all business? Why should I as a tax payer and small business person subsidize someone else's business? Aren't all businesses in the county entitled to the same level of services and to pay the same amount in impact fees and taxes?

Instead of the make-believe world that a majority of our current elected officials live in, we need to have our county and city commissions look to develop the plentiful resources within the Urban Service District. Instead of a "tool kit" to bribe a few cronies, we need "a large inclusive box" that treats all business people equally. In a community such as ours it is far better to have a hundred employers of 10 employees than one super employer with a thousand employees. In a downturn more people will keep their jobs.

Employment, especially high tech employment, is undergoing tremendous change. Frequently, people are being engaged not as fulltime employees but rather on a project by project basis. A Company based in Seattle will hire experts siting and working in London, Shanghai, Kolkata and Stuart for an individual project. We can't build buildings for purposes that won't exist in five years. The promises made for the future will turn out to be broken.

The continued economy of Florida and Martin County must not look to out dated and old ways of doing business. The building of vast tracts of homes and office complexes is not the key to economic development. It will only lead to further sprawl and decay. New businesses will develop organically within the Urban Service District if the taxpayers and their elected representatives provide the right atmosphere for them. We shouldn't squander the resources and infrastructure we already possess within the county. Let's spend our tax dollars on bringing that infrastructure into the 21st century. The buildings, roads, houses and utilities already exist. We just need to use them correctly.

Thomas F. Campenni CPM CCIM has negotiated a new lease for the 2nd 3rd and 4th floors (a total of 22,500 sq feet) at 159 West 25th Street which is in the Chelsea section of New York City. The tenant, Leaddog Marketing Group LLC was the existing tenant headquartered on the 2nd and 3rd floors of the building and decided to remain and expand their presence. Leaddog is a marketing and branding company with other offices in Los Angeles and Chicago. 159 West 25th Street has become a magnet attracting other creative and tech firms. The art-deco-era property, under the management of Thomas F. Campenni, has undergone extensive modernization in the past few years. The total rental will be in excess of $5,000,000 over the term of the 7-year lease.

Thomas F. Campenni CPM CCIM represented the owner in leasing the 5th, 6th, 7th, 12th, and 16th floors at 21 West 46th Street in Manhattan to WorkHouse NYC LLC which specializes in providing office services to tech startups as well as established firms. This art deco building is undergoing a complete modernization including lobby renovation, new HVAC systems and new floors and windows. A roof deck with panoramic views of New York City, including the iconic Empire State Building, will be used exclusively by the WorkHouse group. The lease term, which begins on July 1, is 13 years with an aggregate rent in excess of $15 million. The tenant was exclusively represented by Debra Larsen of Larsen Real Estate.

Peace Food Cafe Too, Inc., a vegan restaurant with a unique fusion of western and Asian foods, has signed a 10-year lease beginning June 1, 2012 for 3000 sq ft (Store 2) at 41 East 11th Street. The aggregate rent with excalations will be more than $3 million. Thomas F. Campenni, CPM CCIM, represented the owner.

Tom was recognized as an active volunteer in his Martin County, Florida community. The article appeared in the March 19 issue of the Stuart News in the Luminaries section. Over the years, Tom has been actively involved in a variety of charitable activities including meal preparation for the homeless in Stamford, CT, Meals on Wheels, East Harlem Lions Club, Martin County Chapter of the American Red Cross, and most recently at the House of Hope. Read more at www.tcpalm.com.

Thomas F. Campenni CPM CCIM representing the owner of 21 West 46th Street, New York NY has leased the entire 14th Floor to Prince Minerals, Inc. for 8 years. Prince Minerals is a mineral trading company with business worldwide. The 16 story art deco property is undergoing extensive renovations including a new lobby, exterior and interiors. The tenant was represented by Debra Larsen of Centric Real Estate Advisors.

Effective May 1, 2012, Enfrastructure New York d/b/a TechSpace has leased the entire 9th floor, consisting of 20,000 sq ft, at 41 East 11th Street (also known as 95 University Place) in Manhattan. This space was formerly occupied by St. Vincent's Medical Center. As part of this new 12-year, lease, TechSpace also renegotiated their existing lease for the 10th and 11th floors which now brings their total to 60,000 sq feet in the building. The asking rent was $42.50 per foot. TechSpace, a long-time tenant of the building, leases state-of-the-art offices to new and existing tech firms. The building, located in the sought-after Union Square area, is also home to tenants such as Beyer Blinder Bell, the renowned architecture firm, and New York University administrative offices. Thomas F. Campenni CPM CCIM acted as the broker.

Aggregate rent will be in excess of $35,000,000 over the course of the lease. The asking price was $42.50/sq ft.

Iconology, Inc., which operates a website for the comic book market, has leased the entire 9th floor (7,500 sq. ft.) at 159 West 25th Street in the Chelsea neighborhood of Manhattan. The website, www.comiXology.com, brings comics into the digital mainstream and exposes new audiences to the rich history and culture of the industry. The company has partnered with major comic book publishers and has created its own mobile and web apps to host over 4000 digital titles. The aggregate rent for the 5 year lease is $1,500,000. The owner was represented by Tom Campenni CPM CCIM of Thomas F. Campenni Company, the managing agent.

Connectivity Data Systems LLC has signed a 3-year lease for the 7th floor at 134 West 37th Street in Manhattan. The company is a provider of information technology and services. The owner was represented by Thomas F. Campenni CPM CCIM and the tenant was represented by Dan Schwartz of Winslow & Company. The lease begins on August 1, 2011.

Thomas F. Campenni CPM CCIM represented the building owner in the leasing of the 6500-square-foot store at 159 West 25th Street, a commercial office building in the Chelsea neighborhood of New York City. The tenant, Décor NYC, LLC, is a high-end home furnishing retailer whose target clientele is designers and other retailers. The 5-year lease will produce a minimum aggregate rental of $1,700,000. The tenant was represented by Roger Eulau of Lansco Corp.

Schematic Inc., a division of WPP Group LLC, the international marketing and advertising entity with offices world wide; has renewed its lease for an additional five years for the entire 6th Floor (20,000 square feet) at 41 East 11th Street a/k/a 93 University Place in Manhattan. The building has a total of 220,000 square feet on 11 floors and has recently undergone modernization including a new heating system, lobbies and elevators. Schematic was represented by Sacha Zarba of CB Richard Ellis and the Owner was represented by Thomas F. Campenni CPM CCIM, the managing and leasing agent for the property.

Also Washington Square Institute, a psychotherapy and research non-profit, has renewed its lease of the entire 20,000 sq feet 41 East 11th Street for an additional 10 years. Washington Square Institute has been a tenant since 1981. The Tenant was represented by Stanley Kleger and Eric Granowsky of KMG Partners while the Owner was represented by Thomas F. Campenni CPM CCIM, the managing and leasing agent. Both leases were in the mid $30s plus escalations.

As the owner of a small, independent real estate company, I have seen the consolidation of numerous "mom and pop" real estate outfits into the behemoths that dominate the market today. While our society and government celebrate the small entrepreneur in principal, in actuality they do everything to eliminate us by their preferences and policies. In each and every way, the elites of big government, business and labor have striven to crush our individualism by enacting laws and regulations to make it harder and harder for the small business to exist.

This trend has accelerated under the past two administrations and has culminated in the recent health care and financial reform legislation. Instead of truly helping the individual citizen, these governmental fiats are nothing more that crony capitalism at its worst. The JP Morgans and Citibanks are no more reined in than they were before the crisis. Our health care system continues to be a money maker for the Aetnas and United Healthcares, and the public be damned.

Ron Paul, in his recent blog post, was absolutely right in calling the Obama administration Corporatist. They do not want socialism, which is the government owning the "means of production," but instead want those "means" owned by a few favored private corporations. These corporations, while nominally independent of the government, are highly dependent on the government to continue to maintain their favored position. This is crony capitalism to rival those of any corporatist state from Ancient Rome to Nazi Germany. Just like the Roman elite spoke eloquently about the virtues of the republic, our elite speak lovingly and wistfully about the family farmer while giving billions in subsidies to a few huge corporations growing unneeded crops like cane sugar.

Many of my friends are small business people. They are not inventors who created new industries such as Bill Gates did with Microsoft. These are men and women who twenty or thirty or forty years ago decided they did not want to work for large companies. Most of these people began in "mom and pop" shops to gain experience and then went on to open their own small businesses. From real estate offices to contracting firms to restaurants, the one common thread was being their own bosses and calling their own shots. But each of these people tell me that if they were starting out today, they just couldn't accomplish what they had previously. It is too hard to compete with the unions, the government and the big guys and be successful.

I am far from someone who doesn't believe in government regulation. What I do not believe in is the government sacrificing the economic well being of 98% of the population so that the big boys can continue to thrive. For example, instead of breaking up the big banks, it is allowing them to continue with the reckless behavior that brought about the recent crisis. A simple regulation that prohibited them from trading for themselves would go far to prevent the next crisis. What is wrong with having banks that are in the banking business and investment houses that are in the investment business?

The morally corrupt Congress continues to vote on legislation that they have not read and was mostly written by lobbyists. The administration continues to move us closer toward the collectivization of our economy. The rest of us become nothing more than cogs in their plans. Our politicians, from Obama to the local legislator, will praise that entrepreneurial spirit of America while doing everything to make that spirit as much an anachronism as the independent small farmer.

Thomas F. Campenni, CPM CCIM, has negotiated with the Swedish-based home goods and furniture retailer IKEA to open a "Pop Up Store" at the building he manages at 159 West 25th Street between 6th and 7th Avenue in Chelsea. IKEA will have a three-day sale in July in order to highlight its merchandise. The store has 6500 sq feet on the ground and 6000 in the basement. The building has just been renovated with new attended lobby and modern elevators. IKEA will be paying the equivalent of $200 per foot for the month.

In addition, Thomas F. Campenni, CPM CCIM, has leased the building at 77 Valleywood Road in Cos Cob, CT at an agragate net rental of $60,00 per year. The property was renovated several years ago. It was purchased by Thomas F. Campenni last year to add to his holdings in Connecticut.

Whenever you speak to real estate professionals, it seems the market is always improving. Things are just moving along and everything is right with the world. If there is one thing that you can't accuse real estate brokers of being, it is pessimistic. However, if you question them in any depth a different picture emerges.

A couple of things become obvious. One is that real estate investment and the home market, though anecdotally improving, is still in the doldrums. Second is that the sustainability of any improvement, anecdotally or not, is far from certain. Real estate, like so many industries in the United States, is government subsidized. Like agriculture, real estate investment and home ownership has been propped up by tax incentives and cheap government-induced mortgage rates.

No rational, intelligent person believes that the United States has anything close to an unfettered market-based economic system. When we, as a nation, first began to tame the Darwinian capitalism of the early 20th century, the government was looking to support the everyman against the robber barons. Sometime beginning in the middle of the last century, the government no longer was concerned with the betterment of the everyman, and despite the rhetoric, they regulated the economy in the interest of big business and big labor.

Subsidies for everything from pig farming to car making to real estate became the norm. The notion of the "greater good" continued to be spoken of in platitudes, but in reality, what our politicians were after campaign contributions. Republican or Democrat affiliation really made no difference. As is all too common, the saying "money talks" was all that mattered regardless of party affiliation.

By the time of our most recent crises, the everyman no longer mattered at all. In fact, the new robber barons of today have become the beneficiaries of huge government subsidy and largess at the expense of the masses. The Carnegies of the late 19th and early 20th century could only dream of having not only a friendly government but one that supports the behemoths to the detriment of the rest of us.

Real estate home sales last month were at their lowest since 2001. With the end of the tax credit and the still lingering recession most people did not feel comfortable in purchasing a new home. But when did it become "un-American" to rent? Not every American has the financial wherewithal to own real estate. There is nothing inherently evil in renting. The government does not have to support artificially high levels of home ownership through policy decisions in order to prop up the real estate industry.

As a nation, we need to ask whether we want to continue with this form of crony capitalism. The continued subsidization of our large businesses and labor unions cannot continue if we intend to get our fiscal house in good shape. In order for us to build an economy that can be sustained, we need to change the way we incentivize and tax. Contrary to what my real estate colleagues believe, the industry and the nation cannot continue on the path of subsidy in order to sell more and more homes to less and less qualified buyers.

Each day, I receive an e-mail bulletin from the Florida Realtors Association with stories and updates on the market. Many times, I will read conflicting stories contained in the same update. One story will state how the market hasn't bottomed out while the next story will tout how prices are surging.

This type of hyperbole is not new. Puffery is a time-honored tradition in the real estate industry. It is even mentioned in our text books in order to explain the difference between puffery and an outright lie, which of course is not permitted. Like so many occupations, real estate practitioners are occasionally much more concerned with what is legal than what is ethical. Throughout history, doing the right thing may often be illegal but can be ethical.

The investment markets and people who manage those markets are much more concerned with the letter of the law than what is ethically right. Perhaps, Goldman Sachs is following the letter of the law, but is their conduct ethical? Madoff's Ponzi scheme was not only unethical but illegal. But, how moral is it to borrow cheap money from the government and then buy government bonds with that money because they pay a higher interest rate. Then, on top of that, the CEOs of those organizations are paid millions of dollars in bonuses because of this smart investment strategy.

Is it possible that we can even trust the markets when the very people who are there to help us manage those markets are corrupt? If a real estate salesperson were to sell you a house that (s)he knew to be defective without disclosing the defect, (s)he could lose his/her license and be sued. When a "Wall Street" brokerage house sells securities or other instruments they know to be of dubious value, they suggest you should have taken the time to better understand the risk associated with the purchase.

For many years, I taught an ethics class to real estate and insurance licensees. I would use a Socratic teaching method using stories and different scenarios in order to ask questions and then elicit responses to make a specific point. Early in the class, I would use more exaggerated stories so that the choice between legal/illegal and ethical/unethical was clear, but as the class progressed, the stories became more subtle so that what was legal and illegal, but more importantly right and wrong, would be harder to know. As I said in the beginning of that class, legality is one thing -- morality may be another.

No one in the class would disagree with the statement that Nazi Germany was morally bankrupt. All would condemn the genocide of Pol Pot and the purges of Stalin. But as the scenarios became more subtle (such as seeing someone take something that was not theirs or tell an untruth in order to further an economic gain), then the line between legality and morality became more blurred. I would say 50% of my students would always state that it was alright as long as it was legal.

Perhaps that is the problem with our institutions today. As a society, we have chosen to regard legality as morality. By doing so, society has ceased to regard certain behavior as bad because it is not illegal. It is just fine for a rating agency to rate a financial investment AAA even when that agency fully knows that it is not truly AAA quality. Too many of our investment professionals can no longer tell the difference between puffery and falsehood.