Disney Runs Its Own Government in Florida. The State is Trying to Stop Them, and It's Not Going Well
Disney Runs Its Own Government in Florida. The State is Trying to Stop Them, and It's Not Going Well
Corporate power is a threat to democracy
So here’s a crazy story for you…
Last week, I published a piece entitled Which Corporation Will Start Its Own Country First? The article speculates as to which billionaire or corporate entity will shoot for sovereignty first. (They all will eventually.)
I’m hugely in favor of Tinyism, but I’m vehemently against the idea of corporate governments because they are not democratic and only exist to profit private interests, not the public at large.
Case in point: The mega-monopoly Disney down in Florida. They’re the $200-billion behemoth that owns ABC, ESPN, Marvel, Lucasfilm (Star Wars), The Muppets, Touchstone, A&E, The History Channel, Lifetime, Pixar, Hollywood Records, Vice Media, Core Publishing, Winnie the Pooh, Indiana Jones, Maker Studios, Steamboat Ventures, ATV, RTL 2, RDS, Tele 5, Kividoo, Earth Star, Synergy Group, the Chronicles of Narnia, and literally hundreds more. Hundreds. (Please note: They will not stop until they are stopped.)
Back in 1967, Disney brokered a shady deal with a corrupt state government to allow them to create a “special purpose district” in Florida.
This nearly 40-square-mile zone is called the Reedy Creek Improvement District, and it operates exactly like a county — except that it’s privately controlled by the Disney corporation.
It runs the fire department
It owns the police service
It administers the environmental protections
It services all roads and utilities
It oversees all development permissions and building codes
It controls all taxation
Rather than pay the county to do all these things, Disney brought them in-house to turn a profit off them instead.
The district’s governance is shady AF. Just five people control the government. All five are high-level employees at Disney. Each of them owns (on paper) an empty 5-acre piece of land in the district — the only land “not owned” by Disney itself.
Unsurprisingly, the district has constantly been accused of acting in the interests of Disney instead of the public. (Which, of course, is the legal fiduciary reason why corporations exist.)
I know what you’re thinking: This is obviously an illegal monopoly.
And you’re absolutely correct.
If Disney can run its own county, why can’t Apple or Facebook or you or I?
It creates an obviously unfair competitive advantage that Disney shareholders have been milking for 55 years.
In a fair-rules-market economy, special purpose districts like Reedy Creek wouldn’t exist.
The only reason Florida allowed them to do it in the first place was that Walt Disney (the real guy) promised to build them a futuristic city. But once the bill passed, they just built resorts instead.
The breakup bill
Last week, Republican Governor Ron DeSantis and his posse decided to abolish this special tax district.
Good.
The question is: Why now? Why haven’t Republican and Democrat governments been trying to shut it down for decades?
Commentators speculate the dissolution of Reedy Creek is retaliation for Disney’s opposition to the Don’t Say Gay bill, and they’re probably right.
But regardless of the motive of these governmental sociopaths, the outcome is good: One corporation has one less advantage over its competition.
Or… maybe not…
Disney fights back
The house that Mickey built will likely press on the retaliation motive and argue in court that the company’s free speech rights have been violated.
But corporations are not humans, no matter what the corrupt Supreme Court says.
Corporations should not have free speech rights under the First Amendment.
Corporations should live and die by the will of the people. (That, of course, would require making America a democracy first.) Corporations are guests in our countries, not the other way around.
But there’s more to this story, and there’s another legal argument to be made that might allow Disney to keep its unfair advantage.
The poison pill
Walt Disney’s lawyers were smart dudes.
They loaded their Reedy Creek term sheet with an IED that would explode if ever the government tried to break up their shady arrangement.
In the original contract that the wretched state signed with Disney, it states that the government would never “alter or limit the powers of the district” until all bonds on the district were paid off.
Reedy Creek, naturally, still apparently owes its bondholders a chunk of change, even after 55 years in existence.
That’s because Disney purposefully runs the district at a multi-million dollar loss each year, quietly creating a protective moat against attack.
The current outstanding amount?
Over $1 billion.
So either the courts will deem the dissolution of Reedy Creek to be unconstitutional under the Contract Clause, or the state of Florida will have to pay off bondholders (ie friends of Disney) to the tune of ten figures.
In other words: A private corporation is ready and willing to steal $1,000,000,000.00 in taxpayer money based on a crooked deal signed by crooked people who are all long dead.
The original deal was so corrupt that a tax lawyer over at Bloomberg thinks it will be impossible to break up Disney’s land monopoly.
Smash the mouse
Corporations don’t get to tell democracies what to do.
They don’t get to ink illegal, immoral, and unfair deals, and then make the public pay them off like mobsters to get out of them.
Governor DeSantis’s reason for trying to dissolve the district isn’t sound, but he’s inadvertently exposed a major problem with America:
Corporations have more power than governments.
I hope he finds a way to smash Disney.
Because every corporation — and every politician — should be terrified of the masses they claim to serve.
Jared A. Brock is an award-winning biographer, PBS documentarian, and the cell-free founder of the popular futurist blog Surviving Tomorrow, where he provides thoughtful people with contrarian perspectives on the corporatist anti-culture. His writing has appeared in Esquire, The Guardian, Smithsonian, USA Today, and TIME Magazine, and he has traveled to more than forty countries including North Korea. Join 20,000+ people who follow him on Medium, Twitter, and Substack.