One of the few silver linings of the current Wall Street financial debacle: thanks to reader John Dickerson for pointing me to news about Sheldon Adelson’s possibly imminent corporate bankruptcy. It seems business has been bad for the gambling industry, dependent as it is on gambler’s discretionary income, which there is very little of these days:
Las Vegas Sands Corp., billionaire Sheldon Adelson’s casino company, fell the most in New York trading since going public after saying it may default on debt and face bankruptcy.
The casino owner, which had $8.8 billion in long-term debt at the end of June, said in a regulatory filing today that it probably won’t meet the requirements of loans arranged by [various banks]
Here’s the company’s own chilling statement:
The casino owner said it doesn’t expect to meet a maximum leverage ratio covenant in the fourth quarter. That would trigger defaults that might force it to suspend development projects and “raise a substantial doubt about the company’s ability to continue as a going concern.”
Adelson spent $475 million of his own personal fortune to avoid violating terms of bank loans as his stock declined 90% through September. October hasn’t been much kinder.
The company’s troubles may prevent Asian gambling capitals from being graced with Adelson resorts:
The reversal of fortune is a black eye for the 75-year-old Adelson, who was once America’s third-richest man on the strength of his Las Vegas Sands holdings. The Las Vegas-based company’s dwindling cash flow is threatening $16 billion worth of developments in Macau, China, and Singapore…
The Bloomberg story of course neglects to mention Adelson’s considerable clout within the right-wing political world, both in the U.S. and Israel. He is Taglit-Birthright’s only major funder. Plus, he owns the farthest-right Israeli tabloid daily, Yisrael HaYom. He also funds the pro-Likud Shalem Center and is Bibi Netanyahu’s chief donor and supporter. He is also a major (perhaps THE major) funder of the Republican Jewish Coalition. He was the founder of Freedom’s Watch, a neocon group whose mission was to help John McCain win the 2008 election.
Without Adelson’s largess, the Jewish right will be, if not voiceless, at least considerably quieter. Netanyahu specifically would expect Adelson to step to the plate at this critical juncture with a national election campaign due in February. Without him, the Likud leader will be hard-pressed to replace his financial bounty.
This could be good news for Tzipi Livni, who may have to face a little bit less mud slung at her from the right without Adelson’s intervention.
I can’t say any liberal Jews are going to be crying in their Manishewitz cups over Adelson’s financial problems. In fact, it couldn’t have happened to a more deserving fellow.