Category Archives: Uncategorized

Slaves of New York

In a world with quarterly mass shootings, nuclear missile warnings and a barrage of daily atrocities, it might be easy to write off the suicide by livery driver Doug Schifter in front of City Hall earlier this week as just another tragic end to a mentally unstable individual – but that ignores the sad truth of his ordeal. Doug died a victim of the new economy.

The adoption of new technology will always displace workers and the advent of ride sharing is no different. We know the proliferation of Uber, Lyft, Via and other ride sharing applications have profoundly reshaped our economy, creating winners and losers. In Doug’s final cry for help, he described how competition had pushed him to work 100-120 hours a week as a yellow cab driver, transforming him from self-employed businessman to a “slave.”  In the new economy, Doug Schifter was a loser.

Doug is not alone.

Gina Bellafante writing for the New York Times detailed the emotional testimony last spring, from Bhairavi Desai the Executive Director of the New York Taxi Workers Alliance,  about the mounting “existential difficulties” of the life of a yellow cab driver.  In short, competition from ride sharing companies has substantially impacted driver incomes and dramatically devalued medallions.

Desai said, “Half my heart is just crushed and the other half is on fire.”

There are literally hundreds and thousands of workers in industries throughout our state that are being displaced by new technology. This is nothing new. In my own experience at Empire State Development we worked with many companies that made investments in new technology creating efficiencies that reduced employment. We knowingly assisted them, with the hope to preserve employers, save jobs and their impact on the community. It is a hard reality. But in those instances we always tried to focus on the displaced workers – typically with an emphasis on upgrading skills and placement services.

When it comes to the amorphous nature of the Doug Schifter’s of New York, there seems to be not enough attention on the displaced workers.

While many aspects of Doug’s plight are shared with those of a laid off manufacturing worker, somehow his story feels profoundly different. The classic role of government is to ensure the marketplace is fair, that rules are being applied equally and as conditions change (new technology is adopted) to amend those rules – to ensure some version of Teddy Roosevelt’s “square deal.”

In Roosevelt’s words, “But when I say that I am for the square deal, I mean not merely that I stand for fair play under the present rules of the game, but that I stand for having those rules changed so as to work for a more substantial equality of opportunity and of reward for equally good service.”

The present rules of the game are not fair.  Yellow-cab owners like Doug are much more heavily regulated by the city. For example, by 2020, half of all yellow cabs must be wheelchair-accessible while ride sharing companies are exempt.  And unlike ride sharing cars that utilize surge pricing to charge higher fares during peak times, yellow cabs are locked into fixed rates.

“Substantial equality of opportunity,” I think Doug Schifter saw that as being ripped away. Not just by competition from ridesharing companies but by a political system that feels more rigged, more disconnected and more unequal every day.  In his final words, Doug bemoaned what is commonly understood – that Uber and Lyft have political muscle and are favored by leading politicians.  According to Desai, in 2016, Uber and Lyft combined spent more on lobbying than Amazon, Walmart and Microsoft combined.

Doug worked until he could work no more, his livelihood hollowed out through no failure of his own – he felt powerless, is it any wonder he felt like a “slave.”

In his final Facebook post Doug wrote, “I hope with the public sacrifice I make now that some attention to the plight of the drivers and the people will be done to save them and it will have not have been in vain and also that we must stop what is happening to Government while we still have one we can vote out.”

The sharing economy has created enormous opportunities for workers and consumers. Their innovations have upended, transformed and in many ways distorted long-standing market places. But Uber, Lyft, Via and others aren’t the villains in Doug’s tragedy – they are like all business enterprises – self-interested and competing within the political, regulatory and consumer marketplace. They will someday be displaced by the companies that dominate the markets for self driving cars, urban transport pods, hyperloops, teleportation – or something we have never imagined.

No, the villains (for lack of a better term) are our political leaders and regulators who haven’t proven nimble enough, committed enough to preserve Roosevelt’s “Square Deal.” It’s not easy and it’s not going to get easier as the increasing pace of innovation is compromising the ability of policy makers to comprehend, let alone anticipate the impacts of new technology.  Only through a commitment to evolving our outdated legal and regulatory structures – to change the rules – can we “work for a more substantial equality of opportunity.”  The alternative is a generation of middle-aged slaves, depressed, angry, untethered and quite possibly at the wheel of your next ride.


Don’t Get Conned on the Con Con

With Election Day just hours away it’s time to get serious. With all my decisions basically set I’m still struggling on how to vote on the Constitutional Convention.  I have to admit, my first instinct was no way!  The convention organizing rules are rigged for insiders (said the insider), the establishment will control the agenda, and our system, as flawed and frail as it currently is, will just get worse.

Further, as a fan of fiscal restraint, I’m truly fearful that the legislature, which would have a powerful hand in any convention, will reassert their authority and end the strong powers of the Governor as it relates to budget making. Their logic is plain, as a Constitutional matter, it echoes of our federal system, where Congress controls the purse strings.  If that happens we can turn the lights off on New York – as in recent decades the only thing occasionally slowing down the growth of taxes and spending are New York’s chief executives.

But a funny thing happened – a group called New Yorkers Against Political Corruption caught my attention.  It seems they have weighed in on the issue spending millions to oppose the Constitutional Convention. I wondered, what does the Con-Con, have to do with political corruption? I thought the purpose would be to get a better system, less corrupt system. When you look behind the curtain, you find the group is made up of a host of large labor unions and their name – is simply a con. New Yorkers Against Political Corruption amounts to one of the most intellectually dishonest, cynical, ham-handed, hack jobs I’ve seen – and that is saying a lot.

And the more I looked, the more everyone who I thought might be for the Convention is opposed.  It seems like every institutional group that holds sway in Albany is more afraid of what they have to lose than what they have to gain.  The unions are fearful that pensions will be stripped.  The environmentalists worry that the “forever wild” clause will be watered down.  Gun owners are worried their rights will be eroded, gun opponents are worried they will be reaffirmed. Minor parties fear for their very existence. The Senate Republicans fear they will be marginalized by same day registration or expanded voting – and the Assembly Democrats, well they just want what NYSUT wants. Logically, all this has prompted me to reconsider.

If all these varied special interests and establishment pols are content with the status quo – it must mean the status quo is pretty good for them. And if all the allied and opposing power brokers in Albany actually believe that the system works “well enough” from where they sit, isn’t that a problem in and of itself?  Doesn’t that mean they already have too much power? If you notice the arguments are not about ideology or solutions – it’s all about maintaining the status quo.

If the status quo was kicking ass – hell if it showed a spark of life, I’d be all for that. But the status quo has left us with two New York’s – with upstate, for the most part, failing to compete due to an economic, social and fiscal framework foisted upon it by downstate politicians and interests.

But it is more than the old upstate-downstate divide that ails our politics – too much money in the system, from both sides, has alienated voters more than ever.  The billionaires, the unions and the corporations have outsized roles in our elections. Campaigns aren’t won and lost by candidates anymore, they are won by George Soros, NYSUT, Bob Mercer, the NRA and some LLC with a mysterious name and address. Cynics say “it balances out” –  that the interests of the monied left and right are aligned in diametric opposition, evening the playing field.  But assuming for a second they do counterbalance each other, they are also so loud and powerful that they effectively squeeze out a multiplicity of other ideas.  The concept that a new right, the freedom to spend, is an analog for freedom of speech has been a great perversion of our political system and while it is a federal issue at its core, we need to get smart about fixing it where we can.

So where do we stand? Some people say, “let’s go, it can’t get any worse!”  Hmmm, have you seen Illinois lately, it could get worse – it could definitely get worse.  Others say, “trust the people” or at least the 30% of eligible voters who come out for our gubernatorial elections. And yet others say we don’t need a costly Con-Con because we can achieve what we need through the amendment process.

The truth is a Constitutional Convention is a total crap shoot – the odds of a successful effort are long.  But at the end of the day, it just feels like we need to roll the dice.  We need to think bigger – the challenges we face today are exponentially more complex than in 1894 the last time the Constitution was completely revised. And you never know we might surprise and find we are up to the task.

Blair Horner of NYPIRG put it best when he told the New York Times, where you stand on the Constitutional Convention, “…comes down to fear versus hope.”  The Albany establishment fears change, but the people need hope – here is one vote for hope.

Amazon…It Ain’t Just a River in South America

It seems like half of America’s cities are competing for Amazon’s 2nd headquarters project and why shouldn’t they – big projects, mega projects matter. The potential of 50,000 employees and billions of investment is a game changer.  Yes mega projects are expensive, yes they are risky – but if you are going to take a big risk it would strike me as smart to wager on the e-commerce giant.

Last week, Ross Douthat writing in the New York Times, called upon Amazon to select a site on the basis of “what’s good for America.” He opined on Amazon’s opportunity to revitalize a desolate place in America – downtown St Louis, Detroit, Chicago or Baltimore – and a chance to be “seen as a company that renews cities and doesn’t just put brick and mortar out of business.”  If these communities were just impoverished, I might be more sympathetic – but the elected officials in those cities have dramatically failed to uphold the most basic responsibility of government – ensuring security.  Whether it’s Iran or the streets of Chicago, safety and security are precursors of economic opportunity not the other way around. 

But following Douthat’s rationale, if Amazon wants to make a difference and be successful – Upstate New York, makes a lot more sense.

According to news reports and stuff I happen to hear – the Albany-Schenectady-Troy / Saratoga MSA is a bidder, the Buffalo-Rochester / Toronto region is a bidder as well as Manhattan, Brooklyn, the Bronx and possibly some yet to be determined area of Westchester.  They all have some obvious merits and they all have their obvious challenges. Among the rumors I’ve heard from around the state, only Buffalo-Toronto and Manhattan will get a real listen from Amazon – but like the lottery, you have to be in it to win it – so as a grandson of the Pastures in Albany, and a cheerleader for upstate I’m rooting for the Capital Region.  

But where? The obvious choice is the Harriman campus – long a site waiting for meaningful redevelopment. My guess is that Harriman could someday make sense for a less brand conscious tenant – but my gut is Bezos and Amazon will want to make a statement. Office parks, corporate parks, tech parks seem soooo 1990’s. Harriman, in my personal view, lacks the sass to stand out in an uber crowded field and ultimately doesn’t tell a story worthy of Amazon’s gravitas.

The big play – the out of the box option for Albany – is to check the gift wrap box, put a bow on it & deliver the Empire State Plaza to Amazon.

And why not?

It will definitely get some attention –  I can pretty much guarantee you no other state will do it.

The assets are all already under control.

It reeks of crazy serious commitment – from the State and local leaders.

It would dramatically re-imagine downtown Albany – giving downtown Albany back to the City.

In short, it has sass.

The Corning Tower alone has almost 1 million sq feet of office space – twice Amazon’s initial need.

The proposal could be to rehabilitate the interior of the (Corning) Bezos Tower (since we are renaming things these days), update the exterior with a state of the art wrap or edifice, add a Winter Garden on the plaza level to house retail / amenities and radically modernize the lobby. Finally, create an off site energy plant to provide 100% GREEN power to the site and yes build the much ballyhooed gondola from the Albany-Rensselaer train station to the Plaza (it would actually make sense)

The kicker – displaced state workers could be relocated in downtowns across the Capital Region. Everybody wins.

Why Albany?  

#1 Albany, the Capital Region and Upstate is a bastion of higher education:

Access to talent is a key driver for technology behemoths such as Amazon and there are few parts of America that can rival the number of students that attend colleges and universities in Upstate New York and the Capital Region. In the Capital Region alone there are 21 traditional higher education, degree-awarding institutions. Our state’s public universities, most of them located upstate, graduate more than 40,000 undergraduates each year, and another 17,000 with master’s degrees or above.

#2 Albany is and always has been affordable:

Historian John McMaster wrote,“…Albany was a place where a man with a modest competence could, in time, acquire riches; where a man with money could, in a short space of time, amass a fortune.” Affordability is a key factor in attracting and retaining talent and in particular the relatively low-cost of housing in the region is a big plus.

#3 Albany is and always has been at the epicenter of transportation:

As the site of one of the 1st commercial airports in America, Albany is an important transportation gateway to millions of people in the Northeast, New England and eastern Canada.

#4 Albany’s skyline is iconic:

The Empire State Plaza, while iconic, is overdue for reinvention. The Corning Tower is the tallest structure between Montreal and New York City.   I’d like to believe the Plaza’s architect, Governor Nelson Rockefeller, who loved to build big things – important things, would be thrilled by a modern adaptation of his work.

#5 Albany is just a “drones throw away” from Griffiss Airport in Rome:

In late 2013, the Federal Aviation Administration (FAA) announced that Griffiss International Airport, a former Air Force base in Rome, N.Y., would be one of ONLY SIX sites nationwide with authorization to test commercial unmanned aerial systems (UAS), commonly referred to as drones.  The Association for Unmanned Vehicles Systems International predicts growth to approach $82 billion by 2025 – Amazon’s, Prime Air, is a leader in this rapidly growing industry.

Judging by recent announcements in Staten Island and Manhattan, New York state economic development officials already boast a strong relationship with Amazon- here is a chance to take it to the next level.

Tagged , , , , ,

Devlin MacGregor and Movantix

One of the best characters, in one of my all time favorite movies, is Harrison Ford as Dr. Richard Kimble in The Fugitive. The wrongly accused surgeon on the run from the incompetent Chicago cops (murder apparently has been a problem there for years) and Deputy Gerard in search of the one-armed man who killed his wife.  In the end, he gets his man – but as we all know the real villain in the story was the evil pharmaceutical giant Devlin MacGregor.

I thought for sure Kimble put those bastards away for good, but Devlin MacGregor is back…and now instead of Provasic they are shamelessly peddling Movantix, a drug to give relief to opioid induced constipation (OIC).  Yep you got it – we have a heroin epidemic in full bloom and the answer isn’t less opioids, it’s how do we manage the scourge of constipation.

The numbers speak for themselves. Between 2010 and 2014 opioid-related deaths rose 47 percent in New York. And judging by the headlines, this trend has continued unabated across the state and nation. In 2016 there were 460 deaths in Westchester, 320 dead in Erie County, 86 in Staten Island, 61 in Onondaga and 57 in Monroe. And already 50 more have died in Erie so far this year. Everyone seems to know someone who is addicted or has died.

Now I ask myself: why would Devlin MacGregor take to the airwaves buying expensive spots in prime time, during the NCAA men’s basketball tournament and even the Superbowl, to mass market–yes mass market–this drug? From Wikipedia – Mass marketing is a market strategy in which a firm decides to ignore market segment differences and appeal the whole market with one offer or one strategy,[1] which supports the idea of broadcasting a message that will reach the largest number of people possible.  

Devlin MacGregor is advertising an opioid constipation drug to “…the largest number of people possible.” Deputy Gerard would disagree with the use of the word, but that’s hinky.

Hinky as in strange, weird or just plain old BS. Isn’t the medical community already under a mandate to strictly control the prescription of opioids? And since they are – shouldn’t prescribing doctors be aware of drugs like Movantix to help their patients manage the side effects like constipation?  And isn’t the ultimate goal to get patients off opioids entirely? I tell you it’s hinky.

At first, I joked to myself that this was a “savvy” effort by Devlin and Big Pharma to actually corner the market on a segment of opioid related sales they can still milk the hell out of. Having lost literally millions of customers and market share to the drug cartels who make heroin cheaper and more powerful, they are instead piling up profits from the bound up. After all, Movantix doesn’t discriminate as to whether constipation is caused by smack, snow, dope, dragon or OxyContin or Vicodin.

Turns out – insanely, that I’m right. According to Claire Gibson, an analyst for the research and consulting firm GlobalData, by 2019 the U.S. “will represent approximately 86 percent of the total market” for opioid induced constipation drugs – an equivalent to $563 million in annual sales. She said the estimated patient population for OIC drugs will be “just under 4 million” people.

Let’s recap that –  by 2019 the United States will account for 86% of the total global market for opioid induced constipation drugs.  Whaaaat???

So apparently, despite all the bill signings, drug busts, headlines and hand wringing, real progress in slowing the prescription of opioids is well – bunged up. According to a report in the Journal News, between 2012 and 2014, 251 million pain pills were prescribed just under Medicaid in New York. That’s 13 pills for every New Yorker, apparently an unlucky number for a reason. These numbers don’t include opioids prescribed under private insurance. Is it any wonder one in six unemployed male of working age in America is addicted to an opioid?

Sorry folks – but that’s insane an amount of pain relief. Paul Ryan wants to require able-bodied persons on Medicaid to get a job, they might be too drugged up to work. Seems like the geniuses in Washington on both sides of the health care debate might want to look into this issue.

In the meantime, please,someone–shareholders, anyone–please stop the amoral profiteers at Devlin MacGregor from airing this putrid nonsense anymore. The ads reek of a culture that is beyond repair. It has the glossy stench of giving up, of a tacit acquiescence to an insidious disease that is robbing us of too many of our family, friends and neighbors.

It’s not who we are. It’s wrong. We don’t give up–just ask Richard Kimble.

Tagged , , , , , , , , , ,

The 411 on the 411

Suffice it to say I crave human interaction.

I take the subway generally because I enjoy watching people. I don’t have EZ pass because I actually like saying hello to toll takers. I go to the same Dunkin Donuts religiously because I like that they know I take a large with two cream and two sugar. Aside from making me look less bald (which is a miracle in itself), I’m seriously attached to Valerie who cuts my hair because I look forward to seeing her new tattoos or what new color her hair she is trying out. And if I see the older Indian gentlemen Saleem working the register at my Price Chopper, he’s so friendly and sincere I’ll stand in line for an extra few minutes just to say hello.

I used to feel much the same way about the 411. You are on the road, you get in a jam and 411 was there to help you out. Just hit those three friendly digits and all your questions could be answered.

Now in most instances the answers are of the automated variety – but over the years, when the computer was stymied by my thick Northeastern drawl, I would end up having quite lovely conversations with Beverley in Oklahoma, Sue in Illinois and Stu in Dallas all directory assistance operators who hooked me up in a time of need.

Operator: How can I help you
Me: How are you today?
Me: Thompson, Lake New York please
Operator: Thompson, Lake New York – Ok
Operator: What listing please?
Me: Some german beer place on the lake?
Operator: Checking german restaurant on Thompson Lake
Me: Maybe it’s Warners Lake
Operator: Checking german restaurant on Warner Lake
Operator: Do you have any more information?
Me: I promise you its the ONLY German sounding place in the whole area.
Operator: I have a Scholz-Zwicklbauer Hofbrau in East Berne
Me: Yes, Yes, Yes
Me: What’s your name?
Operator: Sue. Will that be all? I’ll connect you!
Me: Yes, Thank you Sue, you made my day.

The 411 operator was a life line. They were a human connection in an increasingly automated and de-personalized world. I’m sad to pass along the news there is no more 411 operator.

If you tried to find Zwicklbauer today you would be out of luck – and not just because it closed. (A tragedy for another day)

It seems 411 no longer has the default to a live operator. Which means if the program doesn’t understand your request, you are just screwed, abandoned to that smart ass Siri.

How do I know this – True Story.

Ding, dong, do
Computer: ATT Directory Assistance, name a city and state please
Me: Albany, New York
Me: The New York State Department of Transportation
Computer: The New York State Department of Motor Vehicles.
Me: NO
Computer: Sorry not finding New York State Department of Transportation
Computer: New York State Department of Licensing and Real Estate
Me: Operator please
Computer: Sorry, goodbye.

I repeated this transaction several times, over and over with the same outcome.

Frustrated, befuddled I wondered what’s wrong? In the past when we ran into these roadblocks Sue, Stu and Beverly were there to ride to my rescue. Now I’m just being unceremoniously dropped with no recourse!!! And by the way, its not like I’m looking for a foreign sounding Zwicklbaur, I’m looking for the damn DOT – any DOT in the state would have actually sufficed.

So I was on the road and thought I would use my driving time to get to the bottom of this mystery. At first, I was flummoxed because normally my journey of inquiry would start with 411, but clearly that’s off the table. Leading me to wonder, “how do you find out what happened to 411 without 411”? I was now feeling like I was in an episode of Mr. Robot. Do I call 911? I’m tempted to do this because this truly feels like an emergency to me. The fact that I can’t talk to a person is disorienting. So finally, desperate, I land on my last resort 611. Anyone who has ever called 611, which is everyone who owns a mobile phone, knows you are in for the treatment. Call at your own risk and be prepared to be kept on hold, dropped, transferred and misunderstood — it’s pure torture — but I was on a mission.

I call 611, connect with a customer service representative and proceed to explain my dire circumstance and deep desire to speak with management. For the life of them, the 611 operators couldn’t grasp my issue. They were completely zwicklbauerd by this existential dilemma. Their primary training is to give you your money back for the lack of a proper connection on 411. I thank them and explain nicely, that this isn’t about the money, which didn’t quite compute for most of them. Fueled by my fear of a world without 411 operators I pushed on.

Finally, after three drops, two wrong connections and probably close to an hour on the phone I end up with a young man named Carlo. Nirvana! Carlo actually understands my issue and says “that’s news to me, I’m going to need to look it up.” A few minutes later he’s back on the line and say’s – “you are right!” (Thank God I think, at least I’m not crazy.) Apparently, in April, ATT (or whoever actually provides the info service) did away with Bev, Stu, Sue and the rest of my friends at 411. I ask Carlo to make a note to his boss that this is “bogus” and that I intend to “file a complaint” with everyone I can from the PSC to my elected officials. I then of course throw in the obligatory “and by the way it’s not like the cost of my cell service has gone down.”

Most importantly, I thank Carlo profusely for having finally provided me with the 411 on directory assistance.  It wasn’t the answer I wanted, but it was an answer apparently only a human could provide.

And that’s where we’re are today. I’ll write my obligatory letters, file my impotent complaints secure in the knowledge that they will be ignored — chalked up to the price of progress. While I feel better that thanks to Carlo I got the 411 on the 411, I’m still wistful for the good old days of directory assistance and for Stu, Bev and Sue – the humans on the other end of the line.

Update: Since this post was shared, I’ve learned that Verizon still has live customer service operators. “Can you hear me now?” just took on a new meaning! 

Tagged , , , , , ,

Dropping Like Flies

Have you ever heard of “rapid plasma deposition?” I haven’t, but it sounds geeky cool right? It sounds like the future.

Rapid plasma deposition is a technology that a company called Norsk Titanium deploys to make cutting edge aerospace components. Sounds even cooler, right?  But the coolest thing yet, in August of 2016, the administration and SUNY Poly promised that a state investment of $125 million in Norsk Titanium would create 400 jobs and leverage over $1 billion dollars over ten years for the world’s first industrial-scale additive 3-D printing facility for aerospace production in Plattsburgh, New York.

In the wake of  SUNY Poly projects seemingly dropping like flies around the state, I wonder today if this project is next?

After all, the company is only 12 years old (only 4 of those in production). According to their Linkedin page, the company employs somewhere between 51-200 people (primarily in Norway). Disturbingly, I can only find $25 million in private funding raised and that followed the inclusion in the 2016 New York State budget of the $125 million to support the development of Norsk.  Most importantly though, I wonder if the economic / technology analysis made by SUNY Poly in securing the deal in 2016, matches with the Zemsky-ESD metrics of the New Year.  Late Friday, ESD pulled the plug on a $40 million “transformational” Rochester photonics project concluding that the “deal does not meet the standards required for a significant state investment of taxpayer dollars…and as a result, the state is no longer pursuing the project with Photonica.” It was just the latest project in the SUNY Poly portfolio to be scuttled.

So today we wonder, does the $125 million dollar deal with Norsk “meet the standards for a significant state investment?”

Here’s the problem, despite being an occasionally smart guy, who has spent some time in economic development, who actually nurtures an abiding interest in science and even after researching this company, I have no idea of the viability of Norsk’s technology in the marketplace. As in zero. And no offense to Commissioner Zemsky or my former colleagues at ESD, for whom I have great respect, I doubt they really know either.

But, I know someone who does, Alain Kaloyeros.

I first met Alain in 1997, when I took over day-to-day management of the New York State Science and Tech Foundation (NYSTAR’s predecessor). Alain at the time was running one of the State’s 14 Centers for Advanced Technology (CAT).  Every year, each CAT received $1 million dollars, regardless of their performance. We decided to change that and work to reward CATs more funding from that $14 million dollar appropriation based on performance, with an emphasis on economic impact.  That idea thrilled Alain, he loved the competition and he of course out performed all of the other Centers. But this was just small potatoes, Alain had much bigger plans.

Kaloyeros went on to head the Center for Excellence in Nanotechnology, the most advanced research facility of its kind in the world. The Center would become the home of Sematech and literally thousands of researchers, engineers, students, from companies around the world including: IBM, Tokoyo Electron, Samsung, ASML, Samsung and many, many more. Under his leadership the College of Nanoscale Science and Engineering was established and in 2004 graduated the world’s first PH.D degrees in nanoscience. Let’s just say, in the parlance of the day, his accomplishments are not “overrated.”

But or the record, while any mention has been expunged from its website, the institution that we call SUNY Poly and the state of the art edifice that stands at corner of Fuller and Washington, would have never come into existence without Governor Pataki’s unyielding support, intellectual curiosity, vision and yes the checks and balances that defined Alain’s early years of ascendancy. Alain may have been hired under the late Mario Cuomo, but it was George Pataki who set him on the path to be a modern-day Robert Moses of New York technology infrastructure. (A few months ago, I’m sure that description would have rankled some, today they are probably giddy that anyone else is claiming responsibility.) It’s been a source of great disappointment to many Pataki alumni that in recent years Kaloyeros went all native and acceded to a desire to try to rewrite this history with Putin like accuracy. But as I like to say, “it’s just business.” As the ultimate salesman, Alain always understood how to trade in the currency necessary to curry favor, win continued support and grow his influence.

Alain is charismatic, personable, funny,  dictatorial, irreverent, brilliant, stubborn, at times flattering and others infuriating.  But most importantly, when he wanted to, he had an uncanny ability to make you feel like you could understand the promise of science and technology to the future of New York.  He didn’t dumb it down as much as he talked it up and made you feel like you were inside on the ground floor of technologies that are driving the world economy. He used that ability to convince a series of Governors, elected officials and CEO’s of tech companies, large and small, to invest and invest big in his plans, his projects, his dreams.

To his credit, Kaloyeros outlasted and outmaneuvered University Presidents, Majority Leaders, Speakers, State Senators, Chancellors, Commissioners and Trustees. He managed to free himself legally, not just from the oversight of the University at Albany, he actually got himself his own college. With the Fuller Road and Ft. Schuyler Foundations, he made IDAs and LDCs look like quaint, stodgy development instruments. That’s one hell of a bureaucratic and political feat.

During our time working together it was clear that he regarded Empire State’s Development approach to job development as prehistoric, incremental at best. We disagreed on this point – even as I came to appreciate the value of investing in high-tech infrastructure. Now, let’s address that a little and get some history straight.  Alain was not alone in his pursuit of the semiconductor industry. Under Governor Pataki landing a fab was a priority for every department of government; from ESD, to the Office of Regulatory Affairs, from SUNY to the Departments of Labor and Tax. It’s why in 2003 Pataki was the Semiconductor Industry Association’s Noyce Man of the Year.  It was also the goal pursued by multiple talented partners in local government from Saratoga County to Oneida County, from Orange County to Genesee County.

Nor was Alain responsible for the Global Foundries deal.

But to be 1000% clear — there would be no Global Foundries in Malta without SUNY Poly and there would be no SUNY Poly without Alain Kaloyeros.

Science and technology is a dangerous area for many elected officials because it’s an area typically outside their depth and as a result they too often cede authority hoping to get results. As a result, over the years, unconstrained and empowered, Alain Kaloyeros has become a one man public sector version of Kleiner Perkins, making high stakes and increasingly higher risk bets on the future of technology with the State of New York’s checkbook.  But here’s the thing and there is no escaping it, these investments were all made in the light of day, with great fanfare. This is not news, what’s news is that people are finally taking note of the risk.

Today, Alain faces some trouble. Like Norsk, I have no idea what’s real and what’s not. People always surprise, but I’m quite certain Alain’s motivations had zero to do with self-enrichment. He’s a builder, a salesman, an entrepreneur with an ego so huge, that it’s surpassed only by his capacity for work. But for whatever his flaws, he articulated a positive future for our state and helped transform the Capital Region. He had the amazing ability to make those who desperately want to revive upstate New York, believe that he had the magic formula to make it happen. We all wanted to believe and some wanted to believe so badly that they looked past the obvious red flags.

So what of Norsk?  Alain has supreme confidence in his ability to see the future of technology and despite his current difficulties, I’m sure he remains unshaken in the belief that it’s a good bet for the State.  He might be right, I hope he’s right, but my guess is we never know and another fly drops.

Tagged , , , , , , ,

Road Trip!

Governor Cuomo’s decision to take the State of the State on a road trip out of the Capital should not be a surprise to anyone. A persistent and reasonable desire to control the story line accompanied by a nagging need “to do something different,” is something most administrations eventually contend. A need made ever more urgent as the years pass. More importantly though, traditionally the State of the State was a fundamentally uncomfortable experience for an Executive…after all it’s one of the few places they have zero control over.  You are a guest in the Speaker’s house.

During the Pataki years we had to negotiate with Speaker Silver over everything — from what time the Governor could use the chamber to practice, to how many seats we were given for our guests, to what the signage at the lectern looked like. You don’t control the cameras or the security and run the high risk that between nosy reporters and gabby operatives you will read about your initiatives before the Governor ever gets to the podium. (We would typically omit key announcements from rehearsal drafts.) And this was before everyone from the 3rd grade up had a cell phone that took HD video.

Most of all the setting ensures that the Legislature, the Comptroller, the Attorney General and the Judiciary are presented as co-equals in government. The cramped venue, the brightly lit chamber allows the Legislature and other constitutional office holders to be real actors in the play. They can clap wildly, sit stoically and yes, they might even stand awkwardly behind you. They can boo, walk out or shout interruptions — their reaction is on display to be recorded and dissected in real-time, all in Technicolor.  Finally, there is little that can be done with trickery or sleight of hand through the magic of technology. There are only two ways in and out of the place, no Powerpoint, no JibJab visual aids (thank God) – so you are stuck delivering a speech, hemmed in on all sides by people who don’t necessarily share your agenda. I’m sure for Cuomo the thought of it must feel like the Alamo today.  (Save he wouldn’t need to worry what Kathy Hochul is doing behind him on the rostrum.)

So while, it’s the Governor’s play, it’s the Assembly’s stage. For the Executive it’s like throwing a party in someone else’s house and that someone just might be itching for a fight.

That was a big reason why in 1996 we took the budget presentation to the Egg.  That was our house.  We controlled the audience, the seating, all the stagecraft.  Go to the tape –it’s easier to control the outburst of a Charles Barron in the Egg then it is of the late Tony Seminerio in the Assembly chamber.  And if legislators didn’t want to clap for our initiatives — we packed more than enough of our own people in the place to make noise. It was in many ways our State of the State…after the State of the State.

I can confess over the years several of us staffers (me included) would propose to Governor Pataki that he take the State of the State on the road…for many of the same kind of reasons it’s happening today. Let me tell you over 12 years it’s hard to keep it fresh. And while the political instincts of George Pataki told him it was probably a good idea to take the message to the people, the former state Senator and Assemblyman ultimately held the tradition in higher regard. While Governor Pataki often warred with the Legislative leaders and ultimately struck the most important check on their authority in Silver v. Pataki — as a former member there was always a level of respect and camaraderie held with much of the rank and file.

At the heart of the issue today isn’t really where on the map the State of the State will be given, it’s what’s the future of Governor Cuomo’s relationship with the Legislature. He has the constitutional tools to run rough shod over a divided Legislature – but by alienating them he is pushing them together and together, they can disrupt his agenda. Taking the State of the State show on the road might be the right short-term political move, but long-term it might be one of those road trips you wish you hadn’t taken.

Tagged , , , , , , , ,

The Mystery of the Xmas Hess Truck

Growing up, Christmas was always an amazing time of year for so many reasons. We weren’t wealthy but we were certainly blessed — there were always plenty of gifts and parties. And the gatherings were always punctuated by some airing of grievances (yes, Festivus) usually correlating with the partaking of a little too much holiday cheer. Ultimately, without failure, one clan or another, would end up abruptly leaving our grandparent’s Xmas get together in tears over some slight. “Get in the car kids, we’re leaving!” was a familiar holiday refrain. The drama was real, but it always passed quickly (usually by the time we got home) and it was part of our annual ritual.  I loved it.

One of our other traditions was the Kiwanis Club Christmas party. For a number of years, my Grandfather would take me, my siblings and cousins to their annual Christmas banquet. We would put on our Sunday best, pile in his cavernous, cold-leather clad Lincoln, with an admonishment from our parents to “behave your grandfather, or else,” and head to the palatial HoJo’s in East Greenbush where we would get a gift from Santa and order anything we wanted to eat off the menu.  (I loved the fried clam plate.)

My grandfather was the grand poohbah of the Kiwanis Club for a while, which made our attendance all the more intriguing and in a way, regal. We were at the height of East Greenbush society. Which is why it was always so baffling to me that every year Santa gave us a Hess truck.

Now, I know the Hess truck has become something of a collectible over the years, but I never quite got why it was (or is) a gift for kids.

I wondered, “What fun is it to play gassing up the local Hess station?”  What was my grandfather thinking, let alone those people at Hess!

Hence, the mystery of the Xmas Hess Truck.

As a nerdy and somewhat inquisitive kid, I thought long and hard about this perplexing issue.

After much deliberation, I surmised that it was an easy gift to pickup. After all, there were a lot of Hess stations in our neck of the woods, and back in the day, when people outside of New Jersey had their gas pumped for them, you actually could multi-task. So, I imagined that my busy grandfather had a few minutes to run inside and grab a bunch of pre-wrapped Hess trucks. Pre-wrapped was also key.

My grandfather owned his own plumbing – contracting business and was always working so I thought it was cool that he took even a few minutes to grab us a gift. And from a guy who lovingly referred to us grandkids as “boobs,” “jackasses,”  “morons” and “maroons” it was actually quite a statement of affection.

That explained “the how we came to have the Hess truck,  but not the why.”

I didn’t know for sure, but I had my theories. My grandfather, grew up very poor and hard. While he had a great sense of humor, he wasn’t exactly the warm, fuzzy type and I could never imagine him playing with toys. The only other “toys” I remember getting from him was a hatchet and lawn jarts – which should give you the picture. So I always thought, maybe a gas tanker is as close to his idea of a toy that he would ever appreciate.

Maybe…but over time I developed an alternate theory. The Hess tanker was also oddly reminiscent of what we called the “honey wagon.” If you’ve ever had your septic tank pumped out, you know what I’m talking about. With its huge tank, long detachable hoses and backup warning dinger, the Hess truck was as close to a fancy plumbers toy you could buy. Just imagine the number of septics you could service before you had to pump out the truck – it had to be a plumbers dream.

But yet I still wondered: no matter how much you love your work, “what fun is it to play pumping out a septic tank?” 

Since none us went into the family plumbing business, I guess you have the answer. Not so much.

The truth is, like all boy toys, the Hess truck was most often deployed as weapon. It was a huge flame thrower — torching dinosaurs, cowboys, indians and little green army guys every holiday season.  Or in keeping with the Xmas spirit, we would drive it into the enemy Lego stronghold clearing the path for invasion. Never once do I recall refilling the local Playschool service station or for that matter pumping out a full septic tank at a Lincoln Log house.

The allure of the Hess truck remains a daunting mystery to me. Yet, it always makes me smile and think of my grandfather and Xmas past.

Ho Ho Ho – Merry Christmas.







Tagged , , ,

A Story Begging for a Trump Tweet.

One of the refreshing things about Donald Trump is that he calls bullshit. He doesn’t get bogged down in the minutiae of why the world works a certain way – he just sometimes tells it like it is. Which is why I think if he heard Mike Gaetani’s plight we would see a Trump twitter storm.

Mike Gaetani turned 100 years old a few months back. He’s quite a story, an American story. Orphaned as a baby, Mike was passed around through some tough foster homes in the Boston area and never had a chance to finish high school. Yet he got a job, a good manufacturing job working for Johnson Controls, married the woman of his dreams, owned a home, had a child and scrimped, saved and prepared for a retirement he was firmly convinced only his wife would live to enjoy.

And his planning worked – as a 30 plus year employee of Johnson Controls (JCI) he steadily earned and bought shares in the company he made his career with. Over the years, JCI has been a rock solid stock, paying dividends that allowed Mike to stay off Medicaid, out of a nursing home and connected with his family. He did everything right, he got a little lucky – he was set, or at least he thought so.

At 100, Mike has congestive heart failure, “CHF” as he calls it, which if you are lucky enough to get to 100, most people have. But as faulty as Mike’s heart is – he has one – a big one, which is a lot more than we can say for the executives at Johnson Controls and Tyco that just completed one of the more despicable tax inversion details in history.  

A tax inversion is when an American company combines with a foreign company, typically moving it’s headquarters offshore, to escape our ridiculously uncompetitive federal corporate tax rate. Many see tax inversions as a gimmick for U.S. companies to boost their profits without actually improving business operations.

It was a hot topic during the Presidential campaign and earlier this year the Treasury Department actually issued rules that killed several pending tax inversion deals. Unfortunately, for Mike and the other 20% minority of JCI shareholders, one large inversion that wasn’t killed was a $16 billion deal involving the acquisition of Tyco, based in Ireland, by Milwaukee based Johnson Controls.

Why is it unfortunate? It seems that under federal law when a tax inversion deal closes, shareholders of the company inverting to the overseas tax location, JCI in this case, are hit with a tax bill as if they sold their stock. As such, the inversion is forcing thousands of JCI shareholders to dig into their pockets and pay taxes (essentially capital gains) on their unrealized gains just to remain shareholders.

Ok, that’s tough enough to swallow for Mike and other JCI retirees who acquired the stock at a low price over the years and are living off the dividends. But this inversion has a particularly pernicious wrinkle, in that the acquisition of Tyco was structured in such a way so that only 20% of all JCI shareholders are footing the entire tax bill for the inversion. That’s right 20% of JCI shareholders are responsible for 100% of JCI’s exit tax from America.  

You can guess which 20% of shareholders are footing the bill.  It’s not institutional investors, it’s not JCI corporate officers, it’s not the hedge funds – it’s the little guy, retirees like Mike.  

So I was hoping this story, obnoxious and true, might incite a Twitter storm from our President Elect. But alas, I realize with so many other things to tweet about it’s admittedly a long shot. Barring that – I’ll just generate some fake news and with any luck my bogus tweet will be treated as real and result in shining some light on this sad scam.

(Special thanks to the Donald Trump tweet generator)

Tagged , , ,

God’s Work

God’s work is being announced today in Indianapolis, but we’ll get back to that.

In 1994, when George Pataki became Governor, IBM was poised to move their corporate headquarters out of New York, no not to Mexico, but about 200 yards down the road on the same piece of property, just in Connecticut.  He called then CEO Lou Gerstner and asked him just to “give him a chance” and he would get the state moving in the right direction. Gerstner gave him a chance and IBM and New York would go on to have a very beneficial relationship…the most obvious outgrowth for those in the Capital Region is sitting at the corner of Washington Avenue and Fuller Road, today we call it SUNY Poly.

It was the right thing to do then and what President Elect Trump did with United Technologies is right too.  Leadership matters. Policy matters. I can imagine Trump had a similar conversation with Chairman & CEO Greg Hayes – just gimme a chance.  Kudos for UTC and Hayes for giving him that opportunity.

It’s important for a lot of reasons.  First, on the campaign trail Trump promised to keep these jobs in America…as a politician, as President keeping your promises matter. This was a good one to keep. Second, he sent a message to the business community and he didn’t use 140 characters to do it — he did it the right way.  Third, and most importantly, he saved close to 1000 good paying jobs.

Cynics will say he didn’t solve anything.  They will conflate decades long statistics on the steady loss of manufacturing jobs and say he doesn’t have a chance to reverse the trend. I believe the cynics are wrong on all counts. America’s energy revolution, coupled with rising wages in China, Mexico etc plus US technology / workforce superiority and a nexus to the North American consumer market are ingredients for growth in US manufacturing. Not a revolution – but real growth. The bigger problem is automation, which is constantly reducing labor needs.

But even if I’m wrong about everything – the cynics still are wrong too. I spent a good part of my career at Empire State Development chasing companies, cajoling, incenting, begging doing whatever it took to get them to stay in New York, because I knew it mattered. Not because of some donor, or the largesse of a big corporation (sorry Jim Heaney and my friend Richard Brodsky) and not because of politics (jobs were good press no matter where they were created) – but because it meant someone kept their job, someone could get a job.  A family had a better Christmas, a small town kept its anchor – a mother put dinner on the table and a father had pride and self-worth.

My father was lucky, he was always managed to stay one step ahead – every company he worked for closed within a year after he had moved on. And my mother, a single mom for many years, put aside her dreams and worked whatever job she could to provide for four kids. Through their example they taught us the value of hard work. There is nothing esoteric about that – a story repeated countless times throughout American homes. A story in danger of becoming an urban legend in certain parts of our country. Economic development isn’t always about solving every grand social, political or fiscal issue – pile up the wins, one by one, (bird by bird as Anne Lamont would say) and they matter.

Every job matters.  I treated it that way and believed in it with jihadi fervor and I still do.  And I was proud to work with a bunch of tremendous professionals at Empire State Development who by and large share that same passion.

Which is what brings us back to God’s work.  A few year’s back Lloyd Blankfein, Chairman of Goldman Sachs, was asked what sprung to mind when he thought of Goldman’s mission…he said “I’m doing God’s work.” He added, “We help companies to grow by helping them to raise capital. Companies that grow create wealth. This, in turn, allows people to have jobs that create more growth and more wealth. It’s a virtuous cycle.”

In the wake of the financial disaster – widespread scorn was heaped on Blankfein. In the department of bad timing, he should have been smarter, but I kinda got it (because I read the whole quote) and because I had said the same thing myself on many occasions.  Saving jobs, creating jobs and wealth is about more than the numbers, more than any policy – it is essential to keeping alive the American Dream, rhetorically and in reality.

Trump with UTC saved some jobs in Indiana today and as far as I’m concerned – that’s God’s work.


Tagged , , , ,