Tag Archives: George Pataki

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.

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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.

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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.

 

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Deep Breaths

Take a deep breath everyone, step awaaaaay from the Twitter – Donald Trump has been elected President and the world has not ended. While it’s fair to say this has been one of the most dispiriting campaigns in my lifetime – the truth is that his election is a watershed opportunity to reclaim our system. When I say reclaim, I don’t mean from the Democrats or liberals or for that matter from Republicans or conservatives – I mean from the incestuous cross-section of the financial, media and political establishment that has long been gaming this system for their own purposes.

To some degree the campaign was a microcosm of what ails our process. Today, much of the mainstream media is wringing their hands about the results – yet is was the media’s coverage of a reality TV star that set the train in motion. They breathlessly followed every twist and turn, minute by minute. Broadcasting, analyzing and pontificating on every Trumperance – ultimately delivering over $2 billion in free media coverage to the Trump campaign. To have some perspective, the next closest GOP candidate, Jeb Bush, received only $214 million in earned media – just over 10% of the amount. Quite a difference, especially when considering all these same news outlets over and over predicted Trump can’t win!

While Fox led the way in skewing coverage when it came to the GOP, aka the Fox primary, all the media left and right got in on the act. Morning Joe created this new low standard of the “Trump call in” with Joe twisting himself to legitimize Trump’s positions only later to find some faux outrage. Trump is great TV and ratings soared. CBS CEO Les Moonves said it himself, “Donald Trump might not be good for America, but he’s great for the bottom line,” as record advertising revenues were scored by the cable and network new divisions.

But after cashing all those advertising checks, the same media that skewed coverage one way, decided it was time to drag Hillary across the finish line. When it came it to trying to finally settle the outcome of the election it was NBC that suddenly, mysteriously unearthed “the lost” Access Hollywood tapes in an October surprise. Unfortunately for supporters of team Clinton, NBC released the tapes too early allowing Trump to weather the storm, stabilize and finally for Hillary to be outdone and ultimately undone by none other than Anthony Weiner.

When it comes to Comey – I might be wrong, but my sense was he was put between a rock and a hard place when investigators found Clinton emails on Weiners’ computer. What might, under normal circumstances, have been managed quietly was blown up because if Preet knew of the emails, there was no certainty of when the rest of the world might know. Facing this uncertainty and after promising Congress he would notify them of any new developments – Comey had basically no choice. Comey didn’t cost Clinton the election – if anything Huma and Anthony did.

For the press, reporting the objective truth was more elusive and yes more challenging than ever. Watching Trump say one thing and then his team scramble to calmly explain what “he really meant” in 180 degree fashion was both disturbing and amazing to watch at the same time. Kudos to Conway and Miller for interpreting Trump-speak into reasonable sound bites, even if the dissonance was often jarring, But sadly it reflects the world we live in today.

Double standards, double talk and hypocrisy have become the norm and they have taken their toll on the electorate. 10 years after the greatest economic calamity since the Great Depression not one person responsible has gone to jail. Just this year, Wells Fargo brazenly ripped of hundreds of thousands of account holders – yet the CEO walks away with a golden parachute. Many of our elected officials simply pick and choose which laws they choose to follow. Federal indictments are handed down in Nassau County mere weeks before an election. And the state’s top law enforcement office holds the Trump Foundation to one standard and the Clinton Foundation to another. Is it any surprise that voters are just a bit cynical when it comes to sorting out what’s important and what’s not? What’s the truth and what’s not?

Finally, when it came to the political establishment what a disaster. In a year when 16 rock ribbed establishment Republicans envisioned their own pathways to the White House all but one, George Pataki, hid for months while the 17th, Trump, built momentum toward the nomination. One after another, GOP candidates made the cynical miscalculation, much like the pundits, that the next misstep will take Trump down and their campaign would be there to pick up his voters. Jeb Bush’s PAC spent close to $100 million attacking Marco Rubio – not one campaign with resources focused on taking out Trump until it was too late.

For the Democrats, Wikileaks proved the conspiracy to undermine Bernie Sanders was real and was devastating to the Clinton effort. And as much as Trump was over reported by the media, Sanders, who was very much inspiring his own populist uprising, was largely dismissed and underreported. We can’t underestimate the impact of this disparity on the Democratic primary. Ironically, in many ways Clinton actually looked more like a Republican, certainly more establishment than Trump ever did. Her coziness with Wall Street, her experience voting for and overseeing two failed wars, her shifting support for free trade and her apparent wealth all could of easily landed her in a GOP primary. Is it any wonder she had a difficult time turning out the Obama coalition?

So now what? In the days after election I’ve heard of hispanic grade school students crying for fear that they might be deported, of mothers numb as to what it means for their daughters, a number of reporters genuinely concerned with rising anti-semitism and pundits one and all shocked that “this is not their America.” Their concerns, their fears are real and we must all be on guard for those elements of hate in our society that conflate an election result that acknowledges America’s tough problems with an acceptance of intolerance. But at the same time, this tendency to lump all Trump voters in with racists, homophobes or the general “basket of deplorables” is also unacceptable.

Finally, for those Democrats, liberals and independents who think it’s the end of the world, remember thrice married Donald Trump is not exactly a christian fundamentalist, he voted for John Kerry in 2004, was pro-choice long before he was pro-life and actually in the campaign set aside issues like gay marriage. Donald Trump is not a conservative and not an ideologue – he is real estate developer, a master marketer and ultimately a deal maker.  And while his temperament on the trail has left many of us concerned – only he knows how much of it was showmanship and how much of it was authentic. The truth is Trump seems equally as genuine denouncing Hillary as “crooked” as he does praising her as “lovely” and “tough.”

From repairing the promise of the American Dream for middle America, to reclaiming our inner cities to fixing our broken immigration system – there are tough challenges ahead. Challenges that have eluded establishment Democrats and Republicans alike, the professionals that have formulated their policies and the special interests that have funded them. For the past 18 months Trump has colored outside the lines. He did not campaign within the boundaries of what had been accepted practice – to fix America, he’s going to have to do the same thing.

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