Wednesday, January 4, 2012

New York: The State of the Welfare State

Two articles in today's Buffalo News sum up the economy of upstate New York.
Cuomo commits $1 billion to development targeting Buffalo

ALBANY — Joining a long line of governors placing an economic interest in Buffalo, Gov. Andrew M. Cuomo said today he will give companies $1 billion in the coming years to expand or locate in the region.

Keep pushing project

The Niagara Experience Center, on the drawing boards for years in Niagara Falls, was left out of the first round of awards given under Gov. Andrew M. Cuomo's regional economic development competition, even though Western New York performed very well against other regions of the state. That missed opportunity was a disappointment, because the proposed center -- a high-tech interpretive "experience museum" -- could be a key to bringing a greater share of tourism dollars to the New York side of the falls.

New York State is dying for lack of business investment. The economic climate has been so bad here for so long that several million New Yorkers have simply given up and moved away. Other than suburban strip malls, virtually no businesses are started here or locate here unless the state gives them some payola. And, even in the case of those strip malls, since the population is shrinking, they only replace older businesses with new businesses.

The billion dollars of payola mentioned in the first article will be directed at some targeted projects in Buffalo (most likely in the medical corridor) but will have been taxed away from thousands of existing business-owners who increasingly cannot bear the state's financial burden. Their closings or stagnation will be unseen by the paper, but the eventual hundred or so high-profile bio-tech jobs will get front-page mention and another visit from the Governor to humbly take credit.

The Niagara Falls project, if it ever comes about, will likely turn into a multi-decade, construction boondoggle with huge cost overruns and union scandals that will keep the court dockets full for years. This in a city that sits by one of the natural wonders of the world but cannot figure out how to capitalize on it. Meanwhile, the other Niagara Falls across the border will continue to pack the tourists in.

In a state where business has been suffocated by taxes and regulations, the only bright spots are the gifts bestowed upon us by the state when it so deigns. And over time, New Yorkers have been reduced to jumping like dogs competing for a bone from their owner when economic development grants are on offer. The concept that we are masters of our economic fate has been lost. It's really been a sad thing to watch.

[UPDATE:] Related: Portugal’s Prime Minister Tells Citizens to Emigrate

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