Archive | January, 2012

The Morning Grumpy – 1/27/2012

27 Jan

All the news and views fit to consume during your morning grumpy.

The Cure

1. Yesterday, Buffalo First! organized a rally to support the idea that money spent on businesses at Canalside should be locally focused. After Mark Goldman’s ambiguously employed brigade of concerned and/or bearded men descended on the closed-loop waterfront planning process and turned it into a crowdsourcing project, all bets are off at Canalside. Now, Buffalo First! and 500 local businesses and supporters want to make sure the crowdsourcing doesn’t stop with solar powered carousels and puppet shows but also focuses on a matter of real import, local and sustainable economic development.

The rally will end a petition drive asking the ECHDC to make local businesses the anchor tenant at Canalside, says Sarah Bishop, executive director of Buffalo First.

“We know it’ll be mixed use … but we want 50 percent, at least, reserved for our local business owners,” Bishop says. 

“Our business owners want that opportunity as anchor tenants at Canalside and to put our community’s economic future first,” Bishop says, noting that she knows that Bass Pro Shops was the first choice for that location. 

Buffalo First says it is a nonprofit organization comprised of independent “Main Street” businesses, organizations, and concerned citizens. The group says its mission is to build a local, green, and fair economy in the Buffalo-Niagara region.

The Erie Canal Harbor Development Corporation issued a press release touting all of their local business relationships, but did not directly respond to the Buffalo First petition and rally. From Assistant Director of Communications at the ECHDC, Erich Weyant:

Supporting local businesses and creating local jobs has long been one of the guiding principles of the Erie Canal Harbor Development Corporation (ECHDC).  We are proud to note the local companies, organizations and individuals that have been retained as part of our mission to revitalize Western New York’s waterfront and restore economic growth to Buffalo based on the region’s legacy of pride, urban significance and natural beauty. In addition, we continue to work with 90 local community members on groups tasked with activating the Inner Harbor, Outer Harbor and Buffalo River.

ECHDC has done a significant amount of business with local partners and they have been responsive to community input. Buffalo First is pushing to ensure that ECHDC continues to incorporate the voice of the community in planning decisions.

Former NY State Assemblyman and current Senior Vice President for Regional Economic Development at the Empire State Development Corporation, Sam Hoyt, responded to the petition, rally, and the clamoring for local businesses at Canalside in a WKBW report.

“We’re seeing lots of interest from major developers, and not just local (yokels), we’ve got folks who are feeling the buzz that’ s been created,” Member of the Empire State Development Corporation Sam Hoyt said.

While WKBW edited out the “yokels” portion of Hoyt’s statement in the web transcript, that’s what he said, smirkingly.

Yokel is defined as “unsophisticated country people“. That’s great. The people who make up Buffalo First and the Canalside Alliance were Sam’s base when he was in office. Now? Yokels. It’s a good thing that the only people watching Channel 7 news are the elderly, infirmed, and the huddled masses found in Sloan or this might become a problem for him.

Two years ago, I was opposed to the crowdsourcing of a cultural and architectural plan for Canalside, but I was in favor of a Community Benefits Agreement for any business receiving public monies for the project. Now, I still find the bikeshedding about the depth of the canals and the color of the bricks to be tiresome, but the economic development issue is very important. If a retailer or vendor is going to receive tax dollars as an incentive to conduct business on the waterfront, I want to know they are committed to staying in the region, will pay a fair wage, and support the community when they are successful. I don’t think it’s too much to ask.

Support local business at Canalside.

2. The idea of cash mobs, started right here in Buffalo, continues to spread across the country. This story details one small town’s version of a cash mob.

It was just a way to thank Chagrin Hardware’s owners for a beloved shop that has been a fixture in the village since 1857.

“These are good people who needed our support,” Black said. “It’s just that simple.”

Well said. Invest in businesses that invest in our community. The contest to determine where the next Buffalo Cash Mob will be held begins February 1st.

3. A fascinating series of papers by fellows at The Brookings Institution about the mismatch between the skills the American workforce has and the skills it needs to remain innovative and relevant.

MIT economist David Autor has traced what he terms the “polarization” of the U.S. employment market. Principally in response to the rapid development of low-cost information technology, both ends of the employment spectrum—high-skill, well-compensated managerial, professional, and technical occupations and low-skill service occupations—have expanded, while medium-skill jobs have declined as a share of the total.

An oft-discussed issue amongst policy wonks and economists is the impact that automation and IT efficiencies have had on the labor market. This is rarely discussed amongst politicians, but it needs to be central to our discussion about re-training the American worker and how we educate and train the next generation.

There are many metropolitan areas which struggle with a mismatch between the education and skills level of the workforce and demand for those skills. Buffalo is not one of them, surprisingly.

The sheer magnitude of the Great Recession affected the ability of Americans across the country to find and keep jobs; however, unemployment has been much worse in some metropolitan areas than others, and recovery likewise has been location-dependent. Three key labor market issues facing metropolitan economies help to explain these varying patterns in the employment crisis: industry structure, the housing market, and workforce skills.

What each of these articles demonstrates is that Buffalo is in a unique position to capitalize on several favorable long term trends. Our stable and affordable housing stock, quality infrastructure, educated professional workforce, and our skilled labor pool position us to be a leader in the next wave of national economic growth. However, as Bruce Fisher pointed out in this week’s edition of Artvoice, we’re stuck in a localized bubble of stagnation based on our bizarre desire to maintain municipal independence while duplicating services. We’re also cursed with a do-nothing Mayor in a time that calls for a visionary leader with the capability to set regional goals in cooperation with other community and governmental leaders.

When and how do we shake off our regional morass and move forward with purpose?

4. A few notes about Mitt Romney and his performance at last night’s Republican debate.

Mitt claims his investments in Fannie Mae and Freddie Mac were in a blind trust and he had no knowledge as to where his money was invested. That turns out to be patently false.

On his financial disclosure statement filed last month, Romney reported owning between $250,001 and $500,000 in a mutual fund that invests in debt notes of Fannie Mae, Freddie Mac, among other government entities. Over the previous year, he had reported earning between $15,001 and $50,000 in interest from those investments.

And unlike most of Romney’s financial holdings, which are held in a blind trust that is overseen by a trustee and not known to Romney, this particular investment was among those that would have been known to Romney.

Wow, Republicans just hate journalists, don’t they? What with their trusty Internet connections and ability to research things. DAMN THOSE LIBERAL PINKOS!@#!

Also, Romney closed his Swiss bank account around the same time the USDOJ forced the United Bank of Switzerland to reveal tax cheats. Coincidence?

Through a tax treaty between Bern and Washington that forms the legal basis for requiring UBS to identify clients with undisclosed private banking accounts, the American authorities plan “to make treaty requests of other banks operating in Switzerland for these types of accounts,” said this person, who spoke on the condition of anonymity because he was not authorized to speak publicly about the plan. “UBS was not the only bank.”

The criteria that prosecutors will use in pursuing tax cheats through other banks mirrors the UBS criteria. UBS will generally disclose American clients who had unreported accounts of at least a million Swiss francs, or about $988,000.


5. Where did all the workers go? A fascinating story and graphic.

The spectacular graphic compares employment by sector in 1947 and 2007 and its most important lesson is a whopper. Manufacturing and agriculture employed one in three workers just after World War II. Today, those sectors employ only one in eight.

Where did all the making-stuff and growing-stuff jobs go? They went into services.

The champion in the last six decades was finance, insurance and real estate, which doubled its share of employment from 10.5% to 21.4%. But the broader service industry — including professional and business services (a broad catch-all with marketing, managing, consulting, computer services) and health and education services — also grew from about 13% to about 30%. Everything else has stayed pretty much the same. Government, wholesale/retail, information, and construction account for a little more than a third of the economy today, and they accounted for a little more than a third of the economy 60 years ago.

I’d encourage you to also read the full article in The National Journal from which this graphic was sourced.

6. Republicans like to use “Saul Alinsky tactics” as shorthand for radical socialist/communist/black politics, organizing and thinking. You can barely go five minutes on Fox without someone mentioning it, especially Newt Gingrich who has used it so often to describe Obama that he now uses it without context on the stump and in debates. Warning, IRONY ALERT!

“The job of the organizer is to maneuver and bait the establishment so that it will publicly attack him as a ‘dangerous enemy,'” Alinsky wrote in “Rules for Radicals.” He went on to reveal that, “Today, my notoriety and the hysterical instant reaction of the establishment not only validate my credentials of competency but also ensure automatic popular invitation.”

Though Gingrich has spent several decades profiting from being part of the Washington establishment, the fact that he’s been attacked by so-called “elites” has become self-validating.

And the way he scolded CNN moderator John King in last Thursday’s South Carolina debate followed Alinsky’s 13th tactical rule, which states: “Pick the target, freeze it, personalize it, and polarize it.”

I’ve read “Rules For Radicals” (and you should as well) and I’ve always been amazed that the right wing – which fully employs Alinsky tactics, constantly accuses the left of doing it. Absolutely bizarre. Newt’s entire political strategy is built around Alinsky’s principles.

The classic example of this: Gingrich’s 1995 musings, on Meet the Press, that some children should be put in orphanages. It was covered at the time as a horrible gaffe. Gingrich took the flack, but he was convinced that a discussion of one extreme solution to poverty made his preferred solutions seem more tenable — he shifted the Overton Window, using the media’s outrage machine.

Fact Of The Day: The creator of Spongebob Squarepants is a marine biologist.

Quote Of The Day: “What the American people want is very simple – they want an America as as its promise.” – Barbara C. Jordan

Song Of The Day: “Rattlesnakes” – Lloyd Cole and The Commotions

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Email me links, tips, story ideas: chrissmithbuffalo[@]

AV Photo Daily: 1/27/12

27 Jan

Kickball in Delaware Park

Kickball in Delaware Park by W Alex Fisher

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Valenti’s: Might Want to Frame Those Gift Cards

26 Jan

An empty restaurant (click to enlarge)

It’s been about six weeks since the Buffalo News’ sole restaurant critic gave this Italian upstart a 2.5 star review, extolling the virtues of their red sauce and their Iron Chef and parsnips-based provenance.

On January 20, Budwey Supermarkets, Inc. filed a Notice of Petition to evict “Desires Unlimited d/b/a Valenti’s Italian Restaurant under index number LT-0055-12 in North Tonawanda City Court. The matter is scheduled for a hearing on Monday January 30th at 2pm in that venue. Budwey alleges that Valenti’s owes him $5,200 in unpaid rent, plus $500 in attorneys’ fees.  As of right now, no counterclaim has been filed against Budwey.

I have a call in to Budwey’s attorney.

A source close to the matter says that, as the restaurant was readying for lunch service on Wednesday, the electricity was shut off. Terry Valenti had been attempting to open an electrical account in his name, but Budwey put a hold on the service, which rendered that impossible. With power off, food that was slated to be served yesterday is still sitting out, and the food that is in the coolers and freezers may spoil, costing upwards of $15,000 to replace. The problem is that Valenti’s cannot get a purveyor to service the restaurant due to unpaid bills, and a dubious check may have been cut to Curtze’s. (UPDATE: Curtze’s confirms that, although Valenti’s did not have an account with it, they did buy stuff from them from time to time, and they also confirmed that Valenti’s last check bounced – that there was no money in the account and they can’t locate the person who passed it.)

When the electricity was shut off, a source says that Valenti and Brocuglio pulled the Ansul flame retardant system, possibly damaging equipment and necessitating a very costly recharge of the foam system.


It’s unknown whether Valenti and Brocuglio intend ever to return to the restaurant at this point, but signs point to “no”. It’s also been reported to me that many valuables and important files and financial documents have been removed from the premises.

At 11am on Thursday, the lights were off, Valenti’s was empty and closed.  In the meantime, someone had created a “Budway Valenti“[sic] Facebook account to mock Valenti’s landlord and estranged partner in the business and former server, Melissa Janiszewski. Screen caps below.



The Cuomo Plan

26 Jan

Wilkommen in Buffalo

Governor Cuomo came to Buffalo yesterday to further outline his vision for moving Buffalo forward, and how the city can use the $1 billion the administration pledged.

The announcement has been met with all the hand-wringing, complaints, and angst that accompanies any sort of big news about Buffalo, with outside conservative commentators arguing that the money amounts to spending good money after bad.

But comparing the mistakes of the 50s, 60s, 70s, and 80s to our current state reveals little more than a prejudicial ignorance of what Buffalo is today. The city is financially sound, but politically broken and economically wounded. The most critical thing Cuomo said yesterday to the assembled Buffalonians was to stop looking backwards. Our nostalgia and t-shirt based economy is all well and good, but it’s not growing the city, educating our kids, reforming our government, keeping graduates in the region, or attracting business and industry here.

The key to the billion is that it’s not just a handout. It’s a line of credit that’s conditioned upon business, industry, and government agreeing on a plan – we’re not always good at thinking about the long game around here. Once we have an idea of what we want the billion to accomplish, we can set out to meet that goal through a specific plan.

We haven’t had city leaders express what they’d like Buffalo to look like in twenty or forty years, and it’s an important conversation to have, given the way in which our visionless city leadership is content to cut ribbons and tread water. The billion dollars here is a sort of Marshall Plan – it’s not, as the Wall Street Journal would have you believe, a welfare payment – Buffalo’s TANF for the year.  If we set up the right apparatus with the right people with the right vision and concomitant plan, this could really be something.

The problem now is pulling all of that together without the usual suspects getting all grabby.


26 Jan

Photo: Los Angeles Times

Everyone knows the old adage that there are “two sides to every story”. So, when you write a book in which you mother-eff the Presidentas being rude, but the President doesn’t see it that way, you might expect a bit of blowback from that.

Especially when you have a track record of making stuff up out of whole cloth for political gain or sympathy. A person who has abandoned SCHIP health care coverage for the kids of the working poor, a person who used federal education funds to battle immigrants, a person who is virulently homophobic – her character is called into question by virtue of her opening her mouth.

So, when the subject of your mischaracterization calls you out on it, privately and to your face, that’s not being “thin skinned”, that’s called “defending oneself against untrue and unfair attacks”, and with Ms. Brewer running to the closest cameras to moan about how mean the President was to confront her politely about her lies, it is she who is the thin-skinned one, as evidenced by the picture shown above, which, as another old adage goes, tells a thousand words.

AV Photo Daily: 1/26/12

26 Jan

South End Marina Buffalo, NY

South End Marina Buffalo, NY by Jodi:)

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Buffalo’s Food Trucks React

25 Jan

Interviews conducted Tuesday after the Common Council passed the new Buffalo food truck ordinance. It is expected to be on the Mayor’s desk on Monday, and will hopefully be signed shortly thereafter.

AV Photo Daily: 1/25/12

25 Jan

International Quidditch Tournament in Buffalo NY

International Quidditch Tournament in Buffalo, NY by W Alex Fisher

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The Morning Grumpy – 1/25/2012

25 Jan

All the news and views fit to consume during your morning grumpy.

1. After listening to Mitch Daniels’s rebuttal to President Obama’s State Of the Union address, I was reminded of an article I read a few weeks back in which Paul Krugman wrote, “Nobody understands debt“.

First, families have to pay back their debt. Governments don’t — all they need to do is ensure that debt grows more slowly than their tax base. The debt from World War II was never repaid; it just became increasingly irrelevant as the U.S. economy grew, and with it the income subject to taxation.

Second — and this is the point almost nobody seems to get — an over-borrowed family owes money to someone else; U.S. debt is, to a large extent, money we owe to ourselves.

The first will generate arguments with armchair libertarian economists, but the second point is worthy of discussion. Anecdotal evidence suggest that most Americans have no idea who is responsible for generating our current debt and to whom that debt is owed. Well, that’s why you should subscribe to The New York Times, they’ll help sort it out for you. During the debt limit fiasco of 2011, the New York Times charted our debt using data from the Department of the Treasury, Financial Management Service, and the Bureau of the Public Debt; Federal Reserve Bank of New York; Office of Management and Budget.

If that data is not simple enough for you, here it is in an infographic. Click here to embiggen.

2. A succinct analysis of why Mitt Romney (and people like him) should pay higher taxes.

Most of Romney’s income comes in the form of capital gains and carried interest, which have been taxed at 15 percent ever since the Bush tax cuts went into effect a decade ago. So it’s a good time to get a little wonky and ask why capital gains and carried interest are taxed at only 15 percent, while ordinary labor income is taxed at rates as high as 35 percent.

Capital gains are profits from investments, and a high level of investment is good for the economy. Low tax rates on capital gains encourage investment and therefore benefit the entire economy. But is this true? If it were, you’d expect to see some kind of long-term correlation between capital gains rates and the total amount of capital gains income. The lower the rates, the more the income. Let’s roll the tape.

The data do not support correlation between low capital gains tax rates and increased income.

3. How do private equity firms like Bain Capital make money? Financial gimmicks and manipulation of the tax code.

The real reason that we should be concerned about private equity’s expanding power lies in the way these firms have become increasingly adept at using financial gimmicks to line their pockets, deriving enormous wealth not from management or investing skills but, rather, from the way the U.S. tax system works. Indeed, for an industry that’s often held up as an exemplar of free-market capitalism, private equity is surprisingly dependent on government subsidies for its profits.

The system is broken.

4. Last night during his State of the Union address, President Obama said, “Teachers matter”.  He noted that a good teacher can increase the lifetime income of a classroom by over $250,000. Here’s the study that informs that remark.

The study, by Raj Chetty and John N. Friedman of Harvard and Jonah E. Rockoff of Columbia, all economists, examines a larger number of students over a longer period of time with more in-depth data than many earlier studies, allowing for a deeper look at how much the quality of individual teachers matters over the long term.

Replacing a poor teacher with an average one would raise a single classroom’s lifetime earnings by about $266,000, the economists estimate. Multiply that by a career’s worth of classrooms.

“If you leave a low value-added teacher in your school for 10 years, rather than replacing him with an average teacher, you are hypothetically talking about $2.5 million in lost income,” said Professor Friedman


5. Courtesy of ThinkProgress, some facts to go along with the wild spin you’ll be hearing today as pundits and candidates interpret the President’s speech.

  • Since the last SOTU, the economy has created 1.9 million private sector jobs. [Source]
  • The top 1 percent take home 24 percent of the nation’s income, up from about 9 percent in 1976. [Source]
  • Private sector job creation under Obama in 2011 was larger than seven out of the eight years Bush was president. [Source]
  • The top 1 percent of Americans own 40 percent of our country’s wealth while the bottom 80 percent owns only 7 percent. [Source]
  • Thanks to the Affordable Care Act, 2.5 million young adults gained health insurance. [Source]
  • Last year, China spent 9 percent of its GDP on infrastructure. The U.S. spent 2.5 percent. [Source]
  • 2.65 million seniors saved an average of $569 on prescriptions last year thanks to the Affordable Care Act. [Source]
  • Union membership is at a 70-year low. [Source]
  • Unemployment benefits have lifted 3.2 million people out of poverty. [Source]
  • The United States used to have the world’s largest percentage of college graduates. We’re now #14. [Source]
  • One quarter of all contributions to federal campaigns come from 0.01 percent of Americans. [Source]
  • 47.8 percent of households that receive food stamps are working, because having a job is not enough to keep them out of poverty. [Source]
  • In the last three years, 30 major corporations spent more on lobbying than they paid in taxes. [Source]
  • 50 percent of U.S. workers make less than $26,364 per year. [Source]
  • Since 1985, the federal tax rate for the 400 wealthiest Americans dropped from 29 percent to 18 percent. [Source]

Fact Of The Day: Thorium could be a replacement for Uranium and coal. Pretty awesome research with potentially profound impacts on society.

Quote Of the Day: “A conservative is a man with two perfectly good legs who, however, has never learned how to walk forward.” – Franklin D. Roosevelt

Song Of the Day: “Kiss Me On The Bus” – The Replacements

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State of the Union Reactions

25 Jan


WASHINGTON – Congresswoman Louise Slaughter (NY-28) today released the following statement following President Obama’s State of the Union address to Congress responding specifically to two tenants of his speech that she has worked on for years: rebuilding America’s manufacturing sector through trade enforcement and passing legislation that would end insider trading among Members of Congress.

“I was delighted to hear the President’s enthusiasm to sign legislation that ends insider trading in Congress and finally reigns in the political intelligence industry that’s been lurking in the shadows of the halls of Congress. I’ve been working on the STOCK Act since 2006 and I say that if the President wants to sign the STOCK Act, let’s get it through the House and send it to him!,” said Slaughter. “It is my hope that the bill that we send to the President is the same bill that has received overwhelming support. The STOCK Act is bipartisan, has enough support to pass the House and is what we should make the law of the land.”

“I was also encouraged that the President shares my desire to strengthen the American economy by rebuilding the American manufacturing sector. For too long American manufacturers have had to compete against illegal trade practices from international competitors and now is the time for bold trade enforcement policies.” Continue reading