Archive for June 2009

Margaret Sanger: Hillary’s Hero – By George J. Marlin

June 8, 2009

This article I wrote appeared on The Catholic Thing web site on June 5, 2009.

The Kessel NYPA Watch, June 7, 2009 – By George J. Marlin

June 7, 2009

Notes and Asides

“Numbers matter less than jobs. We’ve just got to create jobs in Western New York.”

 – Richie Kessel

Late last month, Richie Kessel announced a typically cocked up subsidy deal with Yahoo! Here’s the background on the richest subsidy deal ever offered by NYPA: Since David Paterson has been absent from pursuing economic development in the State, Kessel has tried to fill the gap in order to generate precious press coverage for himself. As reported by Jonathan Epstein in The Buffalo News, our accidental Governor and his accidental appointee, Richie Kessel, announced that Yahoo! would spend $150 million to set up a new regional data center in Western New York with about 125 new jobs in return for low cost hydropower from NYPA, specifically 15 megawatts of New York hydropower. Except that’s not true.

The problems with Richie’s deal are many. First, as befits Richie’s focus on press over substance, Yahoo! hasn’t agreed to locate the new data center in New York. Indeed, Yahoo! said that it wouldn’t comment on “ongoing discussions” and Paterson and Richie conceded that the company was looking at Southern States, including North Carolina. So, Richie and his patron, the unpopular Paterson, have compromised Yahoo’s request for confidentiality, announced prematurely a deal that may never happen and by pursuing premature press rather than substance empowered Yahoo! if it wishes to come to New York to demand additional cheap hydropower or other state financial assistance. North Carolina economic development officials were too smart and experienced to make such rookie mistakes.

Worse, as reported by Jim Heaney in The Buffalo News, is that despite Kessel’s claims to the contrary, data centers, which are voracious consumers of electricity to power large and numerous data servers, don’t create tech clusters. Data centers for companies like Google, Yahoo!, E-bay and other consumers of cheap power are usually stand-alone centers in remote areas supported by cheap, subsidized power. Heaney’s piece quoted a tech expert who refuted Kessel’s unsupported assertion that Yahoo! (which remember hasn’t agreed to move to New York) would be a magnet for other high tech businesses. As Heaney reported “Data centers usually don’t act as a catalyst to other high-tech development, however, said Rob Atkinson, president of the Information Technology Innovation Foundation, a technology policy think tank in Washington, D.C. ‘They tend to be relative stand-along entities,’ he said. ‘They don’t generally have a lot of spinoff.'”

Even worse is that Richie’s own words expose his innumeracy and why he shouldn’t be running anything involving public money. Richie is wrong, the “numbers” do matter; in fact, they matter more than these 125 jobs which are not yet in hand. Here’s why: State money is limited; NYPA funds are limited. God knows that the ability of State taxpayers to fund Kessel’s Follies is limited. Since State resources are finite, serious policymakers and decision makers are required to invest in projects that generate the greatest benefit to the State, in this case the greatest job creation and wealth creation upstate. The megawatts that Kessel blithely committed to a company that hasn’t itself committed to Western New York could have been used to cut NYPA rates generally, to support 1,000 jobs somewhere in upstate New York or in some other smart, accretive, wealth-creating manner. Heaney analyzed the cost of the possible Yahoo! deal and concluded that it is one of the richest ever offered by NYPA. In fact, Richie “Numbers Don’t Matter” Kessel has offered Yahoo! over $800,000 in hydropower discounts for every $50,000 job created or four times the average NYPA subsidy in recent years. Thus, had Richie maintained that average, NYPA would have offered not 15 megawatts but only 3.75 MW and saved the rest for the next deal. But his primal impulse to get cheap and easy press coverage was irresistible and if the deal comes to pass NYPA and the State will pay the price for such waste for years to come.

Finally, history tells us that the next corporation looking for cheap NYPA hydropower will cite the Yahoo! precedent in its negotiations. For Richie has established a new floor for the grant of cheap hydropower, a floor that will last only until the next rent-seeker sweet talks Kessel. You see, the “numbers” mean a lot.

THE KESSEL COUNTDOWN: ­573 DAYS UNTIL RICHIE KESSEL IS FIRED BY THE NEW GOVERNOR OF NEW YORK.

The Kessel NYPA Watch, June 1, 2009 – By George J. Marlin

June 1, 2009

Richie Kessel: BIG Republican Political Donor

I lost contact with Richie Kessel, who somehow was able to swim the political rapids from the Democratic side to the Republican side.

                                                                                                           – Mario Cuomo

While a professed life-long Democrat, Kessel’s State political contributions, all a matter of public record on the State Board of Elections web site, belie his protestations.  Kessel in fact donated a total of $1,600 to Republican George Pataki and did not donate personally to his successor, Governor Eliot Spitzer or then-Lieutenant Governor David Paterson or now Governor Paterson.  While press reports stated that Kessel attended Attorney General Cuomo’s recent Long Island fundraiser, there is no record of Kessel contributing to AG Cuomo then, prior to or in the past three years since the AG’s 2006 election.  (Street Corner Conservative will be following any political giving by Kessel this year and next.)  To be complete, Kessel has donated to appointed Comptroller DiNapoli, now a State-wide official, on multiple occasions.

Some speculate that Kessel’s multiple contributions to Pataki were to curry favor with the GOP Governor who said the following in 1994: “I think they’ve [LILCO] been poorly run.  But on the other hand, I think if there is anybody who could run it worse, it would be Richie Kessel.”  In 1995, however, Pataki reversed himself and hired Kessel as LIPA Chair and CEO in 1997, confident that in an effort to keep his LIPA job, Kessel would do as directed.  In addition, Pataki surely knew that Kessel’s closest political friends and patrons were three powerful Long Island Republicans, Al D’Amato, Joe Mondello and Dean Skelos, who would have a direct pipeline to Kessel.  In 2008, lobbyist D’Amato and then Majority Leader Skelos intervened with the hapless Paterson Administration to secure Richie his latest political sinecure at NYPA.

Specifically, based on Board of Elections records, Richie has given to Republican Governor Pataki, then-Republican Senator Mike Balboni and current Republican Senator Ken LaValle and Republican Assemblyman McDonough.  Richie’s friendship with former Republican Senate Majority Leader Skelos may explain why Richie has not donated to any Democratic candidate for State Senate, a top priority of State and Long Island Dems.  On the other side of the aisle, Richie has donated to some Democrats in addition to DiNapoli, including Democrat Roger Corbin who was recently arrested by the FBI for accepting over $200,000 from a Nassau County housing developer and forgetting to declare it on his income taxes.  Corbin is, of course, entitled to the presumption of innocence.  Newsday reports that the Corbin investigation continues.  We find it interesting that Richie has not contributed to either County Executive Tom Suozzi or Nassau Comptroller Weitzman in either of their races.  Given his long-standing interest in the County Executive’s seat, Richie may have wanted to avoid supporting someone he might one day oppose in a Democratic primary for County Executive, a race Kessel lost to Ben Zwirn a number of years ago.

Lastly, we note Mrs. Richie Kessel donated to Town of Hempstead Republican Supervisor Kate Murray in her last re-election campaign in 2007.  Street Corner Conservative understands that Kessel’s spouse works for the Town of Hempstead in a patronage position.  Supervisor Murray, of course, is the official who many believe is holding up approvals on the Lighthouse Project at the Nassau Coliseum.  Those wishing to follow this from home can go to the Board of Elections web site at www.elections.state.ny.us.

THE KESSEL COUNTDOWN: ­579 DAYS UNTIL RICHIE KESSEL IS FIRED BY THE NEW GOVERNOR OF NEW YORK.