Calculating the cost of health care

From the 29 March 2010 Greater Niagara Newspapers

CALCULATING THE COST OF HEALTH CARE
By Bob Confer

The topic du jour for the past week-plus has been the House of Representative’s passage of health care reform. People have been wondering since (and well before that) what they’ll be paying for the health care of others. Before we delve into that it’s important to figure out what you’re paying now in that regard. Grab you most recent property tax bills and tax returns.

First, let’s look at your county/town bill. Refer to the section that reads County Tax. In Niagara County 54 percent of that total pays for Medicaid, the insurance provided to 9 percent of the population who we are told cannot afford medical care. Write down that value which, frighteningly, is more than half of your payment to the County.

Next, move on to your 1040. Determine your federal taxes paid. 20 percent of federal spending goes to Medicaid, Medicare (health insurance for the old) and CHIP (health insurance for the young). So, multiply your federal tax by 0.20. Set the number aside.

Now, determine what you paid to the State of New York. 30 percent of that will go to Medicaid. Tally that up with the numbers you came up with at the local and federal levels and calculate that as a percentage of your total income. I did, and I made the grim discovery that my wife and I had 6.1% of our household income put towards the care of others.

But realize that’s not all of it. Don’t forget that you’re also forced to pay for the health care of nearly all government employees and retirees. If you wanted to figure out what that percentage is you’ve got your work cut out for you, delving through the benefits packages at every level of government from your town to your school to Albany and Washington, DC. It might make that 6.1 percent a devilish 6.66 percent (which would be quite fitting). It may not be a perfect calculation, but it’s pretty darn close.

If you aren’t one of the aforementioned public servants you (and/or your employer) had to pay for your health care. That is, if you could afford to after you paid for everyone else’s first. If you did receive job-based health insurance you probably had to pay a portion of the premium, be it 25, 50, or 75 percent. Depending on the employer contribution and your plan, that could be a pretty penny. Typical insurance packages in WNY are just under $4,000 for single, a smidge under $7,500 for double, and in excess of $11,000 for family coverage. Statistics show that the average family that pays for health coverage puts 22% of its household income towards it.

Now, add your premium payments to what you’re paying for others’ insurance (the quality of which, by the way, probably far rivals what you get from your insurance) and you’re looking at an incredibly massive portion of your family’s income being dedicated to health care…yours and that of someone you don’t even know. And people wonder why most homes can’t survive without two breadwinners.

That value is destined to go up – not down! – with the passage of health care reform. Don’t let Congress fool you when they say the “evil” health insurance, medical equipment and pharmaceutical companies – not you - will foot bill. Those corporations aren’t super-powered like the government; they can’t create money out of thin air to pay the new taxes. They have to get it from somewhere or someone: Namely their customers, you and me.

It won’t be cheap, either. 32 million people will have to become insured. About 25 percent more – approximately 40 million Americans - are already on Medicaid and look at how much that costs us. Just suppose the numbers extrapolate nicely and our new-found payments for this so called “reform” are three-quarters of what we’re paying for Medicaid now. Come 2014 we’ll be paying another extra 3 percent of our income to cover those who were just granted insurance through Obama’s and Congress’s benevolence (using our money), bringing the grand total to almost 10 percent of your earnings.

So, in a few years, if you aren’t one of those who have their health care provided by the government through employment or subsidy you might as well say that one-third of your hard-earned dollars will be spent on health care. It’s enough to give someone a heart attack, so thank goodness you’ll have coverage!

Cell phones are not a right

From the 22 March 2010 Greater Niagara Newspapers

CELL PHONES ARE NOT A RIGHT
By Bob Confer

Numerous times in our young marriage The Wife and I have had discussions about our cell phone packages. We’ve debated at length the minutes, data plans, and equipment that best suit our needs and, more importantly, our budget.

Conversations such as those play themselves out in millions of households across the United States. It’s a common subject because most people agree that, unless their job requires their use, cell phones are luxury items. Mankind has survived for eons without these devices which have only relatively recently become mainstream in their usage. Many rightly know that if something must be cut in a family’s budget there’s a good chance their calling plan will be the first to go. After all, telephones are nowhere near as important to our well being as food, water, and shelter.

Even though the common and fiscal senses dictate that cellular phones aren’t a necessity there are still plenty of people in government – and many more who are subservient to them – who believe that they are. They even go so far as to believe that they are a human right and everyone deserves one.

Unfortunately, it’s we, not they, who are paying for that misguided belief.

For the source of your donation (albeit a forced one) look at your most recent phone bills, cellular or landline. Locate the line item that says “Federal USF Surcharge.” A typical home phone may show a charge of just over $1. Family packages on cellular devices could show something in excess of $2. Business phones, depending on traffic, face higher fees. As an example, in our busiest months my company pays about $25. Now, just imagine the collections from millions of families and businesses. It works out to be about $9 billion per year.

The aforementioned surcharge (read “tax”) is for the Universal Service Fund, a behemoth of public benevolence created by the Telecommunications Act of 1996. The Fund has four distinct responsibilities. The government uses it to temper phone charges in high cost areas, provide affordable telecommunications services to economically disadvantaged schools and libraries, aid rural health care providers in their ability to communicate and, last but not least, provide free or discounted phone service to low-income individuals (to the tune of just under $1 billion annually).

It’s the latter that drives the countless ads you see on TV or the Internet from companies like SafeLink Wireless and Assurance Wireless that tell people they can get free cell phones that come equipped with 60 to 200 free minutes per month, depending on the carrier and the state. Families who fall under certain income thresholds (135% of the poverty rate) or receive public housing assistance or Medicaid are eligible for the phones, fully funded by your taxes.

Many folks on both the Left and Right have no qualms – or limited ones – about helping others get through tough times with home and health subsidies. But cell phones, that’s another story. These free phone programs have been met with justified protest in many states.

But, alas, the program subsists because of concerns like “discontinue the program and what will the poor people do?” To them, I pose the simple answer, the right answer. They need to do as the rest of society and if times get tough do without the cell phone. Do like we did 15 years ago before this program was ever conceived: Rely on a landline (whether it’s theirs, their friend’s or family’s) or a payphone. They could even rewind to the 1980s and get a CB radio. They worked just fine as the mobile communication device of choice back then (they were that era’s cell phone) and for a one-time investment equal to a month’s telephone bill someone can outfit their car or home with a quality set-up. As someone who still keeps a CB in truck and home I can attest to their timeless usefulness.

Basically, when it comes to non-essential items, you make accommodations to deal with life’s inconveniences. As singularly important as we all think we are, there are really very few people who need to be in constant contact or have the ongoing accessibility afforded by a cell phone. They are a modern luxury and, to many users, nothing more than a toy. It sure doesn’t sound like something we should be spending our tax dollars on.

Think about it: As you struggle to pay your family’s cell bill month to month, do you take any consolation in the fact that you’re subsidizing someone else’s ability to gab with their friends free of charge?

I didn’t think so.

The census and your privacy

From the 15 March 2010 Greater Niagara Newspapers

THE CENSUS AND YOUR PRIVACY
By Bob Confer

In his recent column for the Greater Niagara Newspapers my friend Scott Leffler waxed poetic about how illogical – if not illegal – the US Census has become as it asks questions that were unintended by our Founding Fathers. As with quite a few issues, I agree with Scott on this one and I will be one of those folks he mentions who will try their luck by filling out only one question on the 10-question form. If push comes to shove with the Census Bureau I have the Constitution and this soapbox I call my column on my side.

Some may think that people like Leffler and myself are driven mad by conspiracy theories. Not so. We’re only playing by the book, one that is the most important book to people of this nation: The Constitution of the United States of America. The Constitution requires that a census be conducted only for the purpose of enumeration (basically, a head count) to determine the apportionment of Congressional representation and direct taxes to the States. Since it is a count only all other questions are moot and only serve a Federal Government that is much larger than that which was intended.

The Census asks about home ownership (or rental) claiming that it in indicator of the nation’s economic health and is key to the administration of housing programs and planning. It also asks questions about age, sex, and race, which the Census Bureau says is necessary for the implementation of equal opportunity and Civil Rights programs. The Bureau’s website even goes as far to say, “state governments use the (race) data to determine congressional, state and local voting districts.” That begs the question, one to be answered another day, just what does race have to do with voting districts?

The standard Census form is nosy enough, but it’s not the worst. In past 10-year Censuses a random number of households (about 1-in-6) received a long form that asked many more-specific questions. That practice has been abandoned and replaced with a questionnaire that has been sent to about 1 out of every 40 homes every year since 2005. The American Community Survey (ACS) is the Census Bureau’s way of keeping data – that supposedly cannot wait every 10 years – current and fresh so the government can make “critical” decisions. The Bureau cites the ACS as an extension of the standard Census and, therefore, in their eyes, participation is mandatory.

If you are unlucky enough to receive one of these 14-page packets in the mail you will find yourself facing questions that you probably wouldn’t comfortably share the answers of which with your friends and neighbors, let alone Uncle Sam. What time do you leave home for work? How long does it take you to get there? How many hours a week do you work? What is your annual income? How many times have you been married? Do you have difficulty making concentrating, remembering or making decisions? Does the home have a toilet, running water, a sink, a stove, a fridge, etc?

There are other questions that could be considerably time consuming. You’ll actually have to do your homework to answer them; things like: What are your monthly gas and electrical costs? What are your annual water and sewer costs? What could be your home’s selling price? What did you pay in real estate taxes? What is the monthly rent or mortgage? How large is your insurance bill?

If you’re interested in seeing the ACS and just how nosy the government can be a copy of the form can be downloaded at www.census.gov.

Like Mr. Leffler, I won’t tell you whether or not to fill out the Census or the ACS in their entirety. It’s your prerogative. If you feel that you’re doing your job as a good citizen in answering all the questions as a means to help the government plan for our future, more power to you. If on the other hand you decline to answer the questions citing Constitutional responsibility, kudos to you as well. The Census, like beauty, is in the eyes of the beholder: Some people can’t live without big government while others would chose to do without it.

An America less free

From the 08 March 2010 Greater Niagara Newspapers

AN AMERICA LESS FREE
By Bob Confer

Say the word “America” and a few other words immediately come to mind. Freedom. Liberty. Prosperity.

You might be shocked to know that our nation, which has long represented those values more so than all others, is nowhere near the pinnacle anymore. As a matter of fact, we’re only eighth best in the world.

For a decade now the Heritage Foundation and the Wall Street Journal have worked together to produce something called the Index of Economic Freedom. It analyzes 10 factors that affect all participants of a nation’s economy – businesses, workers, consumers alike – such as property rights, government spending, freedom from corruption, and the seven freedoms of business, monetary, labor, trade, investment, fiscal and financial freedom. The Index analysts assign a 0 to 100 grade to each of those factors. The average of those 10 items is then identified as the country’s final grade that is used to compare it against 182 other nations.

In the recently-released 2010 report the United States posted a score of 78 which ranks us eighth overall. Thanks to a one-year drop in score that was the greatest among the world’s 20 largest economies, we fell two slots. The nations who now have more freedom than we are, in order, Hong Kong, Singapore, Australia, New Zealand, Ireland, Switzerland, and Canada.

Think about that: We here along the border joke incessantly about Canada being a quasi-socialist nation yet, the truth be told, it’s we who are less free economically than they are.

How did we earn such a low grade? We’ve historically had a grade in the low 80s that can be attributed to administrations and congresses both Republican and Democrat that have spent heavily and restricted our abilities with as much vigor. We’re no better off than we were in 1995 (the earliest date available in the study) and we’re significantly less-free than we were just last year. That sudden decline to our already-low grade (at least one that’s low in comparison to where we think America should be) is a result of 8 factors dropping in value and 5 of them that are at a grade of 75 or below.

Investment freedom is the highest among those 5 at 75. The low grade is a result of restrictions that are placed on foreign investment in significant portions of our economy like banking, mining, shipping, communications and aviation to name a few. In a global economy that is a major detriment to development that could come to our shores from outside. In the future we cannot rely solely on American money to take us forward.

Freedom from corruption comes in at 73 and shows some substantial risk for the future based on the lack of accountability and transparency by the public and private entities that is inherent to TARP and other bailout programs.

Financial freedom received only a 70. This category took a significant hit since the Recession began with all of the private and federal adjustments made to correct what went wrong with the sub-prime mortgage crisis. As numerous banking and financial firms have failed (thus limiting the choices for businesses and average people) others have been propped up by the federal government, but with strings attached, tempering true liberty and the access to money.

Fiscal freedom chimes in at paltry 67.5. The report cites tax rates at the federal/state/local level that are among the highest in the developed world. That’s your money being taken away from your company or your home and being used by others elsewhere. This leads into the lowest of our grades, the root cause of our fiscal woes, a 58 bestowed on government spending. Once again we are worse than the world average in this category, the result of total government spending that was 37.4 percent of GDP. The report noted year-to-year growth of federal spending that exceeded 20 percent.

It’s disconcerting that we really aren’t the cream of the crop when it comes to economic freedom. We’re America…we’re supposed to be Number One! Where will we be in 20 years? Could we slip further? If we do, then how quickly could China overtake us as the world’s largest economy?

The grades contained within this and future studies should serve as a discussion piece, a motivator, for elected officials, concerned citizens and voters. We need to work together to better our ranking. Doing so requires an attention to the barriers and burdens that impact our day-to-day lives. Prosperity comes from freedom and we need both now more than ever.

Green energy hurts the economy

From the 01 March 2010 Greater Niagara Newspapers

GREEN ENERGY HURTS THE ECONOMY
By Bob Confer

Since his days as a U.S. Senator, President Obama has trumpeted renewable energy as the catalyst for the future growth of America’s economy. He believes that investments in wind, solar, and ethanol energy will excite the marketplace and put Americans back to work. Similarly, the supposed positive domino effect of Green Economics was a key part of the Bush administration’s efforts to promote and subsidize ethanol. But, rather than increasing employment, those efforts increased consumer prices and accounted for vast transfers of wealth, something that should be a lesson to learn from for the President.

The economic weaknesses of corn-based ethanol have long been discussed by critics of the federal government’s ill-advised foray into the alternative fuel market. For years they have said that its makes no sense to turn into fuel something that is such an important food both directly (as corn at the dinner table) and indirectly (as corn syrup and feed for livestock and poultry). A negative impact on consumer prices was virtually guaranteed: A bushel of corn produces an average of 2.7 gallons of ethanol and federal mandates require that the nation uses at least 36 billion gallons (13.3 billion bushels of corn) by 2022. The industry appears to be on its way to exceed that goal: 2010’s production is expected to surpass 13 billion gallons.

Following the laws of supply and demand, corn prices have gone out of control, reflecting the emphasis on ethanol. From October 2002 to September 2003 corn prices ranged from $2.15 to $2.35 per bushel. In the months leading up to the recession in 2007, corn prices exceeded $4.00 per bushel. During the first part of the recession prices fared no better, for in April of 2008 they surpassed the once-mythical $6 mark and actually reached $7.88 in June of that year. With the collapse of the global economy in 2008/2009 and the associated declines in demand and prices for nearly all commodities, corn was in a stretch that saw it stay within the mid-$3 range. Projections for 2010 show another up tick that will take it far beyond $4/bushel.

This trend in increased ethanol production and the reliance on corn has had a detrimental effect on the consumer. Not only has corn itself gone up, affecting everything from sodas to cereals to tortillas, but so have the costs of meats and dairy products. At the turn of the century feed costs accounted for 50 percent of an average meat or dairy farm’s operational costs. As the price of corn doubled and even tripled, the beef, milk, and chicken producers had no choice but to pass on the higher costs to consumers. During the second half of 2007 and the first half of 2008 consumer prices at the grocery store grew at unprecedented rates and economists who disbelieve misleading government statistics like the Consumer Price Index had price inflation pegged at 12 percent, not the 5 percent as indicated by the government.

Over the past few years criticism of ethanol was met with a blind eye and a deaf ear by most in Washington. Recently, though, we saw the federal government actually admit to having inadvertently manipulated market prices through the emphasis on ethanol. A Government Accountability Office report says feed costs for livestock producers more than doubled from 2006 to 2008 as a direct result of ethanol production.

This, of course, has done nothing to create jobs or jumpstart the economy. Instead, it closed dairy farms, cost people their jobs in manufacturing and retail, and helped to escalate the recession. A Purdue study notes that $15 billion per year has been extracted from the economy to satisfy ethanol demands. Rather than being spent on the purchase of more products in volume or invested in discretionary purchases of all sorts - all of which would have had positive economic impact - those funds were instead spent by individuals to maintain the status quo in their diets.

That’s $15 billion per year lost in the ether of our economy, the direct result of government intervention into markets in which it does not belong. It is not a tax per se, but in practice it has the same effect as a tax: Wealth has been forcibly transferred away from the people by the government resulting in a lower standard of living.

NYSERDA and your power bill

From the 22 February 2010 Greater Niagara Newspapers

NYSERDA AND YOUR POWER BILL
By Bob Confer

A couple of weeks ago New York launched the Great Appliance Swap Out. This program offers $50 to $105 rebates on the purchase of qualified appliances. You may have noticed in various news articles and public service announcements that it was funded by the American Recovery and Reinvestment Act and administered by an organization that calls itself NYSERDA.

Chances are you probably didn’t concern yourself with NYSERDA. But, you should.

First, grab your most recent electrical bill. Scroll down through the delivery services portion of it. You’ll notice something called “SBC”. Depending on how big your household may be the SBC line item ranges from $2.50 to $5.00 a month. That’s not chump change. You’re shelling out $30 to $60 per year, money that both you and I know would be best spent by you and not the government.

You see, the SBC is a tax. The acronym means “Systems Benefit Charge”. According to National Grid these funds “reflect costs associated with mandated public policy programs - low income assistance, energy efficiency programs, and certain research and development programs including the advancement of renewable energy resources.” The recipient of these fees is the aforementioned NYSERDA – New York State Energy Research and Development Authority.

If you are an astute student of all things government the first thing that comes to mind is “why are we paying taxes to a public authority?” Authorities are corporate instruments of the State created by the legislature to further public interests. They are basically private enterprises with a public flair that are legally and administratively autonomous from the State, meaning they are accountable to no one but themselves. They are typically funded by user fees and should never be funded by taxes. Yet, here’s NYSERDA being funded by a tax in your power bill. Combined with the lack of accountability to the taxpayers, that makes the systems benefit charge a classic example of taxation without representation. That’s the same kind of thing that got the colonists all fired up during the American Revolution.

And, it’s the same kind of thing that gets me fired up at the office. Long-time readers of this column know how I despise the competitive structure of electricity in New York. My company pays twice what our competitors in Ohio and Indiana pay for power. That’s pretty significant considering we use as much electricity as two average-sized villages. In my ongoing analysis of what makes my power bill so high I’ve long had the SBC in my sights. Back in 2007 I was on the warpath over the charge that then amounted to $8,250 annually. That’s a lot of money. But, much to my chagrin, after analyzing 2009’s bills I made the grim discovery that something changed in collection of these taxes. Last year, for virtually the same amount of electrical consumption, we paid a staggering $32,050 for the SBC, almost 4 times what we did just 3 years earlier.

Back when the charge was “only” $8,250 I was intent on putting it in front of Governor Eliot Spitzer. I was hopeful that the Wall Street Watchdog would have been just as disgusted as I about the unrepresented tax. His director of operations shared my concerns with the Public Service Commission. In her response PSC Chairwoman Patricia Acampora barely addressed my concerns and instead waxed poetic about what NYSERDA supposedly does, like lowering overall electrical demand and costs for New Yorkers. She also noted that, yes, NYSERDA does collect its fees from electrical users but the State has oversight over what it does with its monies. Considering how ineffective that “oversight” is with the New York Power Authority, Thruway Authority and 700 other authorities across the state, I could only laugh.

That’s what we’re up against, folks: An entity that shouldn’t be taxing us but is and is allowed to do so at the behest of the State. Whether you’re a family or a business trying to make ends meet in these tough times you should be frustrated with this tax that is - like a few others – hidden in your power bill where you might just never see it.

Please take the time write your elected officials and let them know you’re sick of playing nice with NYSERDA.

Super-regionalism: WNY and the GTA

From the 15 February 2010 Greater Niagara Newspapers

SUPER-REGIONALISM: WNY & THE GTA
By Bob Confer

(Editor’s note: This is the final part of “Four Ways to Save WNY")

A good many Western New Yorkers have looked at Ralph Wilson as the anti-Christ ever since he turned the Buffalo Bills into a part-time resident of the city of Toronto.

Their assessment is quite unfortunate because Ralph Wilson is a genius for that pursuit and we need every man, woman and child to follow in his footsteps. The merging of the Niagara-Buffalo region, economically and socially, with Southern Ontario is without a doubt the most important thing that we can do to achieve the best possible future for WNY.

It’s not a stretch to say that most people in the area tend to look at Canada as a strange, far away land and that our world seemingly ends at the Niagara River. It’s almost as if we chose to ignore that Ontario is in our backyard and, oddly enough, believe that Rochester or Erie, PA – both of which are farther away than the Greater Toronto Area (GTA) - are more appropriate parts of our lives. Those blinders – based in either ethnocentrism or a misguided fear of the unknown – need to be cast aside.

The area from the border to just past Toronto is aptly named “the Golden Horseshoe”, a c-shaped territory along Lake Ontario that comprises some of North America’s greatest riches. It is home to 8.1 million residents and the Canadian headquarters of the world’s largest corporations. To put that into perspective Niagara and Erie Counties, the most populous of WNY, are home to only 1.25 million people and a depressed economy that is but a shell of its former self.

Were we to open our eyes, our minds, and our borders to our friends to the North, we’d be able to capitalize on their sizable economy and its potential for growth (the Golden Horseshoe’s population is expected to expand by 40% over the next two decades) by manufacturing the products and providing the professional and high-tech services they need. But, at this time, it’s easier said than done.

For starters, the border offers a significant hurdle. In the name of national security both nations have tightened up their vetting process at the gates, slowing traffic to a crawl and accounting for waits at the bridges that typically exceed one half hour for passenger cars and are considerably longer for tractor trailers. That’s a ridiculous amount of time when one considers that Toronto is only an hour away from the Rainbow Bridge. Few businessmen, workers or customers possess enough patience to deal with such delays on a regular basis. It’s virtually impossible to plan your day around it as you may get through the border in five minutes or fifty of them. In order to promote the easy cross-border movement of people and products both governments must fully man each crossing and expedite the screening process. The Canadian government, especially, must find ways to temper the insane number of strikes/slowdowns that their border agents go on.

Secondly, businesses need an effective means by which to network and connect with one another. Many Canadian and American companies have a hard time figuring out how to crack the market and do business on the other side of the River. I’ll admit, even I have found it extremely difficult to properly market Confer Plastics to companies in the GTA. What companies like mine and countless others need are the local chambers of commerce – like the Buffalo Niagara Partnership and the Niagara USA Chamber – and their Canadian counterparts to focus on what their name implies: Commerce. They sometimes host mixers and networking events for smaller companies in their own communities. What they don’t offer are similar events on a larger scale for their bigger clients, US-Canadian matchmaking events that would connect a manufacturer in Lockport with another one in Hamilton or a software firm in Mississauga with, say, a hospital in Buffalo that could use its services. Basically, local business groups and their member companies need to think less parochially and work together to address a macroeconomic need.

There are some people – visionaries if you will - who see the importance of greater trade with the GTA. You might choose to not listen to the Buffalo Bills front office since football teams are so “sacred”. But, if you ever get a chance to catch a speech about bi-national trade from Ken Franasiak of Calamar you’ll be really impressed about what the larger WNY/GTA region is and could be. It’s time that others followed that vision and extended the Golden Horseshoe past the Niagara River, taking it to Rochester and beyond. There’s no reason why the GTA’s prosperity shouldn’t rub off on us.

Water: The key to WNY's past and future

From the 08 February 2010 Greater Niagara Newspapers

WATER: THE KEY TO WNY’S PAST AND FUTURE
By Bob Confer

(Editor’s note: This is part three in a series, “Four Ways to Save WNY”)

If any one thing could account for the past successes of the Western New York economy it’s water.

When the Erie Canal opened in 1825 it made the region the gateway to the West, offering a navigable trade route connecting the Atlantic Ocean to Great Lakes. It was an engineering wonder that cut transportation costs by 95% and improved the timeliness of delivery by weeks. WNY became a commercial hub and Buffalo one of the most important cities in the United States. But, the golden years of the Erie Canal lasted about a half-century. It was made almost useless by the advent of the United States’ vast rail network that, by 1869, connected coast to coast.

It wasn’t long after that, though, that the area experienced yet another economic boom driven by water. In the late 1800s power plants began to develop along the Niagara River, including the world’s first large-scale power plant to produce the alternating current so important to the efficient delivery of electricity and, therefore, industry. The technology harnessed the limitless power of the River to create vast amounts of electricity and whereas many other cities saw electricity as a luxury, Niagara Falls was able to take it for granted. This brought manufacturers by the hundreds to the Falls which became an industrial Mecca for the first half of the twentieth century.

But, after World War II, things changed. Affordable electricity was no longer specific to WNY. Vast hydroelectric projects had popped up all over the United States and power generation technologies that used coal were refined in the 1920s and again in the 1940s, making that an accessible and cost-efficient means to power homes and businesses. Niagara Falls lost its edge. And then it lost its businesses and residents. Now, the corridor along the River looks like a manufacturing ghost town. The City itself is no less unattractive, its population one half what it was in 1960.

But, there is hope. Hope in that substance which boosted our economy in days gone by: Water. It’s time again that we leveraged that asset to bring about a new age of prosperity to WNY. Later this century – and right now for that matter - water has a very good chance of being the new oil, a substance so rare and necessary that governments (even neighboring municipalities) will compete for it and sell it at a premium.

We’re fortunate here in WNY that water abounds. We have the Great Lakes, the mighty Niagara River, and hundreds of streams, ponds and lakes filling our landscape. Other places, including those where Niagara’s businesses and people migrated to, aren’t so lucky. There, water is at a premium. There’s barely enough now and, as those communities expand, they are guaranteed to be lacking in the future.

Among those, Atlanta first comes to mind. The metro area’s water woes have been problematic – if not frightening – with a drought of epic proportions having hit the region. Exacerbating the problem is that even were the area drought-free the over-built cityscape of 5 million people would still be short in regard to future development. Making matters worse, the courts ruled last year that Atlanta has very limited rights to Lake Lanier’s water, which had been its primary drinking supply. This has forced city officials to look elsewhere in Georgia for water and it has forced many companies to take a long, hard look at Atlanta. Because of that, some economists predict that 1 million people will migrate from the city in the near term, leaving it no bigger than it was in the 1970s.

Similar shortages exist in newly-developed parts of North Carolina and there’s always the naturally-dry West.

This puts the Niagara region in a unique position to profit from other people’s despair. Corporations and people need certainty when it comes to water supply and you can’t get much more certain than our backyard. A couple of years ago the Niagara County Center for Economic Development began marketing the region to water-starved states in hopes of attracting new businesses. Very few development agencies in the Great Lakes have followed suit – despite the seriousness and scale of the water shortages - which puts Niagara County in the lead based on both moxie and available natural resources. It is hoped that their continued efforts and the frustrations of southerners combine to bring companies both big and small back to the region. We definitely have the resources and we must use them wisely to recreate a robust WNY economy for future generations.

Keep the kids in WNY

From the 01 February 2010 Greater Niagara Newspapers

KEEP THE KIDS IN WNY
By Bob Confer

(Editor’s note: This is the second part of a series, “4 Ways to Save WNY”)

The vibrancy and future of a region are directly determined by how many young adults have staked a claim on the area, choosing it as a home and a workplace that fits into their personal and professional plans. The metropolises that attract and keep the most people aged mid-20s to early-40s end up being the greatest economic engines in both the short term and the long term.

It’s obvious that Western New York is not among those places. We don’t have the jobs that would keep kids here nor do we have the economic system that would put them at ease regarding the future realization of their full potential. It’s because of that malaise that our youngest residents flee the region en masse: Whereas the US population grew by 8% from 2000 to 2008, the Niagara County population shrank by 2.4% and Erie County contracted by 4.3%.

They weren’t the only young folk who left us. Their peers from around the globe come to WNY for a world-class education. The region is a hotbed for high-quality academics, the far western counties being home to 25 colleges and universities with total enrollment in excess of 75,000. Despite the attractiveness of that intellectual environment there’s little to keep them here once their studies are done.

In order to change WNY for the better we must reverse those trends. We must make this a life-long home for those who were raised here and those who educated here. If we could keep them engaged and interested then we can assure the vitality of the region.

This can only be done in baby steps. There’s no magic cure, no silver bullet that will change this situation overnight. It will take a deliberate effort and little victories to begin a slow but consistent path to an ultimately younger community. By giving incentives to and utilizing the resources of the current crop of youth we can open the door for future generations.

First and foremost in this cause should be the emphasis of college communities as the epicenter for economic development. Some of the greatest minds in the world come to area colleges – especially the University at Buffalo – and it would be nice if they could have a chance to apply what they’ve learned locally (rather than Dallas or New Delhi) to make the next best consumer product or achievement in medical technology. The leaders in the public and private sectors of the locales that realize this benefit (California quickly comes to mind) do their best to give those youth the backing in resources and finances that they need. It would behoove WNY’s leadership to bring together businessmen of deep pockets who are willing to serve as the angel investors or venture capitalists for the graduates, giving them the start-up funds necessary for their enterprises. WNY really isn’t home to such individuals (Erie and Niagara Counties have only 663 millionaires) but some slick marketing to millionaires in Manhattan (who number 16,000) or similar wealth centers could easily find generous souls interested in the financial and social return on investing in fresh-faced geniuses.

At the same time we need the private sector to share more than just seed money, voluntary and involuntary. Every taxpayer – corporate or individual – “invests” thousands of dollars every year in elementary and high schools, community colleges, and SUNY campuses through their property and income taxes, yet very few taxpayers take what you would call a vested interest in the final product. We need everyone – especially businessmen and women - to share their intellect and experiences and dedicate themselves to the development of our youth (and therefore our region). If more companies opened their doors to internships or more business owners mentored students or spoke to classes on a regular basis we could make them better students (and better workers) and maybe permanent residents of WNY. Who knows, the attentive businessman might find that key employee and bright idea he’s always been looking for. This endeavor would best be achieved if Chambers of Commerce and other business groups joined forces with local colleges to create a clearinghouse or partnership that would team schools and professors with the industrialists and retailers who could help them reach their educational goals.

There are countless other tasks that could be undertaken – such low-cost, state-provided student loans that offer lower rates for those who stay in NY – but these are a start. Basically, the leadership of this region really needs to focus on connecting area students with employers and investors in hopes of tempering the migration of the young minds which should represent our greatest asset.

Consolidate our governments

From the 26 January 2010 Greater Niagara Newspapers

CONSOLIDATE OUR GOVERNMENTS
By Bob Confer

(Editor’s note: This is the first part of a series, “4 Ways to Save WNY”)

Ask locals what they dislike the most about Western New York and more often than not the answer isn’t what an outsider might expect. Common national sentiment would have one believe that it’s the snowbound winter months that are most depressing about the Niagara-Buffalo region. Not so. It’s the taxes.

New York’s property tax burden is among the greatest in the United States, the fourth highest actually, at $3,622 per household. That’s a rather significant portion of household income that, before state and federal income taxes, has a median value of $44,064 in Niagara County. To put that into perspective, a family works one whole month out of every year just to pay for their school, county, and city/village/town taxes.

It’s rather disheartening to think that not only do we have less to spend but also that New York is among the very few states where housing represents a bad investment. Think about it: The median home value in Niagara County is $95,800. 10 years of taxes paid is $36,220. Would a Niagara homeowner be able to turn around and sell his house after 10 years at $132,020? It’s impossible and even then he would only break even and that’s not accounting for home improvements.

It’s this extravagant expense (among countless other taxes and fees) that has driven many a resident from our area to places much less expensive in which to maintain a home and support a family.

One would have hoped that the Great Recession would have forced the state government’s hand in bringing about much-needed change to this predicament in an effort to one, save families hit hard by the loss of jobs or retirement income and two, stave off the continued demise of the region. But, the state legislature, in typical short-sighted fashion, has failed to address the mandates (such as Medicaid and educational directives) that make property taxes so exorbitant.

So, what can be done? How can we reverse (or at least temper) this trend?

The answers may exist in a law that goes into effect on March 21. Lost amidst the chaos of the supposed Senate coup of June of last year was the passage of that law, the Reorganization and Empowerment Act. This powerful tool will allow municipal leaders and driven taxpayers to initiate a process of consolidation and dissolution of local governments including towns, villages and special districts. This can be achieved in two ways. In the first method, a town council can put the measure before voters. In the second method, concerned citizens can take up the charge and would need to collect signatures from only 10 percent of the affected voters in order to put it before the general voting population.

According to the commission that helped create the legislation, more than $1 billion in annual savings could be achieved through a variety of consolidation measures. Locally, you could see this wisely put to use in say the combination of the towns of Royalton and Hartland for example, cutting back on services and resources exercised and duplicated in neighboring communities of nearly-identical stature. Similarly, Niagara County’s incredible number of special districts should be on the chopping block. According to a 2007 study by the State Comptroller’s office, County taxpayers pay on average $687 per year in special district taxes. In comparison, that cost in Tioga and Cortland Counties is only $49.

It’s up to the people to move on this - whether it’s the representative small town board or a group of residents - in much the same way they have with Kevin Gaughan’s downsizing efforts that have taken Western New York by storm. When this tool becomes available it will be interesting to see where it is used, who uses it and just how much money is saved. It’s something that might prove significant in making a good number of communities in Western New York more affordable places in which to live.