Cuomo, Levy, and breaking eggs

Jordan Levy is not the richest guy in Buffalo, but now that New York’s governor has chosen him to run the Buffalo Billion program’s $5 million business plan contest, Levy has arguably become the single most important person for Western New York’s future—because Levy is now, potentially, the agent who can change the business culture of a region that can’t hope to survive without a new one.

The business plan contest is tiny compared to the Buffalo Billion. So is Levy’s own Z80 Labs, the technology incubator he runs downtown. But though he is not the billionaire from hydrogenated vegetable oil (Rich Products) or from stadium concessions (Delaware North), nor the half-billionaire from regional banking (M&T), Levy is plenty rich—from startups. The guy is entrepreneurship personified. He works a phone like a cold-caller but, because his networks are so extensive and his energy is so relentless, nobody doesn’t take his call. Staid and diplomatic and polite and learned people cannot abide his style—but there is no better person in Buffalo to run this business plan contest because the style of the startup is what this place needs.

Buffalo artists know about competition. Cultural organizations understand the annual scramble for Erie County Cultural Advisory Board dollars. But the business community in Buffalo—dominated for a generation by rent-seeking real-estate developers and handout-grabbers, facilitated by a proletarian-minded political class that questions nothing in exchange for easy jobs inside heated buildings—has had nothing like competition. It’s all been wired around here. Until now.

Because now comes the egg-breaker—the entrepreneur, Levy. His job is to crack the handout paradigm. His tool is the business plan competition—an annual contest that will feature proposals for brand-new businesses from people who are driven by ideas, research, innovation, and also by tweaks and obsessions, as is often the case in start-up enterprises. The Buffalo business plan competition looks very much like the one that has worked for more than 15 years in Pittsburgh.

We’ve talked about doing a business plan competition here. Why, way back in 2001, a Buffalo team went to Pittsburgh to visit with the folks who organize and run the Pittsburgh Technology Council program, which awards the winning contestants money, advice, space in a brand-new building sited on a former steel plant riverfront brownfield, and a shot at the state of Pennsylvania’s public investment fund for in-state businesses. The Pittsburgh contest has produced about 400 start-ups, more than 150 of which are still producing jobs, products, and, withal, a refreshed sense of possibility for Pittsburgh. The business plan competition has been credited with leading the demographic transformation of the entire region—because the population there is no longer declining, as it is here. There is “rebound” migration in Pittsburgh. People who graduate college there don’t leave for opportunity elsewhere: Increasingly, they stay home to create it. The old industrial culture has successfully evolved into a startup culture. That change was present in Pittsburgh already when a copy of the Pittsburgh program was hand-delivered to the business leadership here.

But what happened in 2001 when Buffalo got briefed on the Pittsburgh program? Well…there is no direct evidence that the Buffalo leaders made paper airplanes of it, but the words nought, goose-eggs, zero, ex nihil nihil fit, all accurately describe what our rent-seeking locals did. Change was a threat to the existing paradigm. Entrepreneurship? Intellectual capital? Bah.

Levy lived through this. Levy knows all these local folks who want to stick with what they know. This is, after all, a small place. But Levy’s rise has not had anything to do with the rent-seeking, conspiratorial, real-estate-focused business class that has dominated Buffalo since the demise of the heavy metal industrial sector. Levy, a local kid from North Buffalo, is culturally a creature of Silicon Valley. He is not a WASP-imitator. He belongs to all the fanciest clubs in town, and out of town, but he never drank the Kool-Aid that dumbed down so many of the golf-playing imitators of the tired old ruling class here.

And now Governor Andrew Cuomo has handed him the password not to the entire $1 billion, but to the game show that everybody wants to watch. Very visibly, the people who are like Levy—the risk-takers, the opportunity-seekers, the relentless, the undiplomatic—will get a shot. Putting Levy in charge of this thing means that the prospect of innovation here is absolutely real for the first time in deacdes.

Just Google the number of companies Levy himself has started, advised, sold, reorganzied, and kicked into shape. Levy was wrong about Bass Pro when he was volunteering at Erie Canal Harbor Development Corporation, but that was just him trying to fit into the dumb old paradigm of bullying, handout-demanding dimwits. That’s not who this guy is. Now, with this assignment, Levy is in his element. Cuomo did Buffalo a very good turn in empowering Jordan Levy.

Everybody wants to hear about entrepreneurship. Meanwhile, Cuomo is still talking about something else that evidently nobody in the political class wants to hear about: consolidation.

When a political leader wants to tip his or her hand, or make a passing mention, or wink at an issue, the best time to do so is in the annual big event. The President of the United States gives an annual State of the Union address, and governors give their own version, mayors and county executives theirs, and now, by gosh, town supervisors, too. These speechs are packed full of little nods and winks and gestures.

But Cuomo invested three paragraphs of State of the State speech in consolidation. He expressed frustration that he can’t quite figure out the right mix of carrots, sticks, prods, praise, and punishments to get some of the 10,500 units of local government to get their acts together. He once again linked the issue of high local property taxes—which even progressives like Fred Floss of the Fiscal Policy Institute decry—with the proliferation of towns, villages, counties, school districts, and special districts.

Cuomo won’t let the issue go, but at the moment, it’s not clear that he knows quite what to do about it. Strangely, an emerging consensus about the superior functionality of regionalized and coordinated governance—a consensus that got enacted into law in prosperous, growing Ontario just across the Niagara from us—has taken a bit of a hit because oafish slob Rob Ford, the suburbanite mayor of Greater Toronto, has tarnished the notion of knitting suburb and city together. What Cuomo seeks to do, though, by once again putting the gubernatorial imprimatur on the consolidation concept, is to remind the political class that the issue will not go away.

Consolidation is like entrepreneurship. An empowered egg-breaker has to lead the cultural change. Nobody should expect the permanent fiscal crisis of places like Buffalo and Syracuse to drive fundamental structural change any more than the generation-long crisis in business leadership will disappear in the face of a few successful startups. But helping a change or two happen, especially here, especially now, would get attention. Jordan Levy is only getting $5 million of the Buffalo Billion. Can we expect a similar effort for merging Syracuse with Onondaga County, or five Cheektowaga school districts into one—or should we hold out for a big plan?

Bruce Fisher is director of the the Center for Economic and Policy Studies at Buffalo State College. His recent book, Borderland: Essays from the US-Canada Divide, is available at bookstores or at www.sunypress.edu.