A City On The Edge of the Erie

For people living near and around Rochester, New York, much of what goes on in the city could be referred to as a soap opera. It seems every time you turn around, there’s another example of poor decision politics going on. Could it be those in leadership are always looking for the quick fix instead of the right fix? Officials in Rochester have a tendency to put all of their eggs in one basket. Then, they go for government funding, and in the end, many times, the project fails.

Could it be that’s happening again with PaeTec?

Read on …

Rochester, New York Announces Incentive Bonuses

While performance-based pay is commonplace in the private sector, the Mayor of Rochester, New York has decided to implement the practice at the government level. As a result of his new plan, the already cash-strapped City of Rochester, is handing out thousands of dollars in bonus pay. This plan, especially coming at this point in time, has at least three major problems.

• The economy is in a bad way.
• Mayor Duffy is handing out taxpayer money to pay huge bonuses.
• Mayor Duffy spends more time crying for money in Albany than he does at home. How can he justify this reckless spending?

All of this also comes at a time when the President of the University of Rochester, Joel Seligman, announced this week he will not take a pay increase next year because the U of R is uncertain of what will happen to their funding stream in the midst of the current economy.

Read on …

Trimming An Already Bloated Budget

Governor David Paterson’s job approval rating may have dipped to 51% this week, but one thing is for sure - New Yorkers overwhelming support his message that the state should cut spending. The question is, just how to cut that spending. The Governor is projecting a $2 billion dollar shortfall for this fiscal year, and it looks even worse, rising into the double digit billions for next year. In a recent poll, 75% of voters think the state budget gap of $2 billion should be closed by cutting spending. 10% support increasing taxes while just 9% favor borrowing money.

Earlier this week I addressed the New York State budget crisis in two other posts;

1. A Republican Money Machine
2. A New York State Stalemate

In the New York State Stalemate post I quoted a recent press release from Assembly Republican Leader Jim Tedisco which said “Some serious and substantive proposals were offered to help address New York’s mounting budget deficit.” Later in the post I mentioned I planned to ask Republican Assemblyman Brian Kolb what those proposals were. I also pointed out that I had an interview with the Assemblyman and I took some Twitter questions from people. Assemblyman Kolb had some great budget cut suggestions, and he also addressed some other key issues as well.

Read on …

Economics 101 Class Is Now In Session

The National Debt Clock near Times Square, New York
Wednesday, October 8, 2008

In the midst of the financial tailspin we now find ourselves in, the National Debt Clock in New York City ran out of digits midweek to record the growing figure. As a temporary fix, the dollar sign was switched to a figure — the ‘1′ in the now over $10 trillion dollar national debt. The Durst Organization, which takes care of the sign, says it plans to update it next year by adding two digits.

That means the updated National Debt Clock will be capable of tracking debt up to a quadrillion dollars!

If that doesn’t scare you, I don’t know what will. I don’t even know what a trillion dollars is, let alone a quadrillion! The late Manhattan real estate developer Seymour Durst put the sign up in 1989. At that time his intent was to call attention to what was then a $2.7 trillion debt. Apparently those in positions of government leadership don’t care about the debt, nor did the sign catch their attention. If the sign caught their attention, we should now be debt free!

With this in mind, while I’ve said it before, I will say it again, I am NOT an economist, but I can certainly figure this out.

So listen up governmental leaders…
The Economics 101 Class Is Now In Session!

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AIG Executives Spend $440,000 After Getting Bailout Money!

Yes, you read that headline correctly. Shortly after AIG received their big bailout from the government, they went on a spending spree. You remember the buyout right? That’s when the government decided to buy AIG with taxpayer money. In other words, the government now owns the insurance giant, and they bought the company with our money.

Have your insurance rates come down at all?

Not only do you we have news of AIG going on a spending spree, but during the latest Presidential debate, both candidates said they plan to spend more money to help bailout the sagging economy. What a minute, this simply makes no sense! When will the madness stop? The nation is already buried in debt, and the economy is struggling because people are in debt. Again, the only ones laughing here are the financial company CEO’s who literally made out like bandits. They padded their bank accounts with company money. Then, when the companies went broke, we the taxpayer are stuck with the bill as government leaders say - “Lets spend billions of taxpayer dollars to bailout the failed companies.”

This November maybe it’s time to clean house in more ways than one!

Read on …

I’ve blogged extensively about New York State’s ‘accidental’ Governor, David Paterson. It appears he likes to make rules for others, while ignoring them for himself. At times it appears he’s making decisions in a bubble, or at least behind closed doors in either the Governor’s mansion or the Governor’s office. First he quickly moves on a budget after inheriting the office because his predecessor liked high priced call girls. In an effort to gain favor with New York State voters, he made a knee jerk reaction and passed something he didn’t have all the details on. Now, when the budget doesn’t balance, he decides to make across the board cuts.

Then, showing his ignorance of the New York State Constitution, the ‘accidental’ Governor Paterson decides to issue an edict from his office mandating that all governmental agencies and counties must start paying benefits to same-sex couples. Not only does this break the Constitution of New York State, which says “marriage is between a man and a woman”, but it also breaks the bank for many counties who are already over-mandated. The so-called mandated programs cost counties millions of dollars each year.

Now, the latest blunder by the ‘accidental’ Governor comes in the form of approving the hiring of a friend of his to a government agency. In the midst a budget crunch, and in the midst of calling for a “hiring freeze,” Governor Paterson apparently figures his “hiring freeze” words apply to everyone else, but not him.

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Only in America!

Once again the government has stepped in to bail out the rich. Last week they bailed out Fannie Mae and Freddie Mac after investors refused to step up to the plate and help the companies. I addressed that in a post entitled The Government Owns Your House. Now, in the latest financial news, the government has stepped in to bail out an insurance company. That’s right folks! Once again the government is spending your money to bail out the rich simply because the rich refuse to lose any of their ill-gotten gain dollars. So, not only does the government own your house, but now the government also owns 80 percent of the company that insures that house! Of course as a spin out of the insurance company, the government also has a stake in your car, your motor home, and whatever else you might have insured through AIG.

When will this madness stop?

Read on …

In the continuing Rochester, New York Fast Ferry saga, we have yet another interesting turn of events. On the heels of rejecting two plans by companies looking to start a ferry service between Rochester, New York and Toronto, Ontario, Canada, Rochester Mayor Bob Duffy and the rest of his politically astute council buddies have instead given the green light for a nightclub/bar at the Port of Rochester. That’s right folks. It’s another example of your tax dollars hard at work in New York State.

From the beginning the whole fast ferry business out of Rochester has been a joke. Millions and millions of dollars were tossed at what was, for the most part, a sinking proposition from the get-go. Then when a pair of companies come up with a proposal to get the ferry running again, Rochester City Council says no. Instead, they decide to approve a nighclub/bar for the location! Amazing, now the millions of dollars spent using tax payers dollars, will support a place for alcohol and over-indulgence. This, on top of the fact that Mayor Bob Duffy has been doing nothing but whine about how he feels Rochester doesn’t get enough state money to balance the budget.

Here’s an idea Mayor Duffy. Maybe you should stop running to Albany every other day to beg for money, and spend more time trying to figure out how to balance your own budget. Green-lighting a bar is not the way to balance a budget. It’s simply a feeble attempt to fill space in a building venture that was taking on water from the beginning.

Just my two cents,
Dr. Rus

From the Your Tax Dollars Hard At Work Files comes yet another example of bad accounting when it comes to the government - especially the New York State government.

The New York Racing Association announced this week it’s closer to emerging from bankruptcy. NYRA holds the state’s franchise to run thoroughbred racing at Aqueduct, Belmont and Saratoga. The group said a federal judge approved its amended plan to pay back creditors. Just how will they pay the creditors back? Through a $150 million dollar state bailout! That’s right folks, the horse gambling industry in New York State was having money problems, so the New York State government decided to kick in $150 million dollars of taxpayers money to bail out an organization that encourages those with gambling addictions.

Did they have nothing better to do with the money? Hey, lets not forget this is the same state government that doesn’t even know how to balance a budget. When will the madness stop? When will someone step up and question such stupid spending. Of course this announcement comes at the same time New York State government is pondering suspending the gas tax in order to bring the price of gas down. But, some in this same government that so freely hands out money to help bail out a gambling organization are worried that suspending the fuel tax could create a hole in state finances.

I’ve got news for those in Albany, suspending the gas tax is the least of your worries when it comes to creating holes in your spending plan.

Just my two cents,
Dr. Rus

So, just how does one turn $40 into $400,000? The answer — do business with the City of Rochester, New York.

In the continuing saga known as the Fast Ferry business venture, which went down about as fast as the Titanic on open water, Maplestar, the company that ran the business into the ground and cost Rochester and New York State taxpayers millions of dollars, made yet another sweetheart of a deal with Rochester this week. Initially when the failed ferry service between Rochester, New York and Toronto, Ontario Canada got underway, Maplestar signed what everyone called a sweetheart of a deal with the city of Rochester. Take possession of the terminal at the Port of Rochester, have no costs for upkeep as Rochester will take care of all of that, and pay just a dollar a year, for 40 years. Wow! What a deal! A brand new building, no upkeep costs, and pay just a buck a year. Oh yes, Maplestar also collected any and all income from the terminal. In other words, Rochester reaped absolutly no financial benefit from the terminal!

When the ferry service went under, Maplestar held onto the lease. Once again, that’s pretty cool. Be the company that cost the City of Rochester millions of dollars, lose the fast ferry, but still keep the terminal for just a buck a year. This week that all changed though as the City of Rochester has taken possession of the terminal. How did they do this? They agreed to pay out the lease agreement with Maplestar. Now it doesn’t take a math genius to figure out if you’re going to buy out a lease deal that’s set at a dollar a year for 40 years, that means the buyout should be around $40. Right? Isn’t that how the math works?

Apparently not in Rochester!

Instead, the City of Rochester, which means the taxpayers of Rochester, will pay Maplestar $400,000 to get the lease and the building back. Wow! $40 dollars has turned into $400 thousand dollars!

It must be that new math.

Just my two cents,
Dr. Rus