EDITORIAL: Next New York governor will need to remove barriers to business

In New York, if you open a store and accept food stamps, state law says you must have at least three kinds of cheese - at least five pounds total - at all times. You also must stock at least five 18-ounce jars of peanut butter, a case of soy-based formula, five dozen eggs and the list goes on.

Now imagine trying to conform to the rules governing the construction of factories.

A workplace in this state can be simultaneously situated in a village, a town and a county, and subject to the ordinances of all three, as well as the laws of the state and the nation. That can make doing business all but impossible.

Every challenge the next governor of New York will face starts with economic development. Every problem, from high taxes to spiraling spending to immigration to crime and corruption, worsens when job creation falters and recedes when the economy thrives.

And those issues still plaguing us sting less when paychecks are steady and steadily growing, property values rise and the future holds promise.

Times aren't great, but even more debilitating is the lack of real strategy guiding New York's economic destiny.

The next governor will be a success if New York is set on a path toward growth, a failure if it is not.

To attain that success, the bureaucracy surrounding business must be razed and a culture of targeted, proven and accountable incubation created.

At the South Carolina website Business One Stop, for instance, anyone can file permits, licenses and registrations, pay taxes and unemployment insurance, and perform dozens of other functions. A similar site, and a similar culture, should be created here.

Toward the Byzantine structure choking commerce in New York, the theory needs to be "If you destroy it, they will come." Much of the burdensome bureaucracy falls under the governor's influence, and the new governor must work to change the culture.

New York has more than 1,000 agencies and 4,200 taxing authorities. The next governor will need to use the power and pulpit of the office to force efficiency. Some entities must be eliminated, others streamlined.

The challenge of local regulation will be subtler. Counties and municipalities must be convinced, cajoled and even embarrassed into reviewing and streamlining local codes to let businesses open and expand, and adopting actively helpful attitudes.

While squelching runaway bureaucracy would remove impediments to development, it must also be actively encouraged with sound strategies. Fostering industries just because they pay well or sound green doesn't work. Finding successful enterprises, however small, and identifying and increasing their competitive advantages, does.

Wichita, Kan., didn't encourage the aviation industry at random, nor Ohio its polymers business, nor Vermont its artisanal cheesemaking. The programs enabling these prospering clusters came when governments saw early successes and invested in infrastructure, educational programs and tax credits to enhance them.

Statewide programs rewarding companies for every job they create, in every industry, don't work. New York State's Excelsior program, for example, targets job creation in scientific research and development, software development, agriculture, manufacturing, financial services, back office, distribution and "other." Tax credits include a $5,000 per job reimbursement.

Any job could fit this program, and no company would take on an employee it wasn't planning to hire anyway just to get $5,000. Excelsior leverages nothing specific, and because of that is a poor use of the state's resources.

Contrast this with the nanotechnology Center of Excellence in Albany. Resources came together at the University at Albany that culminated in the School of Nanoscale Science and Engineering in 2001. IBM kicked in $100 million, the state $50 million. Investment grew, gradually. The public, private and academic sectors worked together, consistently. Today more than $6 billion has been invested, more than 250 corporations are partners, and more than 2,500 people make great livings as chemists, physicists, engineers, managers and in dozens of other professional roles because of this targeted and clustered plan.

Economic development has to be envisioned in specific, even narrow ways. Saying we need to make energy cheaper to create jobs for New Yorkers is not meaningful. The problem is too cumbersome, the solution impossible. Deciding we need to make energy affordable for massive computer server complexes in central Long Island, however, is addressable - and thus solvable.

The answers on job creation will be varied and targeted. By reducing bureaucracy and incubating small successes into larger ones, the next governor can triumph. But by failing to do so, the next governor will flounder - and so will New York's future. hN