NEW YORK POST
www.nypost.com/postopinion/books/64919.htm

BUFFALO'S BLUES
BLAME GOVERNMENT
By NICOLE GELINAS
 
April 23, 2006 -- POWER FAILURE: POLITICS, PATRONAGE, AND THE ECONOMIC FUTURE OF BUFFALO, NEW YORK, BY DIANA DILLAWAY PROMETHEUS BOOKS, 230 PAGES, $24
IN her new study of the rise and (mostly) fall of Buffalo, Diana Dillaway raises a question of urban history with continued relevance to New York: Could good leadership have saved Buffalo after the city's industry abandoned it?
 
Dillaway, a Buffalo native, chronicles Buffalo's heritage as a capital of the American industrial age. Twenty years after its founding in 1803, Buffalo had established itself as an international shipping hub, due in part to the decision of city leaders to invest $5,000 to construct the western terminus of the Erie Canal within the city, creating a cheap waterway for goods to travel from the Midwest through Buffalo to the East Coast and on to Europe.
 
Corporate titans flocked to Buffalo, establishing factories and mills to process raw agricultural and industrial materials coming in on the city's waterways into finished products before shipping them off again. Even when rail replaced water as efficient transportation, Buffalo retained its primacy. The city established itself as a steel-making capital due to another infrastructure advantage: its location near Niagara Falls allowed manufacturers to plug factories into cheap hydropower.
 
Buffalo's decline began after World War II, as new power and transportation alternatives meant that factories - and the healthy economies they fueled - were no longer tethered to cities. When Buffalo no longer offered a geographical advantage, the city's newer disadvantages became clear to corporate leaders, including expensive environmental regulations, labor unions demanding ever higher wages and elected leaders demanding ever higher taxes.
 
Once Buffalo - and Albany and Washington - belatedly determined that the city was failing, it became the beneficiary of hundreds of millions of dollars, much of it federal urban-renewal funds in the '60s and "community development" funds in the '70s and '80s.
 
While a lot of the cash came from Washington, much of the purported leadership came from Albany, via alphabet soups of economic-development corporations cooked up by Gov. Nelson Rockefeller and, later, Mario Cuomo. Dillaway argues that local officials, the business community and elite citizens all failed Buffalo by not marshalling these outside resources to achieve key goals: among them, attracting a second state-university campus to town; building a rapid-transit system; building a downtown football stadium and, years later, a new convention center, and planning new downtown and neighborhood districts.
 
Dillaway makes a reasonable case that attracting a second university campus (it eventually located north of the city, in Amherst) and constructing a mass-transit system to keep the city relevant to its suburbs would have benefited Buffalo. But Buffalo would not have revived itself by investing "wisely" in such ventures as stadiums, business districts and "renewed" neighborhoods. Publicly funded stadiums can't revive cities. Healthy business districts and neighborhoods come naturally to cities that are already healthy; they cannot be conjured up by government.
 
Would modern investors and employers have come to Buffalo after the steel industry left if federal, state and city officials had realized their impotence in attempting to push back the economic forces that compressed industrial cities in the second half of the 20th century? What if Buffalo and Albany had simply responded to change by cutting back their public-sector workforces and, concurrently, state and local taxes, to make the city competitive to other American locations?
 
These are the questions state leaders - and gubernatorial hopefuls - should ask themselves as they propose new ways to "fix" upstate without reforming the state's unsustainable spending and taxing.
 
Nicole Gelinas is a contributing editor to City Journal. Nicole@city-journal.org