Question of the Day: Do You Trust GE or Mayor Jackson Economists, Analysts and Lawyers More?

Submitted by Norm Roulet on Sat, 05/15/2010 - 07:07.

I try hard to ignore what folks at Cleveland City Hall and City Council do, day to day, their performance is so depressing. I just expect the worst and hope that won't harm my children. So I have not been following the odd trade missions Jackson's people have apparently been making to the Far East lately (when, on what Fundation's dime, why) cutting odd long-term deals with Chinese lighting companies promising to bring clean jobs to America (does "clean jobs" even translate into Chinese?). Jackson... 10 year deal... "Far East" trade mission... Sunpu-Opto... yeah, right. I like touring China too... sounds well worth the effort?!?! 77% of Clevelanders did just re-elect Jackson, and the Foundations and PD love the man, so let it ride...

But then I noticed GE has attacked the Mayor for his jet-setting wheeling-dealing economic development ways and I realized I'm not alone in this backwater slum of East Cleveland noticing what a mess Jackson and his cronies are making of the region and world, now that he has gone global. Some important people like the shareholders at GE are starting to care.

That is even better news than if the FBI had stormed City Council chambers - at around $150 billion in revenues, GE is more powerful than the FBI, and has more political clout, resources and lawyers than the Pope. From Wikipedia - In 2009, Forbes ranked GE as the world's largest company. The company has 323,000 employees around the world... that's nearly the number of families residing in Cuyahoga County.

Clearly, GE Corporate - INTERNATIONAL - is concerned Jackson's crack legal and development team at City Hall is setting BAD global precedent for municipal lighting sourcing and contracting - so bad GE must take a high profile corporate legal stand, and spend their money on their expensive lawyers to stop the mayor of little-old Cleveland before he makes a big, long-term mistake harming all citizens of the region, and GE corporate.

I've worked with GE's global IT leadership and they are as good as IT gets... and I know GE has exceptional management across the board, including for legal.

Today the PD reports "GE lawyers call proposed Cleveland lighting agreement with Chinese company 'bad for city'", leading off Attorneys for GE Lighting contend that a proposed agreement between Cleveland and a Chinese LED manufacturer could be unlawful and a "bad deal for the city, its taxpayers and businesses loyal to the city".

The article quotes many GE claims against Cleveland that are likely true, with one claim I am certain is true: GE's attorneys say Cleveland will not get the best price unless it seeks separate bids for each type of LED lights. They also argue that the city should not make a 10-year commitment given the evolving LED technology. A long-term deal could prevent Jackson's successors from doing "what is best for the city," the letter said.

Cleveland's crack legal team, led by the guy Jackson "defeated" for mayor a lifetime ago (y'all grown roots there yet?), says GE is wrong. He writes Cleveland is gaming economics... from the PD: Cleveland has cited the so-called sole-source exemption in defense of the Sunpu-Opto deal, and Triozzi reiterates the argument in his letter. The city "can decide that it wants to replace all of its existing lighting with energy-saving LED products from any supplier that is willing to provide a price that will be at or below the price of any similar product on the market, establish a manufacturing company in Cleveland, and create a minimum of 350 jobs in the city."

I'd like to see every such deal the Jackson administration (Mayor and Council President) has cut that has worked out - the long term jobs created by gaming economics in such ways. I think it is a net loss. So, it seems, does GE.

Cleveland is a large enough market to offer a foreign competitor a nice foot-hold in the US, if they may gain a monopoly advantage here... or so they may think.

Mayor Jackson cut a similar no-bid, long-term deal for optimization of another important asset of the region - development of the city website - a few years back, giving special terms to CampusEAI to "donate" the city web portal to us, and now we are locked-in to their product. Is it free, and does it light the way for citizens?

The fact the City of Cleveland entered into a long term contract to buy AMP-Ohio coal-powered energy shows we may not trust our leadership to analyze and vote on long term economy-impacting contracts - the entire AMP-Ohio project proved to be lunacy.

I considered the city strategy for power management and web presence development here foolish, and I sense their strategy for LED lighting presence development here is foolish as well.

I base that on my observations of overall historic and current City of Cleveland contracting incompetency, their poor decision support systems, and their lack of real economic development analytic and planning expertise. That the city is so dependent on area foundations and universities for decision support raises concerns about where is the Mayor's center of competency in making this important 10-year decision - who are the individual city employees, analysts and consultants supporting the data behind this contract, and who has been involved in any and all related trade missions and negotiations - shine all lights.

Specifically, I'd like to know every daily detail about the following, from City of Cleveland's talks with Chinese LED lighting company continuing: Henderson's March trip to China was his third since last year. He first made contact with Sunpu Opto officials in August during a trip to Japan and China to study waste-to-energy technology and returned to China in December to continue talks with the company.

GE is saying leadership in Cleveland is gaming economics and causing their 325,000 person community and the world harm.

I've been saying about the same thing for 6 years... leadership in Cleveland is gaming economics and causing our 350,000 family Cuyahoga County community and the world harm.

GE may finally shine enough global light on our leadership failure here to force change, when citizen leaders have failed. While I am far from a blanket fan of global conglomerates, I am far more a fan of GE leadership than I am of our leadership here in Cleveland.

As a last consideration, in all this, GE Lighting, in my current hometown of East Cleveland, is one of our sources of pride and opportunity in this community - Sunpu Opto is not.

It may be smart to pay attention to what the GE lawyers are saying here - perhaps GE should take their message to the people.

CollectCorp closes Middleburg Heights call center

Something to think about as we review Mayor Jackson's plans to bring a Chinese LED manufacturer to Cleveland... reported in the PD todayCollectCorp, a Phoenix debt collections company, has closed the Middleburg Heights call center that it opened just nine months ago... The company had received state and local tax incentives to open the office. A previous PD article on this relocation reported: The company could receive more than $200,000 in tax breaks from Ohio and the suburb.

Now would be a nice time to learn the details of those tax incentives, and all the other "incentives" given by local government to rearrange deck chairs in NEO the past ten years.

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"GE... doesn’t translate to what the city wants to do today"

One thing that is for sure, the Sustainability 2019 leadership movement is behind Mayor Jackson and on the attack against GE.

The highly centralized GCBL Institute has used their portal to promote Jackson and his Sustainability Chief Andrew Watterson and this LED deal, without balance in their reporting, writing "Watterson sees only upside to the deal. Cleveland is attracting a company that is planning on spending an initial $1 million to renovate an existing building in the city and is not taking any tax breaks."

Watterson is given the floor to discuss GE's LED business plans in detail: "Six months ago, we spoke to GE about this and they thought LEDs are only for specialty products like signs. They didn’t see them as part of their main line lighting products for another three to five years. I met with them a month ago, and their tune was different. They told me they could make what we’re looking for.”"

That quote from Watterson seems odd, as the following from a Press Release from GE in Cleveland Ohio makes clear:

CLEVELAND—GE Lighting Solutions, a unit of GE Lighting, has earned more awards than any other company in this year's Next Generation Luminaires™ (NGL) Competition, including a Best-in-Class award for the GE Evolve™ R150 LED Cobrahead Luminaire, a new LED street and roadway light. An additional four GE LED lighting systems for refrigerated display, architectural and outdoor applications were recognized.

Note, at the end of this press release:

GE Lighting Solutions consists of GE Lighting's light-emitting diode systems operation based in Cleveland and its commercial and industrial lighting fixture group in Hendersonville, North Carolina. The units were combined earlier this year to support a strategy to serve as an industry-leading solutions provider for the rapidly growing indoor and outdoor fixture segments that use LED systems and other energy-efficient lighting technologies.

Yet GCBL Author Mark Lefkowitz shows the City of Cleveland is pulling out all the stops to slam this deal through for the Chinese, writing: "Watterson is trying to spread the word to sustainability advocates, including his 2019 email list, that “LED lighting is the lighting choice of the future and it is important that we move aggressively forward towards a path that will position Cleveland and our region to take full advantage of this new technology.""

Regarding the process behind this LED deal, Lefkowitz drops some breadcrumbs that lead to the familiar uberplanners of the region, the Cleveland Foundation: "GE’s presence alone in East Cleveland and Cleveland doesn’t translate to what the city wants to do today: Use its purchasing power to attract jobs while reducing its carbon footprint, Watterson says. He compares the city’s role to the Cleveland Foundation’s who helped create the nationally recognized Evergreen Cooperatives, offering residents a start up business like the Evergreen Laundry by cementing deals for contracts from big University Circle institutions."

I figured this is all part of Ronn Richard's big plans - an extension of the Costa Rica plan - when I read in the PD article City of Cleveland's talks with Chinese LED lighting company continuing: Henderson's March trip to China was his third since last year. He first made contact with Sunpu Opto officials in August during a trip to Japan and China to study waste-to-energy technology and returned to China in December to continue talks with the company.

Somehow I pictured GCBL and the Cleveland Foundation piloting this slow boat from China... I recall GCBL has also been preaching waste-to-energy initiatives here, as they heat their home with MCCO coal-fired steam citizens may never afford, but must pay for in their health. The GCBL Institute does not demonstrate impartiality in the slightest, regarding environmentalism, and appears entirely an extension of their sponsors, largely being area Foundations.

So, the battle of GE vs. Sunpu Opto is really the battle of GE vs. Cleveland Foundations.

The Cleveland Foundation's $1.2 billion or so in assets is chump change next to GEs $150 billion or so in 2009 revenues... I think Mayor Jackson, the PD and Ronn Richard finally have a real fight on their hands.

Go GE!

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Cleveland’s misguided LED strategy

story here

Glad to see Gary and Ed debating Sunpu

Glad to see Gary and Ed debating Sunpu - I wish more people had spoken up earlier - it sounds like the machine has been working on this for quite a while and could have been stopped from taking our city to this point - what failed here?

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LED story...who to believe??

From the email inbox: 
 

 
Dear Friend:
 
On Monday, May 17 at 2 p.m., the Jackson Administration will continue its presentation on its LED Lighting Initiative, including the proposed contract with Sunpu-Opto Semiconductor Co. LTD.  This bold proposal, if approved, will bring 350 jobs to the City of Cleveland over the next five years and establish the U.S. headquarters of an international advanced lighting manufacturer here in Cleveland – without traditional loans, grants or tax abatements. Please read the attached letter (click here)from the General Manager of Sunpu-Opto expressing his company’s commitment to the City of Cleveland and this project. 
 
Please note:  Cleveland City Council will hear testimony from the Jackson Administration on Monday, May 17 at 2 p.m. in the Mercedes Cotner Committee Room, Cleveland City Hall , 601 Lakeside Avenue .  This committee meeting will also be streaming live on TV 20 – available online at http://www.city.cleveland.oh.us/CityofCleveland/Home/Government/MayorsOffice/tv20/watch
 
 
Maureen R. Harper
Chief of Communications, Office of the Mayor
Phone: 216-664-4011     Blackberry:  216-857-3301     Fax:  216-420-8760
 

100,000 LED tubes at a cost of about $40 each

An article on cleveland.com now - Cleveland City Council weighs naming Chinese firm sole LED supplier - highlights a few of the economics of this LED deal, including...

Cleveland officials don't know how many fluorescent tubes are in the 200-plus buildings the city owns, but estimate there are 6,600 in City Hall alone. The city plans to buy 100,000 LED tubes at a cost of about $40 each in its first round of Sunpu-Opto purchases.

The U.S. Department of Energy's top expert on LED lighting says LED tubes are not yet a good product. None of the LED replacements tested by the department have passed muster, said James Brodrick, the DOE's solid-state lighting portfolio manager.

"We haven't found one yet that we can recommend," Brodrick said.

LED tubes aren't as bright and don't spread light as well as fluorescent tubes, Brodrick said. Given the price and performance of LED tubes, which can retail for $50 or more, much-cheaper fluorescent lights offer a better return on investment.

Imagine distributing 100,000 $50 bills all over Cleveland government offices...

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who to believe in the GE?China company?

 GE sent their jobs to China for the high efficient light bulbs, closing Ohio plants. At the same time, a Chinese company wanted to open in Ohio. GE told union officials that there are not any plans to brings those jobs back. GE is also sending the high tech medical equipment manufacturing jobs to China.

Now, a new Chinese company wants to make its headquarters in Cleveland, offer jobs, and not ask for tax abatements. Are we so tied into the way things were down  the past quarter century that this is unbelievable, or is it our healthy skepticism of Jackson, et al?

More facts are needed. People who have some expertise in this area need to go to the press conference and to the council hearings, and ask questions. Otherwise, we will hear what the PD wants to tell us.

Investigate the root causes of this mess - More facts are needed

Everything about this deal seems wrong - this is not just a healthy scepticism of Jackson but scepticism of the entire economic development system here, and more facts are needed!!!!!!!!!!!

$50 light bulbs in Cleveland Cuty Hall... LED streetlights... we could put public wifi on the streets and help bridge the digital divide with locally made componenets for that - I want to see all sides of this story, with all the real players in one room.

Who are any local partners for Sunpu... I just don't see them going this alone...

What building are they planning to spend $1 million on, as the PD reports - who owns that and who is the realtor?

So many questions... and just a bunch of heavy handed one-sided propaganda for Sunpu from Jackson and his machines have been released to the public... from City Hall, in high alert, on a Saturday, no less...

... for who... why?

Where is the letter from the CEO of GE to Jackson that raised the stakes in all this - I've seen the letter from the CEO of Sunpu on the Cleveland.com website... wonder who really wrote that...?

Investigate the root causes of this mess - we don't have time for such ED BS, with Jackson's people flitting around China reinventing fire... I don't think they have the talent for that - I can suggest other work for them!

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we have a center of innovation in the region with GE

Since the late 1970s the mega corporations from around the world have scrambled to build partnerships and capacity in China to tap into their cheap labor but most important to provide products to their immense developing markets - GE is in China to sell to China, and growth of the economy in China is rapid and paying off for these firms. From the NY Times today:

Analysts at Barclays Capital said in a note on Monday that they did not believe the sovereign debt crisis represents a large risk to emerging market Asian growth for now.

“The global economy is not experiencing a synchronized slowdown,” they said, adding that the parts of the euro area that are experiencing the sharpest contractions are less important for emerging Asian nations.

In addition, they said, emerging Asian nations’ growth is also gradually becoming less dependent on exports and more oriented toward domestic demand.

The growing overseas capacity building investments in China are very different than in Mexico, for example, which were largely to shift labor to the lower cost Mexican side of the border, to sell products cheaper to Americans (and the world) - not paying off so well.

As fuel costs and consumer focus now shifts economics back in favor of local-owned, local-grown, manufacturing will grow in America again - remember glocalization. What will drive the growth of new economy industry here is technology innovations, making legacy manufacturing methods, equipment and processes obsolete in increasingly rapid evolution cycles, meaning it makes economic sense to build new facilities from scratch, for nearly everything we do today.

Regarding the LED lighting opportunity available here, the pursuit of the manufacturing facility may not be the big win, but rather the development of related intellectual property, design and engineering jobs, for which we have a center of innovation in the region with GE Nela Park. We should not undercut them with risky ventures in China, without opening up all opportunities to them as well.

Like with computers, where 8-cores with DDR3 suddenly makes duo-cores with DDR2 obsolete, paradigm shifts in technologies may change everything about economics - efficiency and performance count, and one of the most important dynamics changing in the global economy right now is productivity - we are doing much more with less, through innovation...

Last thought - don't sign 10 year exclusive contracts for any rapidly-evolving short life-span technology with anyone, ever. Cleveland is dealing with such issues with mobile radio right now, and vendor lock-in platforms are always a grest risk... to take such a risk buying light bulbs is absurd.

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http://www.newsnet5.com/dpp/m

http://www.newsnet5.com/dpp/money/consumer/troubleshooter/residents-must-make-the-difference-in-dealing-with-broken-street-lights

Must see Video starring Community Activists/Co-Chair of Ward 14 Tremont Lincoln Heights/Scranton/Starkweather Block Club and TWDC Board Member Henry Senyak.

City wasting thousands of dollars on all-day burners.

HAPPY BIRTHDAY HENRY. 

 

Let's eliminate 10,000s of streetlights entirely

One thing the Sunpu Opto fiasco brings to light is that we have way too many streetlights in Cleveland. Our number of streetlights should have gone down with our population... someone forgot to turn the lights out in all those abandoned neighborhoods - there is no need to light dead zones, and no need for the citizens to pay for lighting of dead commercial and industrial areas, like Wolstein's flats. We shouldn't even bother plowing many streets in winter any more.

We should be able to eliminate 25% or more of the streetlights in town, with careful planning, probably saving more power, coal and money than 10 years of LEDs system-wide.

The city of EC talked about adding a streetlight to my street and I asked them not to - I'd rather my tax dollars go to something more intelligent and I want as little light pollution as possible.

What is being done to right-size our government infrastructure here to reduce costs - have any streets been decommissioned yet?

Let's eliminate 10,000s of streetlights entirely.

And let's eliminate the government bloat that goes with them.

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It is GE

 It is GE and not a business that has been an example of high standards re: pollution and labor practices, that is crying foul. 

It is Sunpu Opto, from China, vs. GE, from America

I suspect GE has a better record of innovation, environmentalism, openness and fair labor practices than Sunpu Opto, based on review of the Sunpu Opto website, my experiences traveling and doing business in China, and general understanding of environmental, business, trade and labor practices in China versus the United States, where GE is still based. But I may be wrong - Sunpu Opto may represent an entirely new order for China - Sunpu Opto may be ambassadors for a revolution in fair trade and openness worldwide...

I'll ask Google what they think.

I'll ask some peasants in the real China, polluted by toxins there, with children making shoes for our feet here, what they think.

I respect China very much, but I do not pretend they do business like GE.

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I hear you

and I had similar thoughts. GE moved their CFL operations to China, and now we can buy CFLs made in China by GE. I wonder about how they are dealing with the mercury issue in China. Sunpu may not be any better, or could be worse. 

 

judging from their dog food, drywall, toothpaste & baby formula

 they're not getting my vote of confidence on tHAt issue....

It's all the lead in consumer products that pisses me off

It's all the lead in consumer products that pisses me off... and the fact that so much of the crap I've had to buy from China (as they have monopolies on many products now) has been crap and broken after little use. I'd rather buy something once that 5 times... and that goes for the shitty "green" lightbulbs I've gotten so far... total underperforming crap.

At least the Sunpu Opto site says their products are Pb free - so are the motherboards we use, which are excellent and from China

Organic LEDs... that sounds good to me... when is GE coming out with that... how about Sunpu Opto?

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Resounding show of non-support for Jackson by PD and Council

Resounding show of non-support for Jackson by PD and Council - are they actually doing their jobs there for a change? Thinking with independence? Noticing what garbage City Hall has made of Cleveland this Century!

Cleveland's City Council must slow down the Sunpu-Opto deal long enough to really look at it: an editorial

The funny thing about the deal Cleveland Mayor Frank Jackson wants to cut with a Chinese lighting manufacturer is that it is shrouded in darkness.

That's not a joke. That's a reason to demand more accountability, more transparency and lots more due diligence before Cleveland City Council approves a no-bid, 10-year agreement with Sunpu-Opto Semiconductor Co. Ltd. to sell millions of dollars in LED lights to the city in return for establishing its North American headquarters here and creating 350 jobs.

A few key points Jackson has not addressed: First, the agreement appears to violate the competitive bidding provision in the city charter. Second, Peter Tien, the New Jersey businessman who introduced city officials to Sunpu-Opto, has now been named president of Sunpu-Opto North America. Third, the Department of Public Utilities -- home of the debacle known as the Division of Water -- would provide oversight. And, finally, the U.S. Department of Energy's top expert on LED lighting told Plain Dealer reporter Mark Gillispie that he has yet to find an LED tube that works well.

Despite a full court press from the Jackson administration, City Council must not rubber-stamp this legislation on Monday.

That's all the PD editors have to say about the situation - no investigative insight, except that LED's don't work well for the applications planned, and there is some guy named Peter Tien in Joisey involved, who has already profited from the deal. Who else is involved and profiting from this deal - what realtors, property owners and partners profit here - who funded these trade missions and who went where for Cleveland, in the past 5 years - what is the deal Jackson is offering Sunpu Opto anyways... where is the proposal??

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