Today while setting up a Drupal dev environment on a new PC I encountered the drush error "Command needs a higher bootstrap level to run". The first thing I did as many probably would is do a quick search on google. This though yields many different results and fixes. The problem though is I didn't know why it was happening so I didn't know which fix would work.
Turns out though it was quite easy to determine the actual problem. Drush has a nice option that will output dubug messages, funny enough, the option is --debug.
So, to get a better understanding of why you might be getting the "Command * needs a higher bootstrap level to run", simple enter this drush command: drush pm-list --debug and run through the output looking for what might be causing the problem.
In my case, I had a line that read "mysql is not recognised as an internal or external command", suggesting to me that my environment variable for mysql was not set up properly.