'No Place to Hide' for Maine's economy
Report: Stakes high for state's economic survival
Copyright © 2002 Blethen Maine Newspapers Inc.
When it comes to Maine's economic future, a recent study stated boldly that the state has "No Place to Hide."
That is the title of a report published by the Portland-based The Institute for a Strong Maine Economy.
The year 2002 is an election year in which Maine will elect a new governor and a new Legislature. As the report said, "Together they will choose a course for our state and — right or wrong — their decisions will shape our future for years to come." The stakes could not be higher, the report asserted: "Maine's economic survival is being threatened by a host of 'silent killers' — fundamental economic and demographic issues that must be understood and confronted."
The primary contributors to the report are Maine State Economist Laurie Lachance and Jonathan Speros, senior manager and northeast leader of the Credits and Tax Incentives Practice with PricewaterhouseCoopers. Working from their own knowledge and experience, and with input from Maine businesses, municipalities and the public, the authors and the institute produced five key recommendations for action:
1. Reduce Maine's tax burden to the national average. Recent census data ranks Maine second among the 50 states in overall tax burden.
2. Restructure Maine's tax system to promote private investment, export activity, business competitiveness, stability and predictability of revenues. Reducing Maine's taxes means making choices about what is taxed and how the taxes are applied.
3. Reduce the cost of government by restructuring the delivery of regional and local government services. With little more than 1 million inhabitants, Maine supports 500 local governments, 16 county governments, 287 school districts, myriad sewer, water, solid waste, economic development planning and other districts — plus a large state government infrastructure. These costs are part of the reason taxes are high in Maine.
4. Limit the growth in government spending to the growth in gross state product, income or some other logical benchmark. Right now, growth in spending is tied to no reasonable measure, but rather solely reflects the availability of revenues.
5. Promote a culture of lifelong learning through a seamless educational system. This means improving Maine's post-secondary educational system and encouraging more Mainers to earn higher degrees.
There is no question, the report noted, that its recommendations, and proposals from others, will prompt debate.
Producing significant change in Maine can be, and has been, done — but it has rarely been easy or quick.
The recommendations in "No Place to Hide" will be even more difficult to implement than most. Changing the tax structure, controlling state spending, consolidating regional and local government services and reducing bureaucracy in state government all face opposition from vested interests with jobs, money, autonomy and ideological principles at stake.
As the report said, " ... whatever Maine means to us individually, more than anything else we are bound together by a powerful sense of place — a very special place. It is our great strength, and it can also work against us.
"It is a strength in that it reinforces our independence, fosters our pride, and sets us apart in a world where more and more places look and feel the same. But it can work against us when it lulls us into thinking that we can get by tomorrow on what got us where we are today."
"No Place to Hide" describes Maine's accomplishments and sets its challenges for the future clearly.
The report also sets the tone of this issue of The Business Journal. What is happening in all of Maine — the good, the bad and the ambiguous — goes double for central Maine. This region has not yet had the success of southern Maine, nor is it in the straits of our neighbor counties to the north and east. Central Maine is at least holding its own for the moment. That moment, however, may not last long without support from the region for statewide changes and support within the region for local changes that can be decided locally.
Central Maine, too, has "no place to hide" from its future.