The raw facts central to Maine’s current budget crisis do not appear debatable.

The Department of Health and Human Services comprises 45 percent of the state’s spending. Medicaid spending has increased by $1 billion over the last decade. Enrollment in Maine’s Medicaid program has risen 78 percent since 2002, while Maine’s population rose 7 percent between the 2000 and 2010 censuses. The average income of Maine’s population is 82 percent of the national average. It is one of only seven states that provide health care for adults with no dependent children.

Moving from current fact to future inference, it is not unreasonable to assume that these trends will increase if existing policies continue. This is clearly not sustainable and will leave the state with three choices:

* Substantial tax increases.

* Substantial cuts.

* Some combination of the two.

Illinois Democrats have chosen the first, increasing the state’s personal income tax rate by 67 percent and the corporate rate by 46 percent. The state’s credit rating has now fallen to the lowest in the nation, and its annual budget is $507 million in the red.

Illinois Budget Director David Vaught said on Jan. 3, “Our revenue growth is not enough to keep up with pensions and Medicaid. It creates a squeeze for everything else.”

A poll of the nation’s leading CEOs rates the state 48th for favorable business climate. On this evidence, a decision to increase taxes substantially does not appear appropriate.

California and New York are choosing both to raise taxes and to cut public employee pension benefits. New York Gov. Andrew Cuomo views tax increases as bad policy, but he had to agree to them to get the cuts. We will have to wait to see how this turns out.

On Tuesday, Maine Gov. Paul LePage sent a letter to members of the Legislature, saying, in part, “Maine’s welfare system needs to be reformed, and tough decisions need to be made. Doing what is right for the Maine people is more important than getting re-elected. … Without these structural changes (those he is proposing), Maine will be in the same position next year, facing another structural shortfall.”

I interpret the phrase “more important than being re-elected” as a challenge to Republican legislators, since I suspect he believes that it would be a good idea if Democrats are not re-elected. The key point here is that the governor sees tax increases as an evasive stop-gap, leaving the same structural dysfunctions identified by Vaught, of Illinois, unchanged.

There’s another dimension to the tax increase question about which LePage probably is aware: A number of studies over the years indicate that businesses and investors are more impressed by a trend toward tax reduction than by specific isolated cuts. Any backing off from last year’s tax cuts would contradict the trend and run against his plans of making Maine “business-friendly.”

The debate seems to center in Republican ranks, with the Democrats sitting silently on the sidelines, hoping for electoral advantage in this year’s election. If they have a plan to address the structural problems, or even acknowledge that it exists, I have not heard about it.

Although few people have ever heard about the great English statesman, Edmund Burke, most experienced legislators accept his axiom that nothing is ever accomplished in legislatures “except by barter and compromise.”

LePage’s emphatic position is certain to cause antagonism among them. They see a need for some maneuvering room for negotiation, and he shows no inclination to allow it. A compromise almost certainly would involve a tax increase. The governor is likely to see that as both an evasion and abandonment of his primary objective, which is to reduce the government’s grip on the citizens.

Conservatives such as Lance Dutson of the Maine Heritage Policy Center are rallying in support of the governor, and some Republican legislators see him as weakening the party by making them, not the Democrats, his targets.

They may well be right, but there is more to LePage’s stance than hot-headed obstinacy.

This country, and most of its constituent states, now face huge deficits coupled with larger unfunded entitlements. Nobody has an idea about how to pay them. We have come to this position by decades of compromises.

Periods of Republican dominance have hardly retarded the growth of these burdens.

It is possible to argue that principle and arithmetic have come together so powerfully that no compromise can contend with them. One way or another, events will determine whether this is true of not.

In the meantime Maine’s governor and some legislators in his party will be in conflict. That, at least, is not a question of debate or doubt.

John Frary, of Farmington, is a retired professor and former Republican candidate for Congress.


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