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Maine Development Foundation

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Report on state's economy charts course for future

Morning Sentinel - Kay Rand - OpEd

Date:

July 26th, 2010

Public affairs in Maine have always benefited from the civic involvement of leaders from private-sector businesses. At the local level, it's always the owner of the local oil company or grocery store that can be counted on to support and shape important community activities.

At the state level, the business community recently made an important contribution to Maine's public affairs with the state Chamber of Commerce's release of a Maine Development Foundation-prepared report, "Maine's Investment Imperative II: Unleashing the Potential."

The report is intended to serve as a focal point for discussions with candidates for governor and the Legislature about improving the prosperity and quality of life for all Mainers.

Those hoping to find a magic formula for economic prosperity will be disappointed. There isn't one. Those hoping to find sparkling new ideas will also be disappointed. The 94 pages of findings and recommendations do not contain any surprises -- they are issues that have all been discussed before ... some of them many times.

The value of the report, though, is that it focuses on the basics. One hundred previous studies that address a particular issue are relied on to provide direction, rather than attempting to reinvent the wheel. The report quilts it together, creating a pattern out of fragments that have been populating public discourse on the economy for decades.

It's not exhilarating reading. Maine faces a lot of challenges.

Maine's population is now the oldest in the nation.

Maine's productivity growth has not kept pace with the nation, as both the private and public sectors have failed to invest sufficiently in capital, technology and human resources to enable Maine to compete globally.

During the past 50 years, U.S. manufacturing employment has dropped by 25 percent. Maine's manufacturing employment has fallen by close to 50 percent.

Maine trails the U.S. in personal income, about 10 percent less than in 2008.

Maine's per-capita health spending is second highest in the U.S. More than 64 percent of Maine adults are overweight or obese. Comparatively more Mainers rely on public health insurance (Medicare or Medicaid) than in the nation.

Retail electricity prices in Maine are 60 percent above the national average because of the state's disproportionate dependence on oil and natural gas for electricity production. Maine's tax burden remains higher than the national average. Maine is overreliant on property and income taxes, which influences business and individual investment decisions. Maine imposes a regulatory burden on businesses that is a barrier to business investment and growth.

More than one-fifth of Maine children under the 5 are living in poverty.

From 1978 to 2006, K-12 expenditures grew by more than 450 percent, while enrollment declined 16 percent. Higher-degree attainment in Maine continues to lag the U.S. and New England. Higher education in Maine has become less affordable largely due to declining state support of public systems. The percentage of income needed to pay for a public four-year college is 36 percent in Maine, but only 28 percent nationally.

Maine trails other states in public and private investment in research & development. Twenty-five percent of roads are in poor or mediocre condition; 33 percent of Maine's bridges are structurally deficient or functionally obsolete. Eighteen percent of state roads need significant repair; by 2014, this will grow to 24 percent. More than 2,200 miles of road were posted in 2008, and, without further investment, that number will grow to 2,400 miles by 2011.

In short -- if an issue is not addressed in this report, it probably isn't an important factor in Maine's future prosperity.

Part of Maine's challenge has always been consistent economic policy. New programs get created, and then they go away. Every governor and Legislature has their own hallmark priority. New directions are set and then set again.

This report offers a long-term focus on critical issues facing the state from which a steady course can be crafted, without being prescriptive.

Copies of the report are available on the Maine Development Foundation's website. Then rate the candidates by the ideas they have for unleashing our state's potential and enhancing the quality of life for all of us.

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