Free Market and Fairness

Posted Aug. 27, 2010, at 7:15 p.m.
Last modified Jan. 29, 2011, at 12:07 p.m.

Just as there are no atheists in foxholes, there are no free-market fanatics in an economic meltdown. Except maybe in Gouldsboro.

Residents of the town and the surrounding area understandably reacted with cries for help when the sardine packing plant in the village of Prospect Harbor closed in April. But when help came, town officials began pondering such matters as the fairness of government grants that help one business over another. In this thinking, they risked missing an opportunity to host an incubator for what could be a new niche for lobster, one that could add value to Maine’s signature seafood and broaden the fishery’s market reach.

Selectmen initially refused to support an application for a $400,000 grant that would help Live Lobster, the Massachusetts-based company that wants to use the former Stinson Seafood packing plant, to purchase equipment to begin processing lobster. Selectmen were wise to investigate the implications of the grant on the local economy. This sort of due diligence is often lacking at the municipal level in small towns such as Gouldsboro. But in evaluating how the grant would affect other, existing businesses, such as those that purchase lobster from locally operated boats, their focus became too narrow and lost sight of the larger economic opportunity.

Selectmen have since reversed their decision and endorsed the letter of intent for the grant.

Live Lobster officials have stressed that the grant money would be used to purchase equipment, not to buy lobster, which would put them in competition with existing local businesses. In fact, they suggested the funds could go directly to the equipment vendor.

The opportunity to process lobster in Maine — that is, remove it from shells and prepare it in conjunction with other foods for the frozen-food market — could transform the fishery. There are no guarantees that such new products will win over consumers, but if they did, the vagaries of the fresh lobster business could become a thing of the past, which is a benefit that will spread well beyond Gouldsboro.

This sort of value-added approach to Maine’s resources is critical for our economic future.

The role government takes in boosting business through targeted tax breaks and incentives always is open to scrutiny, debate and even skepticism. But the only way to be truly fair is to eliminate all of them. Until that happens, Maine towns such as Gouldsboro should make the most of government help, especially when they asked for it.

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