Maine was the only New England state in 2011 to see a reduction in gross domestic product, and the headlines are a little alarming. Even when put into greater context, the numbers show a picture of economic stagnation.
Comparing one year’s GDP to another is only one way to measure economic growth. It’s correct that a big reason for Maine’s economy shrinking 0.04 percent was because the Brunswick Naval Air Station closed, eliminating thousands of military and civilian jobs. Many of those workers left the state, taking their spouses and children with them.
No other New England state saw a base closure in 2011. That year, New England grew 1.8 percent in its value of goods and services produced, while the nation saw 1.5 percent growth, according to the Bureau of Economic Analysis in the U.S. Department of Commerce.
But the base closure should not be used as an excuse to ignore what’s really happening to Maine’s economy. Let’s look at another economic measuring tool. When comparing Maine’s GDP change to other states, it’s important to examine trends over several years and the state’s output per person.
Even though Maine’s GDP per capita rate declined along with the nation’s during the recession, its ranking in comparison to other states hasn’t changed much in the past 10 years. Maine GDP per capita ranked 42nd in 2011 and 41st in 2001.
The state must clearly continue a long-term effort to improve its economic condition. It cannot settle. Gov. Paul LePage was correct in his radio address this weekend when he said: “Sitting around supporting the status quo is irresponsible and an approach that has failed our state for the past 40 years.” The difficult part, of course, is making changes.
As Maine continues to transition from a goods-producing economy to one that relies on services, technology and an intelligent work force, the state must focus on innovatively producing new products and finding new markets. Doing so takes many different approaches, including the following:
• There should be continued collaboration between businesses, the government and educators to constantly adapt training programs to align with labor market data in order to build and retain a skilled work force. Transition training is needed for manufacturing workers who lose their jobs to automation. Universities should continue to adapt to the needs of an aging population by offering relevant programs to fill jobs in the growing health care industry.
• More educational attainment equals more earning potential. For a knowledge-based economy, Maine needs to grow its number of educated workers — targeting both high schoolers and adults of all ages. The state is keeping pace with the national average for its percentage of workers with a post-secondary degree, but it’s not hitting the targeted projections needed to meet future demands.
• The Legislature should expand research and development funding to the Maine Economic Growth Council’s recommended level of 3 percent of Maine GDP in order to encourage innovation and the creation of new technologies.
• The Legislature should continue work to lower the cost of doing business in Maine, which is consistently higher than the national average when accounting for labor expenses, energy costs and tax burden. Economy.com has ranked Maine as one of the most expensive states in which to do business for at least 15 years.
• Maine should increase its number of high-speed Internet lines, as Maine trails New England and the nation in terms of Internet subscribers per 1,000 people. More, and faster, Internet connections — and new ideas, such as providing WiFi to entire downtowns — provides the means for more people to learn and work efficiently.
There are many bright spots in which Maine can capitalize, including its country living, recreational opportunities and honest work force. Another positive is that Maine’s export of commodities to other countries has spiked over the last decade; businesses should continue to seek new markets overseas.
Maine also has a high percentage of entrepreneurs, which can benefit the state with needed new ideas. Maine municipalities with ideas that have potential to improve government, solve problems and be replicated elsewhere could submit their innovative solution to the Mayors Challenge, a Bloomberg Philanthropies contest. The top idea gets $5 million, with four additional prizes of $1 million each.
The annual GDP numbers, which are estimates and often revised, are beneficial in context and for prompting debate about how to improve the economy. It’s a discussion that should continue at all levels — at dinner tables, boardrooms and government offices.
I never thought I would read an editorial like this in the BDN. The editorial acknowledges that Maine has a problem with respect to the costs of doing business and it also actually gives LePage credit for getting it right with respect to the futility of supporting the status quo. Will wonders never cease?
There was that one yesterday about the MTA, too…I am suspicious!
LePage 2014!!
If you were not being fed the pablum that all media is liberal, you might recognize that the BDN is actually very balanced. They spew just as much conservative propaganda as liberal.
Maine certainly suffers from ails that are not LePages fault or doing. That much is true. As for his policies, you should recognize that they are not intended to increase GDP or median income or reduce poverty or increase employment. They are simply the policies one pursues when advancing an agenda of increasing wealth for the wealthy and corporations.
When the state begins to look and behave more and more like Mississippi, the explanation will be obvious to those who don’t walk around believing that there is a vast liberal media agenda aimed at making us into socialists. That meme was designed to appeal to those who get charged up by the rhetoric and never stress test the underlying assumptions.
Maine is moving backwards in the ways that advance economic development: education, investment and infrastructure. These are the only things that matter to GDP growth and they are clearly not concerns of this administration.
The state must clearly continue a long-term effort to improve its economic condition. It cannot settle. Gov. Paul LePage was correct in his radio address this weekend when he said: “Sitting around supporting the status quo is irresponsible and an approach that has failed our state for the past 40 years.” The difficult part, of course, is making changes.
Hey Libs and LePage bashers, This must be really hard for you to swallow. Even the BDN agrees that the past 40 years are responsible for today’s malaise
You are obviously reading WAY too much into it. Saying that certain “new” things should be done at the moment is not saying that nothing positive was done in the last 40 years under Democratic, Independent, and REPUBLICAN governors and scores of very BI-PARTISAN actions taken by the legislature in conjunction with those governors. (Gee, I remember something about 8 years of McKernan, or did you forget that?) In the last 40 years we’ve seen continued clean-up and preservation of the environment, investment in tourism, emerging and growing financial, healthcare, hi-tech., and scientific research industries, increased education standards with the Maine learning results, homestead and circuit breaker tax reduction programs, maintaining infrastructure, research and development, leadership in alternative energy, work to preserve traditional industries, and much more. All administrations and legislative classes have balanced the budgets per the state constitution. Baldacci closed an $800million gap at the height of the recession without the nonsense we’ve seen out of LePage. So while they are giving him some credit for SAYING some changes, at THIS JUNCTURE, are needed, on which we can all agree, it is the KIND of measures that matter, and on that they are objective and talk about some important investment measures that are not up there on LePage’s list. What will not work is this nonsense about squashing all bonds at a time when interest rates are rock bottom and matching funds are terrific deals. What will not work is even more blank-check tax cuts for the already rich who don’t need them and just shelter them. And what we don’t need is a bullying my-way-or-the-highway approach to governing from someone who can’t understand that he isn’t running Marden’s anymore. The BDN has called LePage out on his nonsense time and again, and they will continue to do so.
You grow an economy through investment and cooperative creativity, not cut and gut and trickle down which has NEVER worked and NEVER will.
PS: Come November, the TeaRadicals will take a well-deserved beating at the polls, and you can thank LeBULLY for it. The majority of Mainers are sick of him and his TeaPublican waterboys, in a big way.
Thank you for more fodder from the radical debt-slave progressive democrat echo chamber….
as the people who support your failed faction dwindle, does the echoing become even more deafening….it certainly appears as though that’s the case
It is very sad that there is so much hate and poison in all your replies towards your fellow Mainers.
It is sad to see that you cannot do the basic fact finding to understand that the national debt has been run up by REPUBLICANS. That ugly fact is not what they talk about in your echo chamber but it is a provable fact.
Republicans are better at talking about cutting deficits and then actually increasing them.
Obama, slowest growth in spending of any modern president. Still he is cast as a wild spending liberal. If you don’t read up on the facts, you are being lied to and don’t know it.
We ranked 41 in 2001 and 42 in 2011 which means, as stated in the article, that things haven’t really changed much in 10 years. Baldacci was governor for 8 of those years. While Bladacci may have, on paper, closed a budget gap, that hardly mitigates the damage he has done to the State.
How much money did he dump into the DHHS computer disaster? How much long term income did he toss out when he sold off the state’s liquor distribution? What about Dirigo Healthcare? Industrial wind? Juniper Ridge landfill?
Baldacci’s strategy didn’t exactly lift this State to the height of prosperity. We’ll have to wait and see the results of Lepage’s strategy. I am not saying Lepage is doing the right things; but, the rose colored glasses through which we view our former governor need a good cleaning.
LePage is a lame duck.
But our state has not failed for the last 40 years. We have managed a pretty solid record on educating our kids and taking care of our peoples basic needs. That is until recently.
The “malaise” you speak of is the direct consequence of the conservative movement in tax and economic policy. It destroyed a sizable portion of our nations wealth and promises even more damage.
You can argue that LePage and the Tea Party could not be responsible since they are relatively new on the scene but that misses the focus of their efforts. They embrace the very same systemic failings that got us to this bad place. Deregulation, cutting services to the public and cutting taxes below what is sustainable have stopped a century of American progress. The rest of the world will not wait for us to get around to investing later. We will never regain the ground we are giving up.
If what you believe is true, Governor LePage and a President Romney should preside over widespread prosperity. They will not. The tax cutting, unaccountable and crony capitalists will preside over the next great depression. You can blame Obama all you want for the recession but when the GOP takes control, the economy will not magically comply with your dreams. The policies have failed us and LePage is indistinguishable from any of the plutocratic leaders.
You have seen nothing of malaise yet.
If it were not for Food Stamps, Food Pantry’s, WIC , Jacking Moose and Deer, there would NOT be any dinner table conversations in Maine. Just empty plates and hungry Mainers. Thanks LePage ! When is the next Government Cheese Handout? Hows that open for business sign, you put up, doing?
We will never turn this state and country around as long as everyone keeps making everything a Democrat or Republican thing. The partisan bickering in Washington and Augusta has to stop if we have any hope of finding common ground and making a better world to hand down to our children. We are in grave danger of being the first generation of Americans to hand down to our children a country that is worse off than when we started, instead of better. Anyone who continues to insist that it is the Democrat’s fault or the Republican’s is part of the problem, not part of the solution. Both parties are guilty of fiddling while Rome burns. I say that we disband the two major parties in politics and make everyone who seeks public office an Independent. No favors owed, no hidden agendas, and people who will do the actual will of the people and not that of their party or it’s benefactors.
Sorry, but this looks like typical BDN rhetoric to me. We’ve been hearing the same thing for decades and it always ends up as an excuse to throw money at the usual suspects.
I agree. Maine needs to facilitate motivated genius, and, yes, there might have to be some trickle-down before everything is said and done.
Come on, you think only progressives are on food stamps? Get real.
Actually, a conservative who supports slashing the social safety net and subsequently loses his job or develops a disabling illness and suddenly NEEDS the social safety net, might just turn into a progressive…
BDN, you give the base closure in Brunswick as a big reason for the GDP drop in 2011, but the vast majority of the “closure” was done in 2009, quit giving the current administration a free pass.
Liberals are blaming 2011 on LePage but the first new laws signed by LePage didn’t take effect until September of 2011. Kind of hard to blame the whole year on LePage! Democrats have been running this state into the ground for decades. We won’t be able to turn it around overnight.
Try saying fellow citizens. We are all in this together. Division is politically wrong.
The way I see it, is if your seated arround your dinner table and your children also seated arround the table are paying attention. You may want to pause and give thought as to where will they be ten,fifteen twenty years into the future.
Will they be able to pay $18,000 to $31,000 dollars for a vehicle to carry them to a job that pays just above minimum wage every other week? Will they even afford higher education and if so will that education place them in dept because with degree in hand, the only employment for them will most likely be waiting on tables. If on the other hand when you sit down to the table and you have spent the last fourty or more years working to keep your household together.
You now know that had you spent your hours on a couch thumbing a remote or clicking a vidio game instead of wakeing all those years to an alarm clock and punching in at work, that no amount of food stamps would have let you survive.
AS for the thought of higher education for higher income! Stop and think a minuet, Sounds good,… more pay? But at what price? More pay and greed will bring higher costs. Bread will be tripple the price. All that we take for granted will only increase along with the greed.
The very shoes you walk in now come from across. The very important things that in our long past allowed family,s and people to build and grow on are now makeing us dependent on production from lands far,far,away.
While your seated at that dinner table, go thru your last few months expenditures. Talk about where your shoes came from, talk about how many people in your homeland had a job makeing those shoes. Talk about why you pay more for that loaf of bread yet we ship it free to help feed those away. Then after you have had your meal and rested up, next time you are out and about and come across a buisiness owner who has hired help. Take a minuet to thank them for not moveing their business away to a far away land as so many have done. Yes thank that small farmer that is still trying to carry on. thank that little old lady with the bakery that is still holding on. Thank that educator that teaches one how to be what you need to be in order to rebuild THIS NATION BACK to what is was known for.
No matter what this pathetic rag tells you, life in Maine is good. There are places in this world where food is scarce and water is non-existent, where hunting is forbidden, and nothing grows in the sand beneath the bare feet of the populous.
So to the people who put the food on your plate, and the water in your glass, my idea of a “conversation” is two words; Thank you.
Please BDN stop your whining. You’re scaring the children.
But the children are already leaving the state and it’s not because of this newspaper.
It’s not so much where we are, it’s where we’re heading that I think needs to be looked at.
Working conditions in Maine are a travesty. The growth of the Healthcare industry in Maine is a relatively short-term solution, as Maine statistically has one of the oldest populations in the country but with few young people staying here, how can that population be expected to continue? Maine also has taxes less-favorable to retirees than say, Florida or Montana (or a dozen other places).
For most of the changes mentioned in this article to occur, the business community (employers) in Maine need to make a basic change in values and strategy. Unlike more developed areas, Maine businesses commonly rely on several detrimental practices in hiring, tending to favor job-specific skill and insider networking over educational qualification. This shoddy mentality justifies non-existent on-the-job training and mentoring and substantially lower rates of compensation while undermining overall competitiveness, quality of service or product delivered, and upward mobility within the general population.
The long term effect as we are all painfully aware, is that Maine (unlike other more economically prosperous places) has little-to-no growing middle class of educated and skilled workers. These are the people who create real and long-term economic growth through the employment advancement that is present in fair and flexible hiring practices. These are the people who, through that job-secure system are able to buy starter homes, new cars, goods-and-services and ultimately, they are the people who incubate new businesses either through their own initiative or through the presence of their relevant and competitive skills. These are the people who create conditions that make insurance affordable for those who really need it.
The past several decades have seen a very specific trend devaluing any culture of education and qualification both socially and systematically in Maine. With that degradation has come a mentality of exploitation, one that says Maine should adopt a parasitic relationship to the rest of the country, generating income from the disposable income of those more prosperous who come here from other places. Or alternately, that Maine is good only for what it can offer in natural resources, no longer what they once were. That same mentality allows business owners in Maine to maintain a standard of living competitive with their counterparts elsewhere while their employees earn substantially less than their counterparts and often go without benefits such as usable health-insurance, paid sick leave, and earned vacation time, undermining the very economic growth that Maine so badly needs. The cost of doing business in Maine has been externalized to the detriment of its own workers and every person who chooses to live here is paying the price.
Not once has there been an argument or a coordinated effort to cultivate Maine as a place that thrives on intellectual capital. On a system that mentors, educates, trains and utilizes people with a diverse range of talents, skills and viewpoints. Instead, those who would be part of such a system just go elsewhere. Currently many educated and well-qualified Mainers have two choices: give up the career they worked hard to be prepared for and take a dead-end job , or go elsewhere and prosper. You know, just like the people who worked at Brunswick Naval Air Station.
The only pragmatic way forward for Maine is through pro-active leadership at the top. No governor is going to jumpstart the economy without productive dialogue with the legislative leadership of both parties as well as input from the private sector. Short of that little will change.
1. Maine is an end-of-road State. He have been seriously constrainted because we are far from markets with high transportation costs. The internet offers a way out. Maine just got its second connection to the internet backbone. We need more. The editorial is right we need more, faster, cheaper, more reliable Internet access as the basis for a new transportationless economy.
2. The editorial is right we need R&D money. Didn’t LePage just stop the R&D bond. Not helpful.
3. Maine has an above average cost of doing business as long as you ignore real estate costs which are well below nation averages. Include them and Maine has no cost disadvantages.
4. Portland & Bangor Airports are not enough.
5. We still will benefit from a state owned and financed road/rail system that covers the whole state not just the coast.
We need a Maine that is easy to get to and through where we can sell our wilderness, low crime, healthy lifestyle to young technical workers.
Does Maine really want to have economic growth? Citizens and policy leaders must look in the mirror and decide if the current path of stagnation is responsible