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Federal report on economic growth spurs partisan attacks in Maine

Ben Grant, chairman of the Maine Democratic Party
Jesse Groening | BDN
Ben Grant, chairman of the Maine Democratic Party Buy Photo
Posted June 25, 2014, at 9:51 p.m.
Last modified June 26, 2014, at 9:19 a.m.

LEWISTON, Maine — A new federal report on economic growth — or lack thereof — is providing fertile ground for criticism from Democrats and Republicans running for office in Maine.

The federal Bureau of Economic Analysis on Tuesday released the latest data on economic growth in the U.S., including a state-by-state breakdown that shows Maine’s economy lagging behind the national average for personal income growth.

The analysis suggests the state’s failure to expand MaineCare — its Medicaid program — under the Affordable Care Act was one reason the state was near the bottom of the charts nationally and dead last in New England in economic growth.

Maine Democrats seized the news as reason to criticize Republican Gov. Paul LePage’s refusal to expand MaineCare and accept federal funding to do so. Five times LePage has vetoed bills that would have expanded health insurance coverage for low-income people and people with disabilities under the ACA.

As a result, the state has lost out on $160 million since January, according to a release issued by the Maine Democratic Party on Wednesday.

Maine Democratic Party Chairman Ben Grant said the state was set to miss out on more than $300 million of federal funds by the end of the year.

“LePage’s failed leadership not only hurts Mainers’ health, but their pockets, too,” Grant said in a news release.

Grant mentioned LePage’s trip this week to China, where the governor discussed a possible manufacturing development at the Loring Commerce Centre, the former Loring Air Force Base, near Limestone.

“LePage is traveling overseas in search of jobs because his failed policy decisions, mismanagement and record-breaking veto spree have held our economy back,” Grant said. “Now, low-income Mainers are paying the price. They can’t afford health care costs, pay their bills or feed their families.”

LePage’s office countered Wednesday, saying the U.S. Bureau of Economic Analysis included federal spending on public benefits, including Medicaid, Medicare, Social Security and unemployment, as income. He said the report also included federal subsidies to eligible enrollees in private insurance plans under the ACA’s insurance exchanges as income.

When that spending was factored out, Maine’s personal income growth was on par with other states in New England, LePage said in a prepared statement.

“It doesn’t matter what liberals call these payments: It is welfare, pure and simple,” LePage said. “Liberals from the White House all the way down to Democratic leadership in Augusta believe that redistribution of wealth — taking money from hardworking taxpayers and giving it to a growing number of welfare recipients — is personal income. It’s not. It’s just more welfare expansion. Democrats can obfuscate the numbers any way they want. The fact is that we have created thousands of jobs, more Mainers are working and their income is going up.”

Democrats quickly responded to LePage’s release with accusations that he was “insulting seniors” by including Social Security, pension and Medicare payments in his description of welfare.

“LePage’s comments are an insult to Maine seniors who have worked long and hard to earn their Social Security and Medicare benefits,” said U.S. Rep. Mike Michaud, the Democrats’ candidate for governor. “[Social Security and Medicare] have helped to provide a secure retirement to thousands upon thousands of hardworking men and women who have earned them one paycheck at a time. They deserve much better than to have their monthly Social Security checks called ‘welfare handouts.’”

LePage’s campaign fired back Thursday morning, saying that Democrats intentionally took the governor’s statement out of context.

“Gov. LePage does not think Social Security is welfare. That is preposterous …,” said campaign spokesman Alexander Willette. “ It was Gov. LePage who proposed the elimination of income taxes on seniors pensions.The governor will always support and defend Social Security and will always protect our seniors.”

State Economist Amanda Rector, a LePage appointee, confirmed the governor’s observations on the economy and job growth in Maine.

“Maine’s personal income growth is being driven by growth in earnings, an indication that the economy continues to see real improvement as a larger share of Mainers find employment,” Rector said.

According to the BEA analysis of the first three months of 2014, Maine ranked 39th in the nation in personal income growth.

But Rector said Wednesday those rankings included states that saw income increases because of expanded Medicaid programs. She said the actual earnings Mainers were taking home were increasing at a rate in line with the rest of New England and above the national average.

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