Our paper industry once led the world. Now, the state must start its next economic engine

Until the mid-1800s, paper was made mostly out of rags. The paper industry lived and died on the availability of discarded clothes and other cloth materials that could be beaten into a pulp and poured into molds to make paper.

Papermaking began in Maine in the 1730s, as the state’s rivers provided power and clean water for the papermaking process. The industry in general was successful – and Maine papermakers made a good living.

But the state’s paper boon didn’t really begin until an 1850’s rag shortage, along with increasing demand for paper, forced European and American inventors to search for new resources to make pulp. They discovered that wood was an efficient resource for paper, and new wood-based paper mills quickly sprung up.

Developers saw an opportunity in Maine, the nation’s most densely-forested state. Maine’s first wood pulp was produced in the basement of a sawmill in 1868, where the workers made one ton of pulp per-day. By 1880, the S.D. Warren mill in Westbrook was the largest paper mill in the world.

It was one of those rare confluences of a need, an idea, an abundance of resources and the money to make it happen – the perfect formula for innovation to flourish. That convergence allowed the paper industry to serve as a primary driver of Maine’s economy for more than 150 years.

But times change. As globalization makes it more difficult for Maine to compete as a paper producer, the state must preserve the industry of the past while discovering new economic drivers for the future.

Last year the Maine Legislature passed a historic bond package to send out to voters in three elections. In November, voters approved one of the largest single investments in the package – $50 million in competitive grants for research and development, to be issued through the Maine Technology Institute.

MTI will award a mix of large and small grants to firms who can prove that their investment will provide the biggest return. With a total of $50 million available to the best and the brightest – and at least $50 million in matching funds expected for winning grants – there will be no shortage of fresh ideas and innovative pitches. Some ideas will venture boldly into uncharted new territory; others will improve old technology to preserve traditional state industries like pulp making, fishing, and farming.

Considering the shaky state of the national economy, it’s crucial that Maine makes targeted investments to build a strong new economic base – even though we may not see the benefit right away. Maine voters made a bold decision to support our state’s future with that vote, and investment in green jobs, technology, and the industries of the future are important to propelling our state out of hard economic times.

Historically, state investments in research and development have paid off. The Jackson Laboratory on Mount Desert Island – a regular beneficiary of state investment – has developed into a premier global biomedical research facility. Targeted investments have also established the state as an international leader in boatbuilding and marine R&D.

Bringing the paper story full circle, some new R&D money is likely to fund groundbreaking research at the University of Maine on turning wood product waste cellulose into ethanol. Scientists have discovered that wood ethanol is far cheaper to produce than ethanol made from corn. This research will add value to Maine’s current paper industry and simultaneously reduce the state’s carbon footprint.

In the 1960s, mothers of students at a Seattle prep school held a rummage sale to buy a terminal and access time on a General Electric computer. It was immediately popular, especially for one student who quickly discovered his almost supernatural knack for writing code. He founded his first software company at age 14.

At age 20, he founded Microsoft.

Bill Gates knew that he excelled at science and math, but he didn’t know the potential behind it until a small investment made at the right time allowed him to realize it. It’s one of innovation’s most famous success stories, and it’s based on the same basic concept of a need, an idea, and a resource all meeting at the right time.

MTI is tasked with spotting potential – which is a challenging, exciting, and essential charge. Somewhere in Maine could be another Bill Gates, who is one small investment away from discovering an ability to change the world. Even more likely, somewhere in the state is the next paper industry – an engine to drive the economy for centuries.

Somewhere in Maine a need, an idea, and a resource are all meeting at the same place.

Rep. Hannah Pingree, D-North Haven, is Majority Leader in the Maine House of Representatives.