The polls say it. And the pols say it. There’s nothing more important — at least in this economy — than jobs. 

So candidates promise to create more jobs  — even though economists say job creation is a lot more complicated in this global economy than the people running for office want to admit.

Paul LePage made jobs promises — but he avoided saying he would directly create jobs.

Instead, he took the traditional conservative approach — get government out of the way and the jobs will come. 

“We know how more jobs are created. Entrepreneurs and small businesses are the backbone of job creation, “ he wrote in his campaign white paper.

While no one in the state is more identified as a Democrat than Beliveau, he is also a real estate investor himself and PretiFlaherty is one of the go-to firms for local and out-of-state businesses that deal with state agencies. (Ann Robinson, a partner in the firm, was co-chair of the LePage transition team and has advised LePage. She is a Republican.)

To Beliveau, LePage has lived up to his promise to make Maine more “business-friendly,” the key to job creation — according to one side of the debate.

“I have to admit there’s been an almost dramatic change in the attitude in the state agencies in their response to inquiries,” said Beliveau, who is backing Michaud against LePage and Cutler. “They’ve become more respectful, more helpful, willing to find a way to solve a problem rather than create obstacles.”

Dana Connors, the president of the Maine State Chamber of Commerce, cites specifics in praising LePage’s policies, such as approval of a bill that “opens the door to mining,” the governor’s veto of a worker’s compensation bill the Chamber said would have added millions to premiums and his veto of a hike in a minimum wage.  

Connors said LePage “has been pretty spot on in terms of staying true to doing what he set out to do.” But there was a qualifier to his support — while his members like the governor’s policies, “where you find the falling out,” Connors said, “are over his comments … It’s the style and not the policy that has people scratching their heads.”

One of the state’s leading environmentalists said LePage’s policies are bad for jobs and the economy because that economy depends in a large degree on the state’s “brand identity.”

Pete Didisheim, the longtime lead lobbyist for the Natural Resources Council of Maine (NRCM), said, “Our sense is the environment is nowhere on his radar screen … underlying that is a lack of understanding of the importance of Maine’s natural resources to all aspects of the state’s economy,” including attracting new businesses.

While environmental groups like NRCM had easy access to the governor’s office going back at least to Baldacci and Angus King, Didisheim has never met with LePage.

He said LePage “came in with a sharply hostile attitude towards the state agencies involved in implementing Maine’s environmental laws that marked him in our eyes and the eyes of many as the most anti-environmental governor ever.”

He cites many examples, from the Portland Press Herald’s series accusing LePage’s head of the Department of Environmental Protection of favoritism towards business to trying to take authority over development in the north woods away from a state-appointed agency known as LURC. 

‘That would have been the end of the north woods as we know it,” Didisheim said. 

(LePage eventually signed a bill reforming LURC based on a bipartisan study).

As a candidate, LePage struck a chord with business people with his promise to reduce red tape so they can expand and add jobs. LD1 was one of LePage’s first initiatives and was crafted by advisor, corporate lobbyist and Preti Flaherty partner Robinson. The legislation proposed rolling back some of Maine’s pioneering laws that limited the public’s exposure to toxic chemicals, including the chemical BPA, abolishing the state Board of Environmental Protection (BEP) and other steps.

It was greeted with outrage by the state’s environmentalists.

“This list is reckless and appalling. It puts our health at risk, it puts our environment at risk, our clean air, our clean drinking water at risk,” said Maureen Drouin, executive director of the Maine League of Conservation Voters.

The bill that LePage ultimately signed was dramatically scaled back by lawmakers, but still streamlined permitting processes, cut the number of members on the BEP, established environmental self-auditing programs for businesses and instituted business assistance programs at the state’s economic development department. 

Many of its most controversial environmental proposals were split off from the original bill and sent to legislative committees for further review.

Beliveau sees LePage’s attitude towards the traditional liberal interests groups as a refreshing change.

“I think this is the first governor in ages that is not indebted to the MSEA, NRCM and MEA,” he said referring to the state employees’ union, the environmental advocacy group and the teachers’ union.  Both unions are major contributors to Democratic candidates. 

LePage, Beliveau said, “has succeeded by challenging them, confronting them and in many ways provided balance where it had not existed earlier.”

His firm represented Plum Creek Development when it applied during the Baldacci administration for LURC permits to develop around Moosehead Lake. If LePage had been governor, Beliveau speculated, it would not have taken three years “and millions and millions in counsel fees, expert witnesses … and a whole slug of experts we had to pay.”

The plan was eventually approved with modifications, “but it was torturous,” he said.

And to those who say agencies like the DEP have become less environmentally sensitive and more business-oriented, the 75-year-old Beliveau had the classic response of a veteran political hand: “Elections have consequences.”

The idea that LePage has put good business practices into place in state government grates on Cutler, an attorney, a former budget official in the Carter administration and an international business consultant.

While Cutler cited some areas where LePage has succeeded  — pension reform, charter school legislation, questioning state spending — he said the governor’s style “is a slap in the face to most responsible business leaders.” 

“I’ve put good practices in place in government … It’s hard work and it’s collaborative,” Cutler said. To succeed, it needs to be “a shared enterprise and have a common sense of purpose. And we don’t have that in Maine today.”

When it comes to measuring LePage’s track record on jobs and the economy, there is also empirical data, such as the employment rate.

Two-and-a-half years into LePage’s four-year term, Maine’s unemployment rate stood at 6.9 percent and the U.S. rate at 7.4.

During that period, the Maine rate dropped 1.1 percentage points, or about 14 percent. That’s not as good as the national drop of 1.7 points or almost 19 percent. But in July, the US rate had gotten a bit worse and the state’s rate a little better.

The Maine unemployment rate has been better than the U.S. rate throughout LePage’s term; but it was worse than the U.S. during parts of Baldacci’s two terms.

Another widely-cited statistic is the percentage of the population with jobs. Here, Maine does better: According to the Bureau of Labor Statistics, the national rate has ticked up just three-tenths of a point while the state has gone up nearly a whole point since LePage became governor.

The Philadelphia Federal Reserve Bank produces a monthly report called the State Coincident Index that takes into account four economic indicators: non-farm employment; average hours worked in manufacturing; the unemployment rate; and wage and salary disbursements. 

Until the recession, Maine had been doing better than the U.S. on this measure, but then Maine slipped deeper and faster than the nation. Both started to turn around about the time LePage took office, with the US numbers going up 9.4 percent and the state’s 4.1 percent in the last 2.5 years.

But the Philadelphia Fed sees a rosier picture ahead for Maine — it is one of only 17 states projected to grow faster than the nation over the next six months.

When it comes to job creation, The Business Journals said Maine ranked 43 of 45 states measured as of May, adding private jobs at about half the national average over 12 months. A report by the Pew Center said Maine added about 200 private jobs from April 2012 to April 2013. 

In September, Forbes magazine  — for the fourth year in a row — ranked Maine the worst state in the nation for business expansion, the driver of private job creation.

“Not much has changed,” Forbes said. Maine “is still burdened with an aging population and a weak economic forecast. Job growth projections are the worst in the U.S.

LePage responded by saying the ranking is a legacy of the years of Democratic rule. Glenn Mills, chief economist at the Maine Department of Labor’s Center for Workforce Research and Information, told the Bangor Daily News that “many of the reasons for Maine’s poor ranking by Forbes can be traced to its aging population, which affects everything from the available labor pool to wages.”

What do all the statistics mean?

“We are growing, but not as fast as we would like.”

That’s the assessment of James Clair. Clair is the chairman of the state’s Consensus Economic Forecasting Commission, the CEO of Goold Health Care Systems and a former non-partisan staffer to the Legislature’s Appropriations Committee. He holds a master’s degree in public administration from Syracuse University. 

One area he sees “getting pretty strong” is personal income. Last year, Maine’s 3.4 percent growth in personal income was the slowest rate of any state and far below the national average of 5.1 percent. But the more up-to-date report by the federal Bureau of Economic Analysis tells a better story for Maine. While all but one state showed declines in personal income growth, Maine’s decline was among the smallest, ranking better than 31 other states.

Bottom line for Clair: “We’re having some growth, but it could be better.”

Continue reading Chapter 4: LePage targets the income tax rate

Naomi Schalit contributed to this story. Disclosure: Severin Beliveau, who is quoted in this story, contributed $250 to the Center in 2013. The Maine Center for Public Interest Reporting is a nonpartisan, non-profit news service based in Hallowell. Email: [email protected] Web: www.pinetreewatchdog.org.

About the author: John Christie is the co-founder, publisher and senior reporter of the Maine Center for Public Interest Reporting. He has covered local, state and national politics as a reporter, editor and publisher at newspapers in Maine, Massachusetts and Florida and holds a BA in political science from the University of New Hampshire.


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