State of Maine: Coveting thy neighbor’s economy: Maine could learn from New Hampshire



The year 2020 has arrived, a good time to ask how our vision is as a state.

So far it has not been that great. For decades governors of every persuasion, and legislatures along with them, have struggled to lift Maine out of the bottom tier of states when it comes to the rankings that count.

In a U.S. News review of the states, Maine shines in just one category, Crime and Corrections, where we rank third in the nation — in a good way, with our criminal justice system and incarceration rates, among other factors. Five New England states are in the top 7, with New Hampshire at No. 1 and Vermont at No. 2.

Maine is in the top half of states in just one other category: health care. We rank No. 19, though last in New England. After that it’s all downhill. In education we rank No. 28 (New Hampshire is No. 5). We’re 27th in Opportunity; New Hampshire is No. 1. We rank 28th in Fiscal Stability, third in New England. New Hampshire is No. 10.

The final categories are the really ouchy ones. Maine’s economy is rated 37th, the worst in New England (New Hampshire is No. 13), and in Infrastructure we come in at 42nd, though that’s third in New England. New Hampshire is No. 31.

How did we get mired in the bottom half of state rankings? It was not for lack of trying. Democratic Governor Joe Brennan was first elected in 1978. He walked into a financial crisis with Medicaid and is more associated with efforts to get the Maine health care system on a sound financial footing than with any particular economic development effort.

From the election of the next governor, Republican Governor John McKernan in 1987, that would change. McKernan made it a priority to reduce the cost of doing business and wanted to make Maine “the opportunity state.” He initiated “opportunity zones” and “centers of innovation.” In a languishing economy and a legislature controlled by Democrats, he had an uphill battle.

Independent Governor Angus King held a portfolio that spanned both sides of the aisle, including reducing regulations and flat-lining taxes to protecting the environment. He was an ardent supporter of technology and can claim credit for the beginning of Maine’s technological evolution. His greatest legacy may be the Maine Learning Technology Initiative, a program that distributed laptop computers to all state middle school students, the first state in the nation to do so. It was also during the King administration that the first research and development bonds were passed.

Democratic Governor John Baldacci came next. His economic development initiative was Pine Tree Zones, which provided tax breaks for businesses in exchange for job creation or attraction. The bottom line on Pine Tree Zones was a net loss after the state’s investment of over $450 million. That loss and an unpopular attempt to force schools to consolidate left his administration underwater on the economic development front.

Enter Republican Governor Paul LePage. A businessman and general manager of the iconic Maine discount chain Marden’s, LePage’s mercurial temper prevented him from bringing the full benefit of his business acumen to bear on the state’s economy. Instead, he spent most of his two terms embroiled in personal battles with legislators and the media.

That covers the last 40 years. Democrat Janet Mills is next in the gubernatorial succession. A year into her tenure she has introduced a “Ten Year Strategic Economic Development Plan” that her office says is focused on “innovation and attracting talent.”

Her press release cites more grim statistics. Growth in Maine’s Gross Domestic Product lags far behind that of the nation for the past decade. Average earnings in the private sector are 78 percent of the national average.

Her plan has three goals and seven “core strategies,” many of which sound familiar. But Mills’ plan has two things going for it. First, early efforts in Maine at developing solar, wind and tidal power have taken on new life due to the urgency of dealing with climate change. Second, she is vowing not to simply preserve Maine’s traditional industries, fishing, farming and forestry, a futile effort in the 21st century, but to adapt them to a new economy. Angus King famously promised that “no fish would leave Maine with its head on,” but adding value to Maine’s abundant natural resources has come slowly. Mills seeks to pick up the pace.

This is by no means a walk in the park. Maine has proven refractory to economic development efforts for decades. Meanwhile, what’s up with New Hampshire, the state we love to hate? They’re cleaning our clock. Maybe we should spend less time foaming at the mouth at the mention of that state and more time examining how their economy came to outperform Maine’s in so many ways.

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Jill Goldthwait

Jill Goldthwait

Retired nurse and former independent Maine State Senator.

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