September 23, 2024
Column

Going beyond more jobs and lower taxes

One month from today, Democrats and Republicans in Maine’s 2nd Congressional District will chose their party nominees. This June primary election will set up a November general election that’s being billed, as elections always are everywhere they’re held, as the most important election since Adam and Eve voted for the apple.

In the 2nd District’s case, this may not be hyperbole. Unless the economic decline and population loss in northern Maine can be reversed, its congressional district may be eliminated by the 2010 Census. If northern Mainers fell neglected today, how will they feel in 2012, when their choices for Congress are between a Dem-ocrat from Portland or a Republican from York?

There are 10 candidates in this primary – four Republicans, six Democrats. They’re all decent sorts, not a dog-kicker in the bunch. Some are running on the platform of more jobs and lower taxes. Some want to be a strong voice in Washington. Some want to go down there and shake things up.

Despite the record of success these time-tested approaches have had to date, a few candidates are trying something new – specific proposals that actually will benefit this district and that actually are doable.

I wrote about such a candidate and such a proposal a couple of weeks ago. Here’s a brief recap. Republican Tim Woodcock, former mayor of Bangor, recognizes that Northern Maine has been harmed to an extraordinary degree by the North American Free Trade Agreement and that the reason is that you can’t engage in trade – free or otherwise – without trade routes. Since the entire northeast corner of the continent is failing to thrive, Woodcock has been working to create a North Atlantic Corridor Economic Zone, a partnership among the Canadian Maritimes, Maine, New Hampshire, Vermont, upstate New York and Eastern Ontario that would use their combined clout to make NAFTA pay off. Northern Maine has not been able to get decent transportation (an east-west highway and an I-95 extension) by itself, but an international, multi-state, multi-province alliance of some 30 million people might pull it off.

Now, from the Democratic side, comes Sean Faircloth – former state legislator from Bangor and initiator of the Maine Discovery Museum – with a beneficial and doable proposal. It’s called the Corporate Responsibility Initiative.

“Irresponsibility” may, or may not, be too strong a word, but northern Maine has been hammered by plant closings and layoffs by some of the biggest corporations going. Since whining hasn’t worked, Faircloth wants to try something new.

Eliminate the corporate income tax, which has done little but create a $300-billion loophole industry for tax lawyers and accountants (Did you know that corporate income tax revenues in Maine have fallen so low they are now exceeded by cigarette taxes?)

Replace it with a Business Activities Tax (BAT), which is applied to what’s left after businesses pay other businesses for good and services. Investments in new machinery and equipment, research and development, job training and other such productive things would be rewarded. There would be no tax on small businesses with gross receipts under $100,000, a direct benefit to a small-business state like Maine.

Busineses that behave responsibly – good wages, health and pensions packages, keeping jobs and investments in the United States, making decisions that see beyond the current fiscal year – would enjoy a lower BAT rate. The revenue from BAT combined with the savings businesses would see from not paying $300 billion to navigate the absurdly complex tax code could be used to cut payroll taxes, maybe by half.

There are other provisions, this is just a brief thumbnail. Faircloth credits current and former members of Congress, from both parties, for the groundwork they’ve laid on this issue, which indicates why it could work – there is broad bipartisan agreement that the corporate tax system we have now does not work.

Lori Handrahan is another Democratic candidate with ideas that can work. She grew up in New Sharon, got herself a pretty amazing education (including a doctorate from the London School of Economics) and has worked on development in such trampled down places as Central Asia and Africa. Northern Maine isn’t in the Third World, but galloping job loss, population flight and now a scandalous epidemic of drug addiction and crime state government chooses to ignore puts it in the neighborhood.

She’s got a lot of good, big ideas, but also some that are good and small, that address what she calls the “nitty gritty” of reversing decline. Whether the locale is Ghana or Aroostook County, a persistent impediment to development is the difficulty entrepreneurs have navigating through government – like the broccoli farmer who could expand his business if somebody in Washington would tell him precisely how he can get the necessary permits for an irrigation pond or the local agency that neither the staff nor the expertise to write the demanding and complicated grant applications that could begin to make a difference.

Handrahan has suggested in the past that Maine follow most other states and set up an independent, nonpartisan office in DC that would do this type of heavy lifting for its people. Maine has not done that, so she intends to do it herself. She’ll have two staffers devoted to development. A grants expert will help the district’s non-profits access federal, corporate and private funds in Washington. A red-tape buster, or compliance officer, would be on call to help anyone lost in the maze of federal agencies rules and regulations.

Another small and good one. Maine has a real brain-drain problem – not enough kids go to college, too many go elsewhere and don’t come back. State government no doubt will continue to nibble away at this problem. Handrahan says she’ll refuse those unstoppable pay raises Congress schedules for itself and put the money in a scholarship fund, with recipients required to put their education to work in the state for at least two years. Helping a few Maine kids go to college is a small thing, about as insignificant as a safe and reliable water well in a village in Uzbekistan.

No doubt other candidates for this office have ideas for this struggling, nearly extinct district that are both beneficial and doable. With a month to go, voters no doubt would like to hear them. Just saying more jobs and lower taxes doesn’t count.

Bruce Kyle is the assistant editorial page editor for the Bangor Daily News.


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