A little comment(ary)...

Paula Moore: Best-selling author shows Plum Creek problems
By BDN Staff
Bangor Daily News

The pending decision about the Plum Creek proposal may be a tipping point in determining the future of Maine and "the way life should be." Perhaps, we need to take a lesson from Plum Creek’s involvement in Montana. The parallels to Maine are breathtaking.

Grist for my argument comes from a New York Times best-selling book by Jared Diamond, "Collapse: How Societies Choose to Fail or Succeed." The book is a provocative analysis of the factors involved in the collapse of both modern and ancient societies. It begins with a case study of modern Montana, including an analysis of Plum Creek’s involvement in Montana’s environmental and economic decline.

Montana, like Maine, is a large state with a small population. Again, like Maine, it is well-known for its natural beauty and bountiful recreational opportunities. And it faces many challenges similar to Maine. It is away from high-population markets; it has locally and seasonally poor air quality; Montana has experienced losses of biodiversity, damage from introduced pest species, effects of climate change and issues in water quality. The only sectors of its economy that are growing are tourism, recreation, retirement living and health care. Montana’s young people are leaving the state because many of them aspire to non-Montana lifestyles or because they can’t find jobs in Montana.

Also like Maine, Montana has large tracts of private timberland that have changed hands. Plum Creek is the largest owner of private timberland in Montana (and second-largest in the U.S.). Montanans hold deep-seated attitudes of pro-individual rights and anti-governmental regulation — the same attitudes that created a weak and politically appointed Land Use Regulation Commission in Maine. With weak government regulation, Montana permitted unrestricted land use by private landowners and thus opened the door for Plum Creek land development.

Remember, Plum Creek is organized, for tax purposes, as a real estate investment trust so that its earnings will be taxed at lower rates as capital gains. No longer able to get a high rate of return from its Montana logging operations, Plum Creek turned to developing Montana land, especially land along rivers and lakes, for real estate, rather than for timber. Consequently, logging in Montana declined because wealthy buyers of beautiful recreational property would pay more than buyers of timber.

http://bangornews.com/news/t/viewpoints.aspx?articleid=162602&zoneid=35

Scott Lansley: Stimulus package? Not for Maine businesses
Bangor Daily News

Many of you have received a letter in the mail announcing how much money the federal government will be sending you as part of an "economic stimulus" package. In light of the economic situation we have here in Maine — low job growth, high taxes, high oil and gas prices, and other negative indicators — this letter heralds much-welcome relief to the average taxpayer.

Some weeks ago, I submitted legislation to ensure the Maine tax monster would not find a way to tax away a big portion of this money, which will be $600 for most taxpayers and $1,200 for married couples. The legislation never made it through the Legislative Council, so it will not come up for a vote. But the governor set our minds at ease by promising not to touch the rebate money when it arrives, probably in May and June.

The legislation I submitted also addressed the other critical part of the stimulus package, which is to allow all businesses to more quickly write off the depreciation of new equipment and machinery. You may ask why big business should receive "corporate welfare." The truth is that mom and pop small businesses also will gain a very large advantage with this stimulus provision. It will enable them to upgrade any equipment they use and to accelerate the depreciation for tax purposes. Many small businesses may need to upgrade computers, software and other technologies to make them more competitive in a global economy.

Depreciation is a broad concept. Simply put, it represents the decline in value of tangible items such as machinery, computers, desks and chairs, and even office shelving. Just as your car depreciates and becomes less valuable as it ages and piles up more miles, so does business equipment. When used for tax purposes, depreciation allows businesses to decrease their reported income and thereby lower their tax liability. This reflects that the equipment and machinery is another year older and closer to being obsolete or unusable.

Law determines these depreciation formulas, so naturally businesses pay close attention to the legislative process. In Maine, business owners understand that we do not conform to the federal dollar amount of depreciation. The federal amount currently is $250,000, while Maine’s stands at $25,000. Maine charges tax on the difference between the two, so we tax $225,000 of the investment. This may sound like a lot of money, but in terms of a business this is a relatively small amount when you figure the cost of equipment and machinery. This "decoupling" of Maine’s depreciation schedule from the federal schedule puts our companies at a clear disadvantage against their competitors in other states.

The problem is that anything that helps Maine business by providing equitable tax treatment becomes a "cost" to the state under the static "scoring" of Maine Revenue Services. MRS attaches a "fiscal note" to any tax bill, which determines how much revenue the state stands to lose or gain by virtue of enacting certain laws or policies.

http://bangornews.com/news/t/viewpoints.aspx?articleid=162627&zoneid=35

Kerry Millay : Democracy lacking in winner-take-all elections
Bangor Daily News

The editorial "Public Opinion: So What?" (BDN, March 29-30) touches on the crucial issue of American politics today, namely, that our political system is broken and needs to be fixed. It doesn’t matter very much whether our political leaders disregard public opinion polls. The deeper problem is that public opinion is not expressed at the polls.

This great country belongs to all of us. The tax money collected by our government belongs to all of us, and all the things and services purchased by those funds, including our military, belong to us. And we decide how all those resources are used.

How does Vice President Dick Cheney fit into that? How can we have an elected leader who expresses contempt for the opinion that elected him? The answer is that our political system has channeled and restricted public opinion to such an extent that Mr. Cheney has no fear of public opinion. He has been able to control it sufficiently for his purposes, and it can’t touch him now.

The problem is our winner-take-all elections. Bush-Cheney won by the merest whisker. It didn’t matter at all. They won, and they act like kings because they got all the immense power of the presidency. They are the "deciders," by a margin of 500 "hanging chads."

There are many millions of citizens of voting age in the United States, and that means many millions of opinions about what our government should do with our money and resources. Why should elections be "winner-take-all"? Isn’t it more sensible that the results of elections should reflect the range of opinion expressed in the election?

The consequence of winner-take-all elections is that we are forced into a two-party system. Third parties, let alone multiple parties, are deselected by political evolution in our system. I believe that the Republican Party is the only case in American history in which a third party has endured. In that case, it replaced one of the pre-existing parties. No third party has had a real chance of winning a national election since 1860.

http://bangornews.com/news/t/viewpoints.aspx?articleid=162628&zoneid=35

A few more ideas for raising the bar in Old Port
By JUSTIN ELLIS
Portland Press Herald

We're nearing that special time of year when Maine's population swells as people come out of hibernation and outsiders arrive to stake their claim to Vacationland.

The signs are already popping up around Portland, with a first wave featuring shirtless dudes and skateboarders.

With the high-cash season looming, there is no better time for Portland's bars and clubs to update their standards.

The Nightlife Oversight Committee, a collection of bar owners from the Old Port and Arts District, adopted "Responsible Bar Management Guidelines" in April.

Committee members have taken their share of flak – possibly because all the city's social ills somehow get linked to the Old Port – and wanted to put themselves on proper footing (possibly before the city feels the need to step in).

There's no doubt the rules are aimed at crushing the Old Port's reputation as an oversexed, booze-soaked rodeo where no drink is too far out of bounds.

The new guidelines are admirable and include everything from prohibiting drinking games and selling liquor below cost to banning customers for at least three months from bars where they start fights.

Other guidelines, such as having the bar and the band in different rooms, not allowing the band to drink, and getting rid of the term "bouncer" in favor of "security," while odd, are well-intentioned.

But if I could throw on my "bar staff" shirt for a second, I think there are a few other regulations that could help.

Presentation: Time to say goodbye to beer buckets. The ice melts too fast, and along with it the savings. No buckets of anything unless it's buffalo wings.

Presentation Part II: If a "uniform" for a waitress doesn't have room for pockets, or if it could be confused with a Halloween costume, it may be time to rethink the staff's look.

Restrooms: Clean. Please.

Entertainment: No riding mechanical animals of any kind. This includes bulls, horses, moose, pandas and alpacas.

TV: Place one staffer in charge of TV sports schedules at all times. No one wants to come in and see a PGA Skins Game or college baseball when the NBA playoffs or Red Sox and Yankees are on.

Shots: The test tube was designed for chemistry class, science fiction movies and hospitals. No one wants to drink a shot out of one, especially if it's bright yellow or pink.

Beer: Isn't it time to ban all beer not brewed in the Northeast? Buy local(ish). (Exceptions can be made for one legacy beer – Miller High Life, PBR or Budweiser. Choose carefully.)

Music: Limit replays of Dr. Dre's "Gin and Juice," Will Smith's "Gettin' Jiggy Wit It" and House of Pain's "Jump Around." Also, ban any remotely depressing music – no one wants to hear Pearl Jam's "Jeremy" in the middle of a good time.

Music Part II: For every two '80s nights that take place, at least one '90s night should be scheduled.

http://pressherald.mainetoday.com/story.php?id=188578&ac=PHnws

Traditional industries are not dead industries
By CHARLES LAWTON

Several weeks ago, I wrote that the drastic decline in employment suffered by Maine's "traditional" goods-producing industries over the past two decades constitutes an "era changing" shift in our state's economy. I noted the loss of nearly 30,000 jobs in paper, lumber and wood products, farming, fishing and food production, textiles, leather and apparel coupled with our failure to offset those losses with gains in other manufacturing sectors as evidence of a major change from our long history of progressive industrial transformation.

It would be incorrect, however, to conclude from these job losses that our traditional industries are dead or dying. The fact that they are no longer the growth engines that created vast wealth, established our economic geography and provided the basis for most of our communities does not mean that they are not now and cannot remain vital elements of a 21st century economy.

The surviving remnants of these once grander industries illustrate in their own ways the keys to survival for our entire economy -- increasing productivity. While employment has declined in these industries, the earnings per worker for those who remain have, in many of these industries, increased. And, more importantly, increased at a rate faster than for the economy as a whole.

Earnings per worker for all workers in Maine increased by 59 percent over the period from 1990 to 2006, rising from $22,500 to $35,700. These averages are based on all earnings and all jobs, both full- and part-time. They are a measure of the entire economy and thus say nothing about any particular industry. Of the 11 sectors I called "traditional goods producing," seven had growth in earnings per worker greater than 59 percent, and seven had average earnings per worker in 2006 that exceeded the state average of $35,700.

First among these was paper production. Earnings per worker here more than doubled over the period, rising from about $48,000 per year in 1990 to over $100,000 per worker in 2006. Clearly, the loss of over 8,000 jobs has not meant the end of this industry in Maine. While earnings growth in our wood products manufacturing sector has not been as spectacular -- a 68 percent growth to $38,500 per year -- it has exceeded the statewide averages. If anything, the potential for Maine to continue to manage, harvest and process our natural supply of wood fiber has grown even as employment in the industry has fallen. The potential for using wood fiber as a source of energy -- both for heating and electricity generation -- points to a new frontier for this industry.

A similar, if less spectacular, story has played out in our other "traditional" industries. Average earnings per worker in food processing grew 73 percent over the period, reaching an average of over $37,000 in 2006. While fish canneries have closed, modern potato processing and a wide range of specialty foods producers have developed competitive niches in what remains our advantageous position close to the enormous market of the northeastern United States. Scientific research, meticulous quality control and intensive management and marketing skills are not restricted to biotech and electronics. Modern business practices can make successful businesses in sectors that have employed Mainers for over a century.

Even in our oldest industry -- textiles and apparel -- specialization has shown the way to survival. While we will never have the number of jobs needed to refill the millions of square feet lying vacant in our 19th-century mills, we have succeeded in maintaining about 5,000 jobs whose average earnings have grown more than 80 percent over the past two decades and whose annual earnings now top $40,000 per year.

http://pressherald.mainetoday.com/story.php?id=189627&ac=PHbiz

The benefits of a dynamic labor market
By CHARLES LAWTON
Portland Press Herald

Focus on the journey, not the destination.
– Greg Anderson

Ask just about anyone what the goal of economic development is, and the answer you're likely to get is, "Jobs, good jobs, high-paying, secure jobs, jobs in stable companies that provide benefits."

Then look at the regions and companies with the fastest employment growth, with the most dynamic economies, with the greatest opportunities for finding new jobs. What you see is not stability and security, but instability, constant change and lots of movement. The central element of a dynamic economy is a dynamic labor market.

And we don't have to go to Silicon Valley to see the evidence of this fact. Consider, for example, two major Maine industries – the poster child for declining manufacturing, the paper industry, and the poster child for continuous growth, the health-care industry.

From the first quarter of 2001 through the second quarter of 2007, Maine's paper industry lost nearly 14,000 jobs, a decline of 33 percent. Over this same period, the average monthly earnings of all employees rose 11 percent, but the average earnings of new hires fell 14 percent.

The quarterly turnover rate for the period – meaning the ratio of new employees and fired or departed employees to stable employees – averaged just 4 percent. In short, while overall employment fell, those able to keep their jobs enjoyed rising wages and a relatively stable workplace.

By comparison, Maine's health-care industry is a picture of turmoil. Over the same 26-quarter period, the industry grew by 16 percent, creating nearly 14,000 jobs. Average monthly earnings of all health-care employees increased 29 percent, but average earnings for new hires grew even faster at 31 percent.

At 8 percent, the industry's turnover rate was double that of the paper industry. Over the 26 quarters measured, the number of separations – people leaving a job, voluntarily or involuntarily – averaged nearly 11,000, and the number of new hires averaged nearly 10,000. Job creation – more jobs at existing enterprises plus the creation or movement of new enterprises into the state – averaged about 3,500 quarter after quarter after quarter.

In short, employment growth is not a simple matter of existing enterprises getting more business and adding more jobs. It is a messy process of people leaving one job for another, of employers scrambling to fill both new and old positions and of workers attempting to build careers in a rapidly changing labor market. Stability is not the word to describe this industry.

Now consider Maine's fabricated metals industry. Over the same 2001 to 2007 period, it presents two entirely different stories. From the first quarter of 2001 to the fourth quarter of 2003, industry employment fell by nearly 1,100 jobs – a decline of 20 percent. The pattern of wage change here resembled that of the paper industry – average earnings for all workers rose 12 percent while average earnings for new hires fell 22 percent. If you had and could keep a job, you did OK, but getting a new job wasn't so easy or rewarding.

Then, from that last quarter of 2003 through the second quarter of 2007, the story was exactly reversed, and the industry took on the pattern of the health-care industry.

http://pressherald.mainetoday.com/story.php?id=193860&ac=PHbiz

South Portland's loss, Standish's gain
By JUSTIN ELLIS
Portland Press Herald

Apparently, tattoo artists' money is no good in South Portland.

Then again, maybe it could be.

Almost a month ago, officials in South Portland sprang into action when word came that two tattoo artists were looking to set up shop in the city.

Tattoo artist Jeffrey Beaudoin, a South Portland native, and his business partner Randy Jensen had a space on Broadway all lined up to open their new shop.

To put the brakes on what would have been the city's first tattoo shop, the City Council entertained the idea of a six-month freeze on the opening of any tattoo parlors and body-piercing studios.

Was the fear of the unwashed, ink-stained dregs of society so great that the city was looking to buy itself time to put together a law that would cover how tattoo shops would run in South Portland?

Not exactly. Instead of voting to move the moratorium on tattoo shops ahead, the council will most likely kill it.

Score a victory for Beaudoin and Jensen, except they already skipped town to open up their shop in Standish.

It looked like the latest socio-cultural-generational dust-up, this time over what's art and what's bad for the neighborhood. Somehow it became another case study in straight economics: New business always beats no business.

Tex Haeuser, South Portland's planning director, said he plans to withdraw the moratorium proposal and will ask the council to amend the city ordinances to require tattoo parlors and body-piercing shops to be licensed.

City Councilor Claude Morgan said the city may have been caught unawares by Beaudoin's plans but hadn't had any reason to talk about tattoo shops in the past.

Morgan – who admits to having a tattoo – says he does not favor banning tattoo parlors and thinks the shops could be a new boost to the local economy.

Though he thinks South Portland will take time to create the right ordinance, he hopes the city can send a positive message to artists.

"The thinking in my own mind is that (a tattoo shop) falls under creative economy," he said. "And that's nothing to be scared of."

Meanwhile, in Standish, Infinity Tattoo opened the first week of June and has seen a steady stream of customers since. "This," Beaudoin says behind the counter of his new shop in Standish, "was a blessing in disguise."

Beaudoin has traveled around a bit and run shops in Florida and New Hampshire. He got his first tattoo as a teenager, when he began selling his drawings as designs to a shop in Portland. He got paid in tattoos.

http://pressherald.mainetoday.com/story.php?id=194329&ac=PHnws






Photos by Jack Milton/Staff Photographer

New chapter ahead for staff, paper
Editor's note column
by Jeannine Guttman
Portland Press Herald

As a loyal reader, you probably saw our recent story about the closure of our four reporting bureaus and the reduction of 12 members of our news staff. And you probably wondered what those changes meant for the news coverage strategy of this newspaper.

As you can imagine, both decisions were extremely difficult to reach. Everyone involved in the process here at the newspaper came to those conclusions very reluctantly.

We needed to make the tough choices in order to shore up our financial picture and to get expenses back in line. We intend to make the best of this situation by recommitting ourselves to a more focused local news report.

Due to revenue pressures from flagging advertising, we closed our four bureaus -- in Augusta, Biddeford, Bath and Washington, D.C. -- effective July 2. Bureau staffers in Maine were transferred to the central newsroom in Portland.

Those same financial pressures also prompted the company to reduce its work force. We did this primarily through a voluntary separation package -- otherwise known as a buyout. Nine members of the news staff took that offer.

Some made that decision because they were close to retirement; others took the offer because they wanted to start a new chapter of their lives.

Three other staffers were involved in the reduction: Two gave their notice ahead of the buyout offer and their positions will not be filled. And our Washington, D.C., correspondent was laid off as a result of the bureau closing.

I note their names here because you will recognize their bylines and work. Last week, our newsroom said its formal goodbyes to reporters Paul Carrier, Kevin Wack, Josie Huang, Tess Nacelewicz, Jonathan Kaplan, Anne Gleason and Seth Harkness; to editors David McNabb and Andrea Nemitz; to artist Alfred Wood; to news assistant Isaac Kestenbaum; and to copy editor Gary Christian.

Elsewhere in the company, 24 other employees were affected, mostly through the buyout process. Several were laid off and a few others left their positions earlier. The departments affected included advertising, circulation, MaineToday, finance and production.

The impact was newspaper-wide and there's no way to gloss over the loss of these staffers. Their absence will be felt and we will miss their valuable contributions. Going forward, every department is building strategies to adjust.

In the newsroom, the editors' team created a new beat plan for our reporting staff. We think this blueprint will help mute some of the impact and set us on a path for future growth in terms of circulation and Web audience.

http://pressherald.mainetoday.com/story.php?id=197738&ac=Insight

Business coalition endorses McCain
About 30 Maine small businesses join a national campaign to support McCain's economic plan.
By DIETER BRADBURY
Political Correspondent
Portland Press Herald

U.S. Sen. John McCain won the endorsement of a coalition of Maine small businesses Monday as part of a nationally organized campaign to support the economic plan introduced by the presumptive Republican presidential nominee.

The coalition, composed of about 30 small businesses, said McCain's plan offers the best hope for growth amid rising energy and health care costs, high taxes and intensive government regulation.

"This is an election for change," said Doug Newman, owner of Newman Concrete Services in Richmond. "John McCain represents the kind of change small businesses and Maine families need."

The Jobs for America plan, which McCain introduced Monday at a town hall meeting in Denver, features an array of proposals aimed at helping small businesses grow and creating more jobs. It also promises to balance the federal budget by 2013, the end of the next presidential term.

McCain said the federal tax code should be changed to provide refundable credits of $2,500 for individuals and $5,000 for families to buy alternatives to employer-based health insurance.

He proposed reducing the federal corporate tax rate, from 35 percent to 25 percent; establishing a permanent tax credit for money spent on research and development, and allowing businesses to accelerate the expensing of equipment and technology investments.

McCain's plan also calls for construction of 45 nuclear power plants; annual investments in the development of clean coal technologies, and a repeal of the moratorium on oil and natural-gas exploration and drilling on the outer continental shelf.

Business coalition members took aim at McCain's challenger, Democratic U.S. Sen. Barack Obama, during the endorsement news conference in Portland. They contended that Obama's policies would create more government regulation and drive up taxes.

"We cannot allow the policies of a Barack Obama administration to get in the way of growing existing small businesses and creating new ones," said state Rep. Josh Tardy, R-Newport, owner of Moosehead Manufacturing, a furniture business in Monson.

Obama addressed McCain's plan in a telephone call to about 300 supporters in Charlotte, N.C., where a scheduled appearance was canceled because a minor mechanical problem forced his plane to make an unscheduled landing in St. Louis.

"If you are satisfied with the way things are going now, then you should vote for John McCain," Obama said. "If you think that we need a fundamental change then we have a clear choice in this election and we've got to seize it."

http://pressherald.mainetoday.com/story.php?id=198220&ac=PHnws

Fishing Under The Dock
By BDN Staff
Bangor Daily News

Calling the state "Vacationland" isn’t enough to sustain Maine’s largest industry. The Maine Office of Tourism tries to react to ever-changing trends in the business, and like a fisherman, must decide where to cast its net to bring in the biggest catch. The latest effort to respond to those trends is a bit like fishing under the dock.

The tourism office is following the lead of Massachusetts, New York and some of the other states Maine competes with for tourism by encouraging residents to vacation in their home state, said Patricia Eltman, director of the Maine Office of Tourism. The term "stay-cation," coined to describe the experience, is becoming common parlance in the business, Ms. Eltman said.

The state devoted a small portion of its promotion budget for the "stay in Maine" campaign it launched this summer. Tourism businesses raised money in 2004 to pay for a similar campaign, but this was the first time state money was used in the effort. "We thought this year was a good year to do it," said Steve Lyons, a specialist in the tourism office.

The fear was that record high gas prices might mean residents of Maine’s core tourism market in southern New England and the mid-Atlantic region would not drive here. So far, reports Ms. Eltman, it’s not clear whether gas prices are slowing visitation. What has emerged as a new factor in dampening tourism is the ability of consumers to check, via the Internet, weather forecasts for Maine from their homes, she said. So if a rainy weekend is expected in Maine, many would-be visitors simply change their plans.

The "vacation in Maine" campaign includes glossy brochures inserted into Maine newspapers extolling the diversity of coast, lakes, woods and small towns, and encouraging Mainers to visit someplace in the state they’ve never been. "Imagine if you lived in an incredible vacation destination all year round," the brochure reads. "Oh wait, you do."

The campaign also includes a week of radio ads featuring Gov. Baldacci, and six weeks of TV commercials.

"This is a test," Ms. Eltman said, and her staff will eagerly watch to see how it works. Though it doesn’t bring new money into the state, tourism officials believe it keeps money in Maine, instead of seeing it "leak" into other markets like Cape Cod or the White Mountains of New Hampshire.

In 2006, according to statistics provided to the state, there were 10.1 million overnight stays in Maine; 2 million were Maine residents spending the night in a hotel, motel, inn, cottage or campground. Overnight stays by both Maine and out-of-state visitors account for $6.7 billion in annual spending.

http://bangornews.com/news/t/viewpoints.aspx?articleid=167884&zoneid=34