Taxes in Maine are too high. We hear that a lot lately. The statistic
that is often illustrated by the fact that finds Mainers have the
highest tax burden as a percentage on income.



I like to tell people that Portland is a great city– there is every job
you ever wanted to do here, except there’s only one of each and the
person who has it, isn’t giving it up.



People talk about the brain drain – Maine’s best and brightest leaving
for greener pastures. I’m willing to bet if every single 20-something
taking part in this out migration were asked, not a single one of them
would cite “Maine’s tax burden” as the reason they are leaving. After
all, where are they going? New York City and Boston are not exactly
known for their low taxes. They leave so they can put their degrees to
work and make lots of money.



Here we have too many people going after too few jobs. It is not
exactly an environment that puts a lot of upward pressure on wages. Not
only are there people willing to do the job for less, but those who
have jobs feel like their employers are doing them a favor. There are
plenty of people who would love to jump in their seats, so forget about
asking for a raise you are lucky to have a job.



Maine has been economically anemic for so long that it becomes
impossible to imagine it any differently. This scarcity model not only
affects the psyche of individual Mainers but also the collective
unconscious of the entire state to the point where it drives public
policy. All the power is in the hands of employers.



A company puts out feelers, “Well we’d love to help you out and expand
into Maine but, jeesh, the taxes, is there anything you can do about
that, governor?”



We wake up to see the front page of the daily break the news that a
paper mill, after decades of a slow death, will finally lay off the
last 70 employees and the governor clears his schedule to work out some
deal to keep the thing creeping along for another five years or three
months. No one seems to ask if in the 21st century whether we should be
expending so much time, resources and money trying to keep a 19th
century industry afloat. It goes without saying: we need to keep these
jobs because those people were lucky to have them.



The taxes are too high camp will tell you that cutting taxes solves
these problems. Lower taxes make Maine more attractive. The more
attractive it is, the more jobs are created. The more jobs that are
created, the more the balance of power shifts toward employees and,
viola!, you’ve cut taxes and increased incomes.



Of course, every businessperson will agree, “Oh, yeah, cut taxes! That’s the answer!”



But if you were able to sit down and share a few drinks with one of
those executives at the bar of the Hilton Garden Hotel after his
meeting with the governor, you might get a different answer.



He’d look over his shoulder to make sure no one was listening, lean in
close and ask, “You want to know the real reason no one expands into
Maine?”



After motioning to the waitress to bring another he’d continue, “It’s
because you’re too far away from everything else. You’re right on the
ocean, but everything is shipped through Boston. It takes forever and
costs a bundle to get material in and product out. You are literally as
far away from China as you can possibly get. You have one major highway
for the entire state and it only goes in two directions. The roads are
too narrow and your rail system is obsolete.”



He will take a sip and continue, “You want to cut my taxes, great. We
already decided whether to expand here, but if we can get a dollar and
a cent rather than settle for a dollar, that’s what we’ll do. In the
meantime your roads aren’t getting any better and the quality of your
labor pool is declining as fast as you cut the school funding. You want
me to move to Maine? Instead of cutting my taxes, cut my transportation
costs.”



But that is not the Maine way. We don’t invest in the future. We make do with less and live in the past.