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Maine's top economic gun loaded with optimism

Cashman said there should be more investment in Maine in alternative energy sources such as wind power and biomass boilers. Maine even should consider bringing back nuclear power, which has become unpopular, as a way to reduce its dependence on imported fossil fuels, he said.

If Maine had a Department of Optimism, it would be run by Jack Cashman.

There is no such agency, of course, but as commissioner of the Department of Economic and Community Development, Cashman is in charge of the next closest thing.

Considering the objective of DECD, optimism may as well be part of the department head's job description. It is doubtful that any Maine governor, regardless of his or her political affiliation, would hire a pessimist to lead economic development efforts in a state that has seen its traditional manufacturing base shrink drastically in the past decade.

Just last week, 400 more Maine manufacturing jobs came closer to the brink of vanishing when Georgia-Pacific announced that it was closing its mill in Old Town. The mill workers will receive their normal pay and benefits for another 60 days while G-P and state officials - including Cashman - search for a new owner to buy the facility.

Despite this setback, the commissioner recently addressed the issue of maintaining a positive attitude. During an interview he granted before the Old Town mill's closure was announced, Cashman said that too often people compare Maine with other states and choose to see Maine's glass of... more [truncated due to possible copyright]  
If Maine had a Department of Optimism, it would be run by Jack Cashman.

There is no such agency, of course, but as commissioner of the Department of Economic and Community Development, Cashman is in charge of the next closest thing.

Considering the objective of DECD, optimism may as well be part of the department head's job description. It is doubtful that any Maine governor, regardless of his or her political affiliation, would hire a pessimist to lead economic development efforts in a state that has seen its traditional manufacturing base shrink drastically in the past decade.

Just last week, 400 more Maine manufacturing jobs came closer to the brink of vanishing when Georgia-Pacific announced that it was closing its mill in Old Town. The mill workers will receive their normal pay and benefits for another 60 days while G-P and state officials - including Cashman - search for a new owner to buy the facility.

Despite this setback, the commissioner recently addressed the issue of maintaining a positive attitude. During an interview he granted before the Old Town mill's closure was announced, Cashman said that too often people compare Maine with other states and choose to see Maine's glass of water as half empty rather than half full.

"It frustrates me," he said. "We're not the only state with black marks."To bolster his case, Cashman listed a host of statistics that he said indicates Maine is doing well in many respects.

Maine ranks fifth nationwide for elementary and secondary education, based on a variety of factors such as graduation rates, proficiency levels, class size and attendance records. It is the third safest, ranks third in information technology investment, and is 28th in workers' compensation payments, after having been first in this undesirable quality not too long ago, he said.

According to Maine Department of Labor statistics, the state lost 18,200 manufacturing jobs between 2000 and 2005 but during that same time gained 14,700 more jobs in education and health care. Overall, the number of jobs in Maine grew by 8,300 during those years, from 603,400 to 611,700. That rise represents a 1.4 percent increase in Maine, which is one-tenth of a percentage point more than the nationwide job growth rate of 1.3 percent for the same period, the figures indicate.

Cashman also said Maine has a "gold standard" work force - a declaration, he pointed out, that Anthony Principi, chairman of the federal Base Realignment and Closure Commission, used last year to describe workers at Portsmouth Naval Shipyard.

"This state has the best work force on the planet," Cashman said.

And Maine is adapting well to the global economy that has siphoned many manufacturing jobs away overseas, according to Cashman. Though they cannot devote as much money to recruitment as other states, government officials and business leaders in Maine constantly are trying to convince businesses to move to the state, he said.

But job creation is a persistent problem that all states deal with, he said. Wisconsin lost as many as 19,000 pulp and paper jobs in a recent two-year span, and Massachusetts, which has the biggest economy in New England, at one point lost 10,000 jobs in a single week, he said.

Biomedical research and financial services are two fields that have grown substantially in Maine in recent years, Cashman said. The Jackson Laboratory, which in less than 10 years has grown from having 700 workers to more than 1,200, is the largest employer in Hancock County. Bangor Savings Bank has expanded significantly in the past decade and TD Banknorth plans to add as many as 100 jobs to its Bates Mill facility in Lewiston, where 1,300 already are employed. Bank of America, despite some job eliminations resulting from its acquisition last year of MBNA, has committed to maintaining a substantial number of employees in Maine, he said.

"We have the lowest bank franchise tax in the country," Cashman said. "Maine competes very well in that sector of the economy."

Other industries also are doing well, he said. New Brunswick-based Cooke Aquaculture has invested $25 million in Washington County in the past two years and has plans to invest $60 million more in the next two. CorrectDeck of Biddeford, which makes composite decking material from sawdust and polypropylene, has grown substantially since it was founded in 1999. Irving Tanning Co., which emerged from bankruptcy only last year, is expected to add more than 100 new jobs at its Hartland plant as it employs new technology that will make seat covers and side panels for cars and trucks out of leather scraps that formerly had been discarded.

Cashman said that before he started working for Gov. John Baldacci in 2003, he worked for 30 years in the private sector as a developer - a position that sometimes gave him a front-row seat for witnessing the economic changes taking place in Maine.

As a developer, he dealt mostly with residential and commercial properties, including JSI Store Fixture's former plant in Howland. In that 2000 transaction, he said, JSI moved into a larger space in the former Dexter Shoe plant in Milo and lobster fishing equipment maker Friendship Trap expanded into the vacated Howland plant, opening a second production facility away from its coastal home in Knox County. Both businesses are examples of specialty, small-scale manufacturers that are bucking the national downward trend in that sector, he said.

Cashman said he does not have much personal experience working with the retail sector but that, with its recent growth surge, it almost appears as if it could expand forever. He indicated he doesn't know how much more the state's retail sector can grow - "every business is cyclical," he said - but stressed that the national companies moving to Maine don't make such decisions lightly.

"They do their homework," he said. "They don't fly in here by the seat of their pants."

Cashman said there's an argument to be made against giving tax breaks to large retail businesses. Manufacturing firms are different, he said, because they can be located almost anywhere, but a big-box store is unlikely to be built in a town without a retail base just because the tax rates there are lower.

A remote tiny township may offer tax incentives to try and lure businesses to move to town "but Wal-Mart is not going to put a store there," he said. "I think that's the way it should be."

One symptom of the expansion of large retail chains into Maine is that many small locally-owned businesses are being displaced and fading away, the commissioner said. The growth in the retail sector is helping to create jobs in service center communities such as Bangor, Presque Isle and Ellsworth, he said, but is having a less desirable effect on smaller businesses like the restaurant his father used to run on Old Town's Main Street.

"There were thriving downtowns. It's pretty much gone now," he said. "I miss local merchants."

Despite some positive developments, Maine's economy still is facing some stiff challenges, the commissioner said - a fact highlighted by the Old Town mill's closure. Taxes and health care costs are too high, Cashman said, as are energy costs.

"Energy cost is a problem in the whole Northeast," he said.

Building liquefied natural gas terminals in the state may present some immediate economic opportunities for some Maine residents, he said, but eventually the state's energy market needs to expand to take advantage of renewable energy resources.

"Gas is a limited commodity," he said, referring to the fuel's global reserves. "At some point you're going to have to replace it."

Cashman said there should be more investment in Maine in alternative energy sources such as wind power and biomass boilers. Maine even should consider bringing back nuclear power, which has become unpopular, as a way to reduce its dependence on imported fossil fuels, he said.

If Maine can establish a steady domestic supply of cheaper, renewable energy - a move that has been much discussed since the first Arab oil embargo in the 1970s, he said - then it should help with all aspects of the state's economy.

"We're better off" with energy independence, Cashman said. "There's no question about that."


Source: http://www.bangornews.com/n...

MAR 25 2006
https://www.windaction.org/posts/1866-maine-s-top-economic-gun-loaded-with-optimism
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