Radio Address – Jim Hamper – 8/2/2019

Though it drew little notice, a very important day in Maine history passed us by a few weeks ago. No, it wasn’t the anniversary of Maine becoming a state, or the important anniversary of some great event.

June 30, 2019 was the last day that Maine State Government operated under a budget that included the fiscal restraints, prosperity, and economic growth of Republican ideas.

When voters put Republicans in charge of state finances back in 2011, Maine finally began to emerge from decades of economic doldrums. The budget that Republicans passed in 2012 included the largest tax cut in the state’s history and removed nearly 70,000 low income Mainers from the tax rolls altogether and cut back on restrictive regulations and impediments to economic growth.

The result has been explosive growth for Maine’s economy.

Almost immediately, Mainers started to feel the positive effects. Over the three-year period from 2013 to 2015, the wages of Maine workers grew faster than those in any other state. Maine’s unemployment rate began a freefall as more people went to work in higher paying jobs.

When that Republican controlled legislature was sworn in that December of 2010, Maine’s unemployment rate was 9%. Today we are in the midst of the longest stretch of record low unemployment in our state’s history.

Despite claims that the 2011 tax cuts would create budget gaps of hundreds of millions of dollars, the opposite has occurred. As we closed out this last budget cycle under Republican influence, state government has a surplus of $168 million.

How did this happen? Well, a prosperous economy is the shortest answer. Because Mainers had more money, they bought things. Automobile sales rose by 80%. Maine restaurant food sales rose by 69%. Lodging revenues rose by 69%. Food store sales rose by 64%. Home sales hit a record high in Maine and the value of a Maine home has risen by 45% since 2011.

Nearly every sector of the Maine economy has been succeeding on overdrive.

Maine’s most vulnerable citizens have benefited as well, and the lives of many of these Mainers have improved greatly since these tax cuts became law.

The number of Maine children living in poverty dropped by 5.1% since 2011 and children living with food insecurity has dropped by 3.5% since 2014.

The percentage of Maine people living in poverty has dropped by 3.7% since 2012.

All of this prosperity and a stable, fiscally sound state government came to an end on July 1st when a new state budget based on very different ideas took effect.

The new philosophy among those who run state government is to spend every dime they can find and then borrow hundreds of millions more, increasing spending at more than six times the rate of inflation.

When the money ran out, they passed dozens of new bills that have clear costs to the state budget, but passed no funding to cover those costs.

It remains to be seen what lasting effects the new fiscal philosophy in Augusta will have on regular, working folks here in Maine. But there are already some early signs.

After three years of nation-leading wage growth, wages for Maine workers fell for the first time in years in late 2016, immediately following the passage of a law that artificially raised the minimum wage.

Maine fell abruptly from 1^st in the nation to 40^th in wage growth.

This is what happens when government abandons policies that encourage economic growth and prosperity for all, and instead tries to force the economy to work as we wish it would, rather than how it actually does.

And so we said goodbye to fiscal year 2019 last month, and with it the government policies that led Maine to one of the most prosperous economies in its history.

With the new budget year comes a new philosophy of spend money, spend more money, borrow money, spend some more money, and then spend money we don’t even have.

By this time next year, we will have a chance to see how that works out for Maine and its citizens.

This is Senator Jim Hamper, still counting the beans.