The other day, I got an email alerting me to an amazing financial opportunity. By hardly doing anything, I could help Bruce — I think he's some kind of Nigerian prince — access a windfall of $472 million over the next five years. And Bruce, as generous an aristocrat as you're likely to meet, was willing to share his largesse with me, a mere commoner.
I was ready to buy into this deal, until my wife pointed out that it's unlikely a Nigerian prince would be named Bruce.
I took another look at the email and realized it wasn't from Nigeria, after all. It came from that other sketchy place:
But the sender was named Bruce, all right, as in Poliquin, erstwhile candidate for governor, senator, or whatever other important office might become available. Bruce is currently serving as state treasurer, a post with much less authority than he thinks he ought to be wielding.
You can see how I might confuse him with deposed African royalty.
Bruce was writing to alert me to the fact that Maine has $472 million in outstanding general obligation bonds that must be paid off between now and 2017. The interest and principal from that debt will cost us more than $120 million this fiscal year. That's enough money to cover the impending shortfall in the state's Medicaid program (after the feds refuse to approve the cuts pushed through by Republican Governor Paul LePage), replenish the coffers of Head Start, provide a hike in heating aid for low-income households, boost the Rainy Day Fund, and cover part of the cost of tax cuts that take effect January 1.
Of course, none of that will actually happen, because the money is already committed to paying off loans accrued years ago for such vital expenditures as research and development programs (has anybody seen the jobs they were supposed to create?), new classrooms at the University of Maine at Fort Kent (in case there's a sudden influx of students into Aroostook County), arts and culture (labor murals, anyone?), economic development projects on Maine rivers (like paper mills?), fixing a bulkhead at the Gulf of Maine Research Institute in Portland, restoring a forest lodge in Upton, new showers at a park in Dover-Foxcroft, ballfield renovations in Standish, an ice-skating rink in Pittsfield, and wind-power projects (although, none involving Angus King).
Not all that borrowing was entirely frivolous. Some of the money went to buy environmentally threatened tracts of land, even though Maine doesn't have the funds to adequately staff and maintain the parks it currently owns. There was the occasional economic-development scheme that worked out, such as the purchase of a rail line in northern Maine that has boosted activity at several businesses. And a fair amount went to repairing roads, bridges, and other infrastructure, although nearly every bond for those purposes was compromised by the inclusion of pork-like projects of importance only to legislators' re-election efforts.
Is that worth the $120 million we'll be paying this year? Probably not. But it takes some of the sting out of writing that check.
The good news is that the annual amount due on our debt is scheduled to drop precipitously. It'll go down more than $22 million in fiscal year 2014, another $16 million the year after that, $18 million in 2016, and in 2017, the last $49 million will be paid off. A huge burden will be removed from the backs of taxpayers.