Addicted to bad ideas

Politics + Other Mistakes
By AL DIAMON  |  January 9, 2013

Solving Maine's most serious problems would be a lot easier if we could eliminate obviously unworkable solutions from the debate.

For instance, no matter what the Tea Party claims, you can't prevent plane crashes by repealing the law of gravity.

Or, as they put it, the "theory" of gravity.

Another example: Democrats believe the way to deal with the state's impending budget shortfall is to raise taxes on the "wealthy." You know, the "1 percent" who aren't paying their fair share. In Maine, with a population of about 1.3 million, that amounts to 13,000 people. Of whom around 3000 are probably children. That leaves roughly 10,000 top-enders to be squeezed. With the state facing a budget deficit in the next two years of over $880 million, that would require every well-to-do person to pay an additional $88,000. For a couple making $250,000 a year — the Democrats' definition of rich — that amounts to 70 percent of their gross income — not even taking into account any taxes they're already paying.

If that happens, don't be surprised to see the state's entire economic elite suddenly decide to join Donald Sussman as part-time residents of some off-shore tax haven. Or maybe they'll just move to New Hampshire.

The truth is that in order to raise significant bucks, any tax hike would have to hit the middle class. Which is defined as anybody who makes enough to afford a bottle of Maine's exorbitantly priced liquor, but can't come up with the extra cash for gas and tolls to drive to New Hampshire, where it's cheaper. Any gains from soaking the average wage earner would be offset by lost booze revenue, due to economically enforced abstinence.

More faulty thinking: Republican Governor Paul LePage's energy policy is based on the shaky premise that all we need to attract more businesses to Maine is better access to cheap power, which he insists will come from two sources:

1) Natural gas, which is currently priced well below oil, wood, solar, or the heat generated by sexual congress with a Zumba instructor.

2) Removing Maine's silly law that refuses to classify cheap Canadian hydropower as renewable energy, thereby allowing it to be sold in this state.

What LePage neglects to mention (or, to give him the benefit of the doubt, doesn't have a clue about) is that natural gas prices are market-driven. The more demand, the higher they go. If the state embarks on a massive pipeline project to bring that product to every struggling paper mill and marginal industrial enterprise on its rural back roads, it could find itself responsible for substantial inflation in the energy market. By the time the gas gets where it's needed, it may no longer be a bargain.

As for Quebec's surplus hydro capacity, sure it's cheap — if you're a Canadian resident. The provincial government subsidizes those huge dams by paying for their construction, thereby allowing its power company to provide electricity at substantially less per kilowatt-hour than Mainers pay. But, regardless of what LePage may believe, Canadians aren't quite stupid enough to be conned into that same deal with outsiders. While they'd be happy to sell us their socialist energy (wait, the governor wants us to support socialism? What's up with that?), they're only going to do it at rates roughly equivalent to what we're already paying (it turns out, those Quebec socialists are free-market capitalists at heart).

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  Topics: Talking Politics , Maine, Justin Alfond, Paul Lepage,  More more >
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