"You Want To Play Chicken? Let's Play Chicken" Maine Governor Threatens Shutdown Over Proposed Tax Hike

Connecticut isn’t the only state in New England that’s facing a budget showdown today. As Reuters reports, Maine is bracing for a possible partial government shutdown on Friday – what would be the first in the state since 1991 - as Republican Governor Paul LePage has warned he will reject any budget deal that does not cut income taxes.

LePage, a second-term Republican who faced national scrutiny and calls to resign earlier this year after making an allegedly racist comment about out-of-state drug dealers worsening the heroin epidemic in Maine, said he would declare a state of civil emergency if a budget is not reached by midnight, which would keep state police, prisons, parks and tax collection services but close most other aspects of state government, according to Reuters.

"I will tell you this: If they put a tax increase, ready for a shutdown. End of story," LePage said in a Thursday interview on Maine's WGAN radio. "They're playing chicken at 100 miles per hour and I'm telling you something, you want to play chicken, let's play chicken."

The conflict at the center of the budget showdown is the issue of funding the state’s schools, as Reuters explains.

“Legislators are negotiating a roughly $7 billion two-year budget, with the main sticking point being how to fully fund state schools. Voters in November passed a measure imposing a 3 percent income tax on state residents who earn more than $200,000 a year, a measure the governor and statehouse Republicans object to.

 

The Democratic Speaker of the state House of Representatives, Sara Gideon, has blasted the threat of a shutdown, saying earlier this week, "We must find a path forward and close this budget."

Maine state law gives the governor 10 days to respond to any budget passed by the legislator. LePage warned on Thursday he planned to wait that long before vetoing any budget that raised taxes. Most of the government would be shut during that time.”

 

Delays this year in negotiations leave the state, with a heavily tourist-dependent economy, facing the prospect of a partial government shutdown at the start of the long July 4 holiday weekend.”

Concerned about the potential impact of a shutdown, a local advocacy group is preemptively suing the state in federal court, seeking an order that would ensure that public assistance payments continue uninterrupted to the 450,000 people in the state, about one in three residents, who receive them.

To be sure, the stakes in Maine’s budget battle aren’t nearly as high as Connecticut’s. The nutmeg state has yet to pass a fiscal 2018 budget, and the deadline is Friday. Connecticut has the distinction of the third-worst ratings in the country, only behind Illinois and New Jersey after S&P, Moody's and Fitch all downgraded the state last month in what officials described as a "call to action" for state leaders.

“We’ve been downgraded by everybody in the last six months, and in the last year two or three times,” Senate Republican President Len Fasano said cited by Fox news. “If we don’t pass a budget, I think we will see a further downward spiral.”

Connecticut is currently operating with a $5 billion budget deficit, and according to an analysis by Pew, the state only has $240 million in its 'rainy day fund'; just five states have a smaller cushion. Much of the financial troubles are tied to the state’s pension system, which two-term Democratic Gov. Daniel Malloy’s office is seeking to address with a new plan to save the state $24 billion in “coming years.” One solution offered by Malloy is to require new state employees to be covered under a new hybrid pension system. The agreement, which Malloy’s office made with the state union, is tentative and awaiting legislative approval. Connecticut and Maine aren't alone; Illinois also faces a Friday budget deadline that, if not met, could result in ratings agencies downgrading the state - which is struggling under the weight of unfunded public employee pensions - to junk status, virtually guaranteeing a debt-fueled death spiral that will likely lead to bankruptcy.

The showdown comes as Connecticut’s already narrow tax base has seen some major defections recently as corporations and wealthy hedge funds decamp for states like Florida, which offer lower tax rates, or cities like Boston and New York, which offer a stronger talent pool. Yesterday, we reported that Aetna, the insurance giant founded in Hartford where it has been for the past 164 years, announced it would move its headquarters to New York City despite intensive lobbying efforts by Connecticut officials. That move followed a departure by GE of its Fairfield HQ of 40 years.

Comments

mtl4 shocktherapy Fri, 06/30/2017 - 14:05 Permalink

Not from Maine but seems to me this governor actually has his head screwed on straight, a true rarity these days.  No wonder the libs in opposition are trying to stonewall him, just wish we could export this type of common sense north of the border too.  Everyone is busy spending other people's money instead of sticking with the old concept of taking more in than what goes out.  Good thing about Maine and eastern Canada is there's no boom, no bust and we know how to eek out a living on next to nothing.  Not too worried about the next black swan event, we'll be stacking firewood no matter what.

In reply to by shocktherapy

MEFOBILLS 5000yl Fri, 06/30/2017 - 13:14 Permalink

The progressive era machinery all WORK TOGETHER, like gears meshing.  16'th is to bail out banks via taxpayer.  17'th is to bribe senators with money and disenfrachise states,. Federal Reserve Act is to centralize money power on New York Fed.  IRS is to make sure that the takover of liberty is complete, as people lose their economic freedom.And yes, the JOOOZ are heavily implicated, especially in Federal Reserve Act.

In reply to by 5000yl

Yen Cross Fri, 06/30/2017 - 12:37 Permalink

 That guy looks like a walking aneurysm.  He's played alot of " deep fryed chicken" in his time. I wonder how many musket balls he's got in the lower intestines? What was this article about?

Lumberjack Yen Cross Fri, 06/30/2017 - 12:46 Permalink

I beg to differ. The man told O where to go in no uncertain terms snd has a real budget surplus, that the libs want to get their hands on.

https://www.google.com/amp/s/amp.bangordailynews.com/2017/02/26/the-poi…

His work for welfare model is a shining example if what welfare should be. A hand up not a hand out.

https://www.google.com/amp/s/www.forbes.com/sites/theapothecary/2016/05…

In reply to by Yen Cross

Lumberjack Yen Cross Fri, 06/30/2017 - 13:14 Permalink

Hopefully one that on occasion looks away!

The big problem is that the majority of the population lives in southern Maine. The rest of the natives call that part Northern Massachusetts. They even wrote a song about it...

https://m.youtube.com/watch?v=asmto0ihXa4

Disclosure: I'm a former native Mainer now residing in the very conservative South Shore region of Ma. Someone had to come down to restore Boston!

In reply to by Yen Cross

Bastiat Lumberjack Fri, 06/30/2017 - 13:05 Permalink

There are a thousand LePage stories. He makes liberal brains explode.One of my favorites:  LePage owns a chain of discount stroes called "Mardens." On snowy winter morning in his first term, they were going to close the State offices for a snow day.  LePage called Mardens, then said:  if Mardens is open, we're open.He's like Trump in his near complete disregard for sacred cows, including the media--but he actually seems more coherent and effective (though it's still early for Trump).  

In reply to by Lumberjack

Lumberjack Bastiat Fri, 06/30/2017 - 13:40 Permalink

Someyears ago we had a RINO guv named McKernan. The state was forced to shut down due to budget woes caused by the previous admin this exact time of year. Maine depended heavily on tourism and almost ALL the liquor stores were state owned. Except for a few in very remore locations. Shittiest 4th of July week evah! State lost millions. Liquor stores are no longer state owned now.

In reply to by Bastiat

MEFOBILLS Charles Wilson Fri, 06/30/2017 - 13:39 Permalink

This is correct.  The government has been transferring Social Security funds into general funds, then spending it.The "lockbox" then gets an IOU against the future.  The IOU is not money, it is a claim against the future.The future is then Mexinvasion to get workers that should be formely aborted white american babies.  See how it works?  Thanks to our bolshevik overlords who are intent on destroying everything they touch.

In reply to by Charles Wilson

graspAU jamesmmu (not verified) Fri, 06/30/2017 - 13:14 Permalink

LOL - social security is just a tax, nothing more. It was debated and also shown through case law. There is no insurance called social security it is just another tax. If you get paid from social security, it is called a gratuity. That's right, it is literally a gift from congress if you see a check and they are allowed to change their mind at any time and not keep giving you gifts. There is no account where they store the money you and your employer have paid in all those years, they just take it as a tax and do that they please.

In reply to by jamesmmu (not verified)

Bastiat Arnold Fri, 06/30/2017 - 13:51 Permalink

Yes, potato county in norther Maine is a different story -- there's an actual economy!Then you have Portland which has a more or less healthy urban economy.  Then you have the coast with fishing, tourism and retirees, then Augusta - government.   Then there's Orono, main campus of the U Maine system.  The paper industry is mostly, if not completely, gone.  There's lumber--Maine has spruce like the Great Plains had grass . . . but so does Canada.Hard to imagine for someone who hasn't lived in it, or close to it, just what it feels like to live in an economic deadpool.  TV, benefits, and finally drugs have turned many people into mushheaded slobs.  Remarkable though, in a state where virtually everyone has guns and about 25% are legally drunk on a given evening, that there are so few shootings.

In reply to by Arnold