Who’s Afraid of Questions 2 and 4?

Read the full report | Research of public records reveals that opponents of proposed vehicle excise tax cuts (Question 2) and controls on government spending (Question 4) receive hundreds of millions of tax dollars every year.

In a recent essay in the Portland Press Herald, Mr. Jim Hanley, government affairs manager for New Hampshirebased Pike Industries Inc., argued that the Question 4 Taxpayer Bill of Rights initiative was a “bad idea.” Why would a company that does millions of dollars worth of business in Maine oppose a business-friendly proposal to slow the growth of government spending? Perhaps it is because Pike Industries, which does highway construction and paving, received more than $80 million in state payments between 2006 to 2008, and untold millions more from Maine’s municipal and county governments.

Pike Industries is far from alone in making a significant living off tax dollars. The highway and construction industries do millions of dollars worth of work on Maine’s roads each year, work that most Mainers heartily support. The sector of the economy that is among the most significant spenders of government money, though, is the extraordinarily vast network of non-profits and social service providers that receive some portion of the $820 million that the state’s Department of Health and Human Services spends each and every year.

How does a small state like Maine spend that kind of money on social services? It is surprisingly easy when the state has a higher percentage of its under-65 population on Medicaid than any other state, the second highest percentage of households receiving welfare, and the nation’s second highest level of participation in the federal Food Stamp program.

It should come as no surprise, then, that the many organizations making a living off these and other taxpayer-funded programs are unified in their opposition to Questions 2 and 4, which are designed to contain the rapid growth in government spending Maine has seen in recent years. A coalition of 160 such organizations calling itself “Maine Can Do Better” hosts a website encouraging visitors to “take action” to oppose Questions 2 and 4. Its list of “coalition partners,” though, includes dozens and dozens of organizations that are funded primarily, if not exclusively, with government funds.

Table 1, on pages 2,3, and 4,contains a list of organizations affiliated with “Maine Can Do Better,” along with publicly-available information about the extent to which they are funded by taxpayer dollars. As Chart 1 indicates, most of these groups get the vast majority of their funding from the government. Is this the reason they oppose Questions 2 and 4?

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