Globalization and The Maine Department of Economic And Community Development

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Introduction of a Theme: The Global Investment Community Threatened by The Small Craft Maker.

A while back I had the thought that a factory worker in a low wage labor market could make as much with one sale on Etsy as he or she could working for a month in a factory. My next thought was that political forces in those countries would apply pressure to keep people from opening an Etsy Shop. I now believe that such political pressure exists everywhere as governments become entrenched in economic “globalism”. It may sound fantastic that governments and global capitalists are threatened by small craft enterprises, but the value systems and what benefits each are at odds with those of other. In this video, The Voices of the  Chinese Workers by leslie T Chang - a well dressed, Harvard educated, young Asian woman presents herself as the voice of the Chinese workers. Instead she comes across as a corporate shill advancing the concept that the end justifies the means and dismissing the importance of taking pride in one’s work.

In this blog post I examine the legislation that established The Maine department of Economic and Community Development.


As I write, the IRS scandal is playing our in the national news. It is a story about the politicization of non-profit organizations and their function in redistribution of wealth by governments in the service of special interests, in the case of the IRS, the special interest is the re-election of Barack Obama, whom many believe won the election and did so through grass roots organization, such organizations being formed and financed as non-profit organizations. Using the power of the IRS to prevent the other side from organizing and financing on equal terms, would clearly give the Obama campaign an electoral advantage.

While the original intent of non-profits was to serve society in way that couldn’t be served, in theory, by for profit enterprises, today non-profits have become largely instrumental in redistributing wealth to the wealthy and entitlements to the general public. There still exist nonprofit organizations consistent with the original intent of serving goals, which are not profit driven. This is attributable to the character of the individuals involved in those organizations, but the character of the people can and does change over time. The thought of the IRS applying a political agenda to obtaining the status of a non-profit to organizations which genuinely serves public needs is truly frightening and all the more reason why the IRS should never be permitted to manage ObamaCare. In the current scandal the IRS put the applications process on hold for nonprofit organizations formed to advance causes of those that oppose the Obama agenda, including ObamaCare which will require a dramatic increase in the number of IRS employees.

Non-profit organizations are being utilized by Maine State Inc, for the purpose of accumulating and redistributing capital, and none more blatantly so than The Maine Technology Institute, chartered in violation of Article IV, part Third, Section 14 of the Maine State Constitution, which prohibits the legislature from chartering corporations with an exception only for municipal purposes and no exception for non-profit corporations. According to it’s 1999 annual report, the Maine Technology Institute. is “ a private, non-profit (501(c)3) organization. It receives a direct appropriation from the Legislature through the Department of Economic and Community Development. MTI is designed to collect capital from both non-profit sources and the general taxpayer and to concentrate that capital in a fund which will be redistributed by the state to private entities as well as to the states own advanced manufacturing center at the University of Maine.

§13056-C. Maine Economic Development Evaluation Fund

1. Fund established.  The Maine Economic Development Evaluation Fund, referred to in this section as "the fund," is established as a nonlapsing Other Special Revenue Funds account administered by the department for the purposes of funding the comprehensive economic development evaluation required pursuant to section 13056-A. [ 2007, c. 434, §3 (NEW) .]

2. Fund sources.  The fund receives money deposited by the Treasurer of State pursuant to this section and any other gift, grant or other source of revenue deposited for funding the comprehensive economic development evaluation required pursuant to section 13056-A. [ 2007, c. 434, §3 (NEW) .]

3. Payments to fund.  Notwithstanding section 1585 or any other provision of law, the department shall assess agencies or private entities that receive General Fund appropriations or general obligation bonds for economic development an amount for contribution to the fund that is not to exceed 0.8% of General Fund appropriations received by or general obligation bonds issued to an agency or entity for economic development efforts. Private entities that receive funds from general obligation bonds for economic development efforts shall pay to the Treasurer of State in the fiscal year in which the general obligation bond was issued an assessment amount determined by the department that is not to exceed 0.8% of the proceeds from the bond issue in any fiscal year, which payment must be made from available resources other than bond proceeds. Only those programs that receive $250,000 or more in economic development appropriations in any fiscal year or those entities that receive funds from a general obligation bond issue of $250,000 or more for economic development efforts in any fiscal year, as identified and certified by the department and the Office of Fiscal and Program Review, may be assessed pursuant to this subsection. The department shall provide to each agency or private entity an annual budget for the fund and a detailed account of each institution's required assessment. Total payments made pursuant to this section may not exceed $200,000 in any fiscal year. [ 2011, c. 563, §3 (AMD) .]

SECTION HISTORY 2007, c. 434, §3 (NEW). 2009, c. 337, §2 (AMD). 2011, c. 563, §3 (AMD

The money so accumulated is then redistributed to privately owned “high tech” companies such as TexTech, which, according to Alan Hinsey of MaineBiz Sunday, has received transfers of wealth from MTI on seven different occasions.

A Global Company

Tex Tech is truly a global company, manufacturing over 7,000 products. Our flagship Maine manufacturing facility covers 200,000 sq. ft. and is home to our Technical and Research & Development centers. In addition, we operate manufacturing facilities in Thailand and China and are dedicated to our growing business in Asia. http://www.textechindustries.com/company/overview

 MTI is redistributing tax payer money and non-profit contributions to a Maine company that has its manufacturing facilities located in China and Thailand. The justifying rhetoric put forth by the legislature and repeated in Maine’s media is that MTI is creating high tech jobs in Maine but TexTech clearly states that the Maine manufacturing facilities are for developing prototypes rather than product manufacturing. TexTech's production  is located in the global low wage markets, notorious for worker exploitation. So much for "social benefit ". The story that the Maine legislature and the Maine media is telling the people of Maine is a whopper. When you consider that the funding is being channeled through a government chartered non-profit corporation, it makes a mockery of the concept that nonprofits do not serve the profit motive. There is no reason for a Maine company to move manufacturing over seas other than the profit motive. We know this well in the ceramic industry where in most major companies and many smaller ones as well outsource their production to the same low wage global labor market.

These are the first two paragraphs of the special act of Legislation that chartered the Maine Technology Institute

§15302. Maine Technology Institute

1. Establishment.  The Maine Technology Institute, as established in section 12004-G, subsection 33-D, is a nonprofit corporation with public and charitable purposes. The duties, activities and operations of the institute are within the provisions of the federal Internal Revenue Code, Section 501(c)(3).

[ 1999, c. 401, Pt. AAA, §3 (NEW) .]

2. Purpose.  The institute, through a public and private partnership, shall encourage, promote, stimulate and support research and development activity leading to the commercialization of new products and services in the State's technology-intensive industrial sectors to enhance the competitive position of those sectors and increase the likelihood that one or more of the sectors will support clusters of industrial activity and to create new jobs for Maine people. The institute is one element of the State's economic development strategy and will contribute to the long-term development of a statewide research, development and product deployment infrastructure.

[ 1999, c. 401, Pt. AAA, §3 (NEW) .]

Research and development is not "industrial activity" -- it is product development and design- not the same thing . Industrial activity occurs during production.In the case of Textech, having received seven wealth transfusions from MTI at the time of the Alan Hinsey interview, their "industrial activity" ( manufacturing ) takes place in China and Thialand as stated on their website.

The DECD is also controls municipal development through the redistribution of the capital resources in its “fund”

§13056-D. Communities for Maine's Future Program

1. Program established; administration.  The Communities for Maine's Future Program, referred to in this section as "the program," is established within the department to assist and encourage communities to revitalize and to promote community development and enhance projects. The department shall administer the program to provide funding for the rehabilitation, revitalization and enhancement of downtowns and village centers and main streets in the State. All funds received for this program must be deposited into the Communities for Maine's Future Fund established in subsection 7.

[ 2009, c. 414, Pt. G, §1 (NEW); 2009, c. 414, Pt. G, §5 (AFF) .]

2. Review panel.  The Community for Maine's Future Review Panel, referred to in this section as "the panel," is established to evaluate proposals and determine funding under the program. The panel consists of:

§13062. Office of Business Development

The Director of the Office of Business Development shall administer the office in accordance with the policies of the commissioner and the provisions of this chapter, emphasizing a program of targeted business development designed to attract particular types of businesses that have potential for Maine and businesses that are considered to be compatible with Maine's environment and interests. The office shall actively seek and encourage firms to expand or locate in Maine. The office is responsible for the implementation of programs designed

In other words the DECD will advantage special interests sectors of the economy that serve the designs of Maine State Enterprises. The redistributed wealth will go to those special interests selected by the government. The rest of the economy will be taxed to finance the governments’ chosen special interests.

Since Maine State Inc has it’s eye on getting its fair share of monopoly money fresh off the the Federal Reserve presses, the strings are being pulled by the federal government just as the state in turn pulls the strings at the municipal level with its power to  redistribute wealth accumulated in the state's multifarious funds.

 1. Business investment.  Business investment shall be encouraged consistent with this subsection.

C. The director, with the approval of the commissioner, may make grants for market development from appropriations for that purpose to any municipality or group of municipalities which have received a grant of authority from the Federal Government to establish a foreign trade zone. [1987, c. 534, Pt. A, §§17, 19 (NEW).]

D. Application for foreign trade zones shall be according to this paragraph.

(1) The director, with the approval of the commissioner, on behalf of the State, may make applications to the Foreign Trade Zone Board and establish foreign trade zones that are to be located on state-owned, leased or otherwise controlled property. A municipality, group of municipalities or a public or private corporation may, with the approval of the department, make applications to the Foreign Trade Zone Board and establish foreign trade zones at other locations. Foreign trade zones shall be established in or adjacent to any ports of entry in the State, where personal property in transit shall be exempt from the stock-in-trade tax and such other taxes and customs as are normally levied in a port of entry.

 (2) Any development or activity with a foreign trade zone established in the State is subject to the laws which the Department of Environmental Protection, Department of Agriculture, Conservation and Forestry, Department of Marine Resources and Department of Inland Fisheries and Wildlife are responsible for administering, as well as any other law which protects the environment.

 (3) For the purpose of this subsection, "personal property in transit" through the areas established under this paragraph means goods, wares and merchandise either moving in interstate or international commerce through these zones or consigned to a warehouse, public or private, within these zones, whether specified when transportation begins or afterward. This property shall not be deprived of exemption because, while in the warehouse, the property is assembled, bound, joined, processed, disassembled, divided, cut, broken in bulk, relabeled or repackaged. The exemption granted shall be liberally construed to effect the purposes of this subsection. The warehouse in which these goods, wares or merchandise are stored shall not be owned, in whole or in part, by either the consignee or consignor. This paragraph does not apply to agricultural products. [1989, c. 781, (AMD); 2011, c. 657, Pt. W, §5 (REV).]

[ 1999, c. 272, §1 (AMD); 2011, c. 657, Pt. W, §5 (REV) .]

Wikipedia on Foreign Trade Zones

A foreign-trade zone (FTZ) in the United States is a geographical area, in (or adjacent to) a United States Port of Entry, where commercial merchandise, both domestic and foreign receives the same Customs treatment it would if it were outside the commerce of the United States. Merchandise of every description may be held in the Zone without being subject to Customs duties and other ad valorem taxes >>>>>Wikipedia on Foreign Trade Zones

 So a business that manufactures in a low price global labor market and has the  product assembled in the USA in a foreign trade zone, can possibly promote the product as made in America while being exempt from custom taxes. If it is a business in Maine’s "targeted sector" –it can also receive investment capital from the taxpayers and non-profit gift giving via the MTI conduit. The warehouse has to be located on state  state-owned, leased or otherwise controlled property.

I am merely speculating at this point that The Loring Development and the MRRA are qualified as foreign trade zones- with the property owned by the state (similar to China's new private ownership laws which excludes private ownership of land.) If so, its establishes great opportunities for tax exempt business ( through access to various state sponsored programs that dole out grants to the “targeted sector”) in which manufacturing is done in low priced labor markets and even financed by Maine state tax payers.

Update-Confirmed that the MRRA is a foreign trade zone

§13083-Q. Designation as port of entry, international airport, foreign trade zone and free port area

If the foreign made imports are labeled as such with paper labels that can be removed once they are in this country to reveal American sounding names underneath the paper labels, it might explain why my letter from Wendy Rosen urging Mainers to contact Olympia Snowe about an indelible labeling bill was rejected from The Creative Economy List Serve run by The Maine Arts Commission. What benefits the small craftier producing a product in Maine, does not benefit the high growth investor taking advantage of the global labor market. SEE This Post For More On The Rejected Letter



Special Interest Favoritism for Some - Taxation Without Representation For Others

The Maine Department of Economic And Community Development is in charge of redistributing wealth to "targeted businesses" to create "quality Jobs". I have yet to run across an explicit definition of "quality job" in statute definitions but in other places it has been indicated that Maine State Inc seeks to create jobs with higher than average pay and all the best benefits . It is reasonable to assume that such materialistic qualifications are what is intended when the legislature uses the term "quality job". See
"Qualified employees" below!

In defining a special interest sector as represented by the term "targeted businesses", it is also important to define who will be excluded from that special interest sector, which, in this case will be the beneficiary of wealth redistributed by the Maine Department of Economic and Community Development.  as well as ax payer funded services provided by said department. The excluded sector is defined quite explicitly as the Retail Sector, which is  generally a main stay of small towns through our Maine:

§13063-C. Job Retention Program

2. Definitions.  As used in this section the following terms have the following meanings.

A. "Certified retained business" means any for-profit business in this State other than a public utility as defined by Title 35-A, section 102 that retains 100 or more qualified employees in this State and that meets all of the following criteria to the satisfaction of the commissioner:

(1) The business is not engaged in retail operations; or, if it is engaged in retail operations, less than 50% of its total annual revenues from state-based operations are derived from sales taxable in this State or the business can demonstrate to the commissioner by a preponderance of the evidence that any increased sales will not include sales tax revenues derived from a transferring or shifting of retail sales from other businesses in this State; and

(2) The commissioner determines that the business is a successor to a business that would have ceased operations in this State but for the acquisition of that business after September 1, 1996 by the applicant by any means and the applicant demonstrates to the commissioner its intention to continue to operate and employ qualified employees in the State.

For purposes of this paragraph, "retail operations" means sales of consumer goods for household use to consumers who personally visit the business location to purchase the goods. [1997, c. 393, Pt. A, §13 (RPR).]

B. "Qualified employees" means full-time employees who are employed by a certified retained business, for whom a retirement program subject to the Employee Retirement Income Security Act of 1974, 29 United States Code, Sections 101 to 1461, as amended, and group health insurance are provided, and whose income, calculated on a calendar year basis, is greater than the average annual per capita income in the labor market area in which the qualified employee is employed. Qualified employees must be residents of this State. [1997, c. 393, Pt. A, §13 (RPR).] 

This is just more fuel for the theory that the Maine economic development bureaucracy exists to further globalization and sees the micro -economic sector as an obstacle to its mission. Right here in the supposed  Department of Economic and  Community Development., globalization is encouraged through the Foreign Trade Zone while Maine Street is being discouraged by taxation without representation.