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The Growth of State Capitalism Via State Incubators in the USA


Earnings on Investments: the Maine Micro-enterprise Initiative

A few posts I ago I wrote about the Maine Micro enterprise Initiative, a state program that distributes funds to non-profit organizations to train micro-enterprise employees.

Upon reading said statute, the question arose as to whether the funds granted to a non profit organization, previously written about here, were appropriated through the micro enterprise initiative. In search of an answer I submitted this Freedom Of Access Request to Mr Douglas Ray, the legislative liaison for the Maine department of Economic and Community Development:

Subject: Freedom Of Access Request RE:§13063-O. Micro enterprise initiative fund program review
I am formally requesting a copy of all the records kept pursuant to

§13063-O. Micro enterprise initiative fund program review

 The department shall submit to the joint standing committee of the Legislature having jurisdiction over business and economic development matters an update on the fund by January 1, 2001 and every year thereafter.

Mr Ray responded with a very brief document containing a short list of figures identified as "Earnings On Investments" for the years 2008-2013 with no accounting for what the numbers represent - such as money distributed or bureaucratic costs ? 

Further inquiry generated this response:
I have some more information for you regarding the history of the Micro enterprise Initiative Fund. The last grants made from the account were in 2009. Attached is a spreadsheet showing expenses and revenues since 2001. 
This new list contained names of regional organizations and many entries for the University of Maine. The regional organizations are characteristic of Maine's quasi governmental network. Geographically they are neither state nor local governments but regional organizations. They are non-profit organizations receiving large "non-profit contributions" from the Maine and federal taxpayer via the state- which makes the use of the term "return on investment" all the more curious. I was not expecting a program that provides training for micro-enterprise employees through non-profit organizations to provide a "return on investment" to the state, other than indirectly through taxation.

When I asked for further information I was told "the information we provided represents all that we have. I suggest contacting the agencies directly to secure the information you desire; as I’m sure they maintain their own records as to whom they awarded the grants directly."

In other words the state has no record substantiating that funds ever went toward training micro-enterprise employees. Responsibility for that assurance is passed on to the regional development organizations ("agencies") substantiating that the non-profit regional development organizations are functioning as an unelected extension of government.

Capital is distributed down the chain of the state's network of "funds" and into associated quasi governmental organizations in a trail that makes the true picture opaque to the general public. It is difficult to know with any degree of certainty how much public money is granted to any one agency or organization. The University of Maine, for instance is a "targeted sector" favorite found on list after list of the states preferred recipients. In the process the University Of Maine is transforming from a conventional educational institution into a central hub in state capitalism (Marxism). In a recent MaineBiz article, John Belding, director of UMaine's Advanced Manufacturing Center in Orono stated that MTI projects are not charged overhead because that would be "like the state paying the state" and indeed MTI funds were used to finance the construction of The University of Maine's Advanced Manufacturing Center
For projects that have received MTI funding — around 25% of the UMaine work — the university charges no overhead expenses as "it's basically the state paying the state," Belding says. Many of those projects, he says, come to the center for development work before applying for an MTI grant and have continued support after. quoted from MaineBiz

I can never repeat too often that the University of Maine offers a minor in Marxist and Socialist Studies which can accompany any major offered by the University, thus advancing the indoctrination of the youth into the acceptance of state capitalism.

Mr Ray eventually dismissed the importance of my request with the following statement:

This program does not exist anymore and has received  General Fund appropriations since fiscal year 2003. The last time any funds were granted was in 2006. Again, no funds have been appropriated to or allocated from this fund in more than 7 years. Please let me know if this satisfies your inquiry.

I pointed out that the program still exists in the statutes and then asked him if he was telling me that, unless there was a program by another name, there have been no appropriations to benefit the micro-enterprise sector since 2003. Mr Ray did not respond.

The Excluded Middle

I then asked Mr Douglas Ray, in his function as legislative liaison for the DECD,
  • why the DECD excludes the entire retail sector from benefits and services, 
  • why the legislature has ignored Article IV part Third Section 14 of the Maine State Constitution 
  • information identifying recipients of the Maine Technology Institute grants.

My second question was not answered. Here is the response to the first and last of the questions:
The list of MTI award recipients is available on the MTI website. Any other questions regarding the work of MTI, I would encourage you to contact them directly.

My response to your request was a result of a conversation I had with MTI President Bob Martin, who told me the information you want is available on their website. As for your question regarding retail sector, retail is not an incentive priority primarily because retail is largely driven by demographics, they locate where there is a population that should be inclined to buy whatever they’re selling. Retail also has the highest failure rate of business sectors.
One need only say the words LL Bean to deflate Excluded Retail Sector excuse #1.

Excuse #2 is a rationalization based in a political ideology in which the role of government is identical with that of investment bankers. In excluding the entire retail sector, most of Main Street is excluded from benefits ( redistributed wealth) and services provided by the DECD. What is more central to a community development than Main Street?

The Transformation of the America Via State Incubators

An article of the title  America Beyond Capitalism: State and National Innovators is about a book ironically titled "America Beyond Capitalism"  there in is a spot on description of  the philosophy of MTI and other state economic development "agencies".

"A number of state and federal institutions function successfully on the principle that capital can and should be accumulated and managed in ways that provide individual citizens with an income stream from publicly backed investments."

The above statement is made in praise of a government operational principle that it is "successful" because some have been enriched by using the resources of the many to their own advantage. The article describes an escalating state  movement which is rapidly advancing state capitalism in the USA within state incubators. It is written in the newly evolved language of Marxism-in the left's ever shifting lexicon wherein the left conceals its self until its new language is revealed as the new clothes for the same old same old totalitarianism that benefits a small elite in the name of social justice.: The only thing "innovative" about state capitalism is the new language used to package it. No longer collectivism, totalitarianism, Marxism, Communism or Socialism the code word of the day is "Pluralist Commowealth principles". Perhaps the University Of Maine can offer a course on this new "innovative" concept!

The content in the article titled "Beyond Capitalism" is pure crass profit motive with no other considerations entailed- All is wonderful because someone is making a profit or other wise benefiting materialistically. Do we need to know anything else? The measure of all values is material profit- this we are told is the new "innovation" that is "beyond capitalism". According to this fools philosophy capitalism is not defined by the process of accumulating great stores of concentrated capital- but by the agency of the accumulation. If the agent is a private individual or entity- then it is capitalism- but if the agent of an exactly same process is the state- then it is "beyond capitalism"- Even better- if the state agency transfers the capital to private interests- it is "beyond capitalism" ! Got it?- Getting to the heart of the real rhetorical change that is consistent with the way Marxism has historically worked in practice- no more pretending that the wealth is redistributed to the people. The new rhetoric openly admits that it is redistributed to the "chosen ones" elite!

A fundamental difference between the American Political Philosophy and what is now called "Pluralist Commowealth principles" is that the American political philosophy has a non-materialistic foundation, created by those who believed in God, religious freedom and the natural rights of the individual- out of that emerges a system of private enterprise. Marxism in all of its new finagled names is based in sheer materialism. It has never been about anything greater than the distribution of wealth and the ownership of the means of production and out of that emerges the collectivist rhetoric about "social justice" and "public benefit" clothing a system that historically advantages an elite ruling class.

As with the Maine media, the article presents state capitalism in glowing terms absent of political philosophical discussion or critical debate meeting the definition of propaganda as found on wikipedia:
Propaganda is a form of communication aimed towards influencing the attitude of the community toward some cause or position by presenting only one side of an argument. Propaganda statements may be partly false and partly true. Propaganda is usually repeated and dispersed over a wide variety of media in order to create the chosen result in audience attitudes.

Opacity at the State

Mr Ray gave me a hear say report  that MTI President Bob Martin said the information I wanted was on the website and offered no links or other accommodating instructions. Someone at As Maine Goes clued me in to look under "Results". There it is reported that Textech received six grants versus the seven times  that Alan Hinsey reported. Either report could be right or wrong leaving questions about the accuracy of what is reported on line.

I contacted the State Ombudsman, Brenda Kielty, at the Attorney General's Office where there is a published  introduction promoting government transparency. I suggested that if the government really wants to be transparent and keep things honest they should have the data base online and allow the public to search the data base themselves and create their own reports. The information that I want should be readily available by applying search terms to a data base. Since the MTI is all about new tech it is inconceivable that they do not have state of the art data base functions available to them.- not to mention that it would save the bureaucracy time and the taxpayer money. This is the response received to that suggestion:


1.Information made available on an agency website but not in a searchable database format may not provide the research and investigative tool needed by the public. The Freedom of Access Act does not require that public information be posted online in any particular format, just that public records be made available. While there is a strong argument for increasing the accessibility and usefulness of information, there is no current requirement that the technology in place achieve that objective.

2.The collection of data and reports generated from that data may be public records but the agency is not required under the law to create a new record or report in response to a FOAA request. If the dataset you request does not exist, the agency may choose to produce it for any number of reasons but not because they are legally required to take such an action. I appreciate your comments on this topic and I will continue to bring attention to the need for accessible, useful public data. Brenda Kielty

I had not posed a legal question but merely made a suggestion about how transparency can be advanced using modern technology. The absence of a legal mandate to provide the public with information in any particular format does not preclude doing so. Ms Keitly's response hinted at a behind the scenes dialogue and suggests that the state is not really interested in transparency-, implying that only if required by law would the government provide the accessibility to the public, overlooking that the same "agency" -the legislature - that wrote the statute that chartered MTI, also writes the laws governing transparency. Kind of like the "state governing the state" to echo Mr Beldings comments above. 

In chartering MTI as a non-profit corporation, violating of Article IV part Third Section 14 of the Maine State Constitution-  the government can, on its own authority, make the Maine state taxpayer a non-profit contributor - and then turn around and refuse to provide accessible transparency because the laws- as written by the same "agency" that chartered MTI, do not require MTI to provide real transparency to the public. (or any other part of government). Where there is such a lack of transparency- could it be that there is something to hide?

It seems appropriate on common sense terms that if the government spokesperson answers in legal terms, that they substantiate their claims with full legal references- just as if a government spokes person answers a request by directing  the questioner to a website, that specific links be included. The failure to do so can be reasoned to be an appropriate response by saying Freedom Of Access code does not "legally" mandate that questions be answered in particular form and thus justify what is starting to look like an emerging pattern of Maine State opacity.

 I replied to Ms Keitly requesting for a legal basis for her response, pointing out that unless the legality is constitutionally based, then it constitutes a case where in that the same party that created the MTI also writes the laws governing transparency of MTI and other parts of government. I am still waiting for a response.


University of Maine Advanced Manufacturing Center 
The Maine Freedom of Access Statute

America Beyond Capitalism: State and National Innovators
By Gar Alperovitz, Truthout | Report


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