On 1/20/2011, Maine’s new State Treasurer, Bruce Poliquin, posted his first official blog describing Maine’s $4.3 billion in unfunded pension liability for teachers and state employees as a “potential fiscal tsunami.” At a State House press conference a few days later, Treasurer Poliquin called the state debt, and unfunded retirement benefits for teachers and state employees “fiscally unsustainable.”
In response, MECEP issued its own statement (“Building on a Solid Foundation: Maine’s Future Prosperity Demands Responsible, Fact-based Fiscal Management”), noting that the nationally respected financial rating organization Moody’s Investor Services found in July 2010 that “Maine continues its conservative approach to debt, with an aggressive payout structure and capacity to accommodate unforeseen borrowing needs.”
“We strongly agree with the Treasurer that we must have ‘all stakeholders at the table’ to reach agreement on a path forward,” Executive Director Christopher St. John said in a press release announcing MECEP’s response. “We must make sure that we use the state’s borrowing power for infrastructure, education and other investments needed to encourage economic growth. And the state must honor its longstanding commitments to our public employees.”
Many in the Maine media shared MECEP’s view. In an editorial entitled “Treasurer should not play politics with debt,” the Portland Press Herald wrote “we fear Poliquin is both confusing and over-simplifying a complex issue — the state’s indebtedness — and perhaps sending an inaccurate message about the conditions of Maine’s finances.” Writing in a 1/26/2011 Bangor Daily News column entitled “State workers not faceless,” David Farmer, former deputy chief of staff and communications director for Gov. John E. Baldacci, wrote that as the nation’s economy recovers, so has the fiscal strength of Maine’s pension fund. “Despite what you hear from Augusta, Maine’s public employee retirement system is well-managed — it earned more than $1 billion in the last six months.”
