Friday, March 7, 2014
WASHINGTON — Jim Wellehan said he thinks often about the widening income gap in Maine and how, during his dad’s time, “you were embarrassed to be rich and ashamed to be poor.”
President Barack Obama works at his desk in the Oval Office of the White House in Washington, Monday, Jan. 27, 2014, ahead of Tuesday night's State of the Union speech. (AP Photo/Jacquelyn Martin)
“Everyone wanted to be middle class,” said the 75-year-old Wellehan, CEO of the Lamey Wellehan chain of shoe stores co-founded by his father a century ago. “It’s not that way anymore. I think there is more greed.”
Wellehan added: “When you stratify a society as much as we’re doing now, you lose that sense that everyone is in this together.”
Don Roberts, a former Augusta city councilor and a semiretired media professional, has a different take on the income disparity likely to be a central theme in President Obama’s State of the Union address Tuesday night. There will always be some income inequality in a capitalistic society, Roberts said, and he’s OK with that.
“I don’t think this class warfare is a good thing,” he said of the political debate over wealth and poverty. “To pound on the job creators, the people who spend all their time and all their risk capital in order to produce the engine for those who are less fortunate, I think that’s wrong.”
Those two perspectives are perhaps emblematic of the challenges facing Obama as he prepares to outline a 2014 policy agenda expected to be heavy on issues important to his Democratic base.
Democrats and Republicans will spend the next 9½ months jockeying for political advantage ahead of elections that could decide which party controls the Senate – and, by extension, the fate of the president’s major policy objectives during his final two years in office.
MAINE GAP GREW IN RECESSION
Obama has called the widening income gap “the defining challenge of our time.” Many wealthy Americans are seeing their earnings rise while lower- or middle-income workers log longer hours, often for smaller paychecks, at least when compared with inflation-adjusted earnings several decades ago.
While the White House has not released specific details of the State of the Union speech, officials indicated Obama is likely to reiterate his call for raising the minimum wage, expanding job training programs and increasing access to higher education among other top Democratic priorities.
The income gap in Maine has grown significantly over the past four decades but was exacerbated by the recent recession, which caused many Mainers’ wages to stagnate or shrink. Even so, the gap is consistently smaller in Maine than in other states.
In 2012, Maine had the 15th smallest earnings gap as calculated by a complicated but widely used mathematical formula for measuring income equality known as the “Gini ratio” or “Gini coefficient.” That’s a slight change from the 12th smallest gap two years earlier and the 11th smallest in 2008, according to the U.S. Census Bureau’s annual American Community Survey.
After adjusting for inflation, the median household income in Maine fell from $48,595 to $46,709 – a drop of 3.9 percent – between 2000 and 2012, according to census data. The percent of Mainers living under the federal poverty line, meanwhile, rose from 11.1 percent in 2002 to 14.7 percent in 2012.
DIFFERENT VIEWS ON SOLUTIONS
Economists and policy experts widely agree on the trend line and the reasons behind the growing gap. Maine’s population is graying and the state is transitioning from a manufacturing economy to one more dependent on tourism and seasonal service-sector jobs.
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