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Governor John E. Baldacci

Good morning. This is Governor John Baldacci.

This holiday weekend, Maine has reason to be thankful.

On Monday, members of the 172nd Mountain Infantry unit of the Maine Army National Guard began arriving home after being deployed in Afghanistan.

The unit has been conducting combat infantry operations against the Taliban and Al Qaeda for nine months in the tribal areas near Pakistan.

During the next two weeks, all 157 members of the unit will be back in Maine.

Operating in a remote and dangerous area, these soldiers performed their duty with honor, integrity and professionalism.

They have endured harsh conditions and a deadly enemy.

We welcome all these men home with a sense of pride and relief.

And we look forward to the day, likely in March, when members of the Eleven-thirty-sixth Transportation Company also return from Afghanistan.

All the men and women who serve in the military and their families deserve our gratitude and respect.

During the holidays, the sacrifices they all make become even more apparent.

The good news doesn’t end with the homecoming.

We learned this week that Maine’s unemployment rate dropped to 7.4 percent for October, down from 7.7 percent in September and more than two points lower than the national unemployment rate.

While there are still too many people who are unemployed, the number is moving in the right direction.

And on Tuesday, Maine’s economic forecasters met and revised their projections for the rest of this year and the next two years.

Based largely on strong corporate earnings, Maine’s revenues are expected to increase by $477 million dollars over the next 30 months.

After shedding more than 30,000 jobs during the recession that began in December 2007, companies in Maine are rebounding and their profits are improving.

So, job creation is still lagging, but there is reason for optimism.

The hard work and the tough votes that have been cast in Maine and in Washington and the resilience of our people have made a difference.

In Maine, we have held the line on taxes and on spending.

General Fund spending has decreased every year since 2008. The current budget for 2011 is $2.69 billion dollars, that is on par with spending a decade ago.

We’ve made smart and targeted investments, ones in research and development and renewable energy.

And we have restructured government at the State, county and school administrative levels to make it more efficient and less expensive.

Along with the federal Recovery Act, the bipartisan efforts of Legislature and my administration have helped to lay the foundation for economic improvement.

So while other States were locked in partisan gridlock and raised taxes, Maine was different.

We’ve passed five straight budgets with overwhelmingly bipartisan support.

Those budgets were disciplined and frugal, but never lost sight of our core values, which include supporting education, protecting the most vulnerable and our environment, and making smart investments.

And those budgets helped us to rebuild our reserves.

When I took office in 2003, Maine reserves were gone and the state had short-term borrowing of $250 million dollars just to cover day-to-day operations.

Today, Maine’s reserves are nearly $50 million dollars. Revenues have beaten projections every month so far this year.

And on the day of my first inauguration in 2003, we received word that a major paper company was filing for bankruptcy.

The industry has faced tough times, but is beginning to show signs of strength.

In the first quarter of this year, pulp exports were up 200 percent and paper exports were up 72 percent over 2009.

About seventy-five hundred Mainers work in the State’s mills, earning very good wages with benefits that ripple across all the rural economies.

In addition, the pulp and paper industry is making critical investments for the future.

Verso paper just recently announced a $40 million dollar investment for a new energy system.

Lincoln Paper and Tissue has installed a new $38 million dollar tissue machine.

Old Town Fuel and Fiber, once threatened with extinction, is investing in a $30 million bio-fuel conversion.

And Sappi has invested $48 million in repairs and upgrades at its Somerset mill.

Despite the positive news, there’s still a lot of uncertainty in the economy.

Policy changes at the State or federal level could impact the new, positive forecast. And long list of things could happen to change the outlook. Things remain fragile and these improvements haven’t yet translated into reduced anxiety for working families.

But given a choice, it’s better to see the economy growing and unemployment falling, even with the caveats.

So this weekend, I’m thankful that some of our National Guard soldiers are home, safe and sound, and others are on the way.

And I’m thankful that the grip of the global recession appears to be loosening on Maine.

Thank you and have a wonderful holiday weekend.

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