M.A.P.: Maine Insights Publishes Wholly False Statement Regarding State Credit Rating, Agencies
Solon, Maine – On June 14, 2012, the Maine magazine Maine Insights published an article titled “Maine’s Gov. LePage’s dictatorial governing style has halted voter-approved bonds”.
While the article itself is presented in an open manner as from a politically progressive standpoint, counter to where
the Governor himself stands politically, it makes several false statements, one of which can be easily proven false.
Below are three statements pulled from the article:
Paragraph 3 - “Citing only ideological reasons, he wrote that it would not be prudent for the state to issue new bonds before January 2014. “Until our debts — and more importantly, our spending — are back under control, adding more of a burden would be fiscally irresponsible,” wrote LePage.”
To claim that the Governor cited only “ideological reasons” in his letter, then clearly lay out the reasoning that the Governor provided, in the same paragraph – that the state’s financial situation needed to improve – before selling more bonds, is a self-contradicting statement. The Governor clearly laid out a detailed explanation and reason why he believed Maine should wait on additional bonds. Whether one agrees with the Governor or not this was not an ideological statement at all, but a clearly articulated statement of his perspective on Maine’s financial situation.
Paragraph 8 - “All three credit rating businesses warned the state that LePage’s policies could hurt the state’s reputation, forcing them to downgrade Maine’s credit rating. If that happens, it will become harder to sell Maine’s bonds and the people of Maine may not get as good of a deal as they would right now.”
The statement regarding “all three credit rating businesses” in paragraph 8 is demonstrably false.
The three credit rating agencies have in fact weighed in on Maine’s credit rating, with all three, Fitch, Standard & Poor’s and Moody’s all affirming Maine’s credit rating, with Fitch and Moody’s revising the outlook downward.
The Fitch report, available in the endnotes of this document, contains absolutely no mention of a warning that the Governor’s policies could lead to damage of Maine’s “reputation” let alone our credit rating. In fact, Fitch highlighted a lower debt level of general obligation bonds and the Governor’s proposed solution to closing the DHHS budget shortfall. This report alone proves the statement from Maine Insights to be wholly false.
The Moody’s report, widely covered by the Maine press, as well as several national media outlets, issued an outlook downgrade to negative for Maine, cited a need to trim Medicaid spending and a lack of reserve funds, both issues that the Governor was supportive of and proposed doing during the legislative session. This report also proves the statement from Maine insights to be wholly false. In addition, passage of the structural reforms in Maine’s Medicaid budget should actually help to strengthen Moody’s outlook on Maine in the future.
The Standard & Poor’s report, issued on May 25, praised the Governor’s policies, citing multiple improvements and in fact, the only warning provided by Standard & Poor’s was in regard to the uncertainty of the federal budget, something the Governor of Maine has absolutely no influence on. A pdf of the text of this report is available in the endnotes of this document. This report also proves the statement from Maine Insights to be wholly false.
Paragraph 9 - “For many, LePage saying that he “might” issue the bonds in 2014 is solely a political move, because LePage will be running for governor then.”
The reporter makes two missteps with this statement. The first is that she attributes a vague statement to “many” yet does not attribute it to anyone. Leaving the statement unattributed certainly opens it up to the question of validity.
Second, the sale of bonds in 2014, a process which itself requires significant planning, is not likely to enter the Maine economy in any way that could affect the economy in a meaningful way.
Additionally, the idea that a Governor whose political base is well known to generally oppose the concept of bonding as a means of successfully growing Maine’s economy, would somehow benefit politically from additional bonding in an election year is simply false.
For publishing statements that can be proven factually incorrect and making additional statements which stand contrary to any attempt to reconcile them with logic or reason, the Media Accountability Project concludes that this Maine Insights article: Contains False Statements – willfully misleads readers.
