March 30, 2003 11:30 A.M.
There have been reports in the Concord Monitor, New Hampshire Public Radio, and other news sources on the move of Governor Benson’s company, Enterasys, to Massachusetts. Yes, that’s right, a company whose largest shareholder is the Governor of New Hampshire, is moving its corporate headquarters to Andover, Massachusetts. The company’s chief executive officer, William O’Brien, says that the move is designed to place the company closer to “some of the best high tech talent and executive talent on the East Coast.” Apparently, the cost of moving a company’s headquarters close to that “talent” isn’t a factor because, says O’Brien, “the talent is the life blood of our business and if it costs you a few more dollars to do it, that’s well worth it.”
This is a big deal because candidate Benson, touting his business credentials as founder of Cabletron, the parent company of Enterasys, said that he was going to attract more high-tech business to New Hampshire. So far, Massachusetts Governor Mitt (what kind of name is that?) Romney is 2-0 against Benson. Bowstreet, a software company late of Portsmouth, NH is, as of February, located in Tewksbury, Massachusetts.
While the move of its corporate headquarters to Andover, where it already has 350 employees and will gain another 50, will not shut down NH operations, the focus of the company’s operations is nonetheless significant. Yesterday’s report in the Boston Globe suggests that this move will make Enterasys the largest telecom networking company in Massachusetts.
Apparently, this is a good move for the company, which is still recovering from its settlement of a Securities and Exchange Commission investigation over accounting irregularities. The company lost ground shortly after going public in 2001 when it announced a $4 million accounting problem with its Asia operations. Then there is that pesky class action lawsuit pending in U.S. District Court that further impacts stock prices. Given its losses over the last year and a half, it is obvious that the company is moving to improve its financial position and that it sees its future in Massachusetts. While this exodus is occurring, Governor Benson’s budget is still $60 million out of balance, according to the head of the House Finance Committee, Neal Kurk, and state agencies are facing draconian cuts. Fourteen state trooper’s jobs will go away (probably to Massachusetts), at the same time as Commissioner Richard Flynn’s office budget is increased. The Governor proposes to underfund indigent criminal defense services, which are required by the Constitution) by $4 -$5 million over the next two years.
The $60 million shortfall does not take into consideration the repayment of the $32 million that was taken from police, fire, and teacher retirement accounts to cover health care increases for retirees. Losing businesses to Massachusetts certainly is not going to help this cause.
Unlike a business, the state is required to provide certain services and to pay certain expenses either by the state or federal constitutions or by law. In other words, there is only so far that a budget can be cut. Unlike the federal government, our state government cannot carry a deficit. No degree of accounting magic can change a $90 million deficit into a balanced budget.
One solution that the Governor has borrowed from business is to offer incentives to state workers for making their agencies more efficient. In early February he asked the legislature to create an incentive program that encourages state workers to put forward ideas to save money or improve efficiency. Once state auditors determine how much money was saved by a particular idea, the responsible state employee gets $10,000 or 10% of the amount saved, whichever is less. This is actually not a bad idea, but no one knows how much savings will be realized, and there are certainly no implications for the current budget.
The much-touted “New Hampshire Advantage” is supposed to be a tax-free, business-friendly environment. If companies are moving out of New Hampshire, even companies owned by our Governor, we are correct in wondering where that New Hampshire advantage went and who will be next to go.
March 30, 2003 10:35 A.M.
Time appears to be on the side of the Iraqi regime. What is most troubling is that the longer this war lasts, the stronger anti-war, anti-U.S. and anti-Bush sentiment becomes. As these sentiments spread throughout the Arab and Muslim worlds, resistance to the war grows. Secretary of Defense Donald Rumsfeld is now threatening Syria for sending weapons to Iraq (he has not yet threatened Russia, but who knows what he’ll do next). This is causing the White House to push for an invasion of Baghdad before the troops and their commanders are ready. I see this as a facet of the political war that I talked about in an earlier post. I think it has the potential for disastrous consequences.
Regardless of what the heads are saying about what they said before, it’s time for serious thinking about the prosecution of the war and just who is driving the bus.
March 30, 2003 10:10 A.M.
In response to questions like, “What’s wrong with you?” and “When are you going to get a real job?” I offer the following by way of explanation. In spite of what it might seem like, I do have a real job, I write for this site
part-time, and, no, there’s nothing wrong with me. I don’t get paid for it (but have you noticed these cunning Support The Site buttons?), and I enjoy it. I like to refer readers to other sources to get them thinking about a topic that comes to my attention. One of the sources that I often refer to is Josh Marshall’s Talking Points Memo. Marshall has recently posted a series of notes about the war in Iraq and the apparent underestimation of Iraqi resistance. I found Marshall’s reporting on Joseph Gallway’s (co-author of We Were Soldiers Once. . .And Young”) observations on the conflict to be particularly hair-raising. Check it out. For absolutely up-to-the-minute war coverage, take a look at the Command Post warblog. You can find links to these sites and more on the list of website links in the left margin of this page.
March 30, 2003 9:05 A.M.
The New Hampshire House of Representatives voted to kill the so-called “Right to Work” bill this week by a vote of 262-103. Good for them, because this attempt at union-busting is a bill that keeps coming back like the proverbial bad penny.