Distant Dome: Economic Upheaval Is Inevitable, but Traumatic

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Nancy West photo

Garry Rayno is InDepthNH.org's State House Bureau Chief. He is pictured in the press room at the State House in Concord.

By GARRY RAYNO, Distant Dome

“The woods are dark and deep” wrote poet Robert Frost, and yet deep into the forests of New Hampshire you find stone walls.

The stone walls come from a bygone era of sheep farms covering the state with fields and fields for the critters to graze.

Their wool was the prize as it was spun into cloth in the textile mills that dominated Manchester and other cities in the Granite State and also some towns fortunate enough to have large enough rivers to drive the machinery.

Although the farmers cleared vast areas of the state for the lucrative business of growing sheep old enough to shear, and using the rocks dug from the ground to retain the sheep, the agricultural practice was soon gone leaving the stone walls running through the forests as a reminder of what was the state’s major industry at one time.

The era of sheep farming began in 1806 when the US Consul to Spain began importing merino sheep from Britain and peaked around 1840 when there were at estimated 600,000 sheep in the state, 1.7 million in Vermont and a total of about 4 million in New England.

Twenty years later the numbers were half and declining rapidly.

For a more detailed history of the Great Sheep Boom, former state Agricultural Commissioner Steve Taylor will entertain you with his lecture through NH Humanities.

The economic boom lasted less than 100 years and those sheep farmers had to find other work or other farming activity to sustain themselves and their families when it ended.

The sheep boom is a great example of a changing economy and the adjustments people must make as technology or inventions upend what was once sustainable and financially rewarding work.

It is not only the sheep boom that went bust in New Hampshire.

The Amoskeag Mills that line the river and Canal Street in Manchester were once a great economic driver bringing people off the farms and down from Canada to work in the textile industry.

The company housing between the mills and Elm Street produced thriving neighborhoods that sustained the immigrants and their culture both domestic and foreign.

But the owners chased cheap labor and the textile mills and shoe factories that once provided the economic base for the cities in New Hampshire were closed as new factories opened in the South.

Soon enough the South watched helplessly as jobs moved elsewhere when it became cheaper to produce the same goods overseas.

For the sheep farmers and textile workers, there wasn’t a great deal of government help in the days before Franklin Delano Roosevelt’s New Deal which put a safety net under American workers. 

Significant economic shifts not only affect blue collar workers, they can also impact professional levels.

You do not have to look too far back in time to see what happened to the legal profession in the state. 

Manchester was home to four or five of the state’s largest banks, and also some of the largest law firms that worked with the banks on the legal end of financial agreements from commercial to residential mortgages and car loans.

After the biggest banks in the state failed under the weight of bad credit in the early 1990s, the banks were taken over by national or regional institutions who had their own in-house legal teams and all that work that used to keep the Queen City’s barristers busy was gone.

There have not been too many governmental lawyer re-education programs available to date.

And a little closer to home, many newspapers celebrated the advent of the world wide web in the 1990s as a way to promote their work to more people, and consequently grow circulation.

Instead the people who publishers hoped to attract as subscribers became accustomed to receiving free news and eventually stopped reading newspapers, so circulations went down, and fewer and fewer advertisers were putting their money into printed products when they could reach more people, better targeted and cheaper, on the internet.

There are 40 percent fewer reporters working in New Hampshire today than there were 20 years ago and it shows in both state and local governments.

Newspapers did not receive any subsidies and many could not envision a model that allowed their publications to move forward in a different economic reality and they died putting people out of work.

Today, the same situation is happening in the North Country of the state, which should have some understanding of economic turmoil after all the paper mills closed in the last few decades.

The last great hope for the logging industry, which suffered significantly when the paper mills closed, was wood burning power plants, which the state has propped up since they were first constructed to offset the oil embargo and provide a hedge for energy generation when needed.

Of the original six wood-burning generating plants, only a couple are still operating. For years lawmakers passed bills to continue to force electric utilities to buy from the plants to maintain the wood products industry and to “clean” the forest floor which would decrease the risk of a major forest fire.

But then there is the Burgess Biomass Plant in Berlin which produces 75 megawatts of electricity, way more than any of the smaller facilities.

It operates under a purchase power contract with Eversource, but at rates well above market price and with subsidies totaling about $200 million during the life of the plant including carbon credits.

To date the company owes ratepayers about $70 million for its over-market price through laws passed the past few years to keep the plant operating.

The House and Senate passed House Bill 142 this past session to try one more time to work out an arrangement allowing the plant to continue to operate while repaying its debt to ratepayers.

But Gov. Chris Sununu vetoed the bill last week saying “New Hampshire ratepayers have been taken for over $200 million in order to subsidize the Burgess Biomass Plant in Berlin, NH. Enough is enough,” adding “The Power Purchase Agreement with Burgess Biopower is a great example of what can go wrong when the good intentions of a sympathetic government get exploited and abused by opportunists in the private sector.”

Some lawmakers were quick to say in the long-term, the veto will have a bigger impact on ratepayers than the bill, but others were disappointed, but agreed it might be time to make a change.

Much like the old wood-burning plants, the Burgess plant was and is touted as a savior to the wood products industry in the North County, which is also facing another problem, well documented by colleague Paula Tracy Aug. 8 in an InDepthNH.org story about a meeting in Pittsburg.

The largest single block of land in the state was recently purchased by Bluesource Sustainable, which expects to reduce the amount of logging on the land by 50 percent and instead use it for carbon credits which are more valuable.

The change would impact towns at the northern tip of the state which depend on the timber tax to fund some of those town’s budgets.

Between the Burgess uncertainty and less logging because of carbon credits, both the wood product industry and the towns will be impacted, like the sheep farmers, textile workers, lawyers, reporters and some say coders when artificial intelligence is unleashed.

Close to home, when the state revamped its education funding system in 2000, it included the Statewide Utility Tax which cost the town of Bow — where I lived — as well as Seabrook, Newington and Portsmouth millions of dollars in property taxes the state took to add to education dollars.

The taxes in Bow tripled in three years as they did in Seabrook, while Newington and Portsmouth had more diverse tax bases to soften the blows.   

Economic upheaval is difficult for people, communities and professions, and most do not have government help for a soft landing and sometimes governmental action makes it more difficult.

There are a lot of good reasons for objecting to Sununu’s vetoes, but also a lot of good reasons to say “enough is enough” and move on.

Because ultimately you can only put off the inevitable for so long. 

Sheep farms still exist, but not that many of them, as there are fewer lawyers and reporters practicing their professions in New Hampshire.

The wood products industry will decline and Berlin and other towns in the North Country will survive, but the transition will be traumatic, and maybe that’s where “government subsidies” should go now and not to out-of-state conglomerates through business tax cuts, or to the state’s wealthiest individuals by eliminating the interest and dividends tax.

Garry Rayno may be reached at garry.rayno@yahoo.com.

Distant Dome by veteran journalist Garry Rayno explores a broader perspective on the State House and state happenings for InDepthNH.org. Over his three-decade career, Rayno covered the NH State House for the New Hampshire Union Leader and Foster’s Daily Democrat. During his career, his coverage spanned the news spectrum, from local planning, school and select boards, to national issues such as electric industry deregulation and Presidential primaries. Rayno lives with his wife Carolyn in New London.

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