 And welcome to Baldacci on Business. I'm Bob Baldacci, and tonight we're opening up our new season. And we've been on hiatus over the course of the summer. And hopefully you have had a chance to see some of our earlier shows that we ran last season, all geared to help those of you who are interested in starting your own business or buying a business. We introduced to you a number of lawyers and accountants and consultants. And hopefully you came away from the shows with a better understanding of what it takes to get into business, lessons learned, and that sort of thing. But we're going to have a totally different approach this season. But to launch it, I'm very, very pleased to have with me tonight my brother, former governor John Baldacci. And John, welcome to the show. This is great. I told people it's hard being here with your older brother. It's like being in the confessional. This is going to be fun. We only have a half hour. But during that time, I'd like to kind of give our viewers a sense of your involvement in business, which I don't think a lot of people are aware of. We grew up in a family business. And how that translated or formed a foundation for you as you move from the restaurant business to public service. So talk a little bit about our family and the type of business that we first got involved in, John. Well, first of all, let me just say, and I'm not just saying it because I'm not running for office, but my brother Bob, when it comes to economic development and strategies, is always the go-to person. He's been in it. He's been on the cutting edge of it. And working for a lot of different companies, it's just fun to watch him. And frankly, as governor, I had the opportunity to develop initiatives that were based on a lot of the experience that you had when we talked about pine tree zones and worked at it. But you work with business and industry. And I think one thing that unfortunately may be not a story that too many people are aware of is I love business. I was brought up in business. We came from a family of eight. We were sort of child labor before there were any exemptions. We were working early and often. And as my mother used to say, it never hurt us any. And it built good character and values. We didn't appreciate it as much at the time. But later on in life, we began to realize how lucky we were. And it's from that foundation, really, that gave me the kind of background that I needed when I was in government, either at the city council, state senate, congress, or governor, to realize that you needed employers in order to have employees, that you needed to meet a payroll, that you needed to really do all you could do to help support businesses, small and large, because they were going to be the ones hiring people and being successful. So it was through those experiences and realizing that, frankly, we were being tested every day in business. So when I was 12. Talk a little bit about that growing in the restaurant. Well, when I was 18, I mean, I was the start of the university. You started when you were seven or eight in Washington dishes. We talked about that before, but 10 were safe at 10. We had all our social security quarters in before we started high school. But I think that we did. We were very early in the business working with our grandparents and parents. And we were very lucky at that time. But as things went on, I dropped out of the university to go working full time at the restaurant. What precipitated that? Well, what happened was is that, you know, we had gone through bankruptcy in our big place downtown. We were being told by urban renewal authority that if you didn't take up enough space with a big enough building, we'd have to move from where we started out from as a family. And my parents and our parents wanted us to stay there as much as possible. So they built a too large of a structure, which required too much financing. We started serving lobsters and stuffed shrimp instead of spaghetti and meatballs and get away from our bay. So it taught us all a valuable lesson. It was a very humbling experience because we went out of business, worked for somebody else, and then realized when we get the opportunity again, we're going to start in from the ground floor and we're going to build a business the way we want to build the business. I mean, at that point in time, John, we faced a decision, you did, and you were the one working more closely with our father and mother in the business. We could have left the community and gotten a job somewhere else, but... Dad felt it was important, Bob, because he felt our roots were here. We had grown up here, gone to school here, he had been in business here, and it would be a lot harder to start up somewhere else where they didn't know us. So as tough and humbling as it was, and it was a very humbling experience to go through a personal bankruptcy and to start in all over again and working actually for another business that was in competition. We worked at Miller's Restaurant during a period of time, and we were fortunate for that. Dad didn't want unemployment, he didn't want handouts, he wanted to work, he had a family and responsibilities, and Paul and I actually went with him to work at Miller's in between. And it was an experience where we learned the hard way, the next time we have an opportunity to be our own boss, we're gonna conduct it in a lot of different fashion. And I think then we found the opportunity at an apartment house in a commercial area that we were able to tear apart and rebuild into a small restaurant. And it was an exciting time to go into business for ourselves again, and appreciate the opportunity. It really was. It was called Mama Baldaches. It was after our grandmother, and it was the way to start in again from our heritage and sticking to our roots. And I think it taught some very valuable lessons, and I always say to people, that's where I got my background, because during the week I'd be down in Augusta in the state legislature or in the Bangor City Council, but I go to business every day and go back to the restaurant, and I knew we had to meet a payroll. I knew that we had responsibilities. I knew that things had to be done. So it was the here and now that had to be addressed, and I appreciated being in that position because it gave me a much better perspective when we were looking at laws or amendments to laws or regulations, because I was always telling the bureaucracy at that time that we needed to go slow. We needed to work with and build collaboration and partnerships, because you need both. You need the partnership, because business, in order to succeed, needs the infrastructure of roads and bridges, connections to the internet, connections to marketplace, but at the same time, they need the ability, they need to have the ability to be able to exercise their business plans, to be able to meet the challenges in the global marketplace. And you've got to work with them and respect them for that and the capital and the risk that they're putting on the line. And if anything, that was probably one of the more important lessons you learned running the business. I remember Bobby being in state government. When I got elected to be governor, it was the main was at a point where we had had the highest tax burden in the country. We're number one, and I made it very clear during the campaign, we weren't going to raise taxes. I said, much like the restaurant business, we cannot raise menu prices. So when you go back in the kitchen and you got to try to figure out, how do you give high quality value and meals to individuals and families and do it at the same or lower prices? I mean, government needs to think more efficiently. So I told people, we weren't going to cut people off and leave people without the safety net, but we weren't going to raise taxes. And we had to address a billion, something $300 million shortfall. So how do you do that? Well, you know, you test our ingenuity. I mean, and one thing that main hasn't, you know, up until the time I became governor, hasn't tried as much to do that I think we need to do more of is use Yankee ingenuity. People use it every day to raise their families, do business, and to make ends meet. But we need to apply that same kind of thinking to government because we have too many different layers of government. You have federal government, state government, county government, local government, school government. You know, I said to everybody, they all wear different uniforms but they're working for the same people. We ought to have just one uniform, put them all on the same level and say, your job is to serve people, is to serve families and to serve businesses and work together. I don't care how you do it or what it takes to get done, but do it. Because the people raising families, making ends meet are in business, are struggling and are worried and are anxious and they're risking everything because they don't know what the future holds. We should do everything we can to support them. I mean, that was the basic message. And I think a lot of that came from your experience in our business and in running a restaurant in Bangor and helping them with a restaurant in Skowhegan. I gotta be careful not to cut you off like you did me in the cooking show. We did a cooking show, which will be aired next month on Italian cooking, which we had a lot of fun with. This has been great. I gotta tell you, it's been great being here working with you and Beth and your family and just reconnecting but just watching the way you're doing this. It's great. You know, and you're working with a lot of businesses. My brother to cut you off one more time for the past year and a half. We were trading it back and forth. Past year and a half, the governor was working in the Defense Department, working on healthcare reform and did a terrific job coming up with a plan to provide better healthcare for our military. Well, you know, Bobby, it was the same thing we did with trying to reduce administrative costs. The Army has its own surgeon general. The Navy has its own surgeon general. The Air Force has its own surgeon general. And I remember Dr. David, who's a good friend of mine, was a captain in the Navy, said, you know, but when you open them up, it doesn't say Army, Navy and Marines. It just says, you know, we need help and we need to be fixed and we need medicines. You know, and I think it's a perspective that needs to be there. We could save over four or $500 million a year just having a unified military medical command and having them all under one roof. And frankly, you know, military does a lot of great things and they're great people. I couldn't work with any better people for any better people. But sometimes the bureaucracy gets in the way. I used to go out on the front lines to like Fort Hood or Balboa out in California, Fort Hood in Texas, Fort Sam Houston in Texas. And these people are doing some extraordinary work and really right there on the front battle lines, you know? But, you know, I'd always say to them, you know, what do you need help with? Well, it's a home office. You know, it's a bureaucracy back home that's making it harder and harder for them to do the work they need to be doing. And that's really what I think it happens is they get disconnected. And that's why I think it's so important to make sure that you keep bringing up those ideas and suggestions to make better connections. So now you're back here in Maine. You're doing a radio show on a local radio station, WGAN. My brother Ken Alschuler, yeah. Our brother, our Jewish brother Ken Alschuler and his partner Mike Violet. And Ken used to be a co-host of show here community television network. Very talented guy, very talented. And I enjoy it with him and Mike and, you know, I sort of alternate back and forth between the Elliott Cutler does it on one Thursday and I'll do it the alternating Thursday and we do it this week. And I enjoy it. It's an opportunity to engage in some of the issues and try to help people. Because sometimes a lot of people don't realize what's going on or all the backdrop to everything. And I try to help fill that in with as concise ability as possible. And it's been very rewarding. I enjoy it tremendously. So talk a little bit about your role at Pierce Atwood, senior advisor. Well, I got to tell you, Gloria Penzer's the managing partner and I really enjoy her leadership. The ethics of the organization is that's not your client or my client, but it's our client. I like that it's very refreshing. We work as a team. We've got some of the best people in so many different areas to tap onto. And it's growing its presence in Boston. We have an office in Portsmouth, New Hampshire and one in Rhode Island and one in Washington. I mean, just there at the top of the field. Good ethics, good camaraderie. We work on a lot of different projects. I work with companies that are working on development and expansion. And it's wonderful to work with the attorneys and to give whatever support or advice in review that I can do to be helpful. I try to add value to what they're doing and they do a terrific job. And I feel very fortunate to be working with them and the firm. No, that's great. That's great. And it's great to have you back here in Maine. And having an impact on the economy here and creating jobs and opportunities, which is, I know, runs very deep in your psyche. Well, and this is what's great. You're working with businesses. You're trying to help them to be brought along to start up from incubators to full-fledged commercial enterprises. And I think that's exciting. Maine has a tremendous amount of opportunity. I tell people they can go anywhere they want to, but in Maine, they can really start up from scratch, get the support that's necessary. People in Maine are willing to get behind people. So I think you can get the financing. You can get the support. It's up to the individual. Let's talk a little bit about that, Governor. You have worked from one end of the state to the other trying to create opportunities when you were governor and continuing on now. Our audience, our viewers, our people who are in business thinking about business, what advice would you give them right now, given the lessons that we've learned in the restaurant business, our small business, as well as the experience that you've earned over the last several years? Just look at the two of us, Bob. You work with angel investors who get behind startup companies or ideas that individuals have. I work at a law firm which has a whole firm available to those startups, not to charge them, to work with them, to help them get off the ground. And if they're successful, then there's a fee or a charge to it, but not unless they're successful and they are able to expand into a full-fledged commercial enterprise. So I think that people need to know that there's a lot of support out there. I mean, what people need to be thinking about is what are their ideas, what are their inventions? And if they think that they've got something, then they should bring it forward. There's an openness here. There's resources that are available. I mean, I just talked to an investor who's pulling his money out of the stock market because he wants to invest in companies because he's not happy with the rate of return. So there are resources, there are support. And I think the best place to go, frankly, outside of my brother Bob would be the first place I would go to would be my brother Bob. I'm not paying him for these endorsements. I'm not running for anything at this time. But Bob, just go see Bob. But the Small Business Administration has a workplace with the University of Southern Maine, SBDC, Small Business Development Center. And they go in and they help you. They also have service corps for retired executives. I would send business people who are having problems getting their financing through conventional means meet with them to help them build their business plan in a better shape so that it would be more acceptable to the financial institutions that they had to deal with. So there's resources, there's volunteers that want to help you that are experienced. And I think you have to really go to them. Go to Bob first, go to SBDC after that. What about the state? I mean, you were governor of the state for years and you had the economic development department. What kind of resources do you think the state provides businesses? I think the state has got to provide the infrastructure. I think the roads, the bridges, the ports, the airports in order to get your goods to market. You need to provide the infrastructure, but you also need to provide the mental, what I used to say, the mental infrastructure, the intellectual capacity, as you used to correct me, instead of mental infrastructure. But it's the intellectual capacity. So you're going to invest in research and development. The Hodgson Boat Yards, they're building the boats there with the composite program. And that research the University of Maine did from tax dollars and bonds resources that went into the University of Maine. So now they're able to compete for military contracts to have other types of vessels built. And it's being applied to other boat building industries up and down the coast. So that needs to be, the state needs to support that with private enterprise to create private sector jobs for private sector companies. So I think that's what the state can do with R&D. That's what the universities are therefore to be economic engines. I think both of them need to be a lot more aggressive than they are now. But I think that's what the state's role is, provide the infrastructure so that businesses can come in, set up shop, and be successful here in our state. Now, we can't be successful for every sector, but we did a review of clusters that we have in Maine, strengths in Maine, where we're strong, and we should build off of those strengths. Where are some of those? Do you recall? Well, Aviation's one. I mean, we're working with a company now that's consolidating its operation in Maine. And they're moving their operation from Australia here to the state. They're going to expand it. They're going to hire more people. The environments here, the tax structures right here, the workforce, which is critical, they have an expertise in this particular field. So you have it at Brunswick Naval Air Station. You also have it down. In York County, there's another, what's the name of the company, Bobby, that's down there? What, in Sanford? Yeah, I'm not sure. It's another company. Applied thermal. Right. So you have companies like that that are able to have that particular expertise. So you have a cluster strength. So if you can do more and more of this, then you can sit back and say, OK, maybe I can get Bombardier to come in and do some of their work for them or Boeing. We could be doing subcontracting work for the major aircraft supplies once you build that and add value to that cluster that you have. So I think looking back on your career, both in the private sector, public sector, the experience that you had in the restaurant business, when you first opened the doors to the Blaine House, what went through your mind in terms of, my god, where do we go from here? And your experience in the restaurant business, how did that help you, John? Company, by the way, the name was Pratt & Whitney. Pratt & Whitney, OK. All I remember is, first of all, Rob, it's an honor to be governor of the state of Maine. And I think to realize that you're one of 73 or 74 in the history of the state is an honor. So you have to realize that you've been given an opportunity and honor to work for the best people you could find anywhere. People who are working hard, who are giving it their all, who look at you providing help and support, we're in it together in our state. Dad used to always say, nobody's any better than anybody else. We're all on the same level. In working together like a large family would. So you approach it with that kind of background and that kind of ethics. I mean, it was a very difficult time. It was the middle of January. Paper mills were closing down. The guy called me up the night of my inauguration. He says, don't take it personally, but we're declaring bankruptcy in the morning. That was great northern paper company. I used to think about my friends in Rusty County. The sense of humor they have is just legendary. And the guy said to me, after hearing about the debt, the deficit, the loans, the paper company closings, he said, well, if you weren't at the bottom when you started, you could see it from where you were standing. So he used to use humor and say, okay, well, there's no place to go but up. And then- And the one thing I was impressed with though, just as your brother, is you never pointed fingers at anybody or tried to blame anybody else. You took responsibility for what we had and tried to move forward. Bob, Dad used to say, when you point a finger, you got three coming back at you. You know, it doesn't do you any good to look back. It doesn't do any good to be finger pointing. I think it's an honor and an opportunity. And the thing that you have to understand about being in that situation and having a crisis in front of you, I mean, we didn't know if we'd meet next month's payroll. I mean, I really was concerned about the finances when I first got in. You know, because I didn't know we were running out of the funds and there was no rainy day and it was a difficult time and everything. But at the same time, you know, we said to ourselves, let's everybody work together. Keep calm through this. Get people to realize that we can't be everything to everybody so there are no pay raises. We weren't gonna try to lay people off. We were gonna try to relocate them as we consolidated. We were gonna try to be generous in support. But at the same time, we had to balance the budget and we weren't gonna raise taxes to do it and lead out those foundations. So, and I give a compliment to the legislature working overwhelmingly bipartisan for the most part. We had our moments over a year period as you go in. But I think by and large, I really appreciated the support I had from both sides of the aisle. And at the same time, I was able to do things to irritate both sides of the aisle at the same time. But I think when you're looking at finances and you're looking at the future of the state of man, you're gonna make some tough decisions. We have to come down from being the number one tax state in the country to being more in the middle of the pack. I was determined. I ran on that. I was determined that we were. And I think we ended up going from number one to number 13 or 14, the state and local tax burden. It's headed in the right direction. It needs to continue on. And taxes aren't everything. But at the same time, it was an albatross around our neck. We couldn't attract the businesses we wanted to attract and couldn't show that we were really aggressive and open for business. The bond rating is another indicator of the financial health. Well, that was very important. I mean, and it was in a very difficult situation because they had told me when I first became governor that they don't give AA plus ratings to states that have a tax anticipation note alone. And I told them not to downgrade the state when I first took office because I wanted an opportunity to get rid of the loan that had been taken out. And so I think, you know, we work through Bob, what I say is every administration has its challenges. Current administration has its challenges. I think my responsibility as governor is saying, okay, this is how I found it, but I improved upon the condition of the state from when I left it. So over the year period, we improved from where we started. Now it's the responsibility of the new administration to carry it forward and improve upon it and hand it off to the next. We're only given this opportunity for eight years at the most, four years or eight years at the most. Do the most you can do to benefit the state and then pass that responsibility off to the new administration and their challenges to improve upon it for the future. And that's when the people really benefit from the work that goes on. Now that you're back in Maine, anything you want to comment on with respect to the economy? I'm not going to get into politics. This is not a political show. But just from a business perspective, John, how do you see things going as far as the state is concerned? You know, Bob, everybody as I was saying about each administration, I think we all, different strokes for different folks. I mean, we came from a large family. I mean, I would always tell people, they'd say, John, why don't you take credit for doing things? Why don't you try to play up your successes? I said, we grew up in a large family. Can you imagine any one of us thinking we were better than the other one? How long would that last? Not very long. How long would it last? Mom and dad would close the door and everybody would beat up on everybody. There are eight of us in the family. I'm the oldest and John is the third oldest. So we've got like a moth and a glass that gets the lid lifted. It still doesn't come out, you know, because you've been hitting your head against it. You're not going to change. So I didn't think it was appropriate. And I mean, people used to always look at the work we did and I said, John, if people knew what you actually have accomplished here, you know, it's much different than, you know, somebody coming in and trying to make it up. You actually have done it. So, but I think that my comfort is, is that I know I've done it. I know we've gone through and done it and it's going to stand the test for the ages. But at the same time, you know, people are going to have to understand and appreciate that we were in a situation where we weren't going to raise taxes. We were going to come off the number one tax state in the state, in the country. And at the same time, we weren't going to cut people off with healthcare or needed services. We were going to do it differently. We were going to manage it more tightly. And, you know, we certainly have room for improvement, but it started out with those were the foundations of how we brought things into a balance and handed it off to the next administration better than we found it. So, to digress a little bit, and we only have a couple of more minutes left on the show, believe it or not. It's like 60 minutes by the way. Ha ha ha ha. Would you go back into the restaurant business? Oh, I love the restaurant business. I do, I enjoy it. And for those of you out there who are thinking of opening up a restaurant, what advice would you? Well, don't get into the same business I'm getting into. Ha ha ha ha. No, but I think it's a great business, but you have to understand it's a huge sacrifice. And it's a sacrifice with your time, with your family. It's a sacrifice in terms of doing any outside things outside of the restaurant business. But you know, what people you say, you know, you hate to work, but you love to work. You know, you hate it, but you love it. And I think that's the restaurant business. It's a tough business. It's a demanding business. But I think it's a rewarding. You see people at different stages of the life. So I enjoy it. I enjoy the people in the restaurant business. You know, we often talk with Fred Forsley maybe about having a mummable dachis night at the sea dog or something where we could try out our recipes. Maybe start it out on a small scale and then see what we can do from there. And that business background was integral to you. Oh yeah. And even when you were governor, you would come home on the weekends and do the dishes. I would enjoy it because it's therapy. It's therapeutic because, you know, you weren't dealing with a legislature. You weren't dealing with a study committee or a bureaucracy. You were dealing with a dirty pot or pan or dishes that needed to be cleaned or dishes that needed to be served. And you could see something being accomplished right before your very eyes. So I thought that was very therapeutic. And Bill Cohen, he used to bring the rolls over. Secretary of Defense. He used to bring the rolls over from the bakery because they used to, we were bipartisan before it was popular. We had his bulky rolls in our spaghetti. But, you know, we used to talk in Washington. Isn't it great? You got good food at reasonable prices and you can end up running the country, you know? It's just an easy world that we live in. Well, we only have a minute left. And Governor or John, thank you. Hey, it's been great to be with you. This has been fun. To our viewers, thank you for tuning in tonight. Please stay tuned for the series of shows that we're going to launch this season. It's a new format. I'm very excited about it. That will be modeled somewhat after the show Shock Tank. Hopefully you've had a chance to see that. We're going to invite budding entrepreneurs on the show. We'll have a panel of experts who will decide whether to invest or to help or consult. So it should be fun. Again, thank you. This has been fun. And thank you, Governor. This has been good. Thank you, older brother. This has been good. Good job.