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As Long as We Remember...

January 4, 2012

Scenarios Abound

Kevin E. Dayhoff

Next Wednesday, on January 11, the 430th taxing tradition of the Maryland General Assembly opera will once again take center stage.


Besides the apocalyptic foreboding talk of proposed tax increases, tax hikes, revenue enhancements, and increased investment, who really knows what is in store for Marylanders. All indications point to multiple plots with subplots and subplots to subplots plus a few soliloquies on the side.


The most intriguing subplot has to do with how the actions of this session will affect the 2014 gubernatorial campaign. More on that later.


For the immediate, Robert Lang over at WBAL filled us in on some of what is on the mind of Gov. Martin O’Malley last Thursday when the governor gave a briefing to reporters in Annapolis.


“Gov. Martin O'Malley says lawmakers in 2012 will have to have the ‘courage’ to consider tax hikes as well as spending cuts, and that includes an increase in the state's gasoline tax,” according to Mr. Lang.


Darn, we are all so surprised. Well, maybe not so much. It’s more like “déjà vu all over again.”


According to numerous media accounts, the governor says Maryland needs more money for road and bridge projects. He reasserted his contention that “lawmakers have already cut $6.8-billion in spending over the last four years,” WBAL-TV’s Mr. Lang reported.


Many take issue with the governor’s point of view on whether or not spending cuts have really taken place.


Writing for, Mark Newgent is not in agreement with the governor’s analysis. Mr. Newgent wrote on December 30, “O'Malley Repeats Budget Cuts Fiction,” in which his lede was “Speaking to reporters yesterday Governor O'Malley repeated the lie that he has cut the state budget.”


According to Mr. Newgent, Governor O’Malley said at last Thursday’s round table discussion with reporters that “ever since this recession hit we've been relying almost exclusively, with some exceptions, but almost exclusively on the cuts…”


To which Mr. Newgent responds: “Except that under O'Malley the state budget has ballooned…” Mr. Newgent asserts that Governor O’Malley has increased the budget by “16.3 percent … between fiscal years 2008 and 2012. Furthermore, O’Malley increased general fund spending from $13.2 billion in 2011 to $14.6 billion in 2012 an increase of 11 percent — one of the largest in the nation.”


And Mr. Newgent is not alone in his criticisms of the governor’s sense of keeping score on the budget. He was joined by Len Lazarick at last Friday in an article, “O’Malley says gas and flush tax hikes may be part of 2013 budget.”


“In past years, the O’Malley administration has sometimes referred to this as reductions in increased spending. The overall state budget has actually grown since O’Malley took office in 2007 …19%...


“But in order to balance the budget each year as required by the Constitution, the governor has had to ask the legislature to cut mandated and automatic increases in spending or entitlements by a cumulative $6.8 billion.”


We will only have to wait and see if this is the year the General Assembly will really raise the gas tax. Although raising taxes on an essential part of life for Maryland workers is not such a good idea, the conventional wisdom is that politically, it is the perfect time to do it.


The next big political rondelay in Maryland will not take place until 2014 and by then chances are most Marylanders – read Democrats – will have long gotten over any tax increases.


That is, unless current Harford County executive – and likely 2014 Maryland gubernatorial candidate – David Craig can remind voters of their pain at the pump.


On September 10, 2011, Richard J. Cross, III, wisely noted, “If history is any guide, 2014 looks like it will be an anti-establishment year. Maryland voters will be restless after eight years of Martin O’Malley, just as they were after eight years of William Donald Schaefer and Parris Glendening.


“Plus, if President [Barack] Obama is re-elected in 2012 and experiencing the traditional mid-term slump that most presidents do, a Republican like Craig could benefit from these anti-incumbent forces.


“To do so, however, he must be able to articulate a case as to why he is the real change Maryland needs. Otherwise, a wily Democrat like Peter Franchot or Howard County Executive Ken Ulman (who would appeal to many of the same suburbanites David Craig would) may step up and snatch the change mantle out from under him.”


To be certain, Maryland Comptroller Franchot also has his eye on the Maryland Statehouse. He will be a formidable opponent in many ways, not to mention the obvious; he is head and shoulders ahead of County Executive Craig in name recognition.


Chances are Governor O’Malley will get his tax increases, one way, or another. Whispers in the hallways indicate that if the gas tax does not work, plans are already being investigated to use the increasing presence of the vehicle black boxes to keep track of, and report vehicle miles driven and levy a mileage tax upon Maryland motorists.


That said, Comptroller Franchot is also aware that by 2014 there will certainly be a ‘tax fatigue’ among even the most ardent Maryland voter.


Writing for the Washington Examiner, Rachel Baye noted that Comptroller Peter Franchot said at a meeting of the Board of Revenue Estimates that “Maryland should institute a two-year moratorium on all tax and fee increases.”


Chances are the Democrats will finally overplay their hand and bestow even more hardships and taxes upon a fragile economy and Maryland families.


As horrible as that sounds, the silver lining is that such foolish public policy may play right into the hands of Mr. Craig and give Maryland a glimpse of sound leadership for eight years from Gov. David Craig, starting in January 2015.


. . . . . I’m just saying…


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