There are no easy choices

Wiley A. Hall 3rd

October 03, 1991|By Wiley A. Hall 3rd

I'm sorry, but I'm just about tapped out.

It seems obvious to me, after the Draconian budget cuts unveiled by Gov. William Donald Schaefer this week, that we're headed for another round of tax increases.

Schaefer has been careful to avoid using the T-word, of course.

But when you step out on a lazy fall day and lay off 1,766 state workers, cut back on emergency helicopter service, slash state aid to local governments and public universities, and reduce assistance to the poor and disabled, the public is bound to howl and legislators are bound to get the message.

Already, there are serious calls to increase the sales tax by at least 1 percentage point. Some officials have talked about increasing income and property taxes. Both state and local officials probably are sniffing around for additional taxes, fines and user fees that they can increase.

Meanwhile, Congress and the president seem to be searching for the courage to launch yet another round of tax increases of their own.

And I feel sorry for them all, I really do. The state budget deficit is projected at $450 million. The federal deficit could top $300 billion.

But I've got my own budget crises: I've got bills up to here. My savings are minimal. As a divorced father, I must contribute to the support of two households. My employer -- indeed, my entire industry -- has been crying poor for more than a year now.

After looking my books over very carefully, I've begun to think about taking in laundry. I'm just about tapped out, governor. I can't afford any new taxes.

And, I'm one of the lucky ones.

There were a record number of bankruptcies in Maryland last year and the trend continues. Business failures nearly tripled in 1990. Almost 9,000 individuals filed for personal bankruptcy, a 12.4 percent increase over 1989.

Officials at the Consumer Credit Counseling Service in Maryland predict their caseload will more than double this year -- to some 20,000 families seeking help.

"Creditors are having trouble with people who have never been in financial trouble before, with whom they never expected to have trouble," noted John Gengler, education director of CCC.

"And these aren't necessarily people who have mismanaged their money," Gengler said. "These are people who made good decisions based on their situation at the time. But then, something happens and the rug gets pulled out from under them."

Unemployment continues to rise, personal savings continue to fall, and most families, according to virtually every economic expert, run a desperate race from paycheck to paycheck trying to make ends meet.

All of these people, I think, also are just about tapped out as far as new taxes are concerned.

But here is the catch and I admit it is a doozie for the governor and the legislature: hard times tend to increase the demand for government spending, rather than the reverse.

The state Department of Human Resources reports that the number of people applying for welfare right now is at a 10-year high, a reported 216,000 people.

We now know virtually all we need to know about the importance of good nutrition, good medical care, good alcohol and drug counseling services, good employment training programs and good daytime child care in helping these families work their way to independence and each of these programs cost money. We also know, beyond any shadow of a doubt, that governments that try to cut costs in education pay for it in the end.

Finally, governments are called upon to provide a safety net for private industry during recessionary times. The new stadium, all of those highway projects, our ambitious and seemingly never-ending prison expansion -- all of these create revenue for hard-pressed industries, whether we need these projects or not. And a recession definitely is not the time to lay off 1,766 workers because the economy may not be able to provide new jobs for them.

All things considered then, our elected officials face some very, very difficult choices.

But it is not a choice between abrupt and harsh cuts in government services or dramatic tax increases. Both of those alternatives are unacceptable. Neither I nor my neighbors can afford either one.

I admit that I don't have a third alternative. But then again governor, I never ran for elected office.

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