Business infighting weakens Md. clout

October 31, 1994|By John E. Woodruff | John E. Woodruff,Sun Staff Correspondent

Four decades ago, leaders of commerce and industry formed the Greater Baltimore Committee and forged an alliance with the city and state governments to set in motion the massive Charles Center and Inner Harbor urban renewal projects.

When they went up, these projects transformed Baltimore's urban landscape.

But today, in office towers with breathtaking views created by the GBC's vision, executives wonder how they lost their clout.

They acknowledge that Maryland's business community has become splintered and often ineffectual in influencing economic growth policy.

"Definitely, there has been a feeling that there is a need for the state business community to sort out its priorities, agree on one widely accepted agenda and pursue it by speaking with a single voice," said Champe C. McCulloch, who became president of the Maryland Business Council and the state Chamber of Commerce earlier this year.

Years of disunity and frustration mean that the business community, far from leading Maryland's economic development, has become part of the problem.

Now, confronted with powerful national forces that are sapping Maryland's industrial base and dismantling big chunks of its defense industries, the state is without the kind of comprehensive, joint government-business strategy that virtually everyone agrees is essential to revive and sustain the economy.

The divided reaction to the 1990 Linowes Commission report, which called for overhaul of the state's tax system, is an example of the disunity the business community must overcome, said former U.S. Attorney General Benjamin R. Civiletti, chairman of the Maryland Business Council.

"The GBC came out early and strong for the Linowes recommendations. Other major business organizations opposed them, and some couldn't reach an opinion. So the Legislature in effect ignored them all and picked and chose what it wanted out of the report," Mr. Civiletti said.

What happened to a business community that once was the virtual definition of Maryland's power structure?

For decades the GBC rested on the laurels from the Charles Center and Inner Harbor projects, according to former and present staff members, including the organization's president, Donald P. Hutchinson.

Then in the mid-1980s, as the GBC began to seek new challenges, it discovered that much of the governmental money and authority to deal with economic development problems had shifted from the city to the state.

In an attempt to make itself felt at the state level, the GBC created a new entity, Maryland Economic Growth Associates (MEGA).

ecision backfires

But that decision backfired.

Maryland already had two statewide business-promotion organizations that did not always work together well -- the Maryland Chamber of Commerce and Maryland Business for Responsive Government. The new group made it three.

Worse, the new entity ended up splitting the GBC itself -- which for years had been the core of the metropolitan Baltimore business community -- into a dysfunctional alignment known to this day as the "Upstairs" and "Downstairs" groups.

The upstairs group, meeting at Economic Growth Associates' new headquarters on the 22nd floor of the Legg Mason Tower opposite the inner Harbor on South Calvert Street, were senior business leaders who focused on such cost-of-business issues as taxes and regulation.

Many of those were self-described conservatives who thought the state should weaken organized labor by eliminating prevailing-wage laws and banning union shops under a right-to-work law.

Downstairs, at GBC headquarters on the 15th floor of the same building, was a more or less middle-of-the-road Republican group that concentrated on building the state's education and infrastructure.

And just two blocks away, on the seventh floor of the USF&G Building, is Maryland Business for Responsive Government, founded 10 years ago as the business community's counterweight to labor, consumer and environmental advocacy groups.

Publicly, Business for Responsive Government has become best known for its annual "report card" on Maryland legislators' voting records on business-related issues.

But within business circles, it is equally known for its combative president, Robert O. C. "Rocky" Worcester, who runs it as a rock-conservative outfit and has made it a relentless critic of Economic Growth Associates and its handling of millions of dollars in corporate contributions.

Last year, GBC leaders essentially gave up on Economic Growth Associates and agreed to fold it into the state Chamber of Commerce under a new umbrella organization, the Maryland Business Council.

But that decision, which left Mr. Worcester's Business for Responsive Government outside the "umbrella," opened the way December to an internecine struggle that participants say is typical of the infighting that saps the unity and effectiveness of the business community.

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