May we have some more?

October 06, 2005

WHEN IT RAINS, it pours -- in the state treasury. MCI Inc. is paying Maryland $26.8 million as part of a bankruptcy court settlement to 16 states and the District of Columbia over charges the company hid profits to avoid local taxes for several years. Comptroller William Donald Schaefer's willingness to go after other large corporations with a penchant for creative accounting has also yielded spectacular results. But even better is the way a hot real estate market is fueling job growth -- and, not coincidentally, all kinds of tax revenues. At the moment, the state is sitting on more than $600 million in unspent funds.

That's why it's so baffling that Gov. Robert L. Ehrlich Jr. is reluctant to restore programs he's raided in recent years to make ends meet. Cutting fat is one thing -- that's welcome surgery in good times or bad -- but quite a few of the governor's budget reductions are in the penny-wise, dollar-foolish category. They might yield short-term savings in desperate times, but it's hard to see how taxpayers benefit in the long term.

Perhaps the best example of this is Mr. Ehrlich's decision to cut $7 million in Medicaid health benefits to immigrant children and pregnant women this year. These aren't undocumented immigrants, by the way; they're here legally. Mr. Ehrlich restored $1.5 million of this cut in July after lawmakers howled, but thousands of people remain out of luck. Forget compassion -- this is more a matter of common sense. It's just foolish to deny prenatal assistance to pregnant women. All that accomplishes is to increase the risk of more serious -- and expensive -- medical problems for mother and child.

It's not just partisan lawmakers who are complaining about that, incidentally. It's Mr. Ehrlich's own advisory panel on Medicaid. And it's coming from none other than Comptroller Schaefer, one of the governor's key political backers. In an unusual move, Mr. Schaefer announced last week that he wants the governor to restore the health benefit to immigrants as well as $42 million Mr. Ehrlich cut from nursing home aid to the elderly poor and the $31.7 million he took from state employees' drug prescription benefits.

Make no mistake, we don't advocate any significant expansion of state government. We'd even quibble with some of Mr. Schaefer's proposed restorations. (Repaying the money the governor raided from transportation and conservation programs ought to rate higher.) We're still concerned about Maryland's long-term fiscal health -- and the possibility that deficits could reappear with the next four-year term. The state's antiquated tax system, the rising cost for health care and education and the specter of continued federal cost-shifting to the states remain a concern.

But it's irresponsible to let a substantial surplus sit in the state treasury and not tap a small fraction of it to make some prudent investments on behalf of taxpayers. Fully funding health care for immigrant pregnant women and children should be a top priority.

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