We've met the enemy and guess what?

April 01, 2007|By C. Fraser Smith

The Sun's Andrew A. Green recently offered a comprehensive, historical account of Maryland's structural deficit.

You know what that is, right? It's the difference between committed spending and expected income. When legislators commit to spending not covered by anticipated income, the state has a structural deficit.

Over some lengthy period, the built-in shortfall has become the governmental version of the weather: Everybody talks about it, but nobody does anything about it.

Actually, that's wrong. People do something about it. They make it worse. They spend more. And they don't raise taxes. They ignore this sage advice: When you're in a hole, stop digging.

Mr. Green's tracing of the history shows again how it all happened. Maryland spent big on aid to public education after it had cut the income tax by 10 percent. If those two things had not happened, there would essentially be no $1.3 billion imbalance - no structural deficit.

Didn't the General Assembly know what it was doing? It absolutely did. But the Democratic majority decided there wasn't much risk. While the Thornton education bill was passing into law, there were many who warned against it. A big commitment like that, they said, needs what in Annapolis is called a funding source: money from something - the sales tax, the income tax, fees of some sort - to cover the cost.

Thornton required prodigious amounts of money, but the Assembly presented the program as if it were free. Sen. Barbara A. Hoffman spoke for many when she said, "Don't worry. We'll work it out."

Then, in 2002, Republicans won the Governor's Mansion. Suddenly the Democrats were out and a no-new-taxes administration was in.

Which brings us to the real reason for the structural deficit:


Yes, you. You, me and everyone else who would prefer not to pay any more taxes. Legislators know how you feel. They're so very concerned. They want to protect you from reality - and themselves from losing an election.

They think we will punish them for acting responsibly. Perhaps this seems like a good thing for many. Good, in other words, that legislators think of us before they put the arm on us for more taxes.

It's not good, though, if we forget what government does in our name - and that it costs money. We always say, when asked by pollsters, that we want good public education. We always make education our top priority, though health care has challenged for the top spot.

We want good roads, too. And public safety: prisons and police protection. We want a clean Chesapeake Bay and the best possible higher education. We don't want our elderly neglected, and we don't want people who care for them living on poverty wages. All of it requires tax money.

Next year, the piper must be paid. The structural deficit by then will be at least $1 billion. This year, the budget was balanced with minimal pain. Next year, it is likely that no one will be happy when the balancing is concluded. Businesses, for example, will oppose increasing the sales tax, and they will oppose applying the tax to products or services not already taxed.

Gov. Martin O'Malley has the unenviable chore of explaining it all. He gets to demonstrate the education side of political leadership. He ought to start soon.

There's actually a model or two. Former Gov. William Donald Schaefer raised the gasoline tax - after dispatching one of his many talented lieutenants to explain it over the course of a year. And later, he commissioned a thorough study of government's costs and needs.

Many of the study's recommendations ran aground in a storm of anti-incumbent unhappiness after the 1990 election.

So here we are again, needing to balance the books in a way that will require help, collectively, from ...


C. Fraser Smith is senior news analyst for WYPR-FM. His column appears Sundays in The Sun. His e-mail is fsmith@wypr.org.

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