O'Malley's timing was off on taxes

January 15, 2008|By JEAN MARBELLA

Once upon a time, there was a governor who faced a budget shortfall of more than a billion dollars. He went to the state legislature, hat in hand, seeking revenues to bridge this looming deficit casting a shadow on the kingdom. Through much toil and talk, cajoling and compromise, he successfully pushed through about $1.4 billion worth of tax increases.

It might be stretching it to say joy spread through the land and everyone lived happily ever after, but there was the next-best ending possible, at least for the governor: His approval ratings rose, into the stratosphere.

No, this is not another one of those political fairy tales that Bill Clinton accuses the media of perpetuating. It is a true-life tale but not, sadly, one set not here in Maryland, but in Virginia.

As you might have seen in The Sun this Sunday, a recent poll the newspaper commissioned found intense opposition to the tax hikes enacted during the special legislative session in November, and it has sent Gov. Martin O'Malley's approval ratings tanking toward George Bush levels - he's down to 35 percent, compared with the president's 27 percent. For the first time in the 10 years that The Sun has asked voters to identify their major concern, too-high taxes beat the perennial worry - schools - to top the list.

O'Malley started with the right playbook - he had consulted with the Virginia governor, Mark Warner, whose 2004 tax hikes didn't harm him politically - but didn't manage to follow it to its happy conclusion.

To hear Robert D. Holsworth, a political scientist at Virginia Commonwealth University, describe it, Warner's strategy should be a case study in Raising Taxes, but Surviving Politically 101. Holsworth, whose university extensively polls Virginia voters, said Warner started by "hugely" cutting state spending before seeking tax increases. He sweetened the proposed hikes with some rollbacks (which, actually O'Malley tried to do as well by seeking, but failing, to include a property tax cut in the package). Warner also got Republican legislators on board with the program, and they actually sought even bigger tax hikes than the Democratic governor was proposing.

Sound entirely different to how it all played out in Annapolis this past November? It was, including something that was beyond either governor's control, Holsworth said - the overall economic climate.

"If you tried to raise taxes today in Virginia, I don't know if you could," he said. "There's more uncertainty today. There's a greater sense of economic risk."

I talked to several people who were polled by OpinionWorks, the firm that conducted The Sun's poll, and it was surprising how this disparate group - among them, an Eastern Shore retiree, a Western Maryland business owner, a Baltimore inner-city office worker - said much the same thing about their opposition to the tax hikes.

Namely, it's not just the taxes, but the timing.

"It's a bad time," said Shirley White, a retiree in Chestertown. "People are losing their homes. It's getting more expensive to live. Every time I go to the grocery store, it's more expensive. [My house] just got reassessed, so my property taxes are going to be going up. My electric bill has tripled."

"It's not just the 6 percent," Phyllis Neal of Baltimore's Penn North neighborhood said of the new sales tax. "Everything's going up - gas, electric - but your paycheck doesn't."

"People are struggling now," said Rebecca Mizak, who has an advertising agency in Cumberland. "There's a downward spiral in sales of homes. The value of homes is going down. It's a lot to put on the back of the common man."

I wasn't called by The Sun's pollsters who took the political temperature of Marylanders last week and found it quite feverish on the subject of tax increases, but if I had been, I might have vented some of my own personal economic angst in similar fashion.

Maybe it was that letter from the mortgage company that arrived earlier this month, saying my monthly payments would be going up a couple hundred dollars to shore up an escrow fund being depleted by the property taxes flowing out of it. Or maybe it's the credit card bills from Christmas that followed shortly thereafter.

Or maybe it's everyone asking the question, "Are we or aren't we headed into a recession?" and increasingly answering, "We so totally are."

"I think there's going to be a recession. I think there's going to be a cutback in spending," said Neal, who even cut up her credit cards last month to make sure she kept her own buying in check.

She's certainly not alone - retailers from Tiffany to Target are reporting slowdowns. But if you can, with varying amounts of willpower, resist a diamond necklace from Tiffany or a T-shirt from Target, you can't exactly resist the tax bill from the government. Death and taxes, as they say.

So now, O'Malley is faced with repairing his tax-battered image. But it might not be easy, as other potentially damaging measures loom ahead as the legislature convenes once again.

"If I could change it today, I would," White said of her vote to elect O'Malley as governor. "I don't approve of what he's doing to [schools Superintendent] Nancy Grasmick."

jean.marbella@baltsun.com

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