Can state leaders get us out of this mess?

December 09, 2009|By Dee Hodges

State Senate President Mike Miller and House Speaker Michael E. Busch spoke at a recent event sponsored by the Annapolis Forum. The event, which previews state government for Naval Academy midshipmen, was open for the first time to others and dealt heavily with concerns facing the upcoming General Assembly session.

It was worth attending just to have the two leaders spell out their views of Maryland and their governing philosophies. Questions were submitted in advance by the audience.

As a brief introduction, the speakers emphasized that education was a priority for tomorrow's work force. They discussed difficulties in fulfilling the self-inflicted unfunded mandate of the Thornton education plan and the need for the tax hikes that were passed in the 2007 special session.

Also, the two leaders warned that because of the recession-induced drop in revenues, the state would have to continue employee furloughs and maybe cut out funding for some non-core-government functions.

We'll see if they mean what they say when the budget comes out. The looming deficit is as much as $2 billion.

Asked about why Marylanders are not allowed buy insurance across state lines, the leaders indicated that they actually could, because large companies self-insure for their employees in many states. Titters of frustration emanated from the audience in response to this non-answer.

Both leaders said they favored nationalized medicine and a public option - without any seeming concern about an increased state obligation to provide more Medicaid money. They said that health costs would go down under a public option. Did these guys flunk their college economics?

No mention was made by either leader of Maryland's excessive state mandates, among the nation's most burdensome, that drive up insurance costs for individuals and small businesses. These mandates need to be reviewed and simplified so our citizens can choose what fits them. (It makes no sense, for example, for a single male to have to buy maternity insurance or for everyone to have to buy hair transplant insurance.)

Messrs. Miller and Busch seemed dismayed when some in the audience suggested that Maryland was not very business friendly. They pointed out that the state's unemployment rate was 3 percentage points less than the national average of 10.2 percent and noted that the average income was $70,000, higher than most states. These things they attributed to the state being business friendly. Yet, everyone knew that these positive statistics reflect not state policy but, rather, Maryland's high percentage of federal government employees.

We were also told that Maryland tries to hold down its property taxes by allowing all of its local jurisdictions to have a "piggyback" income tax, apparently the only state in the country to allow this. Of course, Maryland is only one of six states to require the advance payment of property taxes. Maryland has a AAA bond rating because property owners are on the legal hook to be assessed even more to pay the bonds to prevent default.

There was a glimmer of relief: The two leaders indicated that taxes would not be raised next year because 2010 is an election year. They actually went so far as to suggest that the state would just have to do less with less.

But consider this: By their own reckoning, Messrs. Busch and Miller have a combined 71 years in Annapolis and have enjoyed a virtual one-party dominance in their spending choices. Can we really expect the people who got the state into this shape to get us out? Or will they depend on winning next year's election so they can raise taxes again in 2011?

Dee Hodges is chairman of the Maryland Taxpayers Association. Her e-mail is

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