Fasten your seat belts, Maryland — bumpy fiscal ride ahead

April 20, 2011|By Herb McMillan

Good day, ladies and gentlemen, this is your Captain (and State Delegate) Herb McMillan.

We've leveled off at our cruising altitude, but you need to keep your seat belts fastened. We're in for a rough ride. Here's why.

Our route of flight isn't what I voted for, but the liberal flight planners in our General Assembly think the economic weather is improving. Looking to the left, you see they increased state spending by another billion dollars, and that we project $1.4 billion deficits for years to come.

They gave state employees a $750-per-person bonus that cost $55 million, and $39 million in gambling subsidies to the horse-racing industry. Sounds like they're ready to pop the bubbly. Embarrassingly short of cash, they raided $344 million from special funds (Transportation Trust Fund, Program Open Space) and then borrowed money to fill the gaps they created. They raised taxes and fees by $315 million, and are hoping to have $243 million left over from this year to spend (because they spent it!), and used $124 million in federal stimulus money to fund their spending increases. They believe they are fiscally prudent for "eliminating $608 million in planned spending increases" — and call this a cut. (Do you call not increasing your spending a cut?)

From my cockpit, our route of flight doesn't look good. We have a lot of storms to pick our way around. Maryland owes $34 billion in future retirement and health care payments. Our State Board of Revenue Estimates warns of "significant economic risks" and concerns that "the skyrocketing price of gas might lead to a double dip recession." In January, Maryland employers cut 7,100 jobs — the fifth-largest drop in the U.S. According to USA today, 55 percent of us have taken a pay cut or lost a job within the last three years. On top of that, Maryland has the fifth-highest cost of living in the U.S.

Pilots plan for the worst and hope for the best; those liberals back in the General Assembly plan for the best and hope it won't get worse. No pilot would live to see retirement doing it their way. Republicans in the House proposed an alternative budget that really cut $621 million, increased education funding and got rid of the deficit in two years. Our liberal colleagues paid little attention.

Nervous fliers might enjoy a drink right now. Our flight attendant will conduct a beverage service shortly. Unfortunately, our General Assembly flight planners also jacked up alcohol taxes by 50 percent. They want the alcohol tax increase to "create more revenue" and "create jobs."

Ladies and gentlemen, please don't yell at me or the flight attendants. We know government doesn't create revenue, it can only consume it; and government cannot create a job without taking money from businesses that could've used it to maintain or create private sector jobs. We get it. Sadly, they don't. It's enough to drive a person to drink. Cheers …

Now that you've had that drink, here are two more things you should know about the journey we are on.

A new program, Invest Maryland, will sell $100 million worth of tax credits to raise $70 million, which a governor-appointed board will invest. If we have a 44 percent return on our $70 million investment, we'll make back our $100 million and break even. Anyone know where we can find a 44 percent return on investment?

Finally, there are some stowaways on this flight. Against my strong objections, the General Assembly decided to give illegal immigrants in-state tuition benefits, even though they neither paid for their tickets nor went through security, like you did. This will attract more stowaways and ultimately increase your ticket prices. After all, somebody has to pay for their ticket; there is no free lunch.

Now you know why I left the seat belt sign on; and if you think things are bad in the cabin, you should see all the warning lights flashing in the cockpit."

Del. Herb McMillan, an Annapolis Republican, is a captain for a major airline. His email is herbmcmillan@verizon.net.

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