Rating: 
Viewed: 149 times.
Print
Maryland, My Maryland! The Despot's Heal is On Thy Shore!
This line from our old State song speaks perfectly to the situation we face now in the Old Line state.
Guvnah O'Malley, having squandered a $1 billion surplus, has now forced a crisis to get his way: higher taxes, more spending, and more waste. We have gone from a $1 billion surplus just last January to a $1.7 billion "structural deficit". That is a $2.7 billion swing in state revenues in just 10 months.
Remember, a "structural deficit" is not an actual deficit. A structural deficit is about future revenues and future spending. It means that over the next five years, spending will outpace revenues. It does not mean that revenues have been falling, but that spending is out of control. It also means that the growth of revenue is less than the growth of spending.
O'Malley Lies and the Economy Dies
Guvnah O'Malley wants Marylanders to believe that without massive tax increases, there will be a doomsday for Maryland. It's just not true. As the Republicans in the State House have shown, most of this structural deficit can be reduced by slowing growth in state spending and bringing government programs under control.
Now, the Guvnah is playing the blackmail card, arguing that unless slots are accepted (even in areas that don't want them, like Worcester County), then all sorts of school funding programs -- especially construction -- will suffer. Funny how the state could find the money to fund not one but two MASSIVE sports complexes in the early 90's-- when the state's economy was much worse off than it is today.
The Guvnah is lying. O'Malley lies and the economy will die.
Why not fix the structure?
If there really is a structural issue with revenue in this state, then why don't we work toward a plan to change how we collect revenue? The fact is, that the liberals in this state -- and especially in the I-95 corridor-- are tied to old and ineffective revenue mechanisms. We continue to beat the same drum on taxation -- taxing wealth and income, instead of addressing consumption.
We need to dramatically alter our taxing structure in order to support the services we provide citizens. By relying to much on property and income taxes, we are subject to too many swings -- major or minor --- in the economic cycle. And guess what? THE ECONOMY IS CYCLICAL.
Instead, we need to tax consumption. This has an added benefit. There are hundreds of thousands of people who WORK in Maryland, but LIVE in neighboring states. Guess what? We provide services for them but DERIVE NO INCOME FROM THEM. Passing a commuter tax would be stupid.
But making the sales tax more prominent as a part of the mix-- combined with reducing or even eliminating income and property taxes -- would derive greater revenue. Why? Well, all those commuters buy products and services during their work day. All those folks from Southern PA that commute to Baltimore, Towson, Columbia etc. buy gas, food, haircuts, and more. Focusing on using a consumption tax and moving away from income and property taxes would bring those workers into the taxpaying public.
How Would It Work?
Simple. Create a flat base state sales tax of 5%. Then, set a sur tax rate for each county -- generally 1-1.5%, while drawing down and eventually eliminating the county piggyback and property taxes. The result? Taxing consumption is generally recession proof, cheaper for the state (no more tax returns to process), and a better approach to taxation. It also encourages savings and investment.
So if Guvnah O'Malley was really serious about fixing the "structural deficit", he would get serious about fixing the flawed structure that got us here.
Until then, when O'Malley Lies, the Economy Dies. Forcing a crisis to get your way isn't leadership, it is cowardice. Plain and simple. Baltimore had enough of his cowardly leadership. Maryland doesn't need any more of it.