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THE MARYLAND TAXPAYERS
ASSOCIATION, INC.
August 19, 2007
Dear Fellow Board Members and some MTA Close Friends:
Last Wednesday, the House of Delegates Republican Caucus under the direction
of delegate Anthony O'Donnell held a press conference to offer their alternative
to the growing drumbeat for higher taxes in the Free State sounded by
the governor and his allies. The Republican Caucus proposed some limits
on spending growth and adding slots to the panoply of Maryland's taxes,
to avoid other tax hikes.
THE TONE
MTA came to the press conference to hear not just the content but, equally
important, the tone of the House Republican alternative. What we
heard there, however, was no vigorous pushback, no in-depth look at programs
the state could do without, or should, at the very least, restructure
or significantly shrink. Rather, we found an accommodationist approach.
Leader O'Donnell declared that the caucus members were not there to throw
"rhetorical bombs" - - - Annapolis-speak for principled conservative
approaches to right-sizing government. The House Republican leader reiterated
that he is instead trying to work with the governor and the majority leadership
in the General Assembly.
Here is our paraphrase of his public subtext: "See what the Republican
minority [37 out of 141 members] is doing by working together with the
Other Team - - - our efforts will keep matters from getting much worse."
But here is MTA's paraphrase of O'Donnell's unstated subtext:
"If we avoid giving the majority party too much public grief and
embarrassment and go along on slots, they will leave our small band
largely alone, perhaps even allow us a few local projects. Otherwise
they will threaten the incumbency of most of us. If we propose curtailing
those state expenditures supported by the Maryland Establishment, we
will get a lot of public criticism which we just can't handle. Nor are
we up to making the case for doing so. So we'll keep the home fires
burning and wait for the restoration of a Republican governor in 2010."
The Baltimore Sun quotes House Republican whip Christopher
Shank:
"Shank said the Republicans identified specific line items they
would cut, but said they would only share their ideas with the governor
and not the public [!].'When we tried that with budget amendments in
the last session we got our heads lopped off,' Shank said. 'We're not
just going to let them call in all the interest groups and make us barricade
the doors again.'"
Q.E.D.
THE DOGS THAT DIDN'T BARK
Silver Blaze is a tale in which Sherlock Holmes solves a mystery
by noting that the watchdog didn't bark during the time of the crime.
Here are some ignored challenges that failed to stir the policy watchdogs
at Mr. O'Donnell's press conference.
(1) Keeping post-FY2008 state and local spending limited to population
or pupil-enrollment growth, and inflation - - - this is the principle
behind the Maryland Taxpayer Bill of Rights and TABORs nationally. There
is no reason why the House Republicans cannot take this as their
guiding precept for future Maryland budgets without having a TABOR
amendment adopted - - - as the 2005 fiscal note on that proposed
TABOR declared, "Had
this amendment been in effect for fiscal 1996 through 2004, rebates
would have been issued in fiscal 1997, 1998, 1999, 2000, and 2001 totaling
approximately $60 million, $218 million, $388 million, $532 million,
and $290 million, respectively." Recall that the National
Taxpayers Union had this to say about former governor Ehrlich's
last proposed budget: "The
budget submitted by Ehrlich is the largest one (in nominal terms) in
Maryland history. Batkins noted Ehrlich's current budget request increases
spending at the fastest pace in over a quarter-century. Overall spending
in Maryland is set to increase by $3.2 billion, or more than 12 percent."
(MTA's underscoring.) Of course, the TABOR limits are a ceiling.
In the next Maryland budget cycle, an even lower rate of growth may
well be necessary.
(2) Employing user-financing for new major roads, and privatizing
Maryland toll facilities. Marylander Peter Samuel of the Reason Foundation's
Mobility Project has spelled it out. Without his kind of thought-through
approach, we will have no response when the Other Team uses the Minneapolis
bridge tragedy to leverage new Maryland transportation taxes.
(3) Identifying, then curtailing, the fiscal costs of making
Maryland a magnet state for illegals.
(4) Ending local pork projects. It is really grating to hear elected
officials urge spending restraint when they sought questionable state
bond projects for their own districts: in Mr. O'Donnell's case, Annmarie
Garden in Calvert County, or in his press conference co-presenter
Jeannie Haddaway's case, Easton Memorial Walk in Talbot County.
(5) Avoiding single-payer health financing. This is perhaps the largest
single threat to the Maryland taxpayer. The Heritage Foundation has
designed an alternative expressly for Maryland. Except for some
strong support from state senator E. J. Pipkin in earlier sessions,
most General Assembly Republicans don't seem to "get" health-financing
reform - - - either they should improve the Heritage solution if
they don't like that approach, or market it if they do.
(6) Coming to grips with the Maryland unfunded retiree health costs
crisis. Costs are in excess of $20 billion; Montgomery County's
alone are $2 billion. Shouldn't the party advertising itself as the
voice of fiscal sense take the lead in proposing solutions?
(7) Work towards a fully searchable state website such as the
one Missouri set up to enable Maryland citizens (and citizen-legislators)
to see where their taxes are going, in some detail. Free-enterpriser
Warren Miller has been the pioneer in this effort in the General
Assembly.
The watchdogs didn't bark about these ignored challenges at this press
conference because they obeyed their masters, and the watchdogs knew their
masters didn't want trouble.
THE GORILLA AT THE PRESS CONFERENCE AND AMONG THE REPUBLICANS
Slots are clearly a tax, a new tax, and a bad tax because they
are not transparent, among other reasons. Instead of wanting a piece of
the action, Marylanders should be glad that the slots revenue is going
to other states. Slots income would come to Annapolis as another slush
fund to support endless and ill-supervised government expansion, or worse.
(The O'Donnell presentation employed some useful findings from the non-partisan
Tax Foundation's research, but mysteriously forgot to include the Foundation's
study criticizing state gambling.)
Free-enterprise voices ranging from the Wall Street Journal editorial
page to the Tax Foundation call slots and state gambling generally a bad
bet. Slots have distorted Maryland priorities long enough. As MTA posted
on its website on March 6, 2004:
March
6, 2004. A bill requiring the state to fund the full $1.3 billion Thornton
school aid plan became law yesterday without Gov. Robert L. Ehrlich
Jr.'s signature, reports the Washington Times. "'My thought was
maybe just letting the bill go into effect will highlight the need to
pass a slots bill this year,' he said."
Some House Republican Caucus members uncomfortable with gambling told
MTA of pressure to go along with the slots recommendations presented last
Wednesday. MTA believes that slots advocates carry significant weight
among Maryland elected Republicans. The continuing efforts to unseat or
discredit the current conservative leadership of the Maryland Republican
Party may be aided by some slots advocates.
MTA believes that conservative legislators of both parties should not
be in the business of taxing society's poorest because these legislators
are unwilling to curtail out-of-control spending sufficiently, and restructure
or eliminate existing programs.
If we want to attract more businesses (and thus more public revenue)
to Maryland and keep the productive citizens we already have from moving
away, we should propose cutting corporate and transfer taxes, and certainly
the death tax.
WHAT MARYLAND CONSERVATIVES SHOULD CONSIDER DOING (AND
NOT DOING)
Maryland conservatives should no longer wait around for the Republican
leadership in the Maryland General Assembly to develop and market fiscally
conservative (or other courageous public-safety or education-reform) initiatives.
Thankfully, a few good members in both Maryland chambers are taking these
kinds of initiatives, but how much these delegates or state senators can
influence the legislative outcomes in the next session is not the issue.
Our battles will be won in the court of Maryland public opinion, or
not at all. Taxpayer and values-groups must seriously and more tightly
coordinate their efforts, not worry about offending incumbents.
Several paths need prompt attention:
- Working closely with the Maryland Republican Assembly, which
is dedicated to supporting genuine conservatives in Republican primaries,
and getting ready for these primaries visibly and early.
- Identifying and working with fiscally conservative Maryland Democrats.
- Establishing a state-wide means of supporting the efforts of fiscal
conservatives.
- Putting together a coherent and understandable fiscally conservative
message, and getting it to talk-show hosts and to local print media.
Keeping state and local spending growth limited to population increase
and inflation, for example, is a common-sense solution that has across-the-spectrum
appeal.
We need to lay the conservative groundwork for 2010 right now.
Best Wishes.
Richard Falknor
--
Richard Falknor
Executive Vice-President
Maryland Taxpayers Association, Inc.
MTA, Inc. is a 501(c)(4)
non-partisan, not-for-profit, volunteer grass-roots organization
which asks Maryland elected officials for their pledge not to raise taxes,
acts to make Maryland government more efficient,
and organizes and chairs
the Maryland Center-Right Coalition and the Maryland Leadership Conference.
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