Outspoken economist could help shape state's future

Baltimore, Md. -- Anirban Basu, Chairman And CEO of Sage Policy Group, is a well-known economist and has joined Governor-elect Larry Hogan's transition team.
Baltimore, Md. -- Anirban Basu, Chairman And CEO of Sage Policy Group, is a well-known economist and has joined Governor-elect Larry Hogan's transition team. (Kenneth K. Lam / Baltimore Sun)

Economist Anirban Basu seems like he's everywhere, his advice and insights shaping local governments, big companies, educational institutions and, now, as a member of Gov.-elect Larry Hogan's transition team, the state's future.

In the decade since he started his consulting firm, Sage Policy Group, Basu has positioned himself as one of the region's most recognizable local economists, dishing out blunt takes on everything from Baltimore's historic property tax credit appraisals to cronuts. By Friday, he must present a report to Hogan on how to reposition the state's economy.


Hogan, a Republican who ran on a platform that criticized Maryland's spending and taxes, will take over at a time when the state projects its receipts will fall $1 billion short of its anticipated spending next year even as its economy lags behind the nation. The state's unemployment rate, for example, is 6 percent — higher than the national rate of 5.8 percent.

The state has become far too dependent on the public sector, Basu said, and needs to take "bold" steps to attract private business.


"We know that the Maryland formula of feds, beds, eds and meds is not working," said Basu of the government, tourism, education and health care. "That strategy has produced an economy that is adding an insufficient number of jobs and has produced an unemployment rate now above the national average.

"Our successes have bred complacency and a misunderstanding of how good we are," he added.

Basu, 46, describes himself as nonpartisan and said he would have gladly given advice to Democrat Anthony G. Brown had Brown won the governor's race.

"I tend to think there are certain things that are just true; economics is not the product of a political agenda," said Scott E. Dorsey, chairman and CEO of Merritt Properties. "So I think that's where Anirban is coming from in his role as an adviser to Governor-elect Hogan."

Meanwhile, he's stepped back from some of his other activities. His "Morning Economic Report" on NPR affiliate WYPR is on hiatus while he serves on Hogan's transition team.

Born in New York City, Basu grew up near Chicago before heading off to boarding school at age 13. He earned degrees in law, economics, public policy and foreign service at Georgetown University, Harvard University, the University of Maryland, College Park, and the University of Maryland School of Law. He's pursuing a doctorate at the University of Maryland, Baltimore County; his dissertation analyzes Maryland's unique system for setting hospital rates.

He and his wife, Debita, an assistant principal at Thomas Johnson Elementary/Middle School in South Baltimore, live in the Devon Hill community in Baltimore County. He calls their two daughters, Kimaya, 15, and Kohena, 8, his "cylinders."

"They keep me going," he said. "Ultimately, I'll leave the planet, and I want to leave them as much as I can."

Basu says he fell in love with Baltimore while driving up Charles Street in 1992 on the way to interview for an economics job at the University of Baltimore. He's an avid sports fan, rooting for the Orioles, the Ravens and any team "that has a Maryland address."

"The first thing a Baltimorean ever said to me after moving here was 'Do you want fried onions with that, hon?' And I knew that I was home," he said. "So it didn't take long for me to become a full-fledged Baltimorean."

Friends say one of Basu's greatest strengths is his ability to distill complex economic ideas into something laypeople can understand. He speaks about economics all over the country, often throwing in jokes to keep audiences engaged.

Mike Henderson, president of the Baltimore chapter of Associated Builders and Contractors, said Basu has a "sharp tongue and a razor wit."


"He gets away with saying things that maybe others would not because he says them while he's laughing," Henderson said. While not being mean-spirited, Henderson said, Basu will, for example, "insult people from Nebraska, but they're laughing along with everyone else."

Basu said that his tendency to speak his mind may have cost him some opportunities.

"I think one of the things our clients appreciate is that we are forthright, we are honest, we are not politically correct, and that we simply follow the data," he said. "If that costs us deals, including in our backyard, then it costs us deals."

The 11-employee, Baltimore-based Sage Policy Group has clients in 40 states and five countries, Basu said, with one employee in Jakarta, Indonesia. He said the firm's recent clients include Baltimore County, Howard County public schools, the Johns Hopkins University, Columbia-based chemical firm W.R. Grace, Towson-based Whiting-Turner Contracting and Hunt Valley-based spice maker McCormick & Co.

Because of the inevitable conflicts that come from working for so many local clients, he said he sometimes must turn down consulting jobs.

"He's definitely a leader of the economists in Baltimore," said Daraius Irani, the chief economist at the Regional Economic Studies Institute at Towson University and a former colleague.

Basu said his firm, established in 2004, tends to make revenue projections that are more conservative than those of some competitors.

"Everywhere you look, you see forecasters overprojecting," he said. "Look at the revenues coming from the new Baltimore City casino. Are they not disappointing? We tend not to make such errors."

When it comes to Maryland's economy, Basu said, the problems aren't limited to overspending, but include a lack of revenue generated by private business. The state's business reputation has become "quite poor," he said, reflecting a position held by Hogan. He also criticized the state's tax and regulatory policies.

His report to Hogan will take a big-picture look at places where Basu said he thinks the government should invest, such as the port of Baltimore, in attracting foreign businesses and in supporting entrepreneurs, particularly in the life sciences and technology sectors. He believes Maryland must change its culture and attitudes about business, arguing that governments too often favor the "naysayers" who don't want to see development.

Basu said Maryland could do more to encourage its college graduates to remain in the state and to push for a better quality of life to keep them. A former Baltimore school board member, he said education is one of the most important things a government can do to reduce rising income inequality and argues that there is too much focus on "teaching to the test."

"I think the most important issue is the growing gap between the haves and have-nots in our society," he said. "The middle class is under pressure and it is shrinking."

Eleanor M. Carey, a former member of Gov. Parris N. Glendening's administration who has served, or is currently serving, on transition teams for Gov. Martin O'Malley, Baltimore Mayor Stephanie Rawlings-Blake, Attorney General-elect Brian Frosh and Baltimore State's Attorney-elect Marilyn Mosby, said newly elected officials need advice as they begin their new jobs, although it's never certain how much of that advice will become policy.

"Today in particular it's a very complex world, so you need advice from many people," Carey said.


Hogan's transition team has 60 members.


Baltimore school board member Robert Heck, who served on the board with Basu, said he misses Basu's counsel on the education panel, particularly on complicated budget issues.

"It was great having him as a watchdog," Heck said. "You couldn't fool him."

While Basu said he would be perfectly happy to "play out the string" on his economic consulting career, he said his focus has turned to other potential opportunities as he settles into middle age. He's not sure what that will look like yet, but he said he's interested in elected office or higher education.

"I've always aspired to have not one career but two," he said. "I'd like to take another risk."


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