Last week reporter Michael Dresser, writing for the Baltimore Sun, described new revenue shortfalls released by state government officials due to poor economic performance in Maryland. These revised projects are resulting from "sluggish job growth, stagnant incomes and a weak housing market," according to the article which the Carroll County Times also printed.
Dresser noted that even though we are officially five years past the recession, our state government is still dealing with fiscal struggles. The report suggests that the next governor and General Assembly will have to make cuts in order to balance the state's approximately $40 billion budget.
State Comptroller Peter Franchot is quoted in the article, "Another year has passed, and ordinary families and small businesses haven't even recovered to where they were before the financial collapse, much less made up for the wages they've lost." He goes on to note that, "We need to recognize that hope is not an economic strategy."
This same report described the long term structural deficit challenge that state government has struggled to address for many years. Multiple rounds of tax and fee hikes were intended to bring this structural deficit into balance, but clearly those hikes have not been effective.
My good friend and Carroll County Republican Central Committee chairman Larry Helminiak has consistently gone to Annapolis to testify before committees that if you raise the tax rate you'll end up with less revenue, not more. I wonder if the power elites of the General Assembly will pay more attention the next time he offers testimony.
These revenue shortfalls could have significant implications in this year's campaign for governor. Republican candidate Larry Hogan and Democratic candidate Lt. Gov. Anthony Brown's campaign, manager Justin Schall, were quoted in the article.
The declining revenue projections could also have major implications for the next board of commissioners for Carroll County. Four out of the five Republican primary winners ran on a platform of increasing spending for county funded staff, including our teachers and deputies.
The next budget process for our county could be in for a collision course between expectations raised by public sector workers and the realities of actual revenue available to the commissioners.
Commissioner Richard Rothschild, District 4, has been sounding the alarm for years that the county was treading in dangerous financial waters without significant adjustments, such as closing one or more public schools. While he did win his GOP primary campaign in the predominantly southwestern oriented district, his views were basically ignored in the remaining four districts in June primary.
Historically, when the state is in tough fiscal times, the General Assembly has found ways to shift funding responsibilities onto county governments and take away revenue sharing programs that were previously budgeted toward both county and municipal governments. With these declining revenue projections, it should not surprise anyone for the state to again solve its problems on the backs of counties and towns.
On the state level it should be clear to objective observers that repeated tax hikes are not a sound basis for growing private sector jobs. Large and medium sized businesses generally have choices about where they can locate. The people making such choices are the top managers and owners. Comparing the size of their take home pay after state income taxes, I'm sure, is a huge driver in such decisions.
If we hope to turn things around in our state, it would seem that we need to start changing some of our policies. The only way to do that is by changing the philosophy of the policy makers that we put into office with our votes.
Michael Zimmer writes from Eldersburg. His column appears Fridays. Email him at email@example.com.