Maryland is slowly but steadily coming out of the recession. This week's Board of Revenue Estimates projections forecast consistent growth in the next 18 to 30 months, a prediction that must make Gov.-elect Parris N. Glendening happy. The worst of the economic bad news is over.
And yet Mr. Glendening is pursuing a prudent course for the year ahead. He intends to propose a much smaller spending increase than the revenue board says is possible. And he's right to do so.
Compare the governor-elect's cautious, slow-spending plans to outgoing Gov. William Donald Schaefer's spend-it-now response to the glowing revenue forecasts. "There's money here, and the needs of the people should not be overlooked," he said. Apparently, Mr. Schaefer is not taking the November election returns too seriously. But Mr. Glendening certainly is.
He's planning to ignore the outgoing governor's desire to create new programs. Instead, Mr. Glendening is likely to downsize the existing state bureaucracy, moderately increase aid to education, public safety and economic development and find the money to cut business-related taxes to help stimulate job-growth. If there's cash left over, the governor-elect says he'd like to set it aside in hopes of cutting personal taxes late in his term.
That may be difficult to achieve. A 5 percent growth level, as forecast, should produce an extra $500 million a year. But mandated increases in education aid, Medicaid, prisons and juvenile facilities, the developmentally disabled and pay raises for state workers will consume most of this money. Compounding matters are $300 million worth of new expenses the state must pay for two and three years hence. Stashing money away for an election-year tax cut may not be possible.
Mr. Glendening rightly points out "merely having a short-term surplus and spending that" is counter-productive. Especially in an era when voters want less government, not more. For instance, Maryland may have a $148 million surplus projected for the current fiscal year, but that's a one-time windfall. Starting new programs with that money would create new deficits in the following years.
Still, Mr. Glendening has to be upbeat about the 5 percent growth recommendation of the revenue board. It shows the gradual recovery of Maryland's economy is likely to continue. A new governor couldn't ask for much more.