Wes Moore’s inauguration speech hit the notes a lot of us have been waiting a long time to hear from the governor of America’s wealthiest state — that Maryland should also be one of the safest, best educated, healthiest and most progressive in the country.
“We know it is unacceptable that, while Maryland has the highest median income in the country, 1 in 8 of our children lives in poverty,” Moore said. “We do not have to choose between a competitive economy and an equitable one. We should not tolerate an 8-to-1 racial wealth gap, not because it hurts certain groups, but because it prevents all of us from reaching our full potential. … This can be the best state in America to be an employer and an employee.”
It’s inspiring to hear a governor speak about achieving economic prosperity without sacrificing basic human needs. “We’ve been asked to accept that some of us must be left behind,” Moore said, “that in order for some to win, others must lose. … Well, we must refuse to accept that.”
This is a very different approach than the one Moore’s predecessor offered. An old-school Republican, Larry Hogan wanted to make Maryland “open for business.” He claimed that he was needed in Annapolis because businesses and people — millionaires, in particular — were leaving Maryland and the state’s economy was in the tank.
This claim fascinated me because, even in down times, Maryland always managed to be a prosperous state with big brains. But Hogan made it sound like an economic backwater that urgently needed his conservative Reaganesque approach.
He made these claims again recently, suggesting that the state’s economy was a mess when he took office and now things are better than ever.
In preparing to run for governor in 2014, Hogan established Change Maryland, a grassroots, anti-tax organization that raised Hogan’s profile as a pro-business Republican who opposed the tax increases and fees produced by Democratic Gov. Martin O’Malley and the General Assembly to get the state through the recession of 2007-2009.
Change Maryland claimed thousands of people had left the state during O’Malley’s time and that millionaires were speeding toward the exit ramps.
“Maryland has reached the point of diminishing returns,” Hogan said. “We’re taxing people too much, and people are voting with their feet. Until we change our focus from tax increases to increasing the tax base, more people are simply going to leave.”
But, when I looked at data from the U.S. Census Bureau and other sources, I found nothing resembling the landscape Hogan painted.
For one thing, the state’s population grew throughout O’Malley’s tenure in Annapolis, and the growth continued into Hogan’s first term. From the time of O’Malley’s reelection in 2010 to Hogan’s in 2018, the state’s population went from about 5.8 million to 6.1 million, and it continued to grow after that. Maryland now has 6.16 million residents, according to the Census Bureau.
As for millionaires, they apparently liked Maryland life more than Hogan claimed. We were No. 1 in millionaires as a percentage of the population during O’Malley’s second term. According to Kiplinger, the financial and business publisher, we kept that status when Hogan took office, with millionaires accounting for 7.9% of Maryland households. (Kiplinger defined a millionaire as a person with “investable assets of $1 million or more, excluding the value of real estate, employer-sponsored retirement plans and business partnerships.”)
Since then, the concentration of millionaires in Maryland has increased to 9.72% of households, but the state has fallen to No. 2, just behind New Jersey (9.76%), in millionaire percentage, according to the latest survey from Kiplinger.
Maryland’s median household income is now $91,431 and, as Moore noted, the highest in the country — $20,000 a year more than the national median.
Maryland has been rated either the wealthiest state in the country, or one of the wealthiest, for several years. (We had the highest median household income when O’Malley was governor.) If millionaires are leaving the state — for retirement elsewhere — then others are apparently moving in or creating new fortunes here.
There are more ways to measure the quality of a state’s economy besides the concentration of millionaires — the unemployment rate, for instance. By the time O’Malley left office in 2014, it was 5.4% and below the nation’s rate of 5.6%. By the time Hogan left office, Maryland’s unemployment rate was 4.3%, above the nation’s rate of 3.5%.
Another thing I looked at: The number of businesses in the state. Despite the worst economic downturn since the Great Depression, the number of business establishments in the state still grew during O’Malley’s tenure by 2,520. If Hogan gets to boast about anything, it should be what the Bureau of Labor Statistics shows for his eight years, including the time of the pandemic — a growth of 17,184 business establishments in Maryland.
So there’s my final tally, specific to the claims and warnings Hogan issued eight years ago. It was never as bad as he said it was, and by some measures it’s better today. Indeed, the state’s history of prosperity, and the ingenuity and ambition suggested by it, bear out what Wes Moore said in the speech many of us have been waiting to hear: The wealthiest state in the country can also be the most progressive and humane.