O'Malley making case for tax rise
Times, 19 May 2007 .
Maryland Gov. Martin O'Malley this week began building his case for budget cuts and tax increases by blaming former Gov. Robert L. Ehrlich Jr. for the state's $1.4 billion deficit.Miller: "I told you so"
"We have inherited a $1.4 billion structural deficit from the last administration," Mr. O'Malley, a Democrat, said during a state party fundraising dinner in Howard County Thursday. "It's going to be very difficult, and I really need your help to communicate with your neighbors."
Mr. O'Malley after the dinner also criticized Mr. Ehrlich, a Republican, for increasing taxes, much as Mr. O'Malley is expected to do next year or during a special session of the legislature before then.
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When he took office in January 2003, Mr. Ehrlich inherited a $4 billion structural deficit from former Gov. Parris N. Glendening, a Democrat, and left office with more than $1.8 billion in the state savings account without raising sales or income taxes.
Gazette, 18 May 2007 (Lee).
. . . O’Malley needed a year to set the stage for the massive tax hikes the Dems are planning. And now the stage-setting is well under way. Phase One is convincing taxpayers that the administration is doing everything possible to cut fat and streamline state government.
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Meanwhile, the pro-tax crowd — newspaper editorial writers, university deep thinkers, liberal pundits and the recipient groups (people who depend on state spending) — are putting on a public relations full court press for higher taxes.
Here’s their message:
First, compared to certain foreign nations and considering our quality of life, Marylanders are actually undertaxed, not overtaxed.
Second, tax hikes are long overdue. There hasn’t been a gas tax increase since 1992, a sales tax increase since 1977, an income tax increase since 1966 or a beer tax increase since the Garden of Eden. Opposing such reasonable, timely ‘‘revenue investments” is selfish and unpatriotic.
Finally, (this is my favorite) the opinion-shapers tell us that what’s about to hit us is tax reform, not tax increases. They say, for instance, that Maryland’s sales tax was fashioned for a manufacturing economy, not today’s service economy. So, in addition to taxing items at point-of-sale we must tax services at point-of-sale (i.e. auto repair, haircuts, lawn care, house painting, plumbing repairs and so on — except, of course, legal services).
It’s an absurd argument. Americans are the world’s greatest consumers of goods (regardless of who manufactures them) and we pay a sales tax for almost every item we purchase. Extending the sales tax to services is a naked revenue grab, not tax reform.
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But don’t fret, where there’s a will to tax, there’s a way.
Lawmakers can simply raise sales taxes and income taxes, which they already plan to do,
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And to deflect any criticism they’ll call it tax reform.
O’Malley’s campaign promises hit turbulence
Gazette, 18 May 2007 (Rascovar).
After playing Santa Claus to the cheers of Democrats, Gov. Martin O’Malley has morphed into Scrooge. . . . Go back and read his Jan. 19 budget message. He writes of facing ‘‘difficult decisions and sacrifice,” the need for ‘‘structural reforms,” and warns solving this problem ‘‘will not be easy.” He also cautions that unless the state deals with this deficit ‘‘forthrightly, it will limit what we can achieve.”
He promises to ‘‘maintain our fiscally responsible budgeting practices” and ‘‘make government more accountable and cost-effective.”
But then he ignored his own warnings and pushed through an accommodating legislature a whopping 8.2 percent budget increase in ongoing general fund spending.
Now he’s taking it back — at least $200 million of it.
That won’t please Democratic Party interest groups who bubbled with enthusiasm when O’Malley was generously delivering on his campaign promises. They thought happy fiscal days were here again.
Not any longer.
This is the opening salvo in owning up to Maryland’s habitual overspending. It will culminate in a slew of higher taxes.
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Having been so lavish with state dollars just a few months ago, O’Malley now must renege on some of that generosity. It will make people angry. But maybe that’s the idea: If enough vested interest groups feel the pain, they may be eager to jump on the tax-increase bandwagon by the fall.
Definition: "Structural deficit" is simply a euphemism for irresponsible, out of control spending by government officilas out to buy votes with other people's money.