Death by Blackberry

Oh well it was only a matter of time. Wagging tongues tell us that someone leaked Governor Martin O'Malley's personal blackberry email account to citizens opposed to his tax hike of OH MY GOD proportions. Needless to say the results were predictable. Armed with the ability to get up close and personal with the Governor, many decided to do just that. Word is that the account has since been disabled, shut down or destroyed. Not exactly a progressive response from the guy who touts a vision of One Maryland. Apparently after receiving several thousand irate suggestions of what the Governor could do with his tax hike it was decided that there are in fact two Marylands. The one that wants you to pay the increased taxes, and the other that has been emailing him.

Balancing Act

Rumor has it that the Governor's proposal to increase taxes, legalize slots and spend even more money on a new health care initiative is the result of competing egos between the Speaker of the House, Mike Busch and the President of the Senate, Mike Miller. Apparently Senate President Mike Miller wouldn't go along with new taxes unless he got a slots bill. Speaker of the House, Mike Busch believes slots to be evil, but was willing to bow to political pressure in return for spending on a new health care initiative. Everyone seemed to agree that it was in their best political interest to increase taxes rather than curb Maryland's bloated State budget. The result, a tax, slots and spending package that makes Frankenstein's monster look like a beauty queen.

Annapolis insiders currently give Speaker of the House Busch, the leg-up over Senate President Miller. His opposition to the slots bill was enough to force Governor O'Malley to side with him in putting the slots bill up for referendum in November's 2008 election. A decision which allegedly didn't sit well with our Senate President. Despite the early setback, veteran Annapolis watchers caution against counting Senator Mike Miller down and out for the count. Look out for a last minute "bait and switch" in the Senate that will render the current proposal on slots unrecognizable. When that happens expect a knock down, drag-out, Don King production to settle the matter once and for all.

Open Secret

How many times have we heard talk of the structural deficit being $1.7 billion dollars? How often has Governor Martin O'Malley stated that the structural deficit will increase if his tax hike scheme is not approved by the legislature? Far to many to count.

So imagine the shock and awe that ensued when Maryland Comptroller, Peter Franchot, let slip the secret. Maryland's budget is balanced until June 30, 2008. Yup, you heard me right. There is no fiscal crisis. According to the Comptroller, the structural deficit is tied to the projected budget for 2009. Waiting until the regular General Session as we normally do, will not increase it. Hmmm...someone should tell the Governor his numbers aren't adding up.

Somebody had to say it.

Newly elected Governor Martin O'Mally should be the undisputed master of Maryland politics. After defeating Republican Governor Robert Ehrlich in the 2006 election, he quickly restablished the one party rule of the Democratic party in Maryland. With the Governor's mansion safely back in Democratic hands, and an overwhelmingly Democratic State legislature, you would think it would be safe to raise taxes. Think again.

Galloping in on the white horse of truth rides Peter Franchot, Maryland's Comptroller. Apparently the Governor has been claiming that any delay in approving his tax hike, slots, and increased spending proposal would increase the structural deficit. It was on that basis that the Governor justified convening a "Special Session". The only problem, according to the Comptroller, there is no fiscal crisis.

Despite numerous claims to the contrary, the comptroller points out that the 1.7 billion dollar deficit will not increase if the legislature chooses to wait until the more appropriate General Session in order to deal with it. And he ought to know. After all as the State's Comptroller, it's his job to know where the money is. In an open letter addressed to the Governor and other legislative leaders, Mr. Franchot wrote, "There is no relationship whatsoever between the timing of the next General Assembly session and the magnitude of Maryland's structural budget deficit".

The advantages of waiting are obvious. Rather than trying to tackle complex tax issues in a 30 day special session, we could simply wait until the longer 4 month General Session. That would enable the legislature to hear vital testimony regarding the impact of taxes, slots and spending on Maryland's economy, businesses and families. Only then would they be in a position to act responsibly. Expecting any good legislation to emerge from this 30 day special session is simply beyond fiction.

Mr. Franchot's letter went on to advise against taking action in the special session, warning of the "unintended consequences" of acting hastily. Having failed to heed his warning, there is no word yet on the Governor's response. My money is on the word "Ouch".

To read Mr. Franchot's letter in it's entirety, click here.

Taxes, slots, and increased spending...or else.

In an odd turn-about, Gov. Martin O'Malley is now threatening to cut spending...but only if his proposal for slots, taxes and increased spending is not approved by the legislature. Aides to the Governor made clear that failure to pass the Governors plan would result in no property tax cuts, elimination of $300 million dollars for school construction, and decreasing the budget for a new health care initiative budget from $250 to $100 million dollars.

Does it seem odd to anyone that the Governor would threaten to cut and increase spending at the same time? On the one hand, the Goveror threatens to eliminate his proposal to cut property taxes and remove monies to build new schools. On the other hand he insists on spending at least $100 million dollars on a new health care initiative. What's worse is that he would spend even more money ($500 million dollars) on the new initiative, but only if he can persuade Maryland's legislature to go along with his tax and spend scheme.

There is an old saying that "the first step to getting out of a hole is to stop digging". Apparently the Governor thinks that he can solve the "structural deficit" by spending even more tax dollars. Someone should do him a favor and hide his shovel.

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O'Malley Administration resorts to strong-arm tactics.

News of the O'Malley Administration's efforts to tell State contractors and others to support the Governor's proposed tax hikes have drawn charges of strong-arm tactics. Apparently some cabinet secretaries and their staff have been given the green light to lobby citizens to support the Governor's tax, slots and spending proposal or suffer potential cutbacks in services and contracts. In one instance Alvin Collins, Secretary of the Department of General Services, issued a letter to vendors warning them of "the very bleak budget plan that he will be forced to submit in January if a consensus on the revenue package is not reached".

Natural Resources Secretary John R. Griffin also sent out an e-mail to all Department of Natural Resources workers warning of what could happen if Gov. Martin O'Malley had to institute his "cost of delay" budget which relies only on cuts to close the deficit. The Maryland Department of the Environment also sent out a warning about potential cuts in its quarterly Enviromatters newsletter.

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