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Make or Break

The Baltimore Sun gives us some details of the maneuvering going on as a special session of the legislature, a session dedicated to raising your taxes, looms.

Despite resistance from House leaders of both parties, Gov. Martin O’Malley said yesterday that he would not back off of his call for a special session of the General Assembly to tackle the state’s $1.7 billion budget crisis. Instead, the governor embarked on a feverish push – both in private meetings with lawmakers and via a flurry of media appearances – to sell his plan as a “consensus” proposal.

These are fairly high stakes the governor is playing for and a lot of pieces have to come together for it to work.

The governor can call a special session, but to do so without a buy in from Senate President Mike Miller and House Speaker Mike Busch will ensure nothing productive happens, other than the taxpayers footing the bill for the session, and will undoubtedly cause hard feelings that will carry over into the regular session.

While O’Malley is trying to (dare I use the lefty word?) frame his budget as a consensus, it is far from being that. It is predicated on slots which are by no means a done deal. It requires significant increases in taxes which will increase the tax bill of the average homeowner by $300 (more for renters) and will cost Maryland some 9,000 high wage jobs and encourage other higher income families to move to lower tax jurisdictions.

Maryland Comptroller Peter Franchot, a Democrat and former state delegate from Montgomery County, called a special session “unwise.” He said that state sales tax revenue has been in decline over the past year, which could muddy Maryland’s long-term economic picture.

“I’m troubled as the chief fiscal officer of this state to see this rush in advance of information that could be very important, so I hope that the special session gets postponed and they pick this up in the regular session,” he said. “My concern is that calling a special session and adding a revenue package to the economy before we understand what is going on is reckless in the face of the volatile revenue figures that we’re seeing.”

As we’ve pointed out before, it is difficult to see how O’Malley gets out of the budget deficit box with the plan he has crafted. It is based on tax increases which, by their very nature, reduces the wealth of Marylanders and the competitiveness of Maryland as a business location. The only cuts in state spending proposed to date have been the elimination of a handful of vacant jobs, jobs that were created by O’Malley and never filled to begin with, and trimming the rate of increase of education spending. This last being shameful because it continues to award sizeable increases to the O’Malley strongholds of Montgomery County, Prince George’s County, and Baltimore City at the expense of the rest of the state.

Into this mix is thrown some $1.9 billion in new spending.

If no special session tax increases are enacted then the deficit increases steadily, O’Malley claims a $500 million increase but who knows because he’s hardly the most credible character.

Any tax bill looks like it will have to pass with Democrat votes alone, and probably without the votes of a lot of Democrats from outside the usual marxist constituencies. In short, if O’Malley can’t ram his plan through the legislature next month, he will be a huge loser.

http://redmaryland.blogspot.com/2007/10/omalley-planning-exit.html






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