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2012 Maryland General Assembly Legislative Session Preview

The Maryland General Assembly, or as my friend Doug Gill likes to call it the Cistern on the Severn, kicks off its 2012 legislative session today. Here is a run down of the big issues, and how I see things playing out.

The Budget

Maryland faces a $1 billion budget deficit for FY 2013. Governor O’Malley has said he favors a “balanced approach”, which is code for tax increases. O’Malley has foisted the fiction—with almost no accountability from the press—that he has cut over $6 billion in budget cuts. In reality the entire state budget has increased by 16 percent since he took office. O’Malley increased general fund spending by 11 percent one of the largest increases in the nation.

Maryland has a spending problem and the data bears this out. Since 1997 Maryland general fund spending increased 97 percent, while revenue increased by only 78 percent.

Don’t expect any real budget cuts, just more phantom cuts, which are just reductions to the planned increases. Spending will go up along with and taxes.

Taxes

Expect hikes in the gas tax and the flush tax.

Proceeds from the enhanced gas tax will ostensibly go to pay for O’Malley’s infrastructure stimulus plan. Yet Maryland’s own dismal experience with the federal stimulus plan shows the minimal impact on the state’s economy. Note to O’Malley: you only have yourself to blame for raiding the transportation trust fund to the tune of $861 million.

Doubling the flush tax will supposedly replenish funds needed to upgrade sewer plants. If only O’Malley and the Democrats hadn’t raided the Bay Restoration Fund to cover their general fund spending deficits.

Also, substantial property tax hike may be in the cards to keep up with O’Malley’s increase in debt spending and policy of replacing the cash raids on the capital budget to cover his general fund deficits.

Vinny DeMarco—stooge for Big Tobacco—is seeking another dollar hike cigarette tax. We need a higher sin tax on smokes because the last one worked so swimmingly that it brought in tens of millions of dollars less than projected, nurtured the black market for cigarettes, and led Maryland smokers to buy their smokes across state lines.

Education funding—the largest portion of the budget and main driver of the structural deficit—will continue to increase. Marylanders will continue to spend more money on our “number one” school system in return for ever-increasing achievement gaps, and churning out high school graduates, who need remedial math and English when they get to college.

Plan Maryland

Several legislators have filed bills to put the brakes on O’Malley’s Plan Maryland power grab. We’ll see whether there is enough bipartisan support to stop it. Remember, as a comparison between Texas and Maryland shows, markets are superior to central planning.

O’Malley is also reigniting his ill-conceived push to ban new septic systems.

Plan Maryland is the stick central planners need to coerce local governments to implement Smart Growth policies. Without state coercion, Smart Growth doesn’t work because developers respond to the demands of the market. Producers, responding to consumers needs, in a free market, is just not something O’Malley and the technocrats can allow in this “One Maryland.”

O’Malley says he doesn’t want the state subsidizing “stupid decisions.” Yet, in the end, taxpayers will end up subsidizing the unintended consequences O’Malley’s stupid decisions.

Offshore Wind

Conventional wisdom seems to say O’Malley’s offshore wind boondoggle is running into stiffer headwinds. Yet O’Malley’s new tack will be to back door the corporatist boondoggle through his hand picked appointees on the Public Service Commission. The idea is to set up a credit trading system—much like his renewable portfolio standard scam—for the potential wind power. Ratepayers still get stuck subsidizing a costly, inefficient form of energy, for the benefit of O’Malley cronies.

Gay Marriage

The measure failed to make it out of the House of Delegates last session, but O’Malley is backing it this time around. If it passes the Assembly—which is still not a certainty—look for a referendum petition to put same sex marriage before the voters. Imagine a November ballot with Barack Obama, the DREAM Act, and gay marriage.

Transparency and Ethics

There will be a lot of talk, but not much action, as the powers that be will eschew real reform in favor of window dressing.

As the late, great, Ron Smith once said, “all we can do is bend over, and await the denouement.”






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