Basic Economics

Republican Delegate LeRoy Myers has taken on some tough issues in the past but over the weekend he penned an op-ed in the Cumberland Times-News which addresses the underlying “structural deficit” the state is facing to the tune of $1.5 billion.

You might have thought only economists understood this stuff but Delegate Myers shows that it really isn’t that hard. State and local governments simply spend too much.

Serving on the House Appropriations Committee, I get a firsthand view of the gloom-and-doom budget forecasts for the state of Maryland. The “structural deficit” simply means that the state government is planning to spend more money than we have. The knee-jerk reaction of the governor and my Democratic colleagues in the General Assembly has been to solve the problem by raising taxes. This simply is not necessary. Like the citizens we serve, state government needs to live within its means. We need to slow the growth in government by reducing the amount of money we had planned to spend. This can be accomplished without cutting any current services.

I don’t know if you can cut $1.5 billion without cutting current services, I’d be open to discussing that concept, but there is no doubt that the budget can be pared without touching essential services.

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Mr. Myers makes an observation that should be stapled to the forehead of every financial analyst and legislator in Annapolis: you can’t escalate spending faster than income. Well you can, we have evidence of that before us, but it is really a suboptimal approach to doing business.

Over the last eight years, the state’s operating budget has increased by a
staggering 70 percent, while the median family income in Maryland has increased
by a much more modest 28 percent. Gov. O’Malley has referred to pending tax
increases as an investment in Maryland’s future. The best way to invest in
Maryland’s future is to allow its families to keep their hard-earned money.

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