



The budget deal announced by Maryland’s leaders on Thursday avoided hard decisions and did nothing to improve the state’s economic or fiscal outlook in the years ahead. All that happened was Maryland’s government agreed to spend $2 billion less than it originally planned but still $1 billion more than it actually has. It raised money to come up with the difference in part by introducing new taxes on digital services, the very industries Gov. Wes Moore has said would grow our state economy in the years ahead. The agreement failed completely to make the kinds of hard choices around the Blueprint for Maryland’s Future that could have avoided this year’s tax increases and many of the planned reductions to spending. Worse, nothing in this budget agreement comes close to addressing future state deficits, estimated to reach $6.2 billion annually within five years. Our governor, Senate president and speaker of the House grasped hands in a victory pose after announcing their budget deal but all they can honestly celebrate is kicking the can further down the road.
How did we get here? Except for Democratic primaries, the relatively uncompetitive nature of our politics means politicians compete to outdo one another in support of causes popular with Maryland’s relatively liberal electorate. They don’t always consider the fiscal impacts of those policies or the pressure they exert to raise taxes. Though denied by our leaders in Annapolis, Blueprint spending is a major reason why the state plans to levy $1 billion in new taxes and fees and plans to spend $2 billion less in support of other programs. Advocating for the Blueprint provides politicians with easy talking points about supporting children and easy avenues to attack opponents who question the wisdom of the Blueprint’s spending. It’s not a coincidence that one of Moore’s first acts as he laid the groundwork for his campaign was to testify in support of the Blueprint. He and others are quick to point out its goals but disguise its cost and obscure its unintended consequences.
Democratic leaders claim the Blueprint isn’t the cause of the state’s poor fiscal condition because it’s fully funded with “special funds” for the next three years. Their explanation is hugely misleading and the money in the special fund would have been available for other purposes had it not been redirected. Claims by leaders like Senate President Bill Ferguson that making changes to the Blueprint would not help this year’s deficit are also disingenuous. The money in the Blueprint special fund is there because of a law passed by the legislature and the legislature could pass another law making it available for other purposes. The Blueprint has so far been funded by taking money from existing revenue and by diverting money from the state’s rainy day fund, leaving us with less money to meet other obligations. This gave politicians willing to accept the sleight of hand a useful talking point and hid the Blueprint’s true cost.
What is that cost? New taxes, like the ones recently unveiled on digital services, make it less likely that businesses will establish themselves or expand in Maryland. This means fewer jobs for Marylanders and a smaller tax base in the future. As a Democrat, I believe businesses should be willing to pay higher taxes to support higher government spending, but reality is different than belief and most businesses will choose locations that offer lower levels of taxation. Maryland has advantages that justify businesses paying more to be here, but there’s a point where our advantages are overcome by the costs we impose.
The Blueprint’s mandated spending is also hitting Maryland counties hard and will force them to reallocate money from other worthwhile endeavors, which might include everything from supporting libraries to trash collection. Projections from the Department of Legislative Services illustrate the weight of the burden, with the Blueprint’s cost to counties over the next five years now $3.7 billion higher than anticipated when the law was passed. As the Blueprint consumes a larger portion of available revenue, other things will have to give.
Supporters of the Blueprint attack skeptics as being unwilling to invest in children. The truth is, those who support and oppose the Blueprint both care about educating Maryland’s children. But opponents also focus on supporting children by facilitating a state economy capable of providing them good opportunities after graduation. Even if the Blueprint works, and it’s not clear that its mandates and reforms will have the transformative effects its proponents believe, we would have failed our kids if the side effects of education reform mean they have to leave Maryland to find work or start a business once they graduate.
The Blueprint can’t be our only priority and we can’t have it all. Our state is struggling to fund everything from care for our disabled neighbors to unemployment benefits for dismissed federal workers. The Blueprint pursues a worthy goal but our state has many worthy goals. Opposition to the Blueprint has nothing to do with opposition to education and everything to do with supporting our state’s other priorities, not least of which is to help create a thriving and diversified economy that provides pathways to solid middle-class lives. Opposition also has to do with the uncertainty over the Blueprint’s outcomes. The scope of the reform will make it difficult to determine which of its many investments are actually working given the number of things happening at once. Explaining all of this to Maryland voters who care deeply about our state’s children isn’t easy, but a reduction in the Blueprint’s scope is nonetheless necessary. It’s the job of our political leaders to help Marylanders understand why. Instead, our elected leaders took an easier road. They agreed to a tax cut that will give the average Marylander an extra few dollars a month and hoped this would distract from the tax increases that do real damage to our economy and the prospects of our children.
Colin Pascal (colinjpascal@outlook.com) is a retired Army lieutenant colonel, a registered Democrat and a former member of the Veterans for Hogan Coalition. He is a graduate student in the School of Public Affairs at American University in Washington, D.C., and lives in Annapolis.