Not Doomsday for Wasteful Spending

Marc Kilmer May 9, 2012

The special legislative session is less than a week away. This session will almost certainly raise taxes in order to fund even more spending for the next fiscal year (the current budget has increased spending over last year’s level, contrary to the impression left by many media reports). The governor, legislators, and special interest groups say that this session is needed to restore funding for important programs. But if legislators and the governor would have made cuts in other areas of the budget, there would be no need for them to raise taxes.

According to Governor O’Malley and legislative leaders, the state faces a stark choice – raise taxes or millions of dollars will be cut from education, disability services, and foster care. True enough, the budget bill that passed did contain cuts to higher education, services for emotionally troubled teens, and disability services. Cuts to these programs total $83.9 million (see page 8 of this document). (The other $166.1 million in cuts would come from savings in the state government, eliminating corporate welfare, and ending the ability of legislators to hand out scholarships – certainly none of these savings are to essential state functions.)

As I wrote about a couple months ago, the governor proposed a lot of wasteful spending in his budget. The savings in the “doomsday budget” do eliminate some of this wasteful spending, but not enough. Let’s say the state wanted to find $84 million in savings without touching education, foster care, or services for emotionally troubled teens. How would it do that?

The governor proposed that the Division of Business and Enterprise Development be funded at $74.3 million. His proposal for the Maryland Technology Development Corporation was $13.6 million. These agencies hand out corporate welfare. What’s more important – corporate welfare or higher education? Obviously, the governor and legislators decided that giving taxpayer money to for-profit corporations takes priority.

An easy way to find $87 million in savings would be to eliminate the Maryland Horse Racing Commission. But, no, the governor and legislators decided that kids with emotional problems and kids in college aren’t as important as propping up the dying horse racing industry. After all, they must have reasoned, the handful of people who attend races at Maryland race tracks can’t be expected to do without a state subsidy, can they?

Legislators and the governor also could have targeted items such as buying and operating slot machines in Maryland casinos. This idea actually did gain some traction in the General Assembly, but nothing came of it. Next year the governor proposed almost $258 million to do this. It seems to me that welfare for casino owners should be a lower funding priority than higher education, but maybe that’s why I’m not a member of the General Assembly.

I could go on but you get the point. The question really isn’t between raising taxes or doing without vital government services. It’s between cutting what may be vital services or cutting other, certainly non-vital, government programs. When legislators raise taxes next week, keep in mind what the money is really going to pay for.