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WYPR's Senior News Analyst opines on recent Maryland news.

Smith: Were O'Malley's Fiscal Feats "Plunder" Or Tough Choices?

Tom Chalkley

A listener's long bill of anti-O’Malley particulars includes this:

“He plundered dedicated funds from the budget and transferred them to the general fund.”

Was it plunder? Or was it difficult, recession-driven  choices?

Maryland’s chief fiscal analyst, Warren Deschenaux, says our recession stress has several drivers: gridlock in Washington, the sequester, the government shutdown and the fiscal cliff hysterics.

Yes, there were tax increases.

"For the most part," Deschenaux says, "the higher *debt levels were justified as job-producing investments." They also kept environmental programs going after revenues were diverted to sustain education and social welfare spending."

And now, the listener says, taxes must rise to pay back the borrowing costs.

Deschenaux: It won’t necessarily mean higher property taxes. There are ways to use other revenue to cushion the blow.

The structural deficit is back, the listener observes. Wasn’t the sales tax increase supposed to eliminate that?

Deschenaux recalls: “That increase was necessary primarily to meet the increased cost of the Thornton education formula.”

Then came more bad luck. The sales tax increase came in November 2007.  The “Great Recession” started the next month. As a consequence, over a couple years, we lost the benefit of the tax increase revenue and opened a spending gap we have yet to fully close, in part because recovery has yet to fully come to our region.

Excessive spending, the listener insists.

Perhaps, but was it excessive to give state employees a cost of living increase? Depends on your point of view.

“With a stricter approach we would surely be in better shape,” Deschenaux says. But resolve withers in the face of forecasts that show a better day awaits.

Are we witness to incompetence, as the listener suggests? Or was O'Malley trying to get through the rough seas without throwing anything (or anyone) overboard?

*This quotation essay has been corrected from the original published version.

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