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O'Malley's Final Solution: More Government

Governor would do well to look to Virginia as an example in growing a state economy by encouraging private investment

"Two governors, but only one has made the tough choices to put our priorities first," intoned one of Gov.Martin O'Malley's closing campaign ads from the 2010 election.

The ad was intended to differentiate Governor O'Malley from his GOP opponent, former Gov.Robert L. Ehrlich Jr. But in light of some of the current governor's recent actions, I've been revisiting this whole concept of comparing two governors.

First, let's compare Governor O'Malley to his next-door neighbor, Republican Gov. Robert McDonnell of Virginia.

Private-sector job creation was a major focus of the State of the Commonwealth speech Governor O'Donnell delivered Jan. 11. The governor proposed a $37 million package consisting of tax credits for small business and other measures intended to support existing economic development initiatives. Further, Governor McDonnell's biennial budget included no new tax increases.

Even more important than any individual policies or programs is simply the complete difference in mindsets between Maryland and Virginia.

Our competitors to the south understand that an expanding economy is the best way to grow state revenue. They know that sustainable job creation hinges upon attracting new private sector investment. By contrast, the O'Malley jobs plan consists entirely of 1930s-style public works projects funded by applying the 6 percent state income tax on gasoline (in addition to the separate gas tax).

Whereas funding Maryland's sprawling and bloated government by any means necessary is Governor O'Malley's top priority, creating and sustaining prosperity defines the agenda in Virginia.

For the Commonwealth, it means competing with, and beating, Maryland in the effort to attract new investment. And, so far, Virginia's approach seems to be working. High-profile companies relocating to the region continue to choose Virginia over Maryland, including CSC, Hilton Worldwide, Northrop Grumman, SAIC and Volkswagen North America.

There is another "two governors" comparison worth making: The Governor O'Malley of today versus the Governor O'Malley who was a candidate for reelection in 2010.

Candidate O'Malley claimed to have "cut $5 billion in spending." But, Governor O'Malley has actually increased state spending by $6 billion since 2007, including an 11 percent jump in general fund spending in fiscal 2012 — among the largest increases in the nation.

Candidate O'Malley said he helped "small businesses grow with new tax incentives," while he ran television commercials railing against fees and taxes. But Governor O'Malley mused about raising sales taxes by 40 percent.

When that idea proved a nonstarter even among Mr. O'Malley's own legislative allies, he looked to put the squeeze on businesses and consumers alike by increasing taxes on Maryland's energy and telecommunications industries, imposing sales taxes for online purchases, tripling tolls, tripling the so-called "flush tax" and boosting the gas tax on Marylanders already feeling the pinch at the pump.

All of that comes on top of the hundreds of millions of dollars in fee and tax increases he enacted last year, not to mention the largest tax increases in Maryland history, which he pushed through in his first term.

Candidate O'Malley positioned himself as a champion for Maryland's working families. Yet Governor O'Malley has proposed increasing tuition at state colleges and universities for the third straight year. What's more, he believes the people struggling to pay those tuition costs — people earning $100,000 a year, not exactly "millionaires and billionaires" — are the "rich" and must pay even more in income taxes.

This week's State of the State address seemingly put to rest which governor we would see in this year's legislative session: Candidate O'Malley, who opposed "fees and taxes" and touted his "strong fiscal leadership," or second-term Governor O'Malley, who has continually asked struggling Marylanders in a challenging economy to sacrifice even more. Yet, it's not too late for him to reverse direction.

Mr. O'Malley should try promoting long-term strategies for private-sector job creation, rather than simply revisiting the same old conversation about how best to protect the status quo and maintain an already bloated state government with massive increases in spending and taxes. This new course should be the primary focus for this legislative session and for his remaining years in office.

For this governor and the state he leads, our very economic future is at stake. If we are ever going to turn things around, we simply must start now.

Larry Hogan, a former state cabinet secretary, is the chairman of Change Maryland and the founder and CEO of a group of companies headquartered in Annapolis. Email This email address is being protected from spambots. You need JavaScript enabled to view it..

" I don't know what's wrong with my television set. I was getting C-Span and the Home Shopping Network on the same station. I actually bought a congressman. "

--Bruce Baum

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