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Commentary: Maryland's economic deterioration is 'progress'?

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By Robert L. Ehrlich Jr.
Monday, August 9, 2010

By Robert L. Ehrlich Jr.

Gov. Martin O'Malley (D) often refers to his tenure in Annapolis as one of "progress," implicitly arguing that Maryland is better off today than when he took office.

Nowhere could this argument lack more credibility than on Maryland's economic climate, which is unquestionably less friendly to job creation than it was four years ago.

Consider the evidence: Unemployment in Maryland doubled from 2006 to 2010. Approximately 3,000 small businesses closed on the O'Malley administration's watch last year.

Neighboring Virginia easily outranks Maryland in eight out of 10 categories in CNBC's America's Top States for Business survey, including overall economy, quality of life, business friendliness, transportation and cost of living. Maryland has become a flyover state as businesses like Northrop Grumman move their corporate headquarters and jobs to the other side of the Potomac River. Since 2006, the Tax Foundation has dropped Maryland 26 spots in its ranking of the states' business tax climates.

The causes for Maryland's decline are clear. By passing the largest tax increase in Maryland history before a recession, Gov. O'Malley siphoned sorely needed dollars from job creators and families across the income scale. Second, regulatory agencies began treating small businesses as a source of new fines and tax revenue rather than a source of new jobs. Lastly, government spending in Maryland over the past four years increased by $22 billion compared with the preceding four years. Not surprisingly, a $1.8 billion deficit awaits the next governor and legislature.

As governor, I will redefine "progress" in Maryland by focusing on three priorities.

First, I will fundamentally change the mind-set in state government to ensure that job creators are treated as partners rather than inconveniences.

Second, I will work to make Maryland's corporate income tax more competitive with that of surrounding states so we can attract and retain jobs. I will repeal Gov. O'Malley's 20 percent sales tax increase, which disproportionately hurts low- and middle-income families.

Third, I will fix Maryland's budget deficit by reprioritizing government spending. I will invest scarce transportation dollars to fix deteriorating infrastructure, especially Metro and MARC.

Skeptics should consider my first term as governor. We enacted ambitious proposals to resurrect Maryland's jobs climate in the wake of a recession. We launched construction on the Intercounty Connecter after 50 years of delay, dramatically strengthened investments in technology and education, defeated $7.5 billion in taxes proposed by the legislature and funded Maryland's share of the Metro Matters agreement to improve Metro.

As a result, more than 100,000 private-sector jobs were created in Maryland. Business confidence reached an all-time high, as measured by the Jacob France Institute.

November's election is about who is better prepared to lead a lasting economic recovery in our state. Marylanders need only ask themselves whether fewer jobs, higher taxes and bigger deficits these past four years fit their definition of "progress." I have higher expectations for Maryland. With three big goals -- more jobs, lower taxes, less spending -- we'll get Maryland working again.

Republican gubernatorial candidate Robert L. Ehrlich Jr. served as Maryland governor from 2003 to 2007.


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