IT'S NOT THE sort of thing that wins a politician any friends (as Marion Barry already knows), but Maryland Gov. Harry Hughes is talking about tax increases and spending decreases -- as well he should, since those once-bulging coffers in Annapolis won't be so flush next year. Not only is last year's "surplus" of cash on hand disappearing, but the effects of inflation on government spending have prompted the governor to order across-the-board spending cuts.
The latest austerity order even covers the current fiscal year. Gov. Hughes has ordered each state government department to turn back 3 percent of its money for the year that started July 1.He also ordered each agency to come up with various proposals for reducing spending next year by 4 percent, 7 percent and 9 percent; with these in hand, Mr. Hughes could make a series of choices to come out with little or no increase in total spending.
Too harsh? Some members of the legislature have suggested that there's a dash of shrewd politics in the governor's call for austerity -- that now is the time to take an unpopular stand, with an eye toward creating a new "surplus" that could be magically tarnsformed into tax cuts, state pay increases and other goodies come election year '82. Still, one way or another, Maryland is going to have to deal with money shortages. Based on current spending plans, the state faces an estimated budget deficit of $127 million, and the question for the governor, the legislature and taxpayers is not whether tax increases and budget cuts are needed, but when and how to get on with it.
Gov. Hughes already has said that an increase in gasoline taxes or automobile fees next year is a "fairly definite certainty," which must be his way of saying a near-sure-thing. The gasoline tax should have been raised earlier this year, but legislators -- driven in the opposite direction, toward reelection campaigns -- got cold feet. Action next year is critical. In the meantime, Gov. Hughes and his department heads will be studying financial options that will be felt not only at the state level but in all the local subdivisions that have been looking to Annapolis for financial relief. This means that state aid for welfare, education and police is likely to undergo legislative scrutiny. In addition, any budget squeezes are likely to affect state colleges, universities, prisons and hospital/health programs. All of these decisions are delicate. But in sending out warning signals now, Gov. Hughes at least has given responsible legislators time to figure out how to approach the state's financial problems in a reasonable manner.