[ad_1]
Maryland’s lackluster economy must shift, he said in an interview, and he wants their help to invigorate it.
“There’s no reason to look at the assets that we have in the state of Maryland and then say, ‘Oh, by the way, our economy is the same size as it was four years ago,’” Moore said Thursday. “That makes absolutely no sense. And it just means that we have not been intentional, and our economy has been lazy.”
The data backs him up: Adjusted for inflation, Maryland’s economy grew by a measly 0.2 percent between 2018 and 2022, compared with 3.1 percent in neighboring Pennsylvania and 7.5 percent nationwide.
In some ways, Moore’s message is not new. The first-time politician who started his career as an investment banker had campaigned by calling Maryland “asset-rich and strategy-poor.” But raising the alarm — and tempering expectations of policymakers — marks a shift in tenor for a governor who has played the role of charmer in chief.
A rising star in the Democratic Party, he has raised money nationally for other governors and served as a surrogate for President Biden on national talk shows. Just last weekend, he appeared in Martha’s Vineyard for a fundraiser with Vice President Harris.
At home, he has vowed to end child poverty, reduce the racial wealth gap, ease the financial burden for retirees and launch major infrastructure projects. He plans to replace the aging American Legion Bridge; build a new transit line, the Red Line in Baltimore; and halve the historically high rate of vacancies in state government — ambitious goals that have elicited praise and curiosity about how he will accomplish them.
The underlying message of his planned speech in Ocean City on Saturday is that the state can’t afford to leave systemic problems unresolved, but the economy must provide more resources to solve it.
“Our commitment to being bold and our commitment to being fiscally responsible do not have to be at odds with one another,” Moore said.
“There has been no growth,” he continued, adding: “There’s no excuse. And we’re falling behind. … We have to make a choice that we actually want to win.”
The economic picture Moore plans to highlight will detail a state that relied on the federal government as a chief employer for decades and has yet to recover the jobs lost during the coronavirus pandemic, even as the nation as a whole has added millions of new positions; a state population in decline, while the nation’s and Mid-Atlantic region’s population is growing; and a state with a sluggish gross domestic product outpaced in growth by the nation and the region. For the past 10 years, his administration says, Maryland’s economy has grown at half the pace of the rest of the country’s.
“The private sector in Maryland is largely stagnant,” said Anirban Basu, chairman and chief executive of Sage Policy Group, an economic and policy consulting firm headquartered in Baltimore.
Basu said Maryland has a low unemployment rate not because of a competitive labor market, but because people have stopped looking for jobs here and moved elsewhere.
“That is primary evidence indicating that the state is losing human capital, and that there are other communities around the country that are viewed by job seekers as more dynamic, and perhaps even a better place to live,” said Basu, who served as the state’s economic adviser during Republican Gov. Larry Hogan’s second term. Maryland has been unable to convert its high concentration of expertise into commercial businesses, he said.
“The policymaking community just can’t get this right,” Basu said. “We’re a juggernaut in terms of research and discovery, but not in terms of commercialization.”
Moore plans to encourage the insider crowd at the Maryland Association of Counties’ annual conference to help him get it right.
He’ll call for using the state budget to invest in high-growth industries linked to the state’s existing economic infrastructure, including the headquarters of cyber and security installations such as Defense Information Systems Agency and the National Security Agency, as well as higher education institutions such as Johns Hopkins University and the University of Maryland system. He does not plan to offer specific incentives Saturday and, in June, created the Maryland Economic Council to come up with recommendations by January.
“This is about how we’re reordering, reorienting our economy for the future,” Moore said, citing his goals to make Maryland the “offshore wind capital of the world” and a leader in the artificial intelligence and cyber industries.
By extension, those growing industries would make Maryland less reliant on the federal government, the medical industry and higher education, three dominant forces now.
“We have the assets that we can build off of. It just requires an intentional measure of investment,” he said.
Maryland, like states across the country, had its balance sheets swell with pandemic aid and extra revenue from active stock markets, creating historic surpluses that at one point exceeded $7.6 billion. While state leaders put more than $2 billion of that into savings accounts, the economy can’t support planned spending, including a plan to revamp public schools in a way that raises achievement and invests heavily in students from lower-income areas.
Maryland’s revenue is expected to grow by 3.3 percent annually over the next several years, while planned expenses will grow by 5.1 percent, according to a June report by the Maryland Department of Legislative Services.
The same report found that the state’s budget is expected to balance with $150 million left over next year, but post a $418 million budget deficit the following year. By 2028, it becomes a $1.8 billion gap — and that doesn’t account for spending on any new initiatives Moore has promised.
State leaders routinely face and close budget gaps without deep cuts to public services. Moore’s staff said 17 of the past 20 budgets also had built-in deficits.
Some prominent lawmakers have floated the possibility of rewriting the tax code to make higher earners and corporations pay more, and to help raise cash for the education plan.
Saturday’s speech can also serve as a moment to help set expectations for officials in local governments, which receive about 18 percent of the state’s $63.1 billion budget.
“When I’m going out and talking about the challenge that we have and the fact that we need to create better ways and better mechanisms for economic growth, I am not expecting much pushback from local jurisdictions,” Moore said. “Because they get it and they have seen how this is impacting their balance sheets. … We have the assets. But if you look at our balance sheet, it doesn’t reflect that.”
This story has been updated to reflect additional comment from the Moore administration.
[ad_2]
Source link