02 October 2007

Maryland Democrats: Tax and Spend, and Grant Amnesty, All the Doo-dah Day

Democratic Governor + Democratic Legislature = Impending Doom on State Residents. First of all, raising taxes by an astounding $7.6 Billion is insane. The article linked in the preceding sentence, The Baltimore Sun lays out some of the details:

O'Malley's plan to tackle Maryland's budget woes would include a restructuring of the state's income tax, which he says would reduce taxes for lower-income families while raising taxes for the wealthy; an increase in the state sales tax from 5 percent to 6 percent; a doubling of the cigarette tax to $2 a pack; and an increase in the car titling tax. He is advocating an increase in the corporate income tax rate from 7 percent to 8 percent.

The governor also has put forward a proposal to legalize slot machine gambling in Maryland that he says would raise $500 million to $600 million annually.

A few problems here. First, as always, the cure-all for Democrats is not to fix corrupt and wayward spending, cut programs, or even increase efficiency, it is to raise taxes. It's to make the citizens pay more for the same failed policies, which they say they will gleefully increase as well. Failing and decayed programs to get more money? It's the Liberal mantra. Raising taxes for the wealthy? Hmmm...they do not actually define what "wealthy" is here, interesting. Additionally, the "wealthy" are the ones who do the largest, by far, amount of investing in the infrastructure of the state and corporations that operate within it. By choking off the investment revenues, they are guaranteeing themselves further problems. Another policy they should really feel ashamed about is the cigarette tax increase. This will fail as well. First off, the increased cigarette prices will lead to lower consumption and restrict new smokers from entering the market, which in itself is not bad. It is bad, however, when you are expecting the demand to remain flat and therefore will result in a decline in actual tax revenue. Conversely, if they honestly expect revenues to increase and demand to remain flat, then is there any way they are any different, then say, a drug dealer? After all, cigarette smoking is an addiction and to take economic profit due to addiction is something a drug dealer does. This is essentially the argument that was made about the tobacco industry in the famous court cases. How long then, before that same argument is made against state and federal governments? After all, they are doing precisely the same thing.

Another issue is the raise in sales taxes. Maryland is not exactly a large state, I've been there many times. It's not exactly difficult to buy things from Delaware, West Virginia, and Virginia for lower sales taxes. Sure, you would think 1% is not exactly large, but when the premise of their plan is to lower taxes on the "lower income" families, these families are the exact ones who will not have the means to consistently travel outside of the state to beat these taxes. The same goes for the aforementioned cigarettes. All they would have to do is go into Delaware in order to avoid the tax, and believe me, it will happen. Raising the corporate taxes is also a great recipe for lower employment numbers and a great way to start a recession. After all, it's not exactly going to be a difficult decision for companies to pack up shop and start in another state, or even nation. Democratic politicians constantly beat the drum of outsourcing to Third World Nations. How then does it make any logical sense to attempt to stop outsourcing, which is a response to rising costs of business....by raising the cost of business? Lowering taxes would encourage employers to hire more workers in order to produce more and generate a larger revenue stream in the state. Finally, lets look at the slot issue. With slots already legal in PA, NJ, and DE, how exactly is the state planning on raising so much money through this means? Again, a larger pool of slots will result in lower revenues at all slots. Simple supply and demand. I'm not saying they will not make any money off this endeavour, I'm simply saying that when there is a massive supply of slots in the region, they payoffs from these machines will grow larger to attract more people, and these larger payoffs will result in lower tax revenues. It also goes back the addiction theme I mentioned earlier, Gambling is often classified as an addiction. For the government to provide a larger supply of something that is considered an addiction is a predatory practice, and sure wealthy people gamble, probably more so than lower income people, but the wealthy are not the ones buying lottery tickets and taking their shots at moving into a better life with a pull of a lever, a draw of the numbers, luck of the draw, etc. It's the lower income families that do. It's who the Democrats in Maryland are taking full advantage of, P.T. Barnum style.

Another major issue being overlooked is the round-a-bout amnesty that Maryland Democrats are trying to shove down their populations' collective throat. What is it with the hard left that they will try to push amnesty through by hook or by crook? They are persistent border destroyers, I'll give them that. Yet another reason to never trust the Liberals with any bill unless 100% scrutinized. Give that article a real good read, and then ask yourself who is really benefiting the greatest from the new tax and spend proposal before the Maryland Legislature. It's not very important for the Democrats in Maryland to run a tight, efficient ship, but it is important for them to by pass the REAL Act, which aims to stifle terrorists and illegal immigrants. Again...I question their patriotism.


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