Friday, January 25, 2013

The State Of Maryland's Drug Habit...

What gasoline will cost
with the anticipated "revenue" plan
The beloved home state that contains the Lattanzi Land base of operation is moving further down the path to fiscal insolvency.  However, instead of placing responsibility where it ought to go, the fools in charge of the state legislature respond like Pavlovian dogs by insisting that raising taxes generating new revenue is the only possible solution to any kind of budget deficit and financial shortfall Maryland happens to face.

At issue is the the state gasoline tax.  Senate President For Life Mike Miller has proposed a so-called "two-pronged" approach in how to raise the tax.  Currently, the Maryland gasoline tax is a flat rate of 23.5 cents per gallon.  Allegedly, this is to fund transportation projects throughout the state, such as highways and bridge repairs. What never seems to get mentioned is how the legislature has raided transferred close to a billion dollars from the transportation fund over the past ten years.

The first part of Miller's proposal is to raise the flat rate by five cents to 28.5 cents a gallon, with the catch being that the five cents would be imposed by the individual counties.  The second part of the proposal is to impose a three percent sales tax on gasoline as well.

I could see the flat rate being passed, but the sales tax is a double-edged sword.  It presumes that gas prices will stay at or about three dollars per gallon.  If prices ever fall to under two bucks a gallon, the tax receipts will simply be slashed and then they'll have to go through all this crap again to make up the lost receipts.

I do have one simple question, though.  Why does Mike Miller hate the poor and the working class of Maryland?

This is not a flippant question; it is obvious that any kind of tax increase, er, excuse me, "newly generated revenue" on consumption is by nature regressive.  So obviously what Mike Miller and Martin O'Malley are trying to do is punish the working poor in the state by making it more expensive for them to get to their place of employment.

Getting back to the point of the double-edged sword of attaching taxes (sales and flat) to gasoline - this is identical to the issue of cigarette taxes.  The state determines that the taxes, er, "revenues" derived from the consumption of the product are going to fund some public good (health care by cigarette taxes and transportation by gasoline).  However, at the same time, we are being told by the same people (who overwhelmingly tend to be liberal Democrats) that a) smoking is bad for us and b) we need to drive more fuel-efficient cars.  

Well, guess what?  People smoke less and there are more fuel-efficient cars on the road now. What does it mean?  Budget shortfalls on both ends.  Thus beginning the vicious cycle of wanting to raise taxes on those things which then discourages further use of the product.  It can't be both ways.

What bugs me the most about this, ultimately, is the gross irresponsibility of the budgeting process that a) raids from the transportation fund to pay for whatever voter bribery social program instead of, you know, transportation stuff and b) the premise that the only solution is the hiking of taxes.  Eight months ago in this space, I said that Maryland needed to reduce spending to get its shortfalls under control.  There will soon not be any millionaires left to tax.  I even gave some suggestions:
Eliminate several administrative positions in our University system.  Make professors earn their money by, you know, teaching, instead of getting tenured research positions that require just one class and several research junkets.  Cut back on the staffing in the bureaucracy that is starting to make Annapolis look like Whitehall. Legislators should only get stipends rather than salaries.  Get the unions out of state employment and switch all pensions for those under 55 to 401k/403b plans.  Simple, isn't it?
But, hey, Maryland is getting some cool casinos and Martin O'Malley has an Irish rock band, so it can't be all bad, right?


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