It appears the Maryland General Assembly will be working this summer after all, as Governor O’Malley announced there will be a Special Session beginning Thursday, August 9. A few observations:
First of all, beginning the Special Session on a Thursday probably means they’ll try and wrap things up in two days. It’s doubtful the General Assembly will want to be working over the weekend and it’s probable that the session has the single-minded goal of getting authorization for a sixth casino in Prince George’s County and offering table games at existing facilities before voters. The rumors I’ve been hearing make it sound as though the change from a 67% tax rate may be dead for now – but don’t be surprised if that issue is revisited in the regular session next year.
But the question is what people like us get in the deal. I understand the proponents are making all sorts of claims that counties will see a bounty of cash flow into their coffers, but any and all of the financial components are subject to change at the whim of the General Assembly. Since the Eastern Shore only has nine House votes (seven of which are minority Republicans) and three Senate votes (2 of the 3 are GOP), it’s more than likely that any sweetheart deals will be made to entice General Assembly members from Baltimore City and Montgomery County to vote for the plan at the expense of other parts of the state. That claim of $4.9 million for Wicomico County may end up being 4.9 thousand by the time all is said, done, and horse traded.
(Also worthy of note regarding the Eastern Shore delegation: the only three who voted for the bill in 2007 were Democrat Delegate Norm Conway and two Republicans: Senator Rich Colburn and the late Delegate Page Elmore. As it stands now, Senator Jim Mathias – who was a Delegate then – may be a vote against in the Senate, leaving Conway and Colburn as the lone gambling supporters of the Eastern Shore delegation.)
Oh, and speaking of horses: I thought the intention of the original gambling bill was to prop up local racetracks by allowing them to be slot machine locations. Yet I believe Ocean Downs is the only racetrack which doubles as a slot location – the other sites are standalone sites with no racing. Nor would it shock me to see at least some part of a prospective tax cut for casino operators come out of the 9.5% the equine industry is guaranteed in Maryland. The 48.5% for education will be the last thing they touch.
We all have to concede that, compared with the rosy predictions of $1.36 billion dollars in revenue by FY2013 – the year we are in now – slot machines have been an utter failure in Maryland. The reasons for this are legion:
- Not all of the expected locations are up and running yet – locations in Baltimore City and Allegany County (Rocky Gap) won’t be open until 2013 and 2014, respectively. The Maryland Live! casino in Anne Arundel County just opened this year.
- Because other states weren’t shackled by the poorly thought-out system of needing voter approval to make technical changes, they have already put table games in place, making them more attractive to gamblers.
- Entertainment options are limited at the Ocean Downs casino by state law. This puts them at some disadvantage to nearby Delaware locations in Harrington and Dover which permit live music.
- Finally, a poor economy has limited people’s “fun money.” On a personal level, I used to go to Harrington maybe once or twice a year with the bowling prize money I received at season’s end or other “mad money” I came across. But that’s no longer possible when there are more bills to pay and less income being made; certainly I’m not the Lone Ranger in that particular situation.
So don’t look for gambling to be a cure-all, and take any predictions of revenue from the state with a significant grain of salt. It’s clear that those in charge of Maryland didn’t think things through when they sold us the bill of goods known as Question 2 four years ago, and now that potential big-money campaign contributors and Big Labor are beckoning to build a casino in Prince George’s County just outside Washington, D.C. (talk about regressive taxation there) it’s suddenly enough of an emergency to call our legislature in.
I know Senate Minority Leader E.J. Pipkin was not amused:
The real crisis in Maryland is not whether there should be a sixth casino location, but rather the trend of recent job losses. The state lost 11,000 jobs in June and has witnessed 4 straight months of job declines. Gaming expansion won’t create jobs for at least another year, and then at most 3,000 jobs. Marylanders need help today.
Meanwhile, this has been the ‘Summer of Union Handouts’ with teachers’ unions getting their own special session in May and now the trade unions getting their own special session in August. Curiously left out are the close to 2,000 union steelworkers laid-off last month at the Sparrows Point plant. The state is bleeding jobs at a rate of tens of thousands on a monthly basis, and the best the Governor O’Malley can muster is, ‘If you give me another casino, I can get you 3,000 jobs in a few years.’ How is that relief?
The Governor should know that economic development is more than just bio-tech and casinos. Instead of a special session for a single casino, we should be taking this time to develop policies benefiting all of Maryland’s working families – not just those with powerful unions.
Five years ago, Governor O’Malley called a Special Session which dealt not just with gambling but also raised taxes and spent big money on providing coverage to a small fraction of those Maryland residents who didn’t have health insurance. All this was supposed to solve our state’s structural deficit once and for all.
But a half-decade later, buffeted by damaging economic winds created in no small part by Democrats just like those who run Maryland’s government with an iron fist, we still struggle with financial hardship as a state – unfortunately, these troubles also affect the federal and local governments as well as many millions of Americans who by no means are better off than they were four years ago.
In short, there are two key problems with Martin O’Malley’s Democratic approach to state finances: rich people don’t stay to be hosed by higher taxes and broke people don’t gamble. Other than that, things are just going swimmingly.