If O'Malley wants to create jobs, there's a better way

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One can scarcely blame Gov. Martin O'Malley for wanting to do something about jobs. Maryland's unemployment rate, while still well below the national average, is high and showing little sign of improvement despite the boost from the federal military base realignment program that has sent thousands of defense-related jobs to the state in recent years.

Given that Mr. O'Malley supports President Barack Obama's jobs bill and, as chairman of the Democratic Governors Association, also harbors his own aspiration for the national political stage, his announcement Wednesday that he will offer his own jobs bill at a special session next month comes as no surprise. The message that Democrats support job creation is clearly something that he believes voters very much want to hear.

But what Mr. O'Malley is offering — at least from the hints he and his staff have offered so far — is likely to have a negligible effect on the economy and the unemployment rate this year or next. That doesn't make his ideas bad, just ill suited to the task of creating jobs right now.

That's because the governor is apparently interested in tax credits — including an expansion of those already offered for research and development and biotechnology. And while those are worthwhile long-term investments in Maryland's 21st century economy (particularly as the state seeks to build on key assets, its existing research centers and highly educated workforce), those are seeds that are likely to bear fruit years from now and not immediately.

The biotechnology tax credit, for example, provided breaks to 13 Maryland firms in the 2010 fiscal year. According to a report from the Department of Business and Economic Development, the 12 participating firms who responded to a survey about the program reported having hired or planning to hire all of 56 workers.

What the state could use — and what, interestingly enough, President Obama has also included in his own jobs bill — is an immediate investment in public infrastructure. It is within Mr. O'Malley's grasp to put thousands of Marylanders back to work in a matter of months building roads, bridges and transit projects, investments that the business community is crying out for right now.

Yet the governor and Democratic leaders in the General Assembly have rejected calls to include a gas tax, or any other transportation-related revenue measure, in the special session which has been convened primarily to approve a congressional redistricting plan. Consideration of a gas tax increase has been deferred until lawmakers reconvene for the regular session in January, but even then it faces an uncertain future.

How is that possible? Today, Maryland motorists face some of the worst commuting times in the nation — with both the Washington, D.C. and Baltimore-Towson metropolitan areas ranked among the bottom 10, according to the latest U.S. Census figures. Congestion is worsening, but the state lacks the funds to do anything more than maintenance projects right now.

Conservatives can complain about transportation funds used to help balance the general fund budget over the years, but the scale of Maryland's needs far transcends those withdrawals. The Maryland Department of Transportation recently estimated the state's unfunded "top-priority" projects total more than $12 billion.

Lawmakers are clearly scared to raise the state's gas tax, which has remained frozen at 1992 levels (despite the fact that retail gas prices have more than tripled since then) because voters say they don't want to pay more at the pump.

Yet the reality is that raising the tax from the current 23.5 cents per gallon to 33.5 cents — a dime — would hardly be noticeable to consumers. Prices have gone up and down by far more than that in recent years without much impact on the state's economic circumstances, good or bad.

Obviously, a dime wouldn't pay for $12 billion in improvements, but it would go a long way toward getting the state the $800 million annual investment a blue-ribbon commission recently recommended. That would not only get people back to work (and in construction trades, one of the worst-hit segments of the job market), but it would help the many businesses that depend on a functioning transportation system to earn their living.

Tax credits have their place, and high-tech jobs are particularly welcome. But if Mr. O'Malley wants to have a significant and immediate impact on the economy, he needs to break out the reflective vests, hard hats and shovels and start convincing lawmakers that its time to get people working on Maryland's transportation future.

Copyright © 2014, Los Angeles Times
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