By Len Lazarick
Greater Baltimore Committee Chairman Brian Rogers of T. Rowe Price Group
With a report Monday by CEO magazine ranking Maryland among the 10 worst states to do business, the Greater Baltimore Committee said it’s going to renew its push to improve the state’s competitiveness.
“I’m always struggling with why we think we’re so good and others think we’re not,” said Brian Rogers, chairman of the T. Rowe Price Group who chairs the Greater Baltimore Committee’s board.
Rogers told the GBC’s annual meeting Wednesday night that despite Maryland’s good schools, highly educated workforce and quality of life, it’s a real concern that the state ranks at best in the middle of the pack for doing business.
According to CEO magazine, Maryland ranked 41st among the states, slipping from 33rd place in 2010, to 37th in 2011, and 40th in 2012, putting it among the 10 worst states for the first time. The magazine said Maryland’s “development trend indicator” was ‘negative,’ ” having “passed major tax increases, [and] now may boost minimum wage and sick leave.”
Tax rates drive business decisions
“Our relative tax rates are a big deal” in comparison to Virginia, Pennsylvania and Delaware, Rogers said. (CEO magazine ranked Virginia 7th, but Pennsylvania was ranked 42nd and Delaware 27th, slipping from 14th place last year.)
The three states at the very bottom are Illinois, California and New York, and all the states to the northeast of Maryland ranked worst, except for New Hampshire and Maine.
“Tax considerations drive real world decisions,” said Rogers, who is also chief investment officer of T. Rowe Price, a 75-year-old investment firm that manages more than $600 billion in assets.
“We need to reduce taxes on things we want to promote,” such as job creation and economic growth, Rogers said, “and raise taxes on things we don’t want” such as alcohol, tobacco and gasoline. (The Maryland General Assembly in the past six years has doubled the cigarette tax, increased alcohol taxes 50% and hiked the gas tax just last month, a move the GBC has long supported to invest in transportation needs.)
GBC President Don Fry
Rogers suggested lowering the corporate income tax, which makes up only 4% of state revenues. Such a move is backed by some legislative leaders, as reported here last week.
“Baby steps of change [in the corporate tax rate] would enhance the competitiveness of our business climate,” Rogers said.
Other negative views of magazine’s ranking
Kim Burns, president of Maryland Business for Responsive Government, also took a dim view of CEO magazine’s new ranking, and its mention of taxes, a possible minimum wage hike and mandatory sick leave.
“Job creators are watching and listening to what the Maryland General Assembly has to say and they don’t like it very much,” said Burns. “Again, it has proven true that just the mere introduction of these anti-job proposals by our state elected officials, even if they don’t pass, sends a message that is heard everywhere but Annapolis it seems.”
The Maryland Republican Party put a partisan spin on the CEO magazine rankings. “The Top 10 best states are all led by Republican governors and 7 of the 10 bottom are led by Democratic governors,” said an email from the GOP. “Under the leadership of Republican Governor Scott Walker, Wisconsin was ranked 41st in 2010, but ranked 17th in 2013 while Maryland dropped from 33rd to 41st.”
What GBC plans to do
In December 2010, the Greater Baltimore Committee issued a report called “Gaining a Competitive Edge,” recommending eight core pillars for economic growth and job creation. Among them were: “Regulatory policies that are streamlined, stable and predictable” and “Tax structure that is fair and competitive.”
GBC President Don Fry said the group plans to build on that initiative by developing a “Strategy for Competitiveness,” starting with a day-long Chesapeake Conference of CEOs June 12 at the Baltimore Hilton. Fry told the annual dinner meeting at the Hyatt Regency that the conference “will forge a consensus on specific, achievable steps and policy directions to improve our business climate in our region and state.”
Until the voters in MD decide to rid themselves of entrenched liberal Dems in Annapolis, little will change. MD will continue to limp its way to the bottom. When the $$ are no longer flowing in from the “100 thousandaires” & decent middle class jobs, the sheeple MAY wake up (especially once the money cupboard is bare). But before that happens, thousands of MD natives who would love to age in place will be forced to abandon their home state for one that doesn’t continue to tax those that pay & reward those who don’t.
Until the Democratic liberals residing in Maryland really get bit in their wallets and begin to financially yell ouch, they will keep voting in Governor O’Malley and his legislative tax and spend ilk.
The worst part is that these terrible anti business measures, not only in the taxes, but even more so in the over the top regulation which is poorly designed, understood, and extremely inefficient, combined with the cheer disregard for common sense (let alone the law) focused on only their own narrrow partisan politics, will take decades, yes decades, to reverse let allne erase.
Once moved out, nobody will come back in their lifetime, taking their energy and savings with them. Once pushed out of your own home/home state by your “own” people, you are gone, not to ever come back, unless exceptional measures to get you back have been taken. These measures are very unlikely to be taken by this political circus in the next few years, having shown such a disregard for hard working, innovative people who take responsibility and risk, yes risk.
Keep on arrogantly and cynically counting that your state is so “good”, so “beautiful”, so “educated” that everybody will stay and keep coming anyway and you will gradually decay, living on past glory. Take away the federal paycheck and the little that keeps Maryland up will implode with a big dud, like Detroit lived of the Automobile industry.
Gee – ya think ? What took you so long to realize that O’Malley has FINANCIALLY RUINED Maryland ? All you need to do is get rid of him and his cronies – and then UNDO all his damage – and THEN maybe Maryland will be fit to live in again. (plus all the millionaires who have already fled the state may then think it might be worth it to come back).