Here we go again. More accurately, here we don’t go.
The year 2010 begins with the prospect of a 90-day snore in Annapolis. Legislators and governors don’t like to do much in an election year.
At the top of the list of things they don’t want to do is raise taxes. That quadrennial dynamic, honored soulfully by candidates professing to feel our pain, will be honored passionately.
More’s the pity, actually. We should be raising the tax on alcoholic beverages (and maybe a few other things) because we’ve cleaned out the closets. We’ve shifted and transferred and deferred important spending for going on a decade. The cost of government meanwhile goes up like our budgets.
So even though the tax on booze and beer and wine hasn’t gone up since before The Flood, it’s not likely to go up this year.
Your devoted public servants want to say they didn’t reach into your pocket (much) over the last four years. It’s not because the state doesn’t need the money for public education, teacher pay, road maintenance and the like. It’s because — big surprise — they think you won’t vote for them if they do.
They’re right to be concerned. It’s a struggling economy. Even in wealthy Maryland, people are out of work. Even when we were working, wages hadn’t kept pace with inflation. Raises? What are they? We haven’t heard of any this side of Wall Street.
So we expect very little talk of new taxes. Talk would be good. But the anti-tax zealots assume that talk means tax increases.
Actually there will be talk of taxes this year, most of it revolving around a proposal to increase the tax on drinking. The shorthand puts the proposed increase at 5 to 10 cents a drink. We could all manage that, right? Right — unless you’re in the business of selling alcohol.
Over and against these legitimate concerns are the findings of a recent assessment of benefits from increasing the alcohol tax:
- An estimated 313,000 Marylanders have an alcohol dependency
- A tax increase of 10 cents a drink would yield more than $214 million in new revenue — and save $249 million in medical and other costs.
Thus we are assured of a battle pitting two warhorses: Bruce C. Bereano of the booze biz and Vincent DeMarco of Health Care for All.
Bereano is one of the most effective lobbyists in Annapolis. He’s been there for decades, holding off legislative action held to be toxic to his clients. He remains an important fundraising resource for his friends in the Assembly. At the very least, you don’t want him raising money for your opponent. If he helps you enough, you probably won’t have an opponent.
On the health side of the battle stands DeMarco, a battle-toughened campaigner who loves to win against the odds. He sees parallels between this year’s coming skirmish and battles of the past.
In 1997, an increase in the cigarette tax was declared dead. DeMarco and his growing coalition of supporters played Lazarus. They argued that more expensive tobacco would save lives and fend off addiction among younger smokers. Subsequent assessments gave credence to the claim — and helped to build the coalition.
Bereano, to the extent he must offer any opposition, will say that Maryland cannot raise its tax without provoking an outflow of dollars to surrounding jurisdictions — particularly the District of Columbia, where the taxes are the same as in Maryland. He’s also likely to argue that the historical parallel — increasing the tax on cigarettes — did not produce the promised revenue boost.
Moreover, he says, the assembly is loath to earmark tax revenue. It’s bad government, he says. Governors and legislators need flexibility to meet unpredictable needs. (The flexibility barrier falls in election years, when immutable lockstep is the posture of choice.)
He and DeMarco almost agree on another point. Both think the tax increase will be difficult to achieve — this year.
Next year, DeMarco says, it can happen. Never, says Bereano.
And so it goes. Listen carefully for the discussion and take notes. They might be a good primer for 2011.