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Friday, June 26, 2015

In Marriage Equality Ruling, It was the Constitution that Won

I've seen a few posts from folks today arguing that the Supreme Court was wrong to legalize same-sex marriage. Many of these folks argue that we do not have a right to marry (or a right to privacy for that matter). These folks are making a common, but dangerous, mistake. They are assuming that our rights are enumerated in the Constitution. They are not. The 9th amendment makes clear, "The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people." In other words, we have other rights. Rights in addition to those not enumerated. The burden is not on we, the people, to prove which additional rights we have, the burden is on government to show which rights it can deny, limit, or abridge. The 14th Amendment's equal protection clause ensures that rights, and even privileges, which do exist must be afforded equally. In ruling in favor of the rights of same sex couples to marry, the court simply (and quite conservatively) concluded that no state or party could show a compelling reason to deny a right. Much as there was no compelling reason to deny marriage between people of different races/ethnicities. With all due respect to Justice Roberts, the Constitution (and the 9th Amendment) won today.

Sunday, May 17, 2015

Governor Hogan Wants To Do What?

Last week Governor Hogan caused a big stir in MD politics when he announced that he was moving ahead with a plan to reopen the Annapolis State Police Barracks and add 100 officers - even though the General assembly never considered, let alone approved, his supplemental budget request to do both.

Hogan announced that he would pay for the initiative by line item vetoing a $2 million earmark in the Capital Budget that was supposed to finance improvements at the Maryland Hall for the Creative Arts in Annapolis. A Hogan spokesperson said of the plan "This demonstrates Governor Hogan’s overall commitment to general savings for Maryland taxpayers..."

The decision represents quite a few things, but a commitment to cost savings clearly ain't one of them. This audacious proposal has so many problems that one really needs to question just who has been advising the Governor.

Consider - during the legislative session, the Governor sent the Assembly a supplemental budget for the State's Operating Budget (which funds day-day operations of the state) requesting $8 million to reopen the Annapolis Barracks and hire 100 new troopers. House Speaker Michael Busch did not brings the supplemental to the floor for consideration.  Hogan is now proposing to delete $2 million in spending approved in the Capital Budget (which funds construction and infrastructure) so that he can use those funds to move forward with the barracks reopening and the new hires.

In only three sentences, the prior paragraph has laid out multiple problems in Hogan's plan. Consider first the question of math. Hogan estimated the cost of reopening the barracks and hiring the troopers to be roughly $8.2 million. He now plans to pay for the $8.2 million plan via the cancellation of a $2 million project. I'm not quite clear how a cost deficit of $6.2 million demonstrates an "overall commitment to general savings."  But the issue of cost is actually not the biggest problem with the proposal. As Governor, Hogan has the authority to strike an item from the Capital Budget. But he cannot then take that money and spend it something not already in the Capital Budget. Nor can he - as is the crucial point here - take money allocated in the Capital Budget and transfer it to the Operating Budget. Which is exactly what he would need to do in order to fulfill his plan. Oh, and he can't spend money in the Operating Budget that wasn't authorized by the Operating Budget - so he can't add money to the authorized budget for the state police.

So Governor Hogan wants to transfer $2 million out of the Capital Budget and into the Operating Budget (which he can't do) in order to fund an $8 million program (which $2 million can't do). So unless the Governor's advisors have discovered a previously unknown section of the Maryland constitution this plan is going nowhere and may prove to be the most significant unforced error yet committed by this young administration.

So if the $2 million can't really be used to pay for the barracks and the officers what else could be the motivation for the plan? The likely answer is very disturbing and very unfortunate. The Maryland Hall for the Creative Arts is in Speaker Michael Busch's district and the Speaker has been a tremendous benefactor over the years. Hogan has made clear that he is unhappy with Busch. Hogan blames Busch for the agenda failures he endured during the legislative session and called Busch "petulant" for refusing to allow consideration of Hogan's supplemental budget proposals. By claiming $2 million in savings from an earmark that is insufficient to fund the barracks and unavailable to the Operating Budget, Hogan did little more than take a figurative swing at Speaker Busch (a man without whom Hogan can never achieve his legislative goals). What a ridiculous motivation.

I admit to being generally supportive of Governor Hogan and I have (justifiably) defended his actions on many occasions. But this bizarre proposal is simply beyond my comprehension. If the Governor has some larger plan or some clear legal guidance that would better explain how the $2 million for the Capital Budget can have any impact on his plans via the Operating Budget then he owes it to everyone in the state to release that information as soon as possible. But if he is moving forward with this based solely on the idea that saving $2 million from the Capital Budget would produce general savings to the state in order to offset new spending that he is not authorized to spend, all in an effort to hurt Speaker Busch, then I'm left with the quote from the esurance commercials so aptly applied to this situation by Bryan Sears of the Daily Record - that's not how any of this works. And It's certainly not what voters were looking for when the rejected politics as usual last November.

Friday, May 15, 2015

Overreaction to Hogan's GCEI Decision Does Not Reflect the Reality of the Situation

In what has become a recurring theme, Democrats and their allies - like the Maryland State Education Association - are overreacting to Larry Hogan's decision to not fully fund the Geographic Cost of Education Index (GCEI) which allocates additional education funds to certain counties. The $68 million he is withholding represents less than 1% of the state's $7.5 billion education budget. In a recent Twitter post, a representative of the MSEA stated that per pupil spending in MD had increased every year of the past 10 years... until now. Problem is, it's not true. According to an annual report issued by the U.S. Census Bureau Maryland's per pupil spending in 2012 was below both the 2010 and 2011 levels. The reference to per pupil funding is clearly part of an effort to get the public to equate per pupil spending with student achievement. But numerous studies have confirmed there's no correlation between spending and achievement.

If I were advising Hogan I would've told him to spend the $68 million for the GCEI, but by no means do I think that his decision to withhold the money will undermine the quality of education in the state. One must consider as well that the withheld GCEI funds total only $68 million out of $7.5 billion in K-12 education spending in Hogan's budget. That's less than 1%. Governor O'Malley funded none of the GCEI in his first year in office and only one-third of it in his second year - and no one questioned his commitment to education. Additionally, Hogan's budget increased overall K-12 spending by 1% over FY 2015, that is the same spending increase contained in Governor O'Malley's budget last year. And again, there was no gnashing of the teeth then. The fact that Governor O'Malley got a free pass to make K-12 funding decisions similar to those made by Governor Hogan suggests that the criticism of Hogan is mostly driven by political opportunism and not true policy opposition.

And let's remember as well where that contested $68 million in GCEI funds came from - the woefully underfunded state employee pension fund. Though the money already in the pension system is untouchable, payments intended for the state pension system, specifically the OPEB (other post-employment benefits), were repeatedly cut by the Assembly in order to free up money for other priorities. Years of treating those intended payments like an ATM helped to create billions in unfunded future obligations. So a few years ago, Governor O'Malley and the Assembly pledged to make it sound via annual supplemental funding via the budget, as well as increased cost sharing and reduced benefits for employees. Then O'Malley and the Assembly failed to make the promised supplemental payments even as employees endured the new costs.

So what does this have to do with the $68 million in GCEI funds? In his budget, Governor Hogan proposed a $150 million supplemental payment to the pension fund and proposed funding half of the GCEI. He also proposed the elimination of some Medicaid coverage and the cancellation of a 2% raise that had been given to all state workers. The Assembly wanted to fully fund the GCEI and the other two measures as well, but because of strict restrictions on their ability to add spending to the Governor's budget they needed to first find the money and then recommend that the Governor spend it. Among other found savings, they decided to take half of the pension supplemental payment, but in doing so they claimed as well that future supplemental payments could be reduced as well. This was crucial as it freed up $2.5 over the next 10 years billion for spending elsewhere. But the decision to reduce the supplemental payments is expected to impose new costs of about $4.5 billion in the next 10 years as the state must make more payments to make the system sound. That equals $2.5 billion that won't be available for other priorities - such as education. Diverting that money, knowing the future costs, was the very definition of short sighted. Hogan has pledge to return the $68 million to the pension fund

Consider as well the context of Governor Hogan's surprise victory in 2014. Maryland had a serious structural deficit problem - ranging from $750 million to $1 billion. Over the past many years the Governor and the Assembly tried to close the gap via increases in sales, income, gas, cigarette, and alcohol taxes. But the deficit persisted. So to meet the balanced budget requirement the folks in Annapolis raided the pension system, the highway trust fund, and the Chesapeake Bay fund - all to achieve single year fixes to the deficit. Governor Hogan campaigned on a promise to truly eliminate the deficit, no more single year fixes by raiding other funds. Taxes in Maryland had been increased already w/o closing the gap, suggesting that the time had come to place the same focus on spending that had been placed on revenue.

Medicaid and education are the state's largest spending obligations - it's hard to imagine how one could address spending w/o education and Medicaid being affected in some way. In the face of all that, a decrease in spending on the non-mandatory GCEI by an amount equal to less than 1% of the state's K-12 budget isn't very severe and certainly isn't unreasonable or an education Armageddon. And it doesn't demonstrate a lack of investment in our children. Governor Hogan did accept the Assembly's request to reinstate the Medicaid spending and the 2% state employee raise - but he said "No" to the GCEI request. In a prior post, I urged Governor Hogan to approve spending the $68 million on the GCEI - mostly as a political calculation intended to foster some goodwill in the Assembly. My colleague David Lublin wrote a piece for his Seventh State blog in which he referred to Hogan's decision as an "unforced error."

David and I agree that this was an unnecessary strategic error, but we clearly disagree with regard to the likely ramifications. As with so many things related to Hogan, Maryland Democrats cannot seem to avoid hyperbolic overreactions that cause no harm to Hogan while undermining their agenda. During the general election the Brown campaign and the state Democratic establishment decided to embrace the strategy of painting Hogan as a radical. They wanted voters to believe that Hogan was a Tea Party Neanderthal who wanted assault rifles on playgrounds and had no respect for women. The portrayal was so ridiculous that in undermined faith in Brown's campaign and boosted Hogan. Then, after Hogan delivered a less than conciliatory State of the State speech (another unforced error) Democrats again overreacted - most notably by holding up confirmation of Hogan's appointees. In the end, the overreaction caused far more harm to democrats than the speech did to Hogan.

Democrats and their allies are now repeating the overreaction mistake. Perhaps the most ridiculous example being the attempt to paint Hogan as someone who would rather jail children than educate them based on the decision by the Board of Pubic works to approve the creation of a youth detention facility so that minors charged as adults will no longer be housed with adult criminals - an incredibly compassionate decision. In recent years, Maryland families have absorbed tax increases as well as stagnant wages. They've tightened budgets and forged ahead. I don't think that folks who voted for Larry Hogan are going to be very bothered by a decision that involves less than 1% of K-12 education and that only benefitted certain counties - especially when Hogan's budget increased overall K-12 spending. The hyperbolic rhetoric over, and overreaction to, his decision to not spend the money simply does not match the reality of the situation. And I think it will again do more to undermine Democrats than it will Hogan.

Friday, April 17, 2015

A Nonsensical End to the 2015 Legislative Session

Maryland's 2015 Legislative Session has come to an end, and what a silly end it was. Though the session got off to a rocky start - with a partisan State of the State address and a ridiculous overreaction to it by Democratic members of the Assembly - it quickly settled into a rather calm and productive session. Governor Hogan submitted his budget in late January and, as promised, he eliminated the state's structural deficit in a single year. The editorial boards of the Baltimore Sun and the Washington Post both saw much to laud in his budget. Many assembly Democrats were relieved that the budget was not a scorched earth effort to redefine state priorities. But Democrats did object to a few provisions. Hogan did not provide funds for a 2% cost of living raise (COLA) that had been given to state employees (essentially cutting their pay), he provided only half of the funding needed to meet the state's Geographic Cost of Education Index formula or GCEI (which provides additional funds to parts of the state where the cost of providing an education is higher), and he reduced Medicaid spending by taking away funds that would provide doctors with higher reimbursement and by eliminating Medicaid coverage for pregnant women earning between 186% and 250% of the poverty line.

Democrats pledged to find the roughly $200 million needed to fund those initiatives. The General Assembly cannot increase spending in the Governor's budget. They can cut spending, they can identify and recommend additional spending, and they can prevent a governor from spending money that they cut and recommended for other uses. The House budget committee found enough savings from cutting other programs to restore funding for the COLAs, the GCEI, and Medicaid. But in a controversial move, they found $75 million of that money by cutting in half a $150 million supplemental payment to the state pension fund proposed by Hogan. After years of underfunding the state pension fund, former Governor O'Malley and the legislature passed a plan to restore the pension balance via supplemental funds. But in his final budget, O'Malley reneged on the promise. Hogan attempted to meet the state's obligations, but the Assembly Democrats needed to find money to spend elsewhere. 

The revised budget was unanimously passed out of committee and then passed by the House with all but 10 members voting in favor. Democrats were criticized by the Washington Post for diverting the pension funds and the Senate attempted to compensate for the cut by passing a so-called sweeper amendment that would have dedicated up to $50 million of any year end surplus to the pension fund.

Initial indications were that Governor Hogan was satisfied with the budget deal. Though he believed that the budget was only part of a package that would include much of his legislative agenda. Though the Senate acted on much of his agenda items, the House was slow to follow suit. As the end of the session neared there was tremendous doubt regarding the outcome of the Governor's agenda.

As the final weekend approached, Hogan insisted that the General Assembly restore the $75 million in pension funds. The Assembly leadership was unmoved. The two sides attempted to reconcile their differences. On the final Friday of session, the House/Senate conference committee ultimately adopted much of the Senate's version of the budget. They offered the sweeper amendment, but not restoration of the $75 million. Hogan wasn't interested. On Saturday Hogan offered his plan - with roughly 60 hours remaining in the session. He was willing to fully fund the COLAs for state employees, he offered to increase funding for the GCEI from his initial 50% up to 75%, and he offered Democrats roughly half of the additional Medicaid money that they had sought. But in exchange, he wanted his legislative agenda enacted. Senate President Mike Miller and House Speaker Michael Busch said "no."

And this is where the nonsense reaches a fever pitch. Hogan, Miller, and Busch were arguing about $200 million in a $40 billion budget - roughly 0.5% of the budget. They all wanted to spend it, they just wanted to spend it differently. In the end, they were really only disagreeing about $75 million - Hogan wanted it dedicated to pensions and Miller and Busch wanted it to go to GCEI and Medicaid.

Neither side would budge. On the final day of session, the House and Senate passed their version of the budget. Neither the COLA, GCEI, Medicaid, nor pension money was going to be spent. Rather the budget recommended that Hogan fund the COLAs, GCEI, and Medicaid and he was prohibited from using the money on anything else. Hogan announced that he was unlikely to do so. Then, in the final hours of session, the House passed much of Hogan's agenda.

So session is over. There are no COLAs for state employees, the GCEI is only partially funded, pregnant women between 186% and 250% of poverty have no Medicaid, and the supplemental pension payment was $75 million short.

If Miller and Busch had simply agreed to Hogan's agenda (a rather modest one) on Saturday then they would've gotten the full COLA, 75% of the GCEI, and 50% of the Medicaid funds. Instead they said "No" and got nothing. Then they passed much of Hogan's agenda anyway.

As for Hogan, he was willing to give Miller and Busch nearly everything they wanted - save for the money he held back for pensions. But the Senate sweeper amendment offered a reasonable compromise. So Hogan walked away over a $75 million disagreement in a $40 billion budget - because he wanted all of his agenda.

What we witnessed in those final days of session was not governing. It was ego mixed with stubbornness. There was no reason for Hogan to reject the Miller and Busch plan and there was no reason for Miller and Busch to reject Hogan's plan.

Now the session is over. Hogan saw a significant amount of his legislative agenda passed by the Assembly. Much of it was modified and amended, but that's the nature of divided government and separation of powers. And the state has a budget. In that budget, roughly $200 million has been set aside by the legislature to fully fund state employee COLAs, GCEI, and Medicaid. It also has a provision to dedicate any surplus funds to the pension fund. All told, it's about $75 million away from Hogan's final offer to Miller and Busch. But none of it can be spent with Hogan's approval. With much of his agenda passed and the structural deficit greatly reduced, Governor Hogan should declare victory and agree to accept the Assembly's recommendations and spend the money they set aside. There's simply no good reason to keep saying "no."

Saturday, March 28, 2015

Sorry...

Sorry for the lack of new blog posts. I have been finishing a new book on American politics and became Chair of the St. Mary's Political Science Department in the Fall of 2014. So I have not had as much free time to devote to the FreeStater. I hope to resume regular postings once I finish my book revisions and I get accustomed to my new responsibilities (meetings and paperwork...).

Wednesday, February 11, 2015

Instead of Railing Against Hogan's Budget, Assembly Democrats Should Focus Efforts on Reforming the Process

It's abundantly clear that most Democratic members of the Maryland General Assembly are not pleased with major elements of Governor Hogan's proposed budget. The most contentious issues include a significant reduction in the rate of increase for spending on K-12 education and the elimination of a promised 2% cost of living increase for state employees. House Speaker Michael Busch and Senate Budget Committee Vice Chair Richard Madaleno have been among the most vocal opponents of the budget. Numerous Democrats have pledged to fight Hogan's budget.

But their pledges and their passions amount to next to nothing. There is precious little that any Democrat (or Republican) in the Assembly can do to substantively change Hogan's budget. Maryland adopted an executive centered budget process via a constitutional amendment it 1916 and ever since the General Assembly has been without the power of the purse. According to the constitution of Maryland, the Assembly cannot increase spending in the governor's budget and it cannot move funds around in an effort to increase funding in one area by reducing it elsewhere. All the Assembly can really do is reduce the amount of spending proposed by the governor.  The Assembly can introduce legislation to provide funding for programs - but only if the legislation identifies a funding source (e.g. raising taxes). Certainly, members of the Assembly can work with Hogan and try to convince him to introduce a supplemental budget that provides more funding for programs they value, but failing that, Hogan's budget will stand.

If Democrats in the Assembly really want to make a difference they will work to support SB 660, sponsored by Senators Madaleno, Guzzone, and Manno.  The bill would undo a constitutional amendment that has long outlived it's usefulness. The key section in the state constitution can be found in Article 2, Sec. 52 (6):
(6) The General Assembly shall not amend the Budget Bill so as to affect either the obligations of the State under Section 34 of Article III of the Constitution, or the provisions made by the laws of the State for the establishment and maintenance of a system of public schools or the payment of any salaries required to be paid by the State of Maryland by the Constitution thereof; and the General Assembly may amend the bill by increasing or diminishing the items therein relating to the General Assembly, and by increasing or diminishing the items therein relating to the judiciary, but except as hereinbefore specified, may not alter the said bill except to strike out or reduce items therein, provided, however, that the salary or compensation of any public officer shall not be decreased during his term of office; and such bill, when and as passed by both Houses, shall be a law immediately without further action by the Governor (amended by Chapter 373, Acts of 1972, ratified Nov. 7, 1972).
So in Maryland, the General Assembly is allowed to amend the budget to increase or decrease appropriations for the operation of the General Assembly or the judiciary, but it all other cases it may only reduce or eliminate spending. This is simply ridiculous! It's hard to imagine anything more counter to the concept of representational democracy than a legislature without the power of the purse. In no other state are legislators so irrelevant to the budget process. In roughly half of the states, governors are tasked with developing a budget (much like the president), but that budget is then subject to revision by the legislature. In the other half, the governor and the legislature share the responsibility of making the budget.

How did we wind up with such an executive-centric process? We overreacted to a budget crisis. Maryland was faced with a huge deficit in 1916 and the blame fell squarely on the shoulders of the General Assembly. Our solution? Strip the Assembly of its budget power and hand it all over to the governor. We see how well that worked out. Our ongoing struggles with structural deficits make clear that executives are not any better at budgeting than are legislators.

It's time for Maryland to undo the overreaction of 1916. Instead of offering what are largely hollow pledges to "fight spending cuts," legislators should instead focus on an amendment to the state constitution that would restore the legislature's proper role in the budget process. SB 660 would restore the legislature's role while still respecting the power of the governor. The legislation is far from perfect, especially with regard to the line item veto restrictions that it would place on the governor, but it's a good start.

And no, I'm not proposing this because there's a Republican governor or because I agree with those who would have you believe that Hogan's budget is a draconian overreach. I'm proposing this reform for the same reason I support redistricting reform, because both proposals would boost accountability and representation - two essential ingredients for democracy (unfortunately, none of the redistricting reform legislation introduced thus far is worth discussing).

** I'd like to add that I think Republicans in the Assembly should line up in support of this reform as well. There have been 2 Republican governors in the last 4 decades in Maryland. In most circumstances the GOP is totally shut out of the budget process. If the Assembly actually played a meaningful role then the GOP could gain opportunities to have a role as well. And keep in mind, the GOP made historic gains in the 2014 election. In the Senate, they GOP is 5 seats away from being able to filibuster legislation, thereby earning an automatic seat at the bargaining table. There are 4 Democratic Senators who won with less that 52% of the vote and another 4 or 5 who won in districts carried by Larry Hogan. At present, the MD GOP is one or two election cycles away from being a full-fledged minority partner in governing in the General Assembly. Wouldn't it be better to be a minority partner with the ability to influence the budget as opposed to a minority partner forced to wait for the next Republican governor? 

Monday, February 9, 2015

Maryland Senate Democrats Offer A Clear Reminder of Why Hogan Won

In response to Larry Hogan's "partisan" and "campaign-like" state of the state speech last week, Senate Democrats in the MD General Assembly have decided to take a page from the Mitch McConnell School of Partisanship by slowing down approval of Hogan's appointments and by subjecting the appointees to retaliatory treatment... In other words, Senate Democrats are responding to a speech by jeopardizing the proper functioning of state government. It's always great to see my state Senators behaving like my 4 year old... 

I wrote last week that I believed Hogan committed a strategic error with his first state of the state address as it was a time for more cooperative language. But Hogan did win. And he won comfortably against the Maryland Democratic Establishment's hand-picked and coddled candidate. And Hogan won on a message and an agenda identical to what he proposed in his speech before the Assembly. So what did Assembly Democrats expect to hear? Did they think Hogan would stand before them, hat in hand, and pledge to make a better Maryland for more Marylanders? If they did, they were either naive or arrogant.

And let's keep something very important in mind. Martin O'Malley's state of the state speeches were partisan as well. And in recent years they amounted to little more than test runs for potential campaign themes in a future presidential run. And as Assembly Republicans sat on their hands, Democrats dutifully rose and applauded. But no one in the Assembly or the press cared that O'Malley was being partisan. No one cared that his speeches may have offended Assembly Republicans. With Hogan's speech, Democrats got a taste of their own medicine and decided they didn't like it. Too bad.

Yes, I think Hogan made a strategic error with the speech, but Senate Democrats are behaving like children. I half expect them to announce plans to hold their collective breath until they turn blue if holding up his nominees doesn't force Hogan to come before them seeking forgiveness. 

Senate Democrats may be pleasing the party faithful, the partisan activists, and the other members of the state Democratic establishment that failed to deliver victory in November, but I suspect that their behavior is reminding a lot of voters why they decided to stay home and a lot of other voters why they decided to vote for Hogan.