In today’s Gazette newspaper, columnist Barry Rascovar details the weak economy and other forces conspiring to make the coming budget year an unusually tough one. From his online piece:
Indeed, the projections on tax receipts are the most depressing summary of economic conditions since the depths of the Great Recession.
The overall message from the Board of Revenue Estimates: This state’s economy remains in a mess, and we’re in for achingly slow gains over the next two years.
“Maryland’s recovery from the Great Recession has been feeble,” the report says. “Employment growth has been tepid” and is still declining at times. Wage income is growing “at historically low rates.”
The downbeat notes keep coming: “”The prospect of cutbacks in federal spending, a moribund housing market, and global economic uncertainties give little reason to expect a surge in economic activity any time in the near future.”
In sum, Maryland’s growth “is expected to continue at a subdued rate,” and the state’s economic recovery “will remain delicate and susceptible to shocks.”
He goes on to discuss other challenges arising from the state’s current budget position:
The legislature’s Spending Affordability Committee recommended the governor slash Maryland’s long-running structural deficit by 50 percent in 2012. That would mean cutting $550 million through a combination of permanent reductions and higher taxes.
This could get ugly, with unpopular program reductions mixed with equally unpopular revenue increases.