O'Malley goes up on TV
Gov. Martin O'Malley released on Friday the first TV advertisement of the gubernatorial election cycle — buying time to show an ad that promotes his handling of the state's $32 billion budget.
The ad says O'Malley started in office with a $1.7 billion budget deficit and cut $5 billion in “waste and government spending” over four years.
“While other states are still struggling, Martin O'Malley is making the tough choices,” the O’Malley ad says. It will be aired in Baltimore markets starting Monday, but the campaign did not buy time in the more expensive Washington media market.
Republican former Gov. Robert L. Ehrlich Jr.’s campaign says the ad is false, and sorting out the truth requires a deep dive into budgetary nuance. Ehrlich’s camp contends he left office with a $1 billion surplus, and arrives at that figure by counting a $247 million cash balance — plus funds Ehrlich deposited in the state’s rainy-day fund over and above the amount required by law.
But the same documents Ehrlich’s camp sent also show that O’Malley took office facing a $1.4 billion imbalance. Within six months, deficit projections grew to $1.7 billion, prompting O’Malley to call a special legislative session to raise the sales tax and other revenues. That special session also spawned the referendum that legalized Maryland’s slots program.
O’Malley’s ad correctly notes that Maryland is in far better financial shape than some other states. Feckless fiscal management led to widespread layoffs and cuts to core services like health and education in places like New York, Illinois and California. O'Malley frequently points out that Wall Street analysts have given Maryland the highest bond rating.
And the governor has made some painful reductions. The most significant was a furlough program for state workers that has lasted several years and effectively delivered employees a pay cut.
But the budget is sure to be one issue that Ehrlich will embrace. He and other Republicans say O’Malley missed an opportunity to reshape government and instead used one-time sources of funds, such as federal stimulus money, to keep state government humming. Democrats, they say, will push through a tax increase to cover costs after November's election.
The ad does not mention that the next governor will inherit an estimated $1.5 billion structural deficit. The stimulus funds O'Malley used for operating costs are gone, as is the surplus from the income tax reserve fund — an obscure account from which O'Malley has borrowed hundreds of millions in the last two years. Continuing the furlough program, however, would take a chunk out of the shortfall.
There are short-term problems, too. Nearly $400 million in expected federal Medicaid money is now in doubt, though the state Senate installed a safety valve in this year’s budget that mandates more borrowing from a reserve fund if those federal dollars do not arrive.