How Governments are Different from Real People

Both the state and the county have been whining about being in bad financial straits. Tax receipts are down, and it seems like we can’t spend as much as we want to. When real people find themselves in a financial bind, they reduce spending. When governments get in a bind, they increase spending. The General Assembly passed a state budget for the upcoming fiscal year, increasing spending by 4.5%. The County Council passed a budget last month that increased spending by 4.3%. Since inflation is running about 3.9%, these spending increases are not just about “keeping up”; they are about spending more than we ever did before.

How do you spend more when tax receipts are down? Increase taxes, of course. The General Assembly, as we remember, passed a record-breaking set of tax increases, amounting to $1.4 billion.

The County is more limited. County Executive Leggett and council members are crowing that they passed a budget without increasing the property tax rate; which is true. However, they did increase property taxes. How? The County Charter – equivalent to the Constitution – restricts how much property taxes can be increased in a single year. Faced with that, the council members yawned – and voted to override the charter. Again. Which means, your property tax bill goes up, again.

And it’s not just property taxes. Other tax increases include:
– Increase in (county) income tax, to the maximum the State allows
– Increase in the energy tax (more than quadrupled since 2003)
– Increase in the telephone tax.

Pony up, folks! We need to subsidize the new concert hall in Silver Spring, and the athletic facility in Germantown, and the old concert hall at Strathmore, and all manner of pork.

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Explore posts in the same categories: Budget and Taxes, Montgomery County

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