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O’Malley vs. Perry – The Numbers Tell Who is Really Winning

Posted: September 21, 2013 at 7:59 am   /   by   /   comments (0)

markUncaphernewTexas Governor Rick Perry this past week made a highly publicized economic development trip to Maryland, including a trip to Beretta USA’s Accokeek factory and lunch in Bethesda. Perry’s Washington trip also included an on- air CNN debate with Governor O’Malley.

The Washington Post left little doubt over which side of the Texas-Maryland economic “debate” the newspaper is on, publishing a factually challenged O’Malley op-ed piece. In addition to repeating his perennial howler that his “administration cut more in state spending than any governor in Maryland history,” the Governor claimed “Texas ranks 49th in high school graduation.” However as candidate for Governor Charles Lollar points out, actually Texas ranks 8th best in high school graduation rates, while Maryland under the O’Malley/Brown administration ranks 14th.

Writes Lollar: “Texas has an 86% graduation rate amongst all students, while O’Malley/Brown controlled Maryland with its higher taxes has an 83% graduation rate. 86% Texas beats 83% Maryland – unless you realign the stars.”

The fact checking at the Post was not much better on the news side. The paper played up a Bethesda sidewalk debate “Startup Maryland entrepreneurs take on Texas Gov. Rick Perry in Bethesda.”[1] However Post reporterSteven Overly neglected to mention that the group putting on this political street theatre, “Start-up Maryland,” relies heavily on government funding, receiving support from the Maryland Department of Economic Development (DBED), TEDCO (another arm of the state government), as well as the Howard, Anne Arundel and Carroll County economic development agencies. No doubt when “Start-up Maryland” asks for more state dollars in the future, they will use the Post article as an example of their “promoting Maryland.”

Both the “Startup Maryland” and O’Malley trumpet Maryland’s $84 million state funded venture capital fund “InvestMaryland.” Putting aside the wisdom of having the state’s Department of Business Development involved inmartyO making early stage venture investments or the evident political partisanship involved with these programs, the state’s fund is the equivalent of less than one half of 1% of the total venture investment funding in Texas since Perry became governor.

A new book, How Money Walks – How $2 Trillion Moved Between the States, and Why It Matters by Travis Brown offers hard data on the economic contest among the states.

Brown uses official IRS statistics to produce hard data about the massive movement of American working wealth within the country. Between 1995 and 2010, the nine states with no personal income taxes gained $146.2 billion in working wealth. The nine states with the highest personal income tax rates lost $107.4 billion. The 10 states with the lowest per capita state-local tax burdens gained $69.9 billion. The 10 states with the highest per capita state-local tax burdens lost $139 billion. Simply put money and people moved from high-tax states to low-tax ones.

And the tax that seemed to matter the most? The personal income tax. The states with no income taxes gained the greatest wealth, while the states with the highest income taxes lost the most.

Beyond the book, a “Money Walks App” lets users track, by state and by county not only how income is shifting, which jurisdictions are benefiting.


Maryland – Lost $7.04 billion in annual Adjusted Gross Income

Gained Wealth From: 
District of Columbia $2.99 billion
New York $1.10 billion
New Jersey $906.35 million
Michigan $171.04 million
Connecticut $168.36 million
Lost Income To:
Florida $4.16 billion
North Carolina $1.35 billion
Virginia $1.30 billion
Pennsylvania $1.09 billion
West Virginia $714.66 million
Montgomery Co. – Lost  $4.72 billion in annual AGI
Gained Wealth From:
District Of Columbia, DC $1.13 billion
Prince George’s County, MD $155.39 million
Arlington County, VA $76.48 million
Nassau County, NY $73.43 million
Alexandria City, VA $60.50 million
Lost Income To:
Frederick County, MD $1.29 billion
Howard County, MD $492.18 million
Fairfax County, VA $403.42 million
Anne Arundel County, MD $394.74 million
Palm Beach County, FL $322.04 million


If there is a bottom line, in state and local economic development, jurisdictions compete with each other, producing winners and losers. Maryland is losing.

Mark Uncapher
Montgomery County Republican Chairman