Latest Salvos in Montgomery County Council’s War on Business
By Mark Uncapher
Nearly every week Montgomery County Council members launch yet another attack on the county’s businesses. Even as Governor Hogan has worked to improve the Maryland business climate, the Council fights a rear guard action to keep it as chilly as it possibly can.
This past week Councilmember Roger Berliner promoted an online “Fight the Hike!” petition directed against a proposed Pepco rate increase. Berliner has made a name for himself as the utility’s scourge, including being an active opponent of the proposed Pepco-Exelon merger.
Berliner often takes seemingly inconsistent positions toward the utility. For example he attacks Pepco for its unquestionably poor reliability record, especially during storms. Yet at the same time has also sought to restrict their ability to prune trees in the power network’s right of way.
While Councilmember Berliner may want to lobby the state Public Service Commission for lower energy costs, when the Council had within its own power to reduce county energy costs, it failed.
Less than a year ago the Council ignored the appeals of leading business organizations to allow the county’s $133 million energy tax to fully sunset as scheduled. Business leaders, including the Montgomery County Chamber of Commerce and the Greater Bethesda-Chevy Chase Chamber of Commerce, told the Council that the tax unfairly forces businesses with small profit margins to pay 20 times more than non-commercial customers.
Councilmember Marc Elrich has launched a war of words against the county restaurant community. As a result, he has been banned by Roberto Pietrobono from his establishments Olazzo and Gringos & Mariachis. The flap resulted from comments Elrich made during a council briefing about efforts to reform the county’s Department of Liquor Control (DLC).
Elrich said that the restaurant community should have “just shut up” and given the council’s preferred alternative a chance to work, adding that “they could have solved this problem. They’re the ones that, given a solution to their whining, decided they were going to go ahead and steal everything. I’m not terribly sympathetic.”
Consider this: All Montgomery County liquor sellers – retailers, restaurants and hotels are required to do business exclusively with the county-owned liquor wholesale monopoly. Multiple news accounts for years have chronicled the DLC’s multiple failures, and even corruption.
How does Councilmember Elrich respond to the legitimate concerns of the county DLC’s captive customer base? He attacks them for complaining. As Pietrobono wrote in a letter to Elrich, “I was appalled by the tone and the implications of your statements. Basically calling us ‘liars and thieves.’”
In April, Councilmembers Elrich, Hucker, Leventhal, Navarro and Riemer sponsored legislation that would increase the county minimum wage to $15 per hour by July 1, 2020. In 2013 the Council had already joined in a regional effort with Prince George’s County and the District of Columbia, to establish the minimum wage at $10.75 on July 1 of this year, and raise it to $11.50 per hour on July 1, 2017.
Raising the minimum wage is certainly a feel-good and even a well-meaning attempt to help workers. Yet the economic data compellingly demonstrates that these increases come with economic costs that result in the least skilled and least fortunate among us paying the heaviest cost from fewer available jobs.
After the federal minimum wage increased by 40% between July 2007 and July 2009, one study found there were 550,000 fewer part-time jobs as a result. After Obama claimed that “there’s no solid evidence that a higher minimum wage costs jobs,” even the pro-minimum wage increase Washington Post had to acknowledge the compelling evidence and gave the president’s statement “Two Pinocchios” for its inaccuracy.
The popular myth that minimum wage workers are primarily working full time to raise a family is simply untrue. According to census data, only 16.5% of minimum wage recipients are raising a family on the minimum wage. Nearly 60% of those who would be affected by an increase either live with family or relatives, or are the second-earners in a married couple. Just 16% of those who were covered by the last federal minimum wage increase (between 2007 and 2009) lived in poor households. Forty percent had a household income three times or more above the poverty line. In fact, the average total family income for Marylanders with a minimum wage earner is $73,995.
The cumulative impact of years of County Council business hostility has been a marked shift within the Washington region of new job creation to the Virginia side of the Potomac.