The debate over the business climate has reached a fever pitch. But a vocal minority can drown out the true voice of the business community. That’s why I applaud the creation of the new nonprofit Business Development Corp. to advise the Council and County Executive on the needs of businesses in Montgomery County.
By improving cooperation between the public and private sectors, the new initiative plays to our strengths while resisting the temptation to race to the bottom.
Some say drastically cutting corporate and personal income taxes is the only way to lure business here. This narrow focus is misguided. As we consider economic development, Maryland must play to our comparative advantages. If we play the game on their field, we will consistently lose.
Maryland is a great place to live and work. We have top schools, transportation infrastructure, world-class research institutions, a strong public sector, and an open and creative society. These are Maryland’s competitive strengths – our value proposition to businesses and entrepreneurs.
These are also the strengths that attract and retain Maryland’s large professional class, which pays the lion’s share of income and property taxes. Cutting too deeply into public services thus risks a fiscal death spiral. Schools, infrastructure, and public safety would deteriorate. Property values would drop and high-income professionals would leave. Revenue would drop further, leading to more cuts in a vicious cycle of decay.
Of course, we must strike a balance. Tax rates must be fair and predictable for businesses and individuals. Regulation must be sensible, and public spending judicious and efficient. As we ensure this, the County and the Business Development Corp. must not get distracted by what our neighbors are doing to lure businesses. If we continue on our own path of smart planning, strong education, investment in infrastructure, and respect for all, we will succeed.