Delaney: Maryland must diversify its economic base -- Gazette.Net


Maryland’s reliance on government jobs and federal spending make it too vulnerable to a budget upheaval like sequestration, so it must diversify its economic base to better weather shifts in government spending, first-term U.S. Rep. John Delaney said Friday.

Maryland is the nation’s third-most dependent state on federal spending, and the impact on his district from sequestration-induced budget cuts has been heavy, Delaney (D-Dist. 6) of Potomac told supporters at Magoo’s restaurant in Frederick.

Delaney’s 6th Congressional District stretches from Montgomery County through Frederick and Washington counties and westward to Garrett County.

The cuts generated by sequestration have led federal agencies to eliminate about 5 percent of their budgets, leading to layoffs of furloughs of federal workers.

Maryland has an “intense vulnerability” to changes in spending patterns by the federal government, and the state needs to develop a more diverse economic plan rather than relying on more government spending, Delaney said.

Maryland is home to more than 260,000 civilian federal workers, according to the the office of U.S. Sen. Benjamin Cardin (D-Md.).

Despite the nation’s economic struggles and political gridlock on Capitol Hill, Delaney said his eight weeks in Congress have actually made him optimistic, because he believes there’s a broad recognition among lawmakers that the nation has very significant issues it has to address.

The only way the United States can change its fiscal trajectory is to increase the revenue being brought in as a percentage of the economy, Delaney said.

But he also warned that the problem cannot be solved by simply raising taxes. The nation will also have to fundamentally change entitlement programs, he said.

He suggested raising the cap on Social Security contributions, increasing the retirement age for people who don’t perform manual labor and changing cost-of-living adjustments for Social Security as possible steps to help address the problem.

Marylanders should be aggressive in demanding tax reform and changes to entitlements, because the alternative is to cut federal spending, he said.

The educational system also has to be overhauled to make sure U.S. students can compete for high-quality jobs as economic globalization widens, Delaney said.

“The face of employment in this country has fundamentally changed,” he said.

The nation also needs to develop a new energy infrastructure, including embracing natural gas as a cleaner, cheaper alternative to other fossil fuels, Delaney said.

He said he’s preparing legislation that, if passed, would create a funding source for large-scale projects without taxpayer funds by offering corporations tax credits for investing their overseas assets in an infrastructure bank here.

Brent Hollenbeck, chief executive officer of the Frederick-based Timber Rock Energy Solutions, which helps provide customers with cleaner energy alternatives, said he couldn’t agree more with Delaney about the need to overhaul the country’s energy strategy and infrastructure.

He also agreed on the need to use natural gas as a way to bridge the gap while alternative energy sources are being developed.

Hollenbeck said the way Delaney, a self-made millionaire and venture capitalist, frames issues shows his background in the private sector.

“There’s a lot I liked about what he had to say,” Hollenbeck said.

Len Latkovski, who teaches history and international studies at Hood College, said he was impressed with Delaney’s expertise on economics and finance.

Latkovski, who teaches a class on the effects of globalization, said Delaney was correct about the impact of globalization and technology on the U.S. job market.

But Beverly Byron, a Democrat from Frederick who represented the district from 1979-1993, questioned how anyone can get things done in the current atmosphere.

When she served, members spent more time in Washington, D.C., getting to know one another and fostering relationships that helped legislation develop, Byron said.

Now the middles of both parties have been destroyed, eliminating the desire for many members to work with lawmakers of the other party, she said.

“They’re all crazy,” Byron said.