Monthly Archives: November 2017

Adam Pagnucco, District 30, Ron George

Ron George: “Leftist Democrats” Believe Businesses are “Slave Plantations”

By Adam Pagnucco.

Former GOP Delegate and gubernatorial candidate Ron George, who is running for State Senate in District 30, said on Facebook that “leftist Democrats” think businesses are “running sweat kitchens or slave plantations.”  When challenged on his language by a reporter, he did not back down.

The Facebook exchange occurred on Daily Record reporter Bryan P. Sears’s page.  When Sears posted a video of Delegate Luke Clippinger weighing in on Governor Larry Hogan’s newest sick leave proposal, George wrote:

This helps no one. Employees will take it. Why not? Currently, I do not question my employees when they call in sick. It is their decision if they are too sick to work or have a personal need. But the small business owners I know in other states that have this say it is felt it is owed to them (the employees) and suddenly the business owners are simply paying for people not working. Why are the leftist democrats always thinking business owners are running sweat kitchens or slave plantations. Most treat their employees like family. I am responsible for my employees providing for their families and I feel responsible to do well for them and they feel the responsibility to do well for the business. Most owners put in many extra hours because of our responsibility to our employees and work extra hours for them. It ain’t easy.

George owns a jewelry store on Main Street in Annapolis.

When Sears raised the possibility that George’s reference to “slave plantations” might be viewed by some as “racially charged,” George replied, “In office I heard many comments speaking of business owners in disgust as if they are cold, heartless, inhumane.”  The full exchange appears below.

We get that as a business owner, George may not particularly enjoy the government setting his workplace practices.  But multiple polls find that huge majorities of Marylanders support paid sick leave.  Even Governor Hogan has introduced not one but two sick leave bills.  Are they all “leftist Democrats” who believe that business owners treat employees like slaves?  Or is Ron George as out of touch with Marylanders as he is inclined to the use of racially charged rhetoric?

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District 43, Maryland Senate

Washington Challenges Conway, Part II


Today, we continue our look at the upcoming Democratic primary challenge by Del. Mary Washington to incumbent Sen. Joan Carter Conway (D-43).

Del. Mary Washington brings a record of serious work on issues and constituency service to her challenge to incumbent Sen. Joan Carter Conway. She has been keenly interested in expanding community schools that help link students and their families with services that can help in times of crisis or to overcome barriers to gaining an education.

Washington has also gained attention for her effort to prevent homes for being sold for unpaid water bills—a real problem in Baltimore City because of spiking rates and major glitches in the new water billing system that have led to over 1000 homes and churches facing the threat of sale. These are serious problems for people on fixed incomes.

Washington is poised to make a more serious bid to challenge Conway than Henry’s unsuccessful effort in 2014. First, Washington will have already represented the exact same constituents as Conway for eight years. Additionally, she ran a strong campaign for the House twelve years ago, so she’s well-known in the district and on the ballot.

Second, Washington is much more strongly positioned form a financial perspective. Her last report revealed that she had $81,572.45 in her campaign account. While less than Conway has, or will be able to bring to bear in a tough primary, Washington already has enough to afford key expenditures for a serious challenge.

On the other hand, the two sitting delegates, Maggie McIntosh and Curt Anderson, have made clear that they will stick with Conway. Like Sen. Mike Miller, who will also back Conway, Del. McIntosh is an experienced, skilled politician who can bring significant dollars to bear and plays for keeps. They’re key backers that Conway needs—and has—and not the sort of opponents anyone wants to face.

If Conway decides to retire, Anderson has indicated that he is inclined to enter the race, though the betting appears to be that Washington would defeat him. It will be interesting to seek how tight a joint effort the other incumbents run and if Washington aligns with other challengers.

Washington’s challenge appears to be having the effect of causing Sen. Conway to dig in her heels and want to run for a sixth term. While Conway is a seasoned incumbent who has won her spurs in tough races, it remains unclear how aggressively she could or would campaign. In contrast, Washington is clearly hungry for the seat.

This will be a great race to watch.

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2018 Governor's Race

Not Exactly the Ideal Rollout for Turnbull

Gubernatorial Candidate Ben Jealous Introduces Susan Turnbull as his Running Mate for Lieutenant Governor

Sometimes, it’s worth doing a third take.

Apparently, a car accident outside interrupted Ben Jealous’s effort to do his introduction of Susie Turnbull as his running mate for Lieutenant Governor. After investigating, they came back and did this second take.

It contains some real clunkers. Ben Jealous speaks of removing Gov. Larry Hogan “from the White House.” This Freudian slip only reinforces the perception that Jealous is a lot more knowledgeable and comfortable speaking about national issues and his real interests lie outside the State.

Incredibly, Turnbull then makes the same gaffe by referring to when she “moved to Washington” even though she quickly realizes her mistake and attempts to correct mid-course. She ends up saying:

For the last 40 years, I’ve been engaged in politics. Since I moved to Wash <pause> to Washington and Maryland, especially to Maryland, in the last . . . years ago, what I have done is build coalitions and work in my community.

Leading with her political chops without also highlighting any specific accomplishments doesn’t help sell the message. The takeaway for many may not be their message of “change” and “doing big things” but that Jealous has chosen yet another longtime well-off political insider, much of whose work in her community consists of serving in elite party positions.

Many in the DC area think of themselves as Washingtonians and identify heavily with the metro area. Saying you’re from more well-known Washington rather than Bethesda is natural for Turnbull. Yet Washington insider is not normally the image cultivated by a Sanders candidate. Describing herself as being from “Washington” will surely play poorly elsewhere in the State.

The jiggling camera puts a Maryland spin on it by reminding people of The Wire. I suppose the low production values can be sold as a form of authenticity but I would’ve thought a campaign intending to do a roll out would’ve been prepared to film it.

Jealous has gained a running mate who will reassure the political establishment and may help him raise money – two excellent reasons for Turnbull’s selection. Many people think highly of her and we’ll have future opportunities to hear from them. But this video utterly fails to sell why the broader public should think that she is a great choice for Lieutenant Governor.

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District 43, Maryland Senate

Washington Challenges Conway, Part I

Sen. Joan Carter Conway (D-43) has not made her intentions clear regarding running for reelection but that has not stopped Del. Mary Washington (D-43) from throwing down the gauntlet and declaring her intention to run for the seat.

After winning election to the Baltimore City Council in 1995, Conway was appointed to the Senate in 1997 when Sen. John Pica, Jr. retired. Since then, she has won the Democratic nomination—tantamount to election in this district—five times. While Conway has faced stronger challenges in recent years, she has continued to win convincingly.

Past Democratic Primary Results in District 43
2014: Conway, 64.5%, Councilman Bill Henry (D-4), 35.5%.
2010: Conway, 69.5%, Hector Torres, 30.5%
2006: Conway, 92.0%, Dave Vane, 8.0%
2002: Conway, 100.0%
1998: Conway, 100.0%.

In 2014, Conway dispatched Councilman Bill Henry with ease, winning by a margin of 29%. Henry’s expenditure of $45,687.36, while not insubstantial, was below the threshold needed to take on an entrenched incumbent. Challengers don’t need to outspend incumbents but they do need enough for key expenditures.

Conway spent $146,993.41 in 2014 and this does not include any independent expenditures made on her behalf, though it does include some expenses for the general election. Though she once again contemplating retirement, having packed up her Senate office, Conway remains financially prepared to wage a serious reelection battle with $108,567.58 in her campaign account according to her January report from this year.

Conway has an interesting relationship with Senate President Mike Miller. While they don’t get along personally, Conway has long been part of Miller’s leadership team as Chair of the Education, Health and Environmental Affairs Committee. After the primary in 2014, Conway transferred $35,000 from her campaign account to Miller’s Democratic Senatorial Committee Slate and another $5,000 to conservative Sen. Roy Dyson (D-29). In short, there has been little friction on legislative or political matters even if Miller and Conway will never be BFFs.

Tomorrow, we take a closer look at the challenger, Del. Mary Washington.

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2018 Governor's Race

Susan Turnbull is Running for Office. Is it Lt. Gov. with Ben Jealous?

Former national DNC member and Maryland Democratic Party Chair Susan Turnbull established a state-level campaign committee on November 22.  Her committee filing does not list the office for which she is running.  Her campaign chair is former Montgomery County Democratic Central Committee Chair Karen Britto and her treasurer is federal lobbyist Matthew R. Schneider.

It may not be a coincidence that gubernatorial candidate Ben Jealous just sent out a blast email stating that he will announce his pick for Lieutenant Governor tomorrow. Indeed, private reports indicate that Turnbull has agreed to be Jealous’s running mate.

We have asked Turnbull about the office for which she is running.  When (if?) she replies, we will update this post.

If nominated, Jealous-Turnbull would be the first Democratic ticket with no white male on it. I imagine Jealous is hoping that Turnbull will help in Montgomery County, Turnbull’s home. She also has a lot of connections as a former state party chair that could prove useful in raising money and building support around the state.

At the same time, Turnbull’s status as a party insider cuts against Jealous’s effort to campaign as an outside challenger to the establishment. In that sense, opponents can easily cast Turnbull as the ultimate insider despite her lack of experience in public office.

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Bill Frick, Department of Liquor Control, George Leventhal, Marc Elrich, Roger Berliner

County Executive Candidates on the Liquor Monopoly

Question: The county’s liquor monopoly has come under heavy criticism–not least from Seventh State. If at all, how would you reform or change, or press the state legislature to change, the Department of Liquor Control?

Roger Berliner

At the county level, I have been the chief advocate for ending our unique – and counterproductive – liquor monopoly.  As someone who has fought monopolies most of my professional life, I know in my bones that monopolies are rarely, if ever, in the public interest.  Government monopolies are generally even less efficient.  And a government monopoly that tries to do a job that the private sector does in the rest of the country is almost always less efficient.  That is true in MoCo.  As a result, our residents vote with their feet.  Almost one-third of our purchases of liquor are made outside Montgomery County.  Our restaurants hate it.  Top flight restaurants have said that they would never come here. Bottom line: our monopoly needlessly perpetuates the reputation of our county being anti-business and anti-consumer and stunts our economy.

However, the state is a critical partner in this conversation.  It is state law that created our monopoly, and state law must be passed to change it.  The positive side of this dynamic is that the state would be the principal, direct beneficiary of increased liquor sales.  I would work with the Governor and our legislature to split the savings that the state would derive and hold the county harmless as it weans itself from this monopoly.  The dollars are not that significant given that our retail operations should continue to do well – assuming that they can compete!  And in the long run, our county will prosper more without the monopoly than with it.

Marc Elrich

Any discussion of the Department of Liquor Control (DLC) must acknowledge that the Montgomery County budget relies on over $30 million in liquor revenue per year.  That is no small amount of money, and it supports critical county services, including almost $11 million for bond payments.  Nobody who has proposed privatizing the county’s liquor supply has a workable plan to fill the budget hole privatization would create, likely because there is no way to do so that doesn’t create other problems for the state.

Privatization proposals thus should not be taken seriously; instead, we should continue to look for ways to make the DLC more efficient and effective than it has been in the past, and to increase sales so that we can increase the revenue that the DLC generates.

We’ve already changed the way the DLC is run by bringing in industry professionals, including the director and the warehouse manager, who have improved the operations of the liquor system and brought in a philosophy of continuous improvement.  I’ve also encouraged introducing lower markups for more expensive items, which they did, and I’ve supported and will continue to support efforts to help local breweries and wineries sell and distribute their goods.  Both the new director and I want to hear and consider other ideas for helping transition the DLC from something that the county has long taken for granted into a professionally run system.

In fact, if a private-sector business had a division that produced a substantial profit but was identified as having management problems and customer service issues that prevented it from being more profitable, its most likely course of action would be to change management, work to improve services, and strive for greater profits.  That is exactly what we have been doing with the DLC.

Bill Frick

I have been the state’s leader on fixing this abysmal broken system.  My “end the monopoly” effort, helped immensely by the Seventh State’s Adam Pagnucco, fell short in 2016 in large part because of vigorous opposition from the Council and County Executive.  We agreed to let the Executive lead a work group on the issue, but that work group served no real purpose other than to push the issue onto the desk of the next Executive.

This is a great opportunity.  The DLC has value, and I have proposed to ensure that the value stays with Montgomery County by selling off the DLC’s assets, such as its franchise rights to beer distribution, its stores and warehouse, to generate millions in capital dollars that can be spent on school construction.  Because the elimination of the DLC will generate millions in repatriated sales and excise tax dollars, I would work with my colleagues in the legislative leadership to help return some of those revenues to the County.  Finally, we all know that the work of alcohol distribution will not disappear with the end of the DLC, rather, those jobs will migrate to the private sector and will likely grow in the County as our consumers come home to buy their beer, wine and spirits here.  I will work with the private sector distributors and unions to find the best outcomes for current DLC employees as we get the County out of the liquor business.

George Leventhal

I am willing to entertain serious negotiations with parties who are willing to make a serious offer to purchase the right to distribute beer, wine and spirits in Montgomery County. In FY 2018, that enterprise generated more than $33 million in surplus revenue over expenses to the county’s general fund, of which $11 million was spent on debt service for approximately $100 million in Liquor Control Revenue Bonds, which were issued more than a decade ago to pay for transportation improvements, including the Montrose Parkway. I think we should commission an independent economic analysis of the present value of a guaranteed revenue stream of more than $30 million each year. My understanding is that it would come to hundreds of millions of dollars – more than enough to retire the bonds. I do not think the county should simply give away these valuable rights, which belong to the people of the county. However, serious offers from serious buyers should be considered. Simply giving the rights (and the associated revenues) away would require that the bonds be retired or refinanced through other means. If general obligation bonds were used to refinance the Liquor Control Revenue Bonds, it would reduce the county’s ability to construct new schools and other capital projects by $100 million.

In the absence of a serious offer to buy the rights to the entire enterprise, I continue to support the County Council’s 2015 proposal to privatize special order sales of beer and wine. Problems with delivery of special orders comprise the vast majority of complaints from restaurants, but the Montgomery County delegation to Annapolis declined to take up the County Council’s proposal in the 2016 session after County Executive Leggett asked for more time for study.

The Montgomery County delegation also declined to take up proposals for immediate privatization or for a voter referendum. Candidates for County Executive who have concerns about the Department of Liquor Control’s shortcomings should remember that liquor laws are made in Annapolis, not in Rockville. I would also support action by the state legislature to allow sales of beer and wine in grocery stores. Beer and wine stores will soon be able to sell spirits under legislation that passed in the 2017 session, which I supported.

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Adam Pagnucco, Marc Elrich, purple line

Should There Be Rent Control Near the Purple Line?

By Adam Pagnucco.

Council Member Marc Elrich, who recently equated potential gentrification near the Purple Line with “ethnic cleansing,” is taking flak for his remarks and is not backing down.  We will leave it to others to judge his choice of words.  But what interests us is the policy proposal he has made: specifically, Elrich would like to see rent control imposed near Purple Line stations.  That’s worth discussing.

Economists tend to disagree on many issues but a huge majority of them oppose rent control.  Liberal New York Times columnist Paul Krugman has written, “Almost every freshman-level textbook contains a case study on rent control, using its known adverse side effects to illustrate the principles of supply and demand.”  A massive review of economic research on rent control found evidence that it encourages conversions of rental units into condos and leads to higher rents in non-controlled units.  Rent control repeal in Cambridge, Massachusetts led to a surge in property values in both controlled and non-controlled units and a 20% increase in housing investment.  Even Communists denounce rent control.  In 1989, Vietnamese Foreign Minister Nguyen Co Thach told a news conference that rent control did more damage to his capital city than American bombs.  “The Americans couldn’t destroy Hanoi, but we have destroyed our city by very low rents. We realized it was stupid and that we must change policy.”

One need not go to a Communist nation to observe the effects of rent control.  MoCo has a good example of that policy right here at home: the City of Takoma Park, which passed a rent control law in 1981.  We examined U.S. Census data to analyze how the city’s housing stock compares to the county’s.  Below we show that just 10% of the city’s housing was built in 1980 or later, much lower than the county’s percentage of 47%.  That’s not a fair comparison since the city is much older than the vast majority of areas in the county.  However, other older areas inside the Beltway like Downtown Bethesda (27%), Chevy Chase (20%) and Downtown Silver Spring (26%) have much higher percentages of their housing built in 1980 or later than Takoma Park.

It gets worse.  Takoma Park has been losing rental housing units for years.  Below we show the city’s total, owner-occupied and renter-occupied housing units in 2000, 2010 and the five year period of 2011-2015.  During that time, the city’s total housing units fell by 4% and its renter-occupied units fell by 18%.  Owner-occupied units increased by 10% and vacancies rose by 30%.  No housing policy that produces double-digit losses in rental units can be described as good for renters.

Takoma Park’s housing decline is not going to turn around soon.  According to the site plans, preliminary plans and sketch plans listed on the MoCo Planning Department’s development tracking map, only two housing projects with a combined seven units are pending in Takoma Park.  Those units are all single family, which are exempt from the city’s rent control law.

This extract from the Planning Department’s site plan map shows the huge contrast in development plans between Takoma Park and Downtown Silver Spring.

The implication of all this is clear: housing developers are steering clear of Takoma Park’s rent control law.  These folks are not going to be any more enthusiastic about rent control near Purple Line stations.  Why does that matter?  When it comes to building new housing, there are basically three options.  First, you can build it near transit.  Second, you can build it away from transit, thereby incurring the associated congestion and environmental costs.  Or third, you can try to block it from being built, and that’s one probable effect of rent control.  But that won’t stop population growth – instead, it will result in overcrowded housing, unsafe living conditions and code violations.  (Such phenomena are not unknown in some areas of the county.)  Rent control near the Purple Line just encourages options two and three.

Finally, the Purple Line is a huge investment, costing at least $2.65 billion to construct.  Only an insane society would pour billions of dollars into a transit project and then stop new housing from being built next to it.  Even Vietnamese Communists would agree.

Disclosure: Your author is a long-time supporter of the Purple Line and is a publicly listed supporter of Council Member Roger Berliner for Executive.

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Adam Pagnucco

Giving Thanks

By Adam Pagnucco.

Today is Thanksgiving, an occasion for celebrating with friends and family and giving thanks.  And we here at Seventh State have many thanks to give.

We are thankful for the reporters, bloggers, troublemakers, rascals, rogues and scalawags who keep our government honest.  And we are thankful to this nation’s founders who created the First Amendment to protect them.

We are thankful for Facebook, which gives us online tirades by politicians available for screen shots.

We are thankful for the liquor monopoly, which gives us a rare county service to complain about.  (Snow plowing season hasn’t started yet.)

We are thankful for public campaign financing, which has helped give us more candidates than can fit in RFK Stadium.

A recent day at the County Board of Elections’ candidate counter.

We are thankful to all the County Council candidates who will shortly be filling out our 72-question questionnaire.  (We are kidding – or so they hope.)

We are thankful to our guest bloggers.  After all, someone has to come up with good content for this site!

We are thankful to David Trone, who has promised to give Total Wine coupons to everyone who votes for him.  (OK, this hasn’t happened, but we are entitled to our fantasies!)

We are thankful to Comptroller Peter Franchot, who is doing everything in his power to help Maryland craft beer connoisseurs.  (His occasional entertaining spats with Senate President Mike Miller are a bonus.)

We are thankful to Council Member Hans Riemer for having the best pair of pants in county politics.  (Not to mention one of the best-looking families of all time!)

We are thankful to everyone who signed the petition to deport Justin Bieber and we hope there is another one.  Perhaps the current President will take action!

We are thankful for Roger Goodell, who might be the only person in pro football worse than Dan Snyder.

We are thankful for Baltimore City State Senator Nathaniel Oaks, who brought back fond memories of Senator Clay Davis.

We are thankful to our many off-the-record sources without whom it would be impossible to understand what the government is doing.  Keep it coming, folks!

We are thankful to the government employees who educate our kids, protect us from crime and provide us with professional, top-notch services every day.  And we are thankful to the private sector employees and business owners who pay for them.

We are thankful for our families and friends, who knock us down when we deserve it and pick us up when we need it.

And most of all, we are thankful to Seventh State readers, who tolerate our dreck and inexplicably come back for more.

Happy Thanksgiving!

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Bill Frick, budget, Montgomery County Executive

Bill Frick: Name One Program You Would Cut

Name one program in the county budget that is not working and can be cut.  Tell us how much in annual savings that would yield.

For too long, Council members have used the County budget as a piggy bank to fund their pet projects and ideas, often ones that could not survive a serious cost/benefit review.

As we reorient County government to be a constituent-consumer focused organization, we can find savings.  For example, the county employs nearly 40 personnel in its 311 call center, despite the dramatic shift in technology away from phone calls and towards electronic communications.  If Montgomery County complemented this with a constituent service app, as exists in neighboring jurisdictions, many constituent services would be routed directly to the relevant agencies instead of going first through bureaucratic call centers, and we could save taxpayer money.

Finally, the County should not be a leader in corporate welfare.  I would end our tax credits for investors, money that goes from everyday taxpayers straight to the pockets of wealthy investors, often to reward them for making investments they would have made regardless.  This is a fight I led at the state level as the architect of the Tax Credit Evaluation Act, legislation to spotlight and reform our runaway subsidies, and by going toe-to-toe with Hollywood to make sure our tax dollars were being spent productively.

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budget, Montgomery County Executive, Roger Berliner

Roger Berliner: Name One Program You Would Cut

Name one program in the county budget that is not working and can be cut.  Tell us how much in annual savings that would yield.

I have been a leading proponent of trying to find ways that our county could operate more efficiently.  Working with the County Executive, I was the lead sponsor of legislation that created the Organizational Reform Commission, led by a diverse and talented group of citizens to identify ways we could make our county government more efficient.  However, at the end of the day, while there were steps we were able to take that made our county government more efficient, direct dollar savings were not significant.

I have for years argued that the County Executive should move to what is known as “zero based budgeting”.  What is zero based budgeting?  “Zero-based budgeting is a repeatable process that organizations use to rigorously review every dollar in the annual budget, manage financial performance on a monthly basis, and build a culture of cost management among all employees.”  That would be my goal as County Executive.

In addition to rigorous scrutiny of costs, there are initiatives that you don’t readily think of that can produce cost savings – initiatives like having our county buy 100% renewable power and putting solar on our county rooftops.  Those initiatives alone will save many millions of dollars going forward.  Sometimes doing the right thing actually can save taxpayer dollars!

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