Tag Archives: Maryland

Bob McDonnell’s History Lesson

Shades of Marvin Mandel

By Barry Rascovar

Sept. 15, 2014 — You’ve got to pity Bob McDonnnell, former Virginia governor and recently convicted felon. He never learned from the political-corruption history of Virginia’s neighbor to the north, Maryland.

Had McDonnell familiarized himself with the trials and legal tribulations of Maryland Gov. Marvin Mandel (1969-1978), he might have avoided the ethics lapses and quid pro quo exchanges of gifts and cash that did in McDonnell and his wife, Maureen.

Bob and Maureen McDonnell

Bob and Maureen McDonnell

Indeed, the similarities between the McDonnell and Mandel sagas are stunning:

  • Both men were highly popular, successful governors.
  • Both were dogged by federal prosecutors pursuing complex public corruption and bribery cases.
  • Both prosecutions stemmed in large part from marital discord and payoffs to the spouses.
  • Both cases involved governors whose bank accounts were seriously depleted even as they faced ballooning expenses
  • Both cases led to humiliating, intimate public disclosures about the two governors’ personal lives and weaknesses.
  • Both involved payments of cash, fancy clothing, trips and other luxuries in exchange for government actions that would enrich their friends.
  • Both involved incredibly weak government codes of ethical conduct.
  • Both men maintained to the end their complete innocence.
  • And both cases rested on the fuzzily defined notion that the public is entitled to “loyal and honest services” from its elected leaders.

Improper Gifts

The McDonnells were convicted Sept. 4 of receiving improper gifts and loans from a Virginia businessman peddling a miracle vitamin pill. In return, the businessman gained access to state health officials and other key individuals who could help him, thanks to the McDonnells’ direct efforts.

Mandel was found guilty in 1977 of receiving from friends cash, an expensive wardrobe, jewelry for his wife, valuable waterfront land and interest in an office building in exchange for his help in gaining lucrative thoroughbred racing days.

Mandel “loved beyond his means,” as the late Mary McGrory brilliantly put it.

Marvin Mandel with second wife, Jeanne

Marvin Mandel with second wife, Jeanne

He split from his loyal wife in a highly publicized and messy move (she refused to vacate the governor’s mansion; he lived in a hotel) so he could marry his longtime paramour.

It turned out Marvin Mandel couldn’t afford the divorce settlement or his new wife’s expensive lifestyle without help from his wealthy business friends — who even connived with a Catholic religious order that lent Mandel the divorce money.

The governor’s “thank you”: He dropped his opposition to a doubling of racing days at the Marlboro track (from 16 to 32). Marlboro had just been bought (in secret) by his friends.

Mandel followed up with strenuous arm-twisting to pass legislation giving Marlboro an additional 62 days of racing. A rinky-dink harness track would suddenly morph into a major-league thoroughbred track with 94 racing dates.

‘Serious Mistakes’

To this day, Mandel denies wrongdoing. “I said then, and I say now, that I never did anything illegal as governor of Maryland,” he wrote in a book he penned at age 90.

Mandel’s appellate lawyers cleverly defined his actions as, at worst, “a non-criminal scheme of non-disclosure.”

The trial judge, Robert Taylor, disagreed. “You made some serious mistakes,” Taylor said.

Mandel went to federal prison in Florida, was pardoned by President Ronald Reagan and had his conviction later overturned on a technicality (prosecutors had stretched the legal interpretation of federal racketeering and mail fraud laws too far).

The incriminating evidence — and there was plenty of it — was never disputed.

Cash Poor Governor

This brings us back to Bob McDonnell — politically rich, but cash poor.

He couldn’t afford his daughter’s over-the-top wedding and his wife’s outrageously expensive gowns without help from an exceedingly generous businessman who befriended them in exchange for — he hoped — state endorsement of his miracle vitamin pill.

Like the Mandel trial, which exposed backstage maneuverings by friends to extricate Maryland’s governor from a strained marriage and keep him happy, the McDonnells’ courtroom drama in Richmond revolved around their family soap opera.

Maureen McDonnell was portrayed as an out-of-control shrew, demanding more and more largesse from her financially strapped, henpecked hubby. He threw her under the bus, essentially blaming her for the whole mess.

And, of course, he denied all wrongdoing.

Ethics Loopholes

Why not? Virginia’s laughable Ethics Code makes almost any gift to a public official legal as long as you disclose it.

Maryland’s Ethics Code is even more of a Swiss cheese affair. Mandel as governor issued this code of conduct, making it applicable “to all officers and employees of the executive branch.”

It made it unethical to do exactly what Mandel later carried out.

But here’s the catch: Maryland’s Ethics Code doesn’t apply to constitutionally elected officers, i.e., the governor.

So Mandel can say with a straight face he did nothing wrong under the state’s code of conduct. Let’s call it “technical deniability.”

High Public Expectations

Still, neither he nor McDonnell could evade the long arm of federal prosecutors.

In Virginia, a jury convicted McDonnell of conspiracy, bribery and extortion. He could be sent off to prison, but if so his stay almost surely will be brief compared with Mandel’s 19 months behind bars.

Neither man understood what was expected of them as elected public officials.

They were living under an old-fashioned standard of acceptable political behavior: Take whatever you can get as long as you do it quietly and don’t directly harm the public.

That’s not how citizens view public service today, or in the 1970s. They expect their leaders will act ethically. Don’t accept valuable gifts, even from close friends. Don’t do favors for your friends. Don’t grease the wheels for your friends.

It’s not hard to understand. Politicians in high office, though, sometimes forget they’re expected to be above suspicion.

McDonnell now is paying the price for his failure to pay attention. Had he studied Mandel’s political and personal downfall, he might not have ruined his life — and his reputation.

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Diversion Tactic in MD Governor’s Race

By Barry Rascovar

Sept. 10, 2014 — When you are caught with your thumb in the cherry pie, what do you say?

“Ma, look what Mikey’s doing! He’s up to no good.”

That diversionary tactic doesn’t work on moms, and Anthony Brown’s finger-pointing tactic doesn’t work, either.

Hogan's disputed Windsport

Hogan’s disputed Windsport

Brown may have a serious campaign fund-raising violation to explain to the state elections board.

So what does he say?

He accuses his Republican foe, Larry Hogan Jr., of low-balling his monthly rental fee for a recreation vehicle decked out in campaign logos.

Why, Hogan should be paying a lot more than $683.77 a month to fully reflect the cost of operating this mobile campaign headquarters, Brown’s operatives complain.

What a bunch of malarkey.

What Is Reasonable?

A state elections official has already said covering the full monthly payments on Hogan’s bus — which Hogan owns and is renting to the campaign — qualifies as a “reasonable” standard.

What it costs to fill up this gas-guzzling Windsport daily and oil, grease and repair the recreation vehicle for heavy-duty operation through Nov. 4 isn’t part of the rental agreement. That’s something the Hogan campaign must cover anyway.

So in effect, Hogan’s operatives are already paying “fair market value.”

Brown’s ploy is a canard, a decoy designed to shift media focus from the serious complaint Hogan lodged against the Democrat — coordinating fund-raising efforts of his campaign with that of a labor-supported, independent Super-PAC (Political Action Committee).

That’s illegal, according to the Supreme Court. The Maryland elections board already has said campaigns cannot share with independent Super-PACS “campaign material, strategy or information.”

Coordinating Efforts

The problem for Brown is that one of his top chief fund-raisers, Colleen Martin-Lauer, is also the fund-raising coordinator for the supposedly independent labor Super-PAC that is designed to boost Brown. Hogan’s folks maintain it is “simply impossible” for Martin-Lauer and a second joint fund-raiser not to coordinate their solicitation efforts.

Brown did the same thing (overlapping fund-raisers) in the primary election and got away with it. But what if he runs afoul of the Supreme Court’s difficult-to-enforce edict? It could impair his ability to raise as much money as he had hoped.

Millions could be at stake in that complaint. Thousands could be at stake in Brown’s penny-ante subterfuge against Hogan.

It is just another sign of the insipid tactics being employed in this campaign, especially by Brown’s team, which has not hesitated to smear Hogan with blatantly false accusations.

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Sparrows Point Gold?

By Barry Rascovar

Sept. 8, 2014 — Today, it’s a forlorn hulk, a remnant of what once was the world’s largest steel-making plant, stretching four miles end-to-end on the Sparrows Point peninsula.

Abandoned Sparrows Point steel plant

Labor Day used to be special for the 30,000 people who worked at the Bethlehem Steel complex at its peak. They churned out cables for the George Washington Bridge, girders for the Golden Gate Bridge and steel for machinery and equipment that helped win World War II.

Then after 124 years of operation, it was over. The blast furnaces closed for good in June 2012, the property sold for a pittance to a liquidator.

Now there is reason for optimism “The Point” once again might be turned into economic gold.

Baltimore County and the Port of Baltimore have come up with pragmatic plans to redevelop this vast acreage — 5.3 square miles — into a major jobs generator.

Sparrows Point plant in good times

Sparrows Point plant in good times

Even better, an investment group with deep pockets and strong local connections is negotiating to buy most of the Bethlehem Steel land in southeastern Baltimore County.

Jim Davis heads Redwood Capital Investment, which wants to become the new property owner. Davis’ name isn’t as familiar to readers as his cousin, Ravens owner Steve Bisciotti.

The two co-founded a job-staffing service in the 1980s, Aerotek, which morphed into the country’s largest privately held international staffing company — a $10 billion giant called Allegis Group with 12,000 employees and 120,000 contract workers. Its headquarters are in Hanover, not far from Arundel Mills.

Davis went on to purchase Erickson Retirement senior living communities and a host of other real estate and financial investments through Redwood. Now he is seeking most of the Sparrows Point acreage.

The Point’s Potential

If Davis follows the path laid out by a county task force and the Port of Baltimore, The Point some day will be humming with maritime crews, manufacturing and assembly workers, energy operators and distribution and freight employees.

It could be the most promising economic development story for Maryland in decades.

Nowhere in the Northeast is there such an enormous chunk of land already zoned for industrial use.

While 600 acres is heavily contaminated after a century of steel-making, some 2,400 acres won’t need much work to be placed on the market.

A good part of it overlooks the Chesapeake Bay — six linear miles of deep-water frontage perfectly suited for the port’s expansion needs.

Sparrows Point redevelopment area

Sparrows Point redevelopment area

If Baltimore is to take full advantage of a widened Panama Canal in 2016, it needs additional berths for the giant “post-Panamax” container ships (more than three football fields long) that require 50-foot channels and extra-long cranes.

Sparrows Point already has a 45-foot iron ore pier that could handle roll-on, roll-off cargo like automobiles and farm equipment; a second pier ideal for barges and smaller vessels; a short-line railroad that links to both CSX and Norfolk Southern tracks, and lots and lots of cargo storage space.

Dredge Deposit Site

There’s also Coke Point, where port officials want to deposit tons of dredged harbor muck over the next decade or two. Once filled in, this “de-watered” land can be prepared for use as a state-of-the-art, deepwater super-cargo berth similar to Seagirt Marine Terminal, built on dredged material from construction of the Fort McHenry Tunnel.

That’s just the start of the good news.

The task force, appointed by Baltimore County Executive Kevin Kamenetz, thinks some of the the peninsula is well suited for an energy park containing a natural gas plant, solar and wind farms, a biomass energy plant and a landfill gas plant.

This makes enormous sense. Central Maryland pays heavily to import electric power from out of state. It lacks sufficient transmission lines, too.

Neat Fit for Clean Energy

But The Point already has heavy-duty transmission lines that fed electricity to Beth Steel’s blast furnaces. Clean-energy production would be a nice fit, especially since the facilities wouldn’t be close to residential neighborhoods.

Other uses pinpointed by the task force include innovative manufacturing and value-added assembly for rail cars, ships, marine vehicles, specialty machinery and electric equipment; distribution and logistics parks, and “freight villages” offering warehouse space and service and equipment support.

Additionally, the task force noted a 400-acre quarry on the property soon will be ending its useful life. This opens the way for another “extraordinary vacant land-mass opportunity.”

Part of Beth Steel property

Part of Beth Steel property

It’s almost too good to be true.

And it may be. Davis has to finalize his group’s land purchase. Then he must negotiate terms with the state for the waterfront property. His company will be juggling many development balls simultaneously.

Of course, there’s the overhanging environmental concerns that first must be resolved.

Eventually, though, The Point might make a surprisingly strong comeback.

You couldn’t ask for a better located 5.3 square miles of land — much of it fronting deep water, practically on top of I-95 and the Baltimore Beltway, already connected to major railroads, a short drive from BWI Marshall Airport and at the mid-point of the East Coast’s massive megalopolis.

The State’s Role

It will take major investments from the state to give the Port of Baltimore these long-lasting advantages over other Atlantic ports of call. It’s not clear if the state’s next administration will be up to the task or if politics will intrude as the Transportation Department tries to find the money for this expensive project in its already stretched budget.

Given the recent debacle in finding a freight transfer site for CSX near the port, the MPA’s Sparrows Point expansion takes on heightened significance.

Environmental cleanups will cost someone a small fortune, though. It’s a key sticking point that must be resolved.

The county will play a role in smoothing the way for interested companies who see the vast potential of Sparrows Point. Baltimore City will have to make accommodations, too, especially in finding space to build a full interstate interchange at Broening Highway.

It’s too great an opportunity to let slip away, though.

For over 100 years, from 1889 until 2012, Sparrows Point was a beacon of jobs and success for the Greater Baltimore region. It can happen again — if there’s the will to make it happen.

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Horseshoe Arrives in Baltimore

By Barry Rascovar

Sept. 2, 2014–Baltimore’s first and only casino is open — a decade later than anticipated by city officials.

Horseshoe Baltimore, run by Caesar’s Entertainment, is a bright, cheery and decidedly friendly facility a short walk from Ravens stadium. It’s got a giant parking structure that allows direct access to the casino without venturing on to city streets.

Horseshoe Baltimore

Horseshoe Baltimore

With 2,500 brand-new slot machines, 122 gaming tables and 25 poker tables, the $442-million Horseshoe Baltimore fulfills the wishes of city leaders, though it should have happened years ago.

Former Mayor Kurt Schmoke had a deal with then-Gov. Parris Glendening in the late 1990s to allow a Baltimore casino for a struggling urban city in need of an economic boost.

But Glendening reneged and went on a moralistic anti-slots campaign. It may have been good politics for the governor but Schmoke regarded it as a stab in the back. Baltimore desperately needed the revenue and stimulus.

It still does.

New City Revenue

Granted, Horseshoe isn’t the answer to Baltimore’s woes. But proceeds from the casino will help Mayor Stephanie Rawlings-Blake slowly lower sky-high property taxes, make infrastructure improvements and eventually pour millions it now doesn’t have into community upgrades.

The current squabble over using some of the casino revenue to re-locate a stream pipeline serving downtown Baltimore businesses deflects from the fact that Baltimore should receive more than $10 million in the current fiscal year from Horseshoe operations, $15.5 million or more next year and $22.5 million in fiscal 2017.

That is a gift sorely needed by City Hall to help accelerate the downtown-living renaissance, deal with a serious crime problem and finally start to attack a glut of vacant housing.

For Baltimore, Horseshoe’s arrival is a ringer, a home run, a winner.

Horseshoe Baltimore casino

With 1,700 jobs — many filled by tax-paying city residents — Horseshoe is a new economic engine. Its location near the baseball and football stadiums means huge before-and-after crowds on game days and added revenue both for the casino and for Baltimore.

Under terms of the state casino law, Baltimore will split with Prince George’s and Anne Arundel counties 5.5 percent of the winning proceeds from their three gambling facilities — Horseshoe, Maryland Live! at Arundel Mills and MGM National Harbor now under construction.

This local impact revenue is a godsend for Baltimore.

It is a new, ongoing money source that will allow City Hall to undertake projects on the back burner for years (or decades) and to balance the annual budget without draconian cuts.

It’s no panacea, but it gives city officials breathing room.

Late Entry

Baltimore is late to the casino party, but probably not too late.

Gambling — legal or illegal — always has been popular in Charm City. A single casino will probably do well for years to come, even with a glut of gambling sites in New Jersey and Pennsylvania.

Horseshoe also provides a much-needed boost for local tourism and for Baltimore’s downtown hotels. It gives visitors another reason to extend their stay or to come to Baltimore in the first place. It’s a decided plus for drawing conventions, too.

Part of Horseshoe’s success will come at the expense of David Cordish’s highly profitable Maryland Live! casino.  But Horseshoe will draw a more urban clientele versus the suburbanites flocking to Maryland Live!

Maryland Live

Both casinos, though, will feel the squeeze when MGM National Harbor opens in a couple of years. It will translate into smaller profit margins for both, but  National Harbor’s main draw will be for gambling patrons south of the Potomac River in Virginia.

Six casinos in Maryland seems about the right number — three in rural locations and three in the Baltimore-Washington megalopolis.

Casinos are becoming established, middle-class entertainment options that offer substantial benefits for state and local governments for their relatively stable revenue — as long as the gambling is tightly regulated and the sites are limited in number.

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MD GOP Nightmare

By Barry Rascovar

August 18, 2014 — Just what the Maryland Republican Party didn’t need — a theocratic, paleo-conservative candidate who has renounced the General Assembly as ungodly and is deeply involved in a group advocating a white, Christian nation of the South.

Worst of all for the Maryland GOP, this 61-year-old, Bible-spouting secessionist with a bizarre view of government is the favorite to win the November election in Anne Arundel County’s Broadneck Peninsula-Severna Park-Arnold councilmanic district.

His name is Michael Peroutka, a smooth-talking, debt-collector attorney. He ran for president of the United States in 2004 on the Constitution Party ballot line. He got 150,000 votes out of 122,000,000 cast (0.1 percent).

Constitution Party logo

Yet in June, he shocked the GOP establishment by winning Anne Arundel’s District 5 council primary by a razor-thin 38 votes.

The Republican nominee for governor, Larry Hogan Jr., disassociated himself from Peroutka. So did the GOP’s nominee for county executive, Del. Steve Schuh. Annapolis Del. Herb McMillan isn’t supporting Peroutka, either, because his views “are the exact opposite of the Republican Party.”

Like the slick lawyer he is, Peroutka is trying to sweet-talk District 5 voters into believing he’s an ordinary conservative who rails against the misnamed “rain tax,” abhors all taxes and demands drastically limited government.

It’s a con.

Peroutka didn’t even belong to the Republican Party until this year.

Peroutka button 2004

He and a Christian Reconstructionist cohort, David Whitney, tried to hijack the District 5 election by seeking to win both the Republican and Democratic primaries.

That would have guaranteed a seat on the County Council for this oddball alliance, which centers around Peroutka’s extreme Christian Institute on the Constitution, which he runs out of his law office in a strip shopping center along Ritchie Highway.

Peroutka is out to re-create the Anne Arundel Republican Party, and eventually the Maryland GOP, in his image. His pseudo-conservative rhetoric masks a deep hatred for the Republican Party of Lincoln, Ronald Reagan and George W. Bush.

Here’s what he said last October about the GOP:

“Anyone, including those who identify with the ‘Tea Party,’ who loves America and desires real reform, would do well to disengage themselves from the Republican Party and their brand of worthless, Godless, unprincipled conservatism.”

Fifth-Column Action

Peroutka isn’t even following his own advice. Instead, he’s infiltrated the “Godless, unprincipled” GOP.

This fifth-column action is part of his campaign to turn the Republican Party into a Christian party that follows Peroutka’s “biblical view of law and government.”

To him, “the function of civil government is to obey God and to enforce God’s law — PERIOD.”

Any other government actions — what he calls “pretended laws” —  are heretical and should be ignored or resisted. No wonder he spoke at a radical Second American Revolution rally last November in Washington. He’s out to dismantle the entire American system of government.

Peroutka at Second American Revolution rally

Peroutka at Second American Revolution rally

How wacky is Peroutka?

He said last year the Maryland General Assemby is “no longer a valid legislative body” and its actions should be disregarded because they violate God’s law.

Of course, Peroutka is the one who decides what’s legitimate and what is “Godless.”

According to him, “It is not the role of civil government to house, feed, clothe, educate or give health care to . . . ANYBODY.” Government, Peroutka says, has no authority to take any role in education or alleviating poverty. Government must enforce only the word of God spelled out in the Bible.

Misleading Appearance

Peroutka doesn’t come across as a madman. He’s got a distinguished mane of white hair, a grandfatherly look and a soothing voice. How could someone so sincere and seemingly erudite promote such nonsense?

Peroutka is a board member of the League of the South, an Alabama group that openly advocates Southern secession and establishment of a white, Christian Reconstructionist society.

According to its website, the League of the South is “a Southern Nationalist organization whose ultimate goal is a free and independent Southern republic.”

At this group’s meeting last fall, Peroutka called “Dixie” the country’s national anthem.

Should Michael Peroutka win in November, he’s sure to use County Council sessions as a platform for bringing his theocratic notions of government into the proceedings. It will be his launching pad for an internal Republican Party revolution.

Just what the Maryland GOP didn’t need.

It already is struggling for relevancy in the state’s largest jurisdictions. Peroutka’s ravings as an elected Republican leader could be the nail in the coffin for the Republican Party’s hopes of winning over independents and conservative-leaning Democrats.

Can He Lose?

Stopping him will be difficult, but not impossible.

District 5 hasn’t elected a Democratic councilman in 24 years. It’s a wealthy, conservative part of the county stretching from Severna Park to the Broadneck Peninsula that ends at the Chesapeake Bay Bridge.

Yet there’s hope in the voter registration numbers: 25,800 Republicans live in the district against 21,100 Democrats and 11,600 independents. Given the GOP leadership defections already announced, Peroutka’s election isn’t a sure thing.

He’s got millions of his own money he can funnel into his campaign, though.

Democratic Foe

He’s also running against a political youngster, Patrick Armstrong, a 31-year-old retail store manager who entered the Democratic primary to prevent Peroutka’s theocratic collaborator, David Whitney, from furtively gaining the nomination.

Armstrong did better than okay in the primary. He trounced Whitney, gaining nearly two-thirds of the Democratic votes in June.

He’s also not, as he put it, “a liberal boogie man. I’m a reasonable person” who grew up in District 5, graduated from Anne Arundel Community College in the district, and lives with his parents in Cape St. Claire.

He’s smart enough to run in this district with a pledge to never vote for a new tax or fee increase but instead “come up with creative ways to find solutions to our problems.”

Being Responsible

Yet he’s also wise enough to recognize that opposing the “rain tax” isn’t going to win over district voters who care deeply about the well-being of the Chesapeake Bay and its tributaries, including the Magothy and Severn rivers that define District 5’s boundaries.

He calls the stormwater-runoff fee “the responsible thing to do.”

With strong backing from state Democratic leaders, Armstrong might give Peroutka all he can handle. But he’s got to get the word out about Peroutka’s dangerous views of government and the U.S. Constitution.

After all, Peroutka is advocating the dismemberment of the United States and turning what’s left into a society ruled by Biblical law.

The problem is that even if Peroutka’s Republican charade is unmasked in time and he loses in November, he will remain the Maryland GOP’s nightmare: In June, he also won for himself a seat on the Anne Arundel Republican Central Committee.

That gives him an opportunity to use the county’s GOP Central Committee as a launching pad for converting Republican governing bodies into advocates for Christian government.

As a central committee member, Peroutka also will attend statewide GOP meetings, where he can poison the well with radical resolutions and speeches meant to Christianize the state party. He’s leading God’s crusade against the Republican infidels.

Ignoring Godless Laws

On top of that, another Peroutka theocratic soulmate, Joe Delimater, was the lone GOP candidate to file for county sheriff.

Delimater will be on the November ballot against the incumbent sheriff, Democrat Ron Bateman, hoping to win the right to wreak havoc on Anne Arundel’s court and criminal justice system by ignoring laws and government orders he believes are Godless.

What a mess for the GOP.

Peroutka & Co. pose a serious challenge to the viability and future of the Maryland Republican Party.

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Uber and Out in MD

By Barry Rascovar

August 14, 2014 — Maryland’s Public Service Commission struck a blow for the rule of law this week when it declared the popular app-based, ride-sharing company Uber Technologies isn’t exempt from regulations other companies must follow if they want to transport paying customers.

It is “clear and unambiguous” that Uber is a passenger-carrying, for-profit, public transportation service, according to the PSC.

Uber logo

As such, Uber is not free to make its own rules and ignore Maryland law.

Just because Uber is using innovative Internet technologies to reinvent the taxicab industry doesn’t mean it can arrogantly write its own dictum and thumb its nose at statutes that govern the way other common carriers operate.

Companies like Uber seem to believe that because they are Internet-based, they can run their kingdoms according to their edicts and decrees.

Isn’t the Internet all about unfettered communication and freedom?

Brave, New World

Doesn’t a business based on Internet technologies have the right to do what it pleases, regardless of the consequences or existing statutes?

To follow that logic is to abandon all governance in favor of a libertarian society stripped of legal restraints.

Thankfully, the PSC wasn’t buying Uber’s scary vision of a brave, new fee-for-transport world. If we live in a country ruled by laws, then the laws must be applied across the board.

There’s no doubt Uber offers customers a good deal.

Uber smart phone app

Uber Smart Phone App

But huge dangers lurk as well.

Because Uber doesn’t want to play by the PSC’s rules, it sets its own customer charges. Unlike other cab companies, it applies higher “surge pricing” during busy times. It hasn’t bothered to apply for a common carrier license from the PSC, either.

Uber’s drivers don’t have Maryland passenger-for-hire licenses, which means its drivers haven’t undergone state criminal background checks or driver record checks.

Uber drivers don’t have passenger-for-hire vehicle insurance: If there’s an accident, the driver’s personal auto insurance won’t pay the passenger’s medical bills, or for damages.

No Safety Net?

(Uber claims on its website it has a “commercial insurance policy for rideshare drivers.” But it also claims “all UberBLACK, UberSUV, or uberTAXI rides are provided by commercially licensed and insured partners and drivers. Those transportation providers are covered by commercial insurance policies, in accordance with local and state requirements” — a statement that isn’t true in Maryland.)

Without a government-imposed safety net, passengers take their lives in their hands when they travel with Uber.

“Technology is not a substitute for regulatory oversight,” says Paula Carmody, the Maryland People’s Council, who usually is critical of PSC actions. This time, the official whose job is to look out for consumers applauded the regulatory commissioners. They “got it right.”

Paula Carmody, People's Counsel

Paula Carmody, People’s Counsel

The commissioners also recognized that the Internet riding-sharing revolution is transforming the passenger-for-hire industry. They directed their staff to come up with new regulations within 90 days reflecting evolutionary changes in transport services.

The staff will propose ways to make sure Uber-type companies and drivers have sufficient insurance; that their vehicles are safe and inspected; that drivers are qualified, and that new technologies affecting rates and pick-ups can be applied to all of the state’s taxi-style companies.

Uber, though, continues to act like a spoiled child caught trying to empty the cookie jar.

PSC logo

It railed against the “PSC’s attempt to take choice and competition away from Maryland residents.”

Uber said it will “continue to defend the rights of riders and drivers to have access to the safest, most reliable transportation alternatives on the road.”

“Safest”? Hardly.

The notion that Uber cannot compete if it plays by the state’s rules is buncombe.

What Uber really wants is a built-in advantage over traditional cab and sedan companies. That can only be accomplished by operating outside Maryland law that governs the cab industry.

Level Playing Field

Uber has opened the door for other companies to benefit from technology innovations it has brought to passenger-for-hire car service. That’s what the PSC wants to see in its new regulations.

In other states, Uber is getting its way. It can continue its outlaw-status with minimal state interference.

Not in Maryland, where Uber is being asked to recognize the importance of regulatory laws designed to ensure public safety.

That’s what government is supposed to do — even in an anarchic Internet Age.

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No MD Pension Panic This Year

By Barry Rascovar

August 4, 2014–Good news from the Maryland state retirement agency: investment earnings over the past year ending June 30 rose a strong 14.37 percent.

Maryland retirement agency logo

Don’t get too excited: The agency is still digging out of a deep financial hole caused by the Great Recession, poor decisions by former governors and legislators and poor advice from the agency’s consultant.

The retirement fund’s health, though, is showing solid improvement.

Positive Signs

Since the depths of the Great Recession, the value of its assets have risen over one-third, now topping $45.4 billion — a boost of over $5 billion in the past year alone.

Equally important, reforms to the system have kicked in: Increased employee payments, tighter eligibility rules, contributions from counties for teacher pensions and phasing out the ill-conceived Corridor Funding Methodology that let politicians reduce state payments while ignoring the retirement fund’s deterioration.

Combined, all this has kept the retirement fund on track to return to 80 percent of full funding by 2025 as planned. The corner may have been turned.

Index Fund Debate

Critics, especially conservatives and Republicans, continue to complain about fees paid to money managers — $273.8 million in fiscal year 2013 — rather than dumping all the state’s stock and bond investments into passive, low-fee index funds.

But the state agency recouped its payments to professional financial advisers many times over during the past two years with total gains of nearly 25 percent.

Moreover, fund managers already have shifted more of their assets into index funds: 63 percent of domestic equity investments are in these passive accounts; 47 percent of international equities are held in index funds, too.

Recent strong returns could well persist in upcoming annual reports as the nation’s economy finally starts to gain steam and enters a robust growth phase. It’s a good time to be a pension fund manager.

Two-Way Economic Cycle

But there will be dips and plunges along the way. There always are. Economic cycles flow in two directions — up some years, down in others.

To prepare for the down years and slower long-term growth, the state’s pension fund managers continue to re-channel investments into safer, less volatile financial instruments. The goal is long-term, stable growth, not flashy, short-term gains (or losses).

Some states get a bigger annual investment return than Maryland by placing riskier bets. But they are using retirement fund money for these gambles, which in some cases have backfired quite badly.

Long-Term Results Count

Still, we shouldn’t place too much importance in these annual profit-or-loss statements from government pension funds.

Everyone with stock portfolios knows the short-term picture can look terribly bleak (for example, last Thursday’s and Friday’s steep plunge in the Dow-Jones Average). But over the long haul — a decade or more — historic patterns are quite positive.

That’s what counts — the long-range results for pension funds. Harsh critiques of a fund’s 12-month performance can be misleading.

False Assumptions

Placing too much emphasis on the unfunded actuarial liability also can lead to false conclusions.

Yes, Maryland’s unfunded IOUs topped $19 billion as of last year. But there’s plenty of money in the retirement plan to write pension checks to 132,000 retirees and beneficiaries for years and decades to come.

Meanwhile, reforms taken over the past three years will continue narrowing the gap between what goes into the fund and what is drawn out to pay pensioners each year.

Eliminating the Deficit

The saving grace is that Maryland only pays out a fraction of the pension fund’s assets each year. Most of the 192,000 active participants in the program won’t start collecting retirement checks for another 20 or 30 years.

There’s plenty of time to gradually eliminate the unfunded liability.

That’s the stated objective of the retirement agency’s trustees.

They’ve made substantial progress in the last few years. If the nation’s economy continues on an upward trend, the agency’s financial picture could brighten faster than expected.

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Barry Rascovar’s blog is www.politcalmaryland.com. He can be reached via brascovar@hotmail.com

Child Immigration and MD — II

Sometimes an opinion article hits a nerve.

In this case, my column on Maryland Republican officials, child immigration from Central America, and what to do locally about these children, sent a number of the GOP faithful into conniptions.Contemplated immigration site in Westminster

Dan Bongino, the GOP candidate for Congress in the Montgomery County-Western Maryland district, called the column a “hate-filled, ignorant, one-sided piece. . .. so full of vitriol and emotion. . . . [it] should have never been published. There is already a movement growing, among a large group of grassroots activists, to respond.”

They did – along with many others.

Len Lazarick, who publishes MarylandReporter.com, an essential aggregator of news and commentary on Maryland politics and government, ran my column and later ran responses from Republican Congressman Andy Harris and Republican Del. Pat McDonough, among others.

MarylandReporter.com

Len also ran a lengthy defense of Republican immigration policy and a frontal attack on the Democrats’ immigration policy (and my “slanderous, outrageous” column) signed by Diana Waterman, chair of the state GOP.

Another former elected official sent me this response:

“Barry,

“This has got to be the most outrageously partisan[,] myopic, and uninformed column you have ever spewed out. I might try to respond but it would not be worth my time.

“Disgusted,

“Ellen Sauerbrey”

What follows are some of the other reactions.

From Billy Earl:

“Brilliant piece, spot on. . .”

From Jeff:

“[Y]ou were right when you said this: ‘The best way to stop this unwanted influx is to become involved in helping Honduras, El Salvador and Guatemala crack down on criminal activity, to bolster health and education opportunities and to encourage business development.’

“How could anyone disagree with this? It is shameful that Mr. Bongino called for your firing for an opinion piece. I am a life-long Republican and I have never found his presence comfortable. . . .

“I do not support the Governor’s actions or those who have spoken up on this issue because I find that both sides are just reading polls and trying to get attention. I find it classless all the way around.”

From Diane:

“Personally, I think [Rascovar is] full of s**t on this issue, but I am glad you posted it, and hope you keep it online, so people can form their own judgments on the issue and on Rascovar’s opinions. . . .”

“If the column reduces Rascovar’s readership or influence, or lowers public opinion of his value, so be it–he’s entitled to say what he thinks and we are entitled to draw whatever conclusions we wish about him. My personal opinion of him has taken a major hit.”

From Sarah:

“Yeah, I know you and Len took a lot of flak for it, and maybe you did paint with a broad brush, but I appreciated your opinion piece. . . . Someone had to say it.”

From AB:

“I’m a registered Republican and I thank you for this column.  Your courage and insight are appreciated always, at least by [my] family.”

 From Margaret:

“I’m not familiar with you or your column. . . . [P]eople want something for nothing and there are politicians in this country who are spreading the rumor in [C]entral and [S]outh American countries that they can get it here. Unfortunately WE Americans are sick to death of paying for the problems of non-residents. . .  It is not the American way.”

From Pete:

“That piece is really beneath you, filled with ad hominem vitriol. You have to ask yourself why nothing has been done on Immigration reform, and why these children are causing such a ruckus. For years, the ‘gentlemen’s agreement’ between the two sides of the aisle has been that the Democrats don’t do anything substantive about halting the flood of illegals since they generally partake of Democrat social programs, and so vote Democrat. Since they’re illegal, they get paid under the table, so Republican business interests can pay them as little as they like. So far, so good. Now, kids are coming in, whom the Democrats like, but who won’t be working for Republicans anytime soon. Oops.”

From Jack:

“I appreciate you trying to be a reporter of sorts but I would get your facts straight before posting. People will appreciate your views much better.”

“I didn’t bother reading all of your article because nothing seemed factual . . .

“Keep reporting Barry but at least research. Most of what I read isn’t true.”

From Mark:

“Usually your columns are very insightful. Not today. I suppose everyone deserves a vacation once in a while.

“First and foremost, you conflate legal and illegal immigration. . . .

“Second, since when is appropriate [to] use graffiti to characterize a political party’s position? . . .

“Third, you mischaracterize the historic position of the Republican Party on immigration. . .

“Finally, is there a more eloquent articulation of pro-immigration position than in Ronald Reagan’s Farewell Address? . . .”

 Jeff’s response:

“I suggest you pull this article immediately. It is so full of lies and misinformation and fabrications, that you better hope that you don’t get sued by the GOP.

“Pull it immediately until you have factual information.  And you know I can call you out on it being a blogger myself.  It’s horse**** ”

Finally, from Jerry:

“Wow!  What do you really think about the child immigrants? And our neo-Know Nothings in the Republican Party?  Well said!!”

*     *     *     *     *

One of the goals of column-writing is to stimulate discourse and discussion.

The column I wrote focused almost exclusively on how certain state Republican officials have reacted to the recent wave of child immigration. I avoided getting into the broader immigration issue that has tied national Republicans and Democrats in knots.

The central point of the column was this:

As Americans, we have an obligation to humanely care and shelter these children until their cases are resolved. Maryland Republican officials mentioned in the column opposed the “helping hand” approach proposed by local religious and government leaders.

I found that misguided, and that’s what it wrote.

Little, if any, of the responses from Maryland Republicans have offered sensible suggestions on how to humanely care for these children locally while they await their fate.

That’s unfortunate.

Maybe the next round of missives will return to that pivotal question and give us some thoughtful answers.

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Primary Differences: Women & Turnout

By Barry Rascovar

July 21, 2014 – In a primary election wrap-up message e-mailed to his supporters, former state Sen. Art Helton of Harford County listed reasons why he lost his latest effort to re-gain his seat in the General Assembly.

Art Helton

Art Helton

Poor turnout, especially among African American voters, he wrote, hurt him in his race against fellow Democrat Mary-Dulany James. (The Senate seat is now held by Republican Nancy Jacobs, who is retiring.)

The results: James, 4,705 votes (61 percent); Helton, 2,997 votes (39 percent).

Mary-Dulany James

Mary-Dulany James

The other reason Helton gave for his loss:  the dominance of female candidates in Democratic primaries.

He listed 10 female Harford Democrats who were victorious in the June 24 primary.

“[N]ot one woman lost unless challenged by another woman,” he wrote.

“The percentage of women voting in the Democratic [p]rimary was 63.4%. You can view the results and draw your own conclusions.”

Making a Difference

Women indeed are becoming a pivotal force in local and state elections in Maryland. They are more likely to go to the polls than men. Given the right candidate, it can make a difference.

Baltimore City ousted its incumbent state’s attorney and replaced him with a woman. After November, three of the four citywide elected offices in Baltimore will be held by women, all African Americans.

Also after the general election, four of the city’s six state senators will be women.

Women in the Senate

Half of Montgomery County’s eight state senators will be female, too.

As many as six new women could take seats in the Maryland Senate in January – Gail Bates of Howard County, Susan Lee and Cheryl Kagan of Montgomery County, Addie Eckardt from the Eastern Shore, Shirley Nathan-Pulliam from a joint Baltimore city-county district, and James from Harford County.

Susan Lee

Susan Lee

They aren’t neophyte politicians, either.

Combined, they have served 88 years in the General Assembly. They will enter the Senate as highly seasoned lawmakers.

Bates and Lee are concluding their third four-year terms in the House, James is finishing her fourth term. Eckardt and Nathan-Pulliam are 20-year legislative veterans. Kagan previously served two terms in the House.

Addie Eckardt

Addie Eckardt

Yet the “women are dominating Maryland politics” theme shouldn’t be oversold.

Only 11 of 47 state senators today are women. After the November election, the number may rise a tad in the Senate to 13.

Cheryl Kagan

Cheryl Kagan

Many counties have few women in elective offices.

Overall, the fair sex remains under-represented in elective positions, but not as voters.

*     *     *     *     *

Turnout in Maryland’s primary election was, as predicted, abysmal.

It proved an embarrassment to leaders in Annapolis who devised the early June 24 primary schedule.

Voting booths

Only 20.7 of the state’s nearly 3.4 million registered voters cast an early, absentee or election-day ballot: 561,030 registered Marylanders voted; 2,831,570 didn’t.

Turnout proved truly terrible in the Washington suburbs – 18 percent in Prince George’s County, despite the fact the leading Democratic candidate for governor came from P.G.

In neighboring Montgomery County, total turnout was just 16 percent, even though two of the three Democratic gubernatorial hopefuls were local residents.

Best Turnouts

Baltimore County led the list of large jurisdictions with a turnout of just under 25 percent – still a terrible showing in a representative democracy.

The best results came from small, rural counties, such as Kent County (30.6 percent) and Garrett County (26.6 percent). Voting poster The highest vote totals came from Montgomery (84,100) and Baltimore County (82,900), followed by Prince George’s (69,800), Baltimore City (54,600) and Anne Arundel County (50,500).

Democrats far out-voted Republicans in the larger jurisdictions – a hint of what will follow in November.

One-Sided Figures

In Montgomery, 68,179 Democrats voted vs. 12,516 Republicans.

In Prince George’s, 64,982 Democrats cast ballots vs. 4,167 Republicans.

Baltimore County saw 59,980 Democrats vote vs. 22,906 Republicans.

In Baltimore City, the imbalance was far worse: 51,730 Democratic voters vs. 2,894 Republicans. Voting sign Howard County, once a toss-up jurisdiction, saw 19,193 Democrats cast ballots, vs. 8,967 Republicans.

The primary vote totals were close in Harford County – 11,795 Democrats vs. 14,935 Republicans.

In Anne Arundel County, voting numbers were almost even – 24,655 Democrats and 25,806 Republicans.

That could lead to a tight race for county executive in the fall between Republican state Del. Steve Schuh and the county’s former sheriff, Democrat George Johnson.

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Immigration Quandary

By Barry Rascovar

July 28, 2014 — Are Republicans poor spellers?

They might be, judging from the graffiti (“NO ILLEAGLES HERE”) spray painted on a former Carroll County military building. It briefly was under consideration as housing for immigrant children fleeing violence in Central America.

Contemplated immigration site in Westminster

Contemplated immigration site in Westminster

Or is it just that Republicans are narrow-minded bigots?

It seems they don’t want people entering this country unless immigrants are Anglo-Saxon Christians who believe the “G” in GOP stands for God.

Republican History

Hostility toward immigrants is in the Grand Old Party’s DNA.

The Republican Party started as a coalition of anti-slavery groups and the Know-Nothing Party (formally known in states as the American Party or the Native American Party).

The Know-Nothings’ near-hysterical hostility toward Irish-Catholics and Germans later turned into anti-Chinese venom.

Keeping “them” out of the U.S. of A. has morphed into today’s sweeping condemnation of 57,000 children from non-English-speaking, heavily Catholic nations in Central America who have crossed the border.

‘Combat Zone’

Frederick County’s arch-enemy of immigrants, Sheriff Chuck Jenkins, recently toured part of the Texas-Mexico border, declared it a “combat zone” and called for full militarization.

Sheriff Chuck Jenkins of Frederick County

Sheriff Chuck Jenkins of Frederick County

Fortress America, here we come!

“We’re being invaded by drug cartels, drug smugglers, human traffickers,” the sheriff railed.

Huh?

Unaccompanied children are crossing the border, not gun-toting thugs and narco terrorists.

And in Baltimore County. . .

You’d never know that by listening to Del. Wade Kach or Councilman Todd Huff of Baltimore County.

The two Republicans have joined the anti-immigrant mob.

They’re upset Catholic Charities wants to house 50 children from Central America at its secluded St. Vincent’s Villa that tends to children with severe emotional and behavioral problems — and which originally opened 174 years ago as an orphanage for immigrant children.

Meanwhile, Republican Baltimore County Del. Pat McDonough, who never misses a shot at outrageous publicity, is calling for the erection of tent cities along the border and immediate deportation of “them.”

Congressional Intervention

Then there’s the irrepressible Republican naysayer, Congressman Andy Harris.

He was quick to announce his bombastic opposition to Central American kids living temporarily at a former Army Reserve building in Westminster – a locale that is not in his district.

Harris, an anesthesiologist, cited among other reasons “the potential health risks to the community” — as though these kids were carrying the Bubonic Plague.

He wants the 57,000 children deported to their home country “and get back in line.”

Discrimination is alive and well in the Republican Party’s Maryland branch.

Christian Response

Catholic Charities’ proposal, thankfully, does not follow Republican Party dicta.

Instead, it follows Christian teachings that most Republicans ostensibly say they follow.

This is, as Pope Francis pointed out, a “humanitarian emergency” involving unaccompanied children in a foreign land. We must first protect and care for these children, the pope said.

Pope Francis

Pope Francis

Catholic Charities is extending the good work it does by undertaking this new mission at St. Vincent’s Villa in Timonium.

It’s not a permanent solution but rather a helping hand for 50 kids while their situations are sorted out. What’s wrong with that?

Governor’s Response

How does Maryland suffer from a local charity assisting some of the needy, regardless of their place of origin?

Gov. Martin O’Malley understands.

Gov. Martin O'Malley

Gov. Martin O’Malley

He first complained to the White House about placing kids at a Westminster facility lacking security or running water – not to mention the seething animus in Carroll County toward outsiders (especially Spanish-speaking “illeagals” who might pollute Carroll’s idyllic surroundings).

He was right to tell the White House it was a ridiculous idea.

There are far better ways to assist these kids — such as finding compatible settings near Washington, where there are large Hispanic communities (and proximity to Central American embassies) or in Baltimore City, with its own Spanish-speaking enclave and ample support services.

NIMBY Republicans

The Republican line is that this crisis is “a federal problem” created by the hated Obama administration, which should handle this matter itself.

Republican NIMBYism is alive and well: Let someone else care for these desperate kids, all 57,000 of them.

Just make sure the federal refugee camps are “not in my back yard.”

What’s confronting the United States is a major human dilemma. It won’t be solved solely by the White House. It will take a combined effort by sympathetic states, non-profit groups and the federal government.

Republicans, though, don’t want any part of extending charity to these kids.

The best way to stop this unwanted influx is to help Honduras, El Salvador and Guatemala curb criminal activity, bolster health and education opportunities and encourage business development that translates into jobs.

Republicans will have none of that.

They don’t want immigrants coming to this country and they don’t want to help other countries stem the tide, either.

Their only answer is stationing armed troops on our southern border.

Baltimore Archbishop William Lori calls this problem “a test of the moral character of our nation. This is not a time for political posturing. . .”

Sadly, Republicans aren’t listening.

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