By Brendan Raleigh
Round Table editor

In Maryland Governor Martin O’Malley’s latest state-of-the-state speech, he announced his intent to raise Maryland’s gas-tax by 21 cents (6 percent) over the next three years, exceeding the state commission’s recommendation by 6 cents. This is in addition to several other hikes proposed by O’Malley, most of which are aimed at reducing the state’s $1.1 billion budget deficit.While Maryland’s fiscal problems are certainly in need of solving, the implementation of a gas-tax is almost guaranteed to do more harm than good for the state.

The revenue generated from the tax is intended to fund various transportation projects, creating 7,500 jobs, according to the governor’s speech.

Even assuming this projection is true, the jobs created would be paid for largely by Maryland’s middle and lower-classes. Fuel taxes are notoriously regressive; they hit low-income families much harder than higher-income families. This one in particular would even affect those it employs on their way to work.

In the midst of a recession, the government should obviously avoid stunting whatever growth can be found in its lower-classes. In addition to making their lives more difficult, it also causes consumers to tighten their belts, resulting in businesses reducing spending and possibly even laying-off employees.

My skepticism as to whether the revenue will be allocated properly stems from past mismanagement of funds allegedly protected in Maryland’s transportation trust. In 2010, for example, $370 million was transferred from the trust to cover non-transportation expenses. As the Maryland Public Policy Institute’s report on the issue points out, the temptation for politicians to dip into these funds when Maryland is already facing such a heavy deficit may be too much to bear.

Even the tax money spent on transportation may not necessarily be used to its full potential. O’Malley insisted that the additional income would be used to build roads and bridges in order to relieve traffic congestion.

Though the gas-tax will provide some funding for such ventures, it will not be set aside in a pool spent exclusively on them; it will be grouped in with all of Maryland’s road and transit spending, 45 percent of which is spent on transit alone. This is in spite of the fact that only 3 percent of the state’s travel is by public transportation.

If O’Malley wishes to gain any approval for his gas-tax, he must address these problems. The state senators’ proposal for a constitutional amendment guaranteeing that the revenue from gas taxes go exclusively to transportation projects must be passed. He must reduce the money spent on public transportation in favor of highway projects; an effort which would be done most effectively if the two were separated, rather than being combined in the Transportation Trust Fund.

Even if O’Malley complies with his critics’ requests, the proposition of a fuel-tax is unlikely to gain any traction among legislators or voters. Although I would normally respect a politician’s decision to take the unpopular stance on an issue, the fact that O’Malley is not able to run for re-election in 2014 means he has nothing to lose.