Delegate Mike McDermott Private Pension Editorial

“Do as I say, not as I do”

-The O’Malley-Brown message to Private Pension Retirees

by Delegate Mike McDermott

I’m sure that I am not the only one who finds irony in the O’Malley-Brown administration heralding a new “Task Force” to help protect private sector retirement money.  This should send chills down the spine of the private sector. It reminds of when President Ronald Reagan said, "The nine most terrifying words in the English language are: 'I'm from the government and I'm here to help.'"

Perhaps the first “Task Force” we should have is one that would study how the State of Maryland plans to repay the $1.3 billion dollars that they are taking from the teacher’s pensions over the next five years. It would also be nice for this group to study how Maryland plans to cover a $37.5 billion dollar unfunded pension/benefit liability in the years to come.

Quite frankly, it’s terrifying to think that Lt. Governor Brown is involved in this at any level following his dismal management of Maryland’s version of Obamacare. One might expect that the prudent choice would be someone from the private sector to head up this brain trust, but that’s just not the way things shake out in Annapolis. So they dust the cobwebs off former Lt. Governor Kathleen Kennedy-Townsend and trot her out for a spin. These decisions do not engender “optimism”.

Well, here are some simple things this administration, and those that follow, can do to “help” the private sector when it comes to them saving for retirement:

·     ⇨    Reduce the tax burden on our corporations and businesses. Good things happen when companies retain greater earnings: they expand; and they invest in their people. A prosperous, growing company can be an employee’s best answer to a secure retirement.

·    ⇨     Let Marylanders keep more of their own money. Cut income taxes across the board by 10% and allow them to invest in their own futures. Families with increased discretionary income can better prepare for the future needs of their children as well as their latter years.

·   ⇨       Provide direct incentives to companies who create matching fund retirement accounts of up to a 5% match of the employee’s contribution.

·   ⇨      Exempt all contributions to an individual’s retirement account from ever being subject to Maryland taxes, including the capital gains associated with the investment account.

·   ⇨      Eliminate all inheritance taxes and estate taxes.  

All in all, we just need Maryland to become a more business friendly state. A robust economy is an elixir for many ills and future retirement needs. We would also do ourselves a favor by exempting retirement income from the State income tax. This would allow our seniors to age in place and would make Maryland a friendlier climate for many retirees looking for a favorable place to park their money.

All of these things have been recommended by the Republican’s in the General Assembly. Many bills have been introduced that would accomplish much of what I have proposed, yet little meaningful action is taken by the Democratic leadership to address these challenges.

If we are going to do something to help private sector retirees we must lead by example; and the model we are displaying is a choice between piracy and passing the buck. Beware private pensioners!…I see the dome of the capitol on the horizon and she has hoisted the Jolly Roger!!!