ELKRIDGE – Maryland’s location near the nation’s capital will cause sequestration to have a stronger influence on the state’s economy, Gov. Martin O’Malley said to employees at FLIR Systems, a thermal imaging company here.
He’s one of several high-profile Maryland politicians leading the discussion on sequester – the series of federal budget cuts set to go into effect Friday -- and its impact on the state and country. The sequester would cut funds from key programs and roll back the nation’s recovery following the economic recession.
Although corporations are bringing in profits, O’Malley blames politics in the House of Representatives with “keeping all that capital in the sidelines when it should be getting reinvested into the economy.”
Because Maryland is home to nearly twice as many federal employees as the national average, it will be hit especially hard should the sequester occur. About 5.6 percent of Maryland workers are federal employees, compared to an average of about 2 percent nationwide. Companies specializing in security and defense, and that rely on government contracts to stay in business, could suffer in the sequester.
Some of the progress made after the recession could be lost by the sequester’s “job-killing cuts,” according to O’Malley. Maryland’s Department of Budget and Management estimates that more than 12,000 jobs could be lost due to the sequester -- a third of the job gains from last year, according to O’Malley.
So far, Maryland has recovered jobs faster than the rest of the region after the recession, and it ranks eighth in the nation in jobs recovery, O’Malley said.
Maryland politicians are frustrated that Congress has been unable to find a compromise that will stave off sequestration.
“We’ve been here now for two months and there’s been no legislation designed to end the sequester put on the House floor,” House Minority Whip Steny Hoyer, D-Mitchellville, said Tuesday.
Hoyer said 46,000 civilian Department of Defense employees could be furloughed; there could be 200 fewer teachers and aides in schools and law enforcement could lose $300,000 in grants.
“I think I’m as frustrated as I’ve been as a member of Congress for the last 32 years,” Hoyer said.
The uncertainty surrounding these cuts has forced the Maryland state government to set aside $389 million to prepare for sequestration.
“Frankly, we would like to be investing in other things that accelerate our jobs recovery,” O’Malley said.
President Barack Obama plans to meet with House and Senate leaders of both parties on Friday, but there is no timeline on how long it will take for legislators to come to an agreement.
“Nobody knows how long this will be managed and how long it will last,” Hoyer said.
Hoyer, Sen. Barbara Mikulski and Rep. Chris Van Hollen, D-Kensington, are among the Democrats supporting an alternative to the sequester. Their plan would cut farm subsidies and tax the second million dollars a person makes at the same rate as someone earning $55,000 a year.
“We can be more frugal. We can be more sensible. But let’s not do sequester. It’s bad management, and we can do better.” Mikulski said.
Mikulski is chairwoman of the Senate Appropriations Committee and convened a committee hearing on sequestration. She and fellow Senate Democrats plan to introduce an alternative to sequester on Thursday.
Van Hollen, ranking member of the House Budget Committee, introduced a bill in the House to repeal the sequester, but the House Rules Committee denied it a vote on the floor.
“With 750,000 jobs at stake – not to mention the furlough of hundreds of thousands of federal employees – this is a total abdication of leadership from Speaker Boehner and his caucus,” Van Hollen said in a statement. Van Hollen is a member of the House Budget Committee, one of the committees where the bill was sent for referral.
Capital News Service reporter Jeremy Barr contributed to this report.