By Donald C. Fry
Tax and regulatory policies, infrastructure and workforce development are key issues around which Maryland government should frame strategic public policies to strengthen the state’s competitiveness for business growth and job creation, according to the participants in the Greater Baltimore Committee’s inaugural Chesapeake Conference of CEOs last week.
CEOs from throughout the region gathered at the Hilton Baltimore on June 12 for a day-long series of GBC-led workshops to begin drafting a private sector-driven strategy to strengthen competitiveness.
“We live in such a wonderful area. We work in such a wonderful area, but we can always be better. I think the purpose of today is to think about how we can be better,” GBC Chairman Brian Rogers, who is chairman and chief investment officer of T. Rowe Price Group, told conference participants.
Collectively, the CEOs generated dozens of specific recommendations to improve Maryland’s competitiveness. They will serve as the basis for a report the GBC plans to issue later this summer proposing specific outcome-based achievable policies for competitiveness. It will be the framework for a business and economic strategy that the GBC will seek support and buy-in from executive and legislative candidates in the 2014 campaign.
The new report will build on the GBC’s previous “Competitive Edge” report that outlines eight core pillars for a competitive business climate.
Conference participants recommended developing achievable approaches to improving Maryland’s tax structure and regulatory processes and to strengthen investment in transportation and technology infrastructure.
They also recommended finding ways to ensure both K-12 and higher education in Maryland generate more graduates with the skills needed to provide a strong workforce for the state’s growing technology and science-driven industry sectors.
A proposal to create a privately-funded national infrastructure bank by Maryland 6th District Congressman John Delaney, who addressed the opening session of the conference, struck a responsive chord for many CEO participants.
Delaney’s proposed Partnership to Build America Act would create a $50 billion national infrastructure bank funded by the private sector. The bank’s capital base could be leveraged to create $750 billion to provide loan guarantees to states and local governments to finance transportation, energy, communications, water and education infrastructure projects. The bank would be capitalized by the sale to corporate investors of 50-year bonds that are not guaranteed by the federal government and would pay only a 1 percent interest rate.
To encourage U.S. corporations to purchase these bonds, they would be allowed to repatriate overseas earnings tax-free based on the amount of bonds purchased. The amount of overseas earnings that could be repatriated tax-free would be determined by auction, according to information from Delaney’s office.
Many workshop participants agreed that infrastructure, particularly in Baltimore City, is a major business climate issue. One participant suggested Baltimore and Maryland seek to become the national model for a local or state transportation infrastructure bank.
On the issue of education, economist Anirban Basu, who also addressed the conference’s opening session, noted Maryland must meet its challenge to become more competitive for business if it wants to retain its coveted top ranking for education.
“Will we be No. 1 in 10 years?” Basu asked. Maryland won’t unless we have “the economic activity necessary to generate the investment in education to retain that No. 1 ranking,” Basu said.
“There is no reason that one has to savage their business community to provide high quality education,” he said. “In fact, the two should go hand-in-hand. A good business climate should make for more sustainable educational opportunities.”
Basu cited Minneapolis and Minnesota as a region and state with “very good educational outcomes and a very good business climate.”
Most participants agreed the business sector must become a more aggressive advocate in Annapolis for public policies that strengthen Maryland’s competitiveness as a place for business location and growth.
Several CEOs articulated a core prerequisite for addressing a stubborn disconnect over business climate between the private sector and government in Maryland: a shared vision.
Maryland must better leverage its significant assets into stronger business growth. Despite the enduring disconnect, Maryland’s economic prospects are decent now. But they will soar dramatically if and when our state’s business and government sectors can get on the same productive page when it comes to the fundamental issue of developing public policy for competitiveness.