NTU Asks Its Members to Support Ehrlich's Veto of HB 2, 1-10-05

National Taxpayers Union
January 10, 2005

Tell Your Legislators: Support Governor Ehrlich's Anti-Tax Hike Vetoes!

The Maryland Legislature seems to be obsessed with raising taxes and foisting bad economic policies upon the state's taxpayers. For starters, a few weeks ago, Governor Ehrlich called the Legislature into a special session in order to pass urgently needed medical malpractice reform. Unfortunately, instead of enacting curbs on runaway lawsuits, the Legislature passed a plan that would raise taxes on Health Management Organizations (HMOs) in order to subsidize the doctors' costs for malpractice insurance. In addition, big-spenders in the Legislature are pushing a bill that would impose a 10 percent surcharge on corporate income taxes and mandate even more spending on higher education.

Not only can you take action below, but you can also attend a rally in support of Governor Ehrlich's vetoes. A taxpayer rally will be held at 8:30 a.m. on Tuesday, January 11th on the Lawyer's Mall (right next door to the Maryland State House, 100 State Circle). For more information please email Maryland Taxpayers Association at mta@rstarmail.com, or contact rally coordinator Lyle Seigel at (240) 375-3928.

What's At Stake:

Due to the runaway costs associated with frivolous lawsuits and huge payouts, doctors are facing steep costs for malpractice insurance. In fact, doctors covered by the state's largest malpractice insurer are facing a 33 percent increase in their 2005 premiums that comes on top of a 28 percent increase for 2004. In order to reform Maryland's unfair and economically harmful medical malpractice system, Governor Ehrlich called legislators to Annapolis before the holidays for the express purpose of passing medical malpractice reform that would place caps on the damages patients can sue their doctors for.

As so often happens with elected officials, legislative proposals that start out as necessary reforms often turn into further excuses for increasing the size of government. Instead of keeping their constituents' concerns at the top of their agendas, many in the Legislature seem more interested in keeping their friends in the trial lawyer lobby happy. That is why a majority of legislators decided not to tackle medical malpractice costs, and instead passed a tax hike on health insurance that will cost patients more than $60 million annually.

The other legislation that Maryland's Legislature may try to pass over the Governor's veto is a "temporary" 10 percent surcharge on corporate income taxes and a mandate for increased spending on higher education. The Legislature's own analysts expect this bill to increase the State's deficit by over $111 million as of 2008 because the mandated spending levels will surpass the revenues contained in the tax hike, thus leading to even more future tax hikes.

Sample letter:

Subject: Support Governor Ehrlich's Anti-Tax Hike Vetoes!

Dear [decision maker name],

I urge you to support Governor Ehrlich's vetoes of both the tax increase on HMOs that was passed in the Legislature's special session and the 10 percent surcharge on corporate income taxes to fund higher education. Both of these plans would unnecessarily raise taxes on Marylanders, thus slowing the state's economy and making the state less hospitable as a home for businesses and productive residents.

Indeed, Marylanders desperately need medical malpractice reform that places caps on the damages that can be won in lawsuits, but they don't need - or want - their health care costs to rise by more than $60 million a year because of higher taxes on health insurance.

It is shameful that a majority of the Legislature turned their backs on any serious medical malpractice reforms in voting on the final legislation. Instead, the trial lawyers will have their costs directly subsidized by taxpayers who will foot the bill for malpractice lawsuit abuse under the Legislature's plan.

As if a new tax on health care were not harmful enough, the corporate tax surcharge would actually increase the State deficit by 2008 by over $111 million.

I urge you to uphold Governor Ehrlich's veto of these shameful and economically destructive pieces of legislation. Don't raise taxes on Maryland families!

Sincerely,

National Taxpayers Union
108 N. Alfred St.
Alexandria, VA 22314