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Fact-checking the debate: Ehrlich says surveys show Md. worse for business; O'Malley says depends on which survey

Washington Post Editors

This item has been updated.

Maryland Gov. Martin O'Malley (D) and former governor Robert L. Ehrlich, Jr. fought hard over the economy at a midday forum Thursday sponsored by The Washington Post, with each accusing the other of being a poor steward of the state's business community.

As he has previously, Ehrlich accused O'Malley of creating a hostile business climate in Maryland, saying its business rankings have declined since the Democrat took office in January 2009. Ehrlich said O'Malley weakened state businesses by raising taxes and layering on regulations.

"We're a flyover for corporate headquarters," Ehrlich said. "We've become a tax hell."

O'Malley, who cited some surveys that gave Maryland favorable marks, said it all depends on what survey you look at.

In response to a question about the Tax Foundation's rankings, Ehrlich blamed O'Malley for the state's slide toward the bottom, repeating a charge he also made Monday at a debate at Baltimore's WJZ TV. During Monday's debate, Ehrlich also took credit for raising the state's rankings in a survey published by the Baltimore Business Journal.

The Tax Foundation, a nonpartisan research organization based in the District, has said that Maryland took a dive in its business climate survey during O'Malley's term. In fact, the foundation, in a 2008 report, singled out the Free State for having recorded the biggest single-year drop in its rankings that year when Maryland fell from 24th in 2008 to 45th in 2009, midway through O'Malley's term. The Tax Foundation's 2010 State Business Tax Climate Index, issued in September 2009, again ranked Maryland 45th again. Only Iowa, Ohio, California, New York and New Jersey ranked worse, with New Jersey dead last.

As to Ehrlich's reference to the Baltimore Business Journal, the magazine reported during his term that the number of Maryland businesses that had given the state good grades had reached 69 percent, the highest level in a decade. The magazine's Jan. 25, 2006, edition based its report on a quarterly survey by the University of Baltimore's Jacob France Institute. The survey, which has been done quarterly since 1995, relies on telephone polling of the state's business executives. On Wednesday, the institute, which is the research arm of the university's Merrick School of Business, reported that 36 percent of businesses rated Maryland as business-friendly in the third quarter of 2010, an increase from the second quarter's 31 percent.

But O'Malley defended his record and noted that other surveys have been more favorable to Maryland.

"We are friendly to business," O'Malley said, citing a survey by the U.S. Chamber of Commerce -- "now hardly a mouthpiece for the Maryland Democratic Party," O'Malley added -- said Maryland ranks one of the top two states for innovation and entrepreneurship.

Actually, he was goosing Maryland's ranking a little on the Chamber of Commerce survey***, which was entitled "Enterprising States" and was part of its campaign entitled "The American Enterprise. Dream Big." The May 2010 survey, which is also linked on O'Malley's campaign site, says Maryland ranked fourth in its index measuring states' excellence in promoting economic development. The report put North Dakota first, followed by Virginia, South Dakota, Maryland and Wyoming.

O'Malley also referred to the Ewing Marion Kauffman Foundation's 2008 State New Economy Index, which put Maryland among the five best states in transforming the U.S. into a global, entrepreneurial economy that thrives on innovation and knowledge. The survey, which is the most recent performed by the foundation, listed the top five in order as Massachusetts, Washington, Maryland, Delaware and New Jersey. The survey, which was not conducted this year, will be updated next year, a spokeswoman said.

--Fredrick Kunkle

A spokesman for the governor's campaign called after this item was posted to tell us that the governor was, indeed, correct about the Chamber's ranking, as there is more than one survey. Although Maryland scored fourth in the category of "Top Overall Performance" among the states, Maryland did indeed rank second among the "Top Entrepreneurship and Innovation Performers," a category that focused on the creation of jobs in science, math, engineering and mathematics, total state investments in research and development, and two measures of entrepreneurial activity, as indicated by high-tech start-ups and the aforementioned Kauffman index. We regret the error.

By Fredrick Kunkle  | October 14, 2010; 3:47 PM ET
Categories:  2010 Elections, Governor  
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Md. gov's race spinning toward colorful conclusion


It's a good thing that TV still only has audio and visual, and not odor, because Ehrlich smells like burnt cabbage.

Posted by: hamsandwich | October 14, 2010 6:30 PM | Report abuse

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