Hogan gets hero’s send-off at business group lunch — but national ratings aren’t so favorable

Year after year, Gov. Larry Hogan’s annual speech to the fundraising lunch of the Maryland Free Enterprise Institute brings Hogan (R) some of his greatest accolades. It’s an audience that loves his pro-jobs message and largely shares his fears about all-Democratic rule in Annapolis.

So it was no surprise that Hogan’s valedictory address to the group Thursday, delivered remotely to a packed audience in a hotel ballroom in Towson because he tested positive for COVID-19 earlier this week, was a particular lovefest, as the governor has just 2 1/2 months left in office.

Speaking to the group in a Q&A format led by Maryland Free President Duane Carey, Hogan returned to familiar themes and boasts: That he turned around the state’s economy after “43 tax increases” during the administration of his predecessor, Democrat Martin O’Malley; that he held the line on taxes, created jobs and improved the state’s business climate; and that he was able to accomplish it all despite the presence of “70% progressive majorities” in the General Assembly — all while winning high approval ratings from the voters.

“That’s exactly what we said we were going to do,” Hogan said.

Hogan received the most enthusiastic introduction imaginable from his Commerce secretary, Michael Gill.

“November is the month of gratitude,” he said. “I know Marylanders are most grateful for the past eight years.”

Even with all the huzzahs for Hogan, Maryland’s ranking in certain business indexes isn’t very good. Just this week, the Tax Foundation’s annual State Business Tax Climate Index ranked Maryland 46th in the U.S. — a drop of two slots from a year earlier. And in a report issued this spring by the conservative American Legislative Exchange Council, Maryland ranked 42nd in economic outlook, down nine places from 2015, the year Hogan took office.

Those numbers resonate with Christopher Summers, the president and CEO of the Maryland Public Policy Institute, a think tank that promotes free market policy solutions.

“Gov. Hogan has been a great governor in terms of prioritizing small business and trying to improve the business climate in the state, but there’s still a lot to be done,” he said. “In terms of the state’s tax structure, nothing’s changed.”

Summers conceded that Hogan was hindered in his efforts to make dramatic reforms in economic and tax policy by the Democratic supermajorities in the House of Delegates and Senate.

Hogan told the Maryland Free crowd that the thing he was proudest of during his eight years in office was turning the economy around, resisting Democrats’ efforts to raise taxes, and shoring up the state’s finances. He used his oft-repeated line that as governor, he felt he was often “playing goalie” against the Democratic legislature, and allowed that “sometimes they were able to score a point.”

But the thing Hogan prized the most during his tenure was his stratospheric public approval rating from Republicans, Democrats and independents alike. Yet both fans and foes of the governor wonder whether he could have accomplished more of his goals if he had been willing to expend some political capital for tough legislative fights in Annapolis.

“He built up all this political capital — but did he use any of it?” Summers asked. “It’s great to be popular, but did it really help?”

On the other hand, Hogan is often credited with having a superlative political radar and an ability to place himself where an overwhelming majority of the voters are.

The state’s poor rating from ALEC, the national free-market group partially bankrolled by the Koch brothers, was revealed in its annual report, “Rich States, Poor States.” The study grades the states on 15 different economic factors.

“Based on our metric, Maryland is in the bottom tier of states when it comes to economic competitiveness,” Jonathan Williams, ALEC’s chief economist, said in an interview.

Williams observed that Maryland’s drop in ranking during Hogan’s tenure was due in part to the measure that raises the state’s minimum wage to $15 an hour by 2025 — which Hogan vetoed, only to see his veto overridden by the legislature.

“It’s a very complicated story,” Williams said, noting that ALEC does not measure the performance of individual governors “but the overall economy writ large.”

Still, there is ample evidence that business leaders across the state are grateful for Hogan’s tenure.

Sandy Pruitt, executive director of People for Change Coalition in Prince George’s County, said the Hogan administration has helped small businesses, especially when the COVID-19 pandemic began to take hold two years ago.

Her organization includes more than 300 nonprofit groups and small and minority-owned businesses not only in Prince George’s, but also neighboring Charles County, Baltimore and the District of Columbia. It also worked on a project two years ago on the Eastern Shore. Members of the coalition receive consulting services and assistance to obtain government grants and secure procurement opportunities.

“I like the fact that the Hogan administration reached out to a heavily Democratic county and majority Black county [to] make sure we were aware of resources and programs in the state,” Pruitt said. “It doesn’t matter to me if [the governor is] Democrat or Republican. We lock out our own people because of who’s in office. If we fit the criteria and requirements for that funding, then we need to be open to apply for that funding.”

Carey, the Maryland Free president who owns a marketing and public relations firm in Howard County, called Hogan “a friend to business and a friend to the organization.” He credited Hogan for stopping anti-business bills in Annapolis and improving customer service at state agencies, creating a climate that made it easier for businesses to thrive.

“Employers are more likely to expand in Maryland when the executive branch recognizes their critical role in growing a healthy economy,” Carey said.

‘I won’t be watching the store for you’

Hogan’s speeches to Maryland Free — the group that was known until recently as Maryland Business for Responsive Government — have been substantially similar through the years. But the different format Thursday, with Carey as interlocutor, was refreshing. Hogan was able to hit all his talking points, but Carey elicited some interesting observations. Among them:

• Hogan predicted that there would be “a massive red wave” next week across the country, because “we have a monopoly in Washington now the way we had a monopoly in Annapolis,” though he stopped short of predicting that the U.S. Senate would flip to the GOP.
• Hogan took credit for Maryland’s congressional districts becoming more competitive, and he maintained that with solid candidates, Republicans could compete in five of the state’s eight districts. He greeted Nicolee Ambrose, the GOP nominee against 10-term Rep. Dutch Ruppersberger (R), as “congresswoman.”
• Hogan declined to forecast the race to succeed him, between Del. Dan Cox (R-Frederick) and author and former nonprofit executive Wes Moore (D). But Hogan, who has been sharply critical of Cox, seemed to acknowledge the general sentiment that Moore would win, by observing, “We don’t need to go to the arrogant monopoly, when it takes the state too far in a leftward direction.”

Carey asked Hogan whether he had any regrets as he looked back over his eight years in office. Hogan said he was sorry the state didn’t pass tougher crime laws during his tenure and lamented that some of his more stringent education reform proposals were never considered by the Democrats in the legislature. In fact, the legislature did pass major education reform, the Blueprint for Maryland’s Future, largely over Hogan’s objections.

Asked about his future, Hogan was a little more circumspect than he often is. Carey joked about the political rumors swirling around the governor, which Hogan acknowledged by saying, “I’ve heard them, too. I’m not sure any of them are true.”

But Hogan was never asked directly whether he plans to run for president in 2024, and he never said he was considering a White House bid.

“I’m hoping maybe I can get a day or two off after working day and night, seven days a week,” he said, adding that he would then assess “how I can best serve,” whether in the private sector or the public sphere.

Yet Hogan is clearly thinking about the presidential nominating process and his ability to attract support. He quickly noted that 14 states have open presidential primaries — meaning a more centrist Republican like him might have more crossover appeal than fire-breathing extremists.

Hogan seemed genuinely touched by the warm reception from the crowd, and it was clear that he was sorry not to be there.

“Your voice is very important,” he told the assembled business leaders. “I come every year because I really respect what you’re doing.

“After January,” Hogan lamented, “I won’t be watching the store for you.”

As for Maryland’s national business standing, at least according to ALEC’s assessment, business leaders may not have to worry about it falling much further. Williams, the ALEC economist, noted that states like New York, Vermont, California and Illinois are always going to fare worse than Maryland in any national survey on business climate.

“That’s the silver lining for Maryland — that there are many more states that are even more anti-business,” he said. “It would take a Herculean task to reverse that.”

And Carey said that even though business leaders have some trepidation about a unified Democratic government in the State House, they are “hopeful about a Moore governorship.”

“The raw materials are undeniable — great, natural leadership skills, high intelligence, military service, business background, and a magnetic personality,” Carey said. “But most importantly we think the legislature will work with him, and as a scholar, we think he will be open to the wealth of data that show what it takes to have a burgeoning economy that raises up everyone.”

William J. Ford contributed to this report.

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