Friday Five | January 27, 2023
A recap of this week’s top-five news items and resources from the intersection of business and government.
1. Gov. Moore picks transit veteran to lead transportation agency
On Wednesday, a crowd of approximately 5,000 people gathered to watch as Wes Moore was sworn in to become Maryland’s first Black governor and only the third elected in U.S. history.
Maryland Gov. Wes Moore announced his long-awaited decision on the person who will guide the state’s transportation projects, picking the former head of the Baltimore-Washington International Thurgood Marshall Airport and the D.C. Metro system to be transportation secretary.
Paul J. Wiedefeld, who has decades of experience in transportation, was the Democratic governor’s pick for this high-profile job in the new administration.
Moore and Wiedefeld will face numerous difficult decisions on thorny projects, including completing the long-delayed Purple Line Metro extension in the D.C. suburbs; deciding whether to continue former Gov. Larry Hogan’s plan to address traffic on some suburban D.C. highways with toll lanes; and fulfilling Moore’s campaign promise to revive the proposed Red Line, an east-west transit project in Baltimore.
On Thursday, Governor Wes Moore announced that more than four dozen appointments made by former Gov. Larry Hogan have been withdrawn.
The 48 appointments across 23 boards and commissions include the Public Service Commission, University System of Maryland Board of Regents, Maryland Stadium Authority, state Board of Education and Commission on Judicial Disabilities. Of those names withdrawn, 35 were appointments made by outgoing Republican Gov. Larry Hogan in July.
“Governor Moore has thoughtfully and carefully put together an administration that will make Maryland a more competitive and equitable state for everyone,” said Carter Elliott, a spokesman for the governor. “The administration would like to thank these individuals for their willingness to serve, and we look forward to working with the governor’s future appointees.”
2. Md. Supreme Court will weigh constitutionality of digital advertising tax
The Maryland Supreme Court will consider whether the state’s tax on digital advertising violates the U.S. Constitution’s prohibition on state interference with interstate commerce and discriminates against certain online companies while not taxing others.
The high court said last Friday that it will hear the Maryland comptroller’s appeal of a judge’s ruling that the tax intended to fund upgrades to the state’s public schools essentially imposes a state regulation on interstate commerce, which is the constitutional province of Congress.
Senate Minority Leader Steve Hershey, R-Upper Shore, said Monday that “I’m just as confident now, as when we debated the bill, that this policy violates the First Amendment, the Internet Tax Freedom Act, and the dormant commerce clause.”
3. US economy slowed but still grew at 2.9% rate last quarter
The U.S. economy expanded at a 2.9% annual pace from October through December, ending 2022 with momentum despite the pressure of high interest rates and widespread fears of a looming recession.
Thursday’s estimate from the Commerce Department showed that the nation’s gross domestic product — the broadest gauge of economic output — decelerated last quarter from the 3.2% annual growth rate it had posted from July through September. Most economists think the economy will slow further in the current quarter and slide into at least a mild recession by midyear.
“Recent data suggest that the pace of expansion could slow sharply in (the current quarter) as the effects of restrictive monetary policy take hold,” Rubeela Farooqi, chief U.S. economist at High Frequency Economics, wrote in a research report. “From the Fed’s perspective, a desired slowdown in the economy will be welcome news.”
4. U.S. Chamber: Why We’re Fighting the FTC
Earlier this month, the Federal Trade Commission moved to ban noncompete clauses in employment contracts. In an op-ed for the Wall Street Journal, U.S. Chamber President and CEO Suzanne P. Clark vowed that the Chamber “will oppose the proposed regulation with all the tools at our disposal, including litigation.”
This fight is about more than noncompete agreements: “If the FTC can regulate noncompete agreements without authorization from Congress, there is no aspect of employment or commercial arrangements that it doesn’t have the authority to regulate or ban arbitrarily,” Clark wrote.
5. Democrats grapple over whether Biden should negotiate with McCarthy on raising debt limit
Democrats are grappling over whether President Biden should negotiate an increase to the debt ceiling in talks with House Speaker Kevin McCarthy (R-Calif.).
Most Democrats are dead set against negotiating as Biden signals he’s prepared to meet with McCarthy, arguing any talks will just be gobbled up by Republicans who will then ask for more.
Senate Majority Leader Charles Schumer (D-N.Y.), for example, doesn’t want Democrats to negotiate with House Republicans until the House GOP shows it can actually pass legislation to raise the debt ceiling.
The House GOP is demanding spending cuts be paired with a debt ceiling hike, but it’s far from clear that they can rally around a single plan if Democrats in the House hold tight in opposition — especially given the narrow majority held by McCarthy.
Inspire MD
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