Back to normalcy...

..that is, if you believe that government expansion is normal. On Tuesday, the 111th Congress convenes with larger Democratic majorities in each body.

In an era where the bailout has become de rigueur in Washington, the toll to the taxpayer only remains to be seen - all we know is that the Beltway bureaucrats will have plenty of largesse to spread around without thought of where it's coming from. Estimates of the budget deficit for the current fiscal year are necessarily guesses at this point, but most observers peg the shortfall north of $1 trillion. That comes in an era where our total federal budget just topped $3 trillion in the last year.

Eight days later, the Maryland General Assembly begins yet another session which labors under a somewhat different rule than their federal cousins have just a few miles to the west - they actually have to balance their budget. With a shortfall that seems to grow every time the state officials figure out the tally, the choice becomes which unpopular cuts need to be made. However, Democrats in Annapolis will make sure to quickly blame the outgoing Bush administration for their financial woes and not come to the slightly more obvious conclusion that raising taxes in a down economy tends to make a bad situation worse, and is some of the reason that their revenues have come up short of expectations. Don't say we didn't tell you so.

This after a holiday season which was terrible for most store chains and may have sounded the death knell for a number of retailers too heavily battered and weakened over the latter half of 2008. While a number of large merchandisers have made headlines with their demise or bankruptcy (such as Mervyn's and Circuit City), less noticeable are a vast number of smaller outlets whose closing will collectively make a similar impact when they throw in the towel. In turn, this dumps more people out of work, putting stress on the unemployment insurance programs.

While the Obama Administration wishes to enlist workers to build infrastructure, the transfer of capital from what would essentially be either higher taxes or simply thin air (e.g. printing money) through the federal bureaucracy - who takes their pound of flesh - to those workers fortunate enough to receive the jobs at the inflated wages mandated by the Davis-Bacon Act (unless Republicans in Congress can somehow force through an exemption) can hardly have the same impact as leaving the money in the private sector.

We've already seen the damage higher taxes created in Maryland as revenues fell short of expectations. Unfortunately, those at the federal level don't have to balance the budget nor do they have any restrictions on printing money. Looks like we'll be back to the normal Washington snafu beginning next week.