If you haven’t yet seen it, I highly recommend browsing the New York Times’ new interactive tool, the United States of Subsidies. The tool is part of a series exploring state and local government subsidies throughout the country. These subsidies amount to a staggering total of over $80 billion each year. According to the data, Maryland spends at least $554 million annually on such subsidies. That works out to $96 per person, or 4% of the state budget.

We’ve blogged about such subsidies before, but it’s troubling to see them listed all in one place. Even more troubling is the fact that, as the series convincingly demonstrates, there is virtually no evidence that such subsidies work. Whether you examine the millions in tax credits awarded to General Motors just prior to its shuttering factories in the same locations, the suicidal border war between Kansas and Missouri over AMC and Applebee’s headquarters leading to a $100 million cut to the education budget, or the baffling decision to grant Oliver Stone $10 million in tax credits to film “Wall Street: Money Never Sleeps” in New York City, it’s clear that state and local governments are not operating in the public interest.

Closer to home, just last week LivingSocial, the daily deal website, announced it would cut 160 jobs in Washington, D.C. as part of a larger company-wide layoff. Earlier this year, the D.C. Council granted LivingSocial a $32.5 million tax credit, based on an assumption that the company would add additional employees.

Right here in Maryland, Bechtel received a $9.5 million conditional loan from the state, based on the promise to keep 1,250 jobs in Frederick through 2018. Similar incentives have been given to Allison Transmission, Northrop Grumman, Marriott, Morgan Stanley, and MedImmune.

Such public subsidies might be justified if they actually accomplished what their proponents claim they do. But as it turns out, neither the state nor Bechtel is willing to say that the conditional loan was a necessary condition for keeping those jobs in Frederick. According to Jim Henry, the director of finance programs for the Maryland Department of Business and Economic Development, “Such incentives are not generally the main reason most companies choose to remain in the state… A high-quality work force, good schools, shorter commutes for employees and the costs of moving factor into such decisions.”

As for Bechtel, Michelle Michael, a spokeswoman, told the Maryland Gazette that “The loan was not the deciding factor in keeping the privately held engineering giant’s power division headquarters in Frederick.”

Maryland politicians frequently portray such subsidies as necessary to compete with the incentives granted by neighboring states. Ironically, when it comes to lowering taxes, Maryland politicians invoke the exact same logic to justify why Maryland shouldn’t compete with neighbors like Virginia.

In an October interview with the New York Times, O’Malley reacted to the comparison between Maryland and Virginia tax rates:

“On the other side of the river, especially under Governor McDonnell, they would have you believe that it all begins and ends with tax rate. We all strive to be competitive on that score. But there are other things that determine whether or not your state is well-equipped and whether your children are more likely to be winners or losers in a changing economy.”

O’Malley argues that Maryland doesn’t need to stoop to Virginia’s level by lowering taxes, citing Maryland’s top-notch rankings in median income, innovation and entrepreneurship, and K-12 public education as sufficient reasons for businesses to locate and remain in Maryland.

Yet at the same time, O’Malley and other Maryland politicians argue that unless Maryland offers hundreds of millions of dollars in tax credits, cash grants, low-interest and guaranteed loans, and subsidies, companies won’t be willing to locate or remain in Maryland. Instead, they’ll flock to neighboring states that do offer such incentives.

But wait—what happened to Maryland’s valuable assets like quality of life and a highly educated workforce? Aren’t such factors supposed to justify why Maryland doesn’t need to compete with its neighbors?

If O’Malley and Maryland politicians truly believe that our state can attract and retain businesses on its own merits, then we don’t need to offer $554 million in annual subsidies. On the other hand, if Maryland can’t attract and retain businesses, we would be better off lowering taxes across the board rather than attempting to pick and choose which businesses will benefit from public largesse.