for health, including our programs to combat mental illness and
mental retardation, and another 10. 7 per cent is allotted to public

welfare. Thus, you can see that more than 84 per cent of general
fund appropriations is allocated to education, heath and welfare. As
you have seen, the budget calls for an expenditure of some $369
million in general funds, which is an increase of $25 million over the
present appropriation for fiscal 1965.

We are all pleased, I know, that we are able to balance the budget
for fiscal 1966, as we are required by law to do, without imposing
additional tax burdens upon the people. This we are able to do
because of the continuing upsurge of the Maryland economy. Our
President, in his message to the Congress, reminded us that we are
"in the midst of the greatest upward surge of economic well-being
in the history of any nation. "

ECONOMIC CONDITIONS

Most fortunately, Maryland is sharing in this national prosperity,
and indeed is outstripping the nation as a whole in most aspects of
the situation. The forty-second state in geographical area, Maryland
has moved up from twenty-first to twentieth among the fifty states in
population. We are growing and we will continue to grow. Employ-
ment is up and unemployment down. For thirty-one consecutive
months, the percentage of unemployment in Maryland has been lower
than that for the nation as a whole. In October it was 2. 9 per cent,
as compared with the national rate of 4. 4 per cent. Our industrial
workers — with a weekly average of $104. 55 in October — receive
considerably higher pay for their work than the national average.
Last year, as compared with the year before, our total state income
and product climbed from $11. 2 billion to $11. 8 billion — an increase
of more than a half billion dollars. These and practically all other
indicators show that our State is sharing abundantly in the general
economic prosperity that our country is enjoying.

With a tax structure geared carefully to the economy, we are now
able to expand and improve our governmental services without chang-
ing tax rates, while at the same time we preserve the sound, stable
financial condition of our State. It is safe to say, therefore, that we
have no fears about the financial strength of our State so long as
this prosperity continues. I should like to move now to some of the
highlights of the fiscal program which I have submitted to you for
your consideration and approval.