Across the four counties, it’s the economy, stupid

“It’s the economy, stupid,” is a catchphrase made famous by Bill Clinton when he ran for president in 1992 and won.

Recently, we have been getting lots of news about our economy here in the islands, and none of it has been good.

The national site WalletHub has pegged our economy 48th out of 51 (including DC). We eked out a victory over only Mississippi, Louisiana and Alaska.

The University of Hawaii’s economics organization, UHERO, also came out with a somber assessment. “Over the past year,” it said, “there has been a broad slowing of growth across the four counties. To varying degrees, each has seen a falloff in tourism activity and a slowing of employment growth in a number of sectors.”

The state Department of Business, Economic Development and Tourism publishes a quarterly forecast.

The most recent one for the second quarter of 2019 predicts modest growth in the gross domestic product for the state, with annual increases a little less than 4%.

In the meantime, our county governments are passing record-busting budgets.

The City and County of Honolulu recently passed a budget 8.8% higher than last year, which included tax hikes on hotel and resort properties and in non-owner occupied “Residential A.” The mayor’s chief of staff was quoted as saying, “The additional revenue will be used to remedy Honolulu’s unfunded healthcare and retirement liabilities, and to prepare us for future rail operations and maintenance.” Prepare us? Uh-oh, it looks like we have more revenue woes to come.

Maui County passed the largest budget in county history, including tax increases in almost all property classifications including residential. The budget proposes to spend $823.5 million, 8.6% more than fiscal 2019. “The council opted for economic investment in Maui County, rather than austerity,” the council chair stated in a news release. That’s easy to say when the money being invested isn’t theirs.

Kauai adopted a $278 million budget, a 7.75% increase over the prior year. “With a new mayor and administration onboard, the council carefully set out to provide the administration with the tools needed to innovatively improve systems, services and functions countywide,” the County Council said. Now someone needs to use the tools.

And the Hawaii County Council passed a $585 million budget, which is more than 13% over last year, adding 95 positions. “We’re demonstrating to our constituency and taxpayers that we’re watching the bottom line,” one councilmember is quoted as saying. Maybe someone needs new glasses.

So, let’s now ask the question. If the economy isn’t growing as much as the rate government is spending, what’s going to happen?

There is an engine in our society which we call the economy. Businesses provide goods and services to people and other businesses.

Those businesses can’t do it alone, so they employ people. The businesses themselves need goods and services to perform, and their employees need meals, shelter and other goods and services. Our tax system takes a piece of each of almost all these financial transactions.

So, if our economic engine is running and spinning, our government is taking in money. That taking acts as a brake on the engine, but if the engine is running fast enough it won’t slow down so much. But what happens if the engine is just sputtering along and government demands more anyway through tax rate hikes?

Lawmakers, if you don’t know the answer to that question, just listen to a few of your constituents who were forced to dip into savings, sell household goods or the family home, or even leave our sunny shores for greener pastures — or at least pastures where the taxes are lower. If it gets bad enough for them, they might exact retribution at the ballot box. Like how George H.W. Bush lost to Bill Clinton because of “the economy, stupid.”


Tom Yamachika is president of the Tax Foundation of Hawaii.

  1. Blue Dream June 23, 2019 7:17 am Reply

    What will happen the writer asks? Uh, here is what:

    More homeless moving here, more working families moving to LV or Seattle, more Micronesians being shipped over by employers who refuse to pay above minimum wage, more liberal politicians getting filthy rich off of more light rail extensions, worsening schools, turnstile criminal justice system, and the more of the same local newspapers endorsing the same old filthy rich democrat tax thieves.

  2. Charlie Chimknee June 24, 2019 7:48 am Reply

    Aloha Kakou,

    And no one has mentioned that the health of America continues to worsen with more and more of the same old chronic degenerative diseases, the likes of which are impacting the majority of citizens, and the diseases themselves are unliked by all…except those making $$$ and jobs off it.

    Heart disease and stroke called CARDIOVASCULAR DISEASE, CANCER, OBESITY and DIABETES, and ALZHEIMERS’ Broken Brain Disease just keep effecting more and more people younger and younger.

    And all the while these diseases are increasing, the only things keeping pace with the increase of disease is the increase of Petrochemical drugs used to treat them.

    Never mind the CAUSE of these diseases, we are having too much fun making money on the treatments and too much money selling the public the drugs better known as petrochemicals chemicals.

    And the only thing keeping pace with the disease and petrochemical drugs used to manage your disease, are the petrochemical food additives and manufactured sugars put in ALL of your food. READ THE LABELS…!

    In the near future the food manufacturers may even charge extra if they add food to your petrochemical food.

    Food labels…really warnings that no one reads…will list the chemicals: the GMO, and petrochemical Agricultural poisons…and some may even say: Real Food Added…”ka-ching”…the price just went up.

    And the Growth and other Hormones and Antibiotics in pumped up dead animals you eat, with their “delicious” white marbled meandering lines of grease, really looking like how your fatty heart and arteries are going to look after a few decades of eating that grease…and not a single thread of Dietary Fiber in animal flesh, the fiber you must have to be healthy…but without which your doctor can happily “ka-ching” substitute petrochemical drugs with.

    So as the petrochemical chemicals and animal grease quantities in your food go up, so does your silent disease count go up.

    Soon the drugs used for disease treatment will be already added in your food. Dead animal food and grease will have statins, blood pressure, and digestive system drugs already in them so,you don’t get sick symptoms until you’re almost dead. Saves time going to the doctor too. It’s called Dietary Pre-Treatment.

    And for the foods loaded with petrochemical food additives, they will add the cancer treatment petrochemicals in the food to save other time wasted going to the doctor and pharmacy…and doctors and pharmacists can retire early and still receive their same wages by mail wherever they retire early.

    But no ones looking for the CAUSE of the killer diseases, or any other disease for that matter; because who would dare to wreck a good thing. Medical Disease Care makes $4 Trillion dollars a year alone, and the petrochemical chemical companies and the Health(?) insurance companies are making another unseen zillion dollars a year.

    Our Military Budget is only $350 Billion dollars a year vs. $4 Trillion for Disease Care. And for those who are still into small arithmetic…a Trillion is a 1,000 times larger than a Billion. $4 Trillion to treat and manage, really perpetuate, and keep your diseases ongoing, and no one is looking to find or understand the CAUSE of the few diseases killing so many.

    Why’s that…? Because it’s the FOOD…READ THE LABELS, STUPID…!

    The Dairy product protein, Casein, causes Cancer, and who drinks the most milk? Children…! And amazingly they get childhood cancers, which otherwise should take decades to accumulate in the body. Milk is powerful alright, when it comes to disease. Fortunately people are wising up to dairy because now there are several dairy cow milk available…almond, cashew, green peas(?), soy, etc.

    Fortunately we have the choice to change if alternatives are provided. Cell phone cameras have replaced the photograph paper industry. And it can be done with our food. If the humans quit eating petrochemicals poisonous chemicals and sugar…demand for real food would lead to more health and healthy foods.

    America, where you can study to be a PhD in technologies, but be kept utter-ly stupid about your health…and by Virtue of Blind Faith still believe in doctors in white coat disguises that to take petrochemicals is better for Disease than is Prevention by removing the Cause or Preventing the Cause or Avoiding it.

    Read the labels, stupid, the warnings are even on cigarettes and alcohol, Mommy!

    Mahalo for reading…! ! !


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