Friday, July 31, 2009

Third Way Budget Solutions for Hawai‘i

Like any scientific issue (including political science), the solution to Hawai‘i’s economic diversification, and ultimate independence doesn’t lie in dichotomous theories. Although right-wing, free-trade theory does create a larger economic pie, left-wing protectionism is sometimes needed to ease the fall of uncompetitive domestic industries and support the emergence of new, sustainable industries in Hawai‘i. No compromise need be made between the means of conservative (the governor) and liberal (the legislature) policy makers here in Hawai‘i, but rather a single centrist (third-way) viewpoint should be created as a synthesis of these competing viewpoints. As are the alternatives I will propose, novel Third Way ideas have been defined as being “in favour of growth, entrepreneurship, enterprise and wealth creation but also in favour of greater social justice and see the state playing a major role in bringing this about" (BBC News. “What is the Third Way?” London: September 27, 1999).”

With a history of “them and us” attitudes between political parties in Hawai‘i inhibiting progress, this type of collaborative initiative is exactly what Hawai‘i needs. The goal of the Third Way policies I will propose is to meet the bi-partisan ends of both efficiency and equality by simultaneously utilizing conservative ideas of economic expansion, along with some liberal policies to expand the middle-class in Hawai‘i and supplement the free-market in fostering economic diversification. But before moving on, it must be disclaimed that I AM aware that I am merely a college student. The framework that will be laid out is not intended to be an absolute solution to Hawai‘i’s dependency, but rather mere suggestions or a preliminary design for experienced theorists and policy makers to work off of.

It is imperative that State governments work to balance their budgets during the recession to prevent unnecessary inflation, but the way Hawaii is going about it may not be the most efficient. The federal stimulus was intended for job creation, yet our state is instead focusing on job cuts. There are other solutions to help minimize the burden absorbed by the working public and future generations (See previous post).

Would the Hawaii’s tax payers prefer a small, temporary increase in General Excise taxes over the proposed layoffs and paycuts? What are the comparative consequences of each?

With a 4.5% general excise tax rate allowing over $2.18 billion in the past fiscal year, a 1% increase could generate an estimated $600 billion dollars for the State of Hawaii (well over the State’s $488 million deficit). The tax will only need to be increased temporarily to cover a two year deficit of $786 million per year. Since much of this tax is paid for by tourists, as businesses are allowed to levy the tax to their customers, this tax would be the most sensible to increase. Of course, there's no guaranteeing that the national recession will not cause a greater loss in State revenue after 2 years time, but all other actions designed by the state (such as furloughs and layoffs) are also only designed to account for the next two years. Compared to layoffs and pay cuts, this option is the easiest to undo. [All data received or derived from Department of Business, Economic Development & Tourism. Outlook for the Economy. (Honolulu: GPO, 2009)]

I also recognize that the burden of tax will fall upon consumers and businesses equally because of rather simplistic rules of supply and demand. However, if legislature was to continue to enforce the cap of the amount of the GE tax (imposed on business) to be levied onto consumers, at around 4%, then we shouldn't expect to see a decrease in spending due to higher taxes. Businesses, on the other hand, will immediately be forced to economize more efficiently.

Second, a state level cap-and-trade system with pollution credits shared and sold among businesses, similar to the recent federal bill, should be implemented. This abstract market could also prove to be a great benefit to Hawai‘i’s government as both a money maker –it’s almost as if it were out of thin air—and a protection for both environmental and economic sustainability as it would create a limit for corporate pollution.

The revenue from the cap-and-trade system could go towards the creation of new, sustainable industries. Focus shouldn’t be on preserving falling industries and “buying local”, but rather on the creation of new businesses and industries. Hawai‘i policy makers should divert the attention placed on technology to the sustainable energy markets , in which Hawai‘i would not only have the comparative, but the absolute advantage as well, with only very little threat from outside competition. Tax-credits could be appropriated for businesses in industries directly related to solar, wind, wave, and geothermal energy production and usage. Direct subsidies for infant industries could also be appropriate to allow for free-entry in an otherwise monopolistic atmosphere. This being, the subsidies would only last in the short run and the industry should not expect to rely on the funding after the first year or so.

Next, government streamlining is needed to keep costs down and reduce excessive intervention. The most noteworthy and notorious area of concern is Hawai‘i’s Department of Education, which is the only centralized, completely state-controlled system of public education among all States in the United States of America. Usually, schools are led by boards in their respective districts, while the schools are paid for by the property taxes in the area. In Hawai‘i, however, School districts are directly controlled from Honolulu by the fourteen members of the Board of Education: Central District, Hawaiʻi District, Honolulu District, Kauaʻi District, Leeward District, Maui District, and Windward District. Thirteen members are directly elected by the voters of either O‘ahu or the Neighbor Islands to staggered four-year terms. The original reasoning behind of a centralized system in Hawai‘i was to allow every child a chance at the same, quality education, regardless of where they are from. However, during these years, Hawai‘i has developed a reputation for having one of the worst net of standardized test scores in the nation.

The structure of the DOE should be broken down into smaller districts. This will alleviate the tax payers of Hawai‘i from the burden it takes to maintain a centralized system. The size of the Hawaiian Islands (especially Oahu, the most densely populated) in relation to the concentration and placement of public schools, makes it possible for students from less affluent neighborhoods to attend another with more resources. Furthermore, there are top-rate private school options spread throughout Hawai‘i’s communities that offer very generous amounts of financial aid to underprivileged children which could also reduce the costs of these programs lower than that of the public system. The fact of the matter is, a great education IS available for any child who is able and motivated in Hawaii. A child’s perceived value of education starts from within the home. Our investment in each school shouldn’t be greater than what it will produce. It’s fair to have better schools for more motivated students! If a parent wants her child to go to a great school, she’ll make it happen, even if it requires a slightly longer commute. The possibility of increasing the amount of charter schools in the islands should also be looked in to.

Tuesday, July 28, 2009

Maui Boy Makes it.

Congratulations Kaluka Maiava! I'm proud to have played against you. You are and will continue to be a true inspiration for all young, up-and-coming athletes in Hawaii.

According to the Cleveland Brown's scout report:

"The Cleveland Browns have signed fourth-round pick Kaluka Maiava, the team announced on Friday. According to a league source, Maiava signed a four-year, $2.27 million deal that includes a signing bonus of $516,500. The former USC linebacker was a second-team All-Pac 10 selection as a senior when he notched 66 tackles, eight stops for loss and an interception. He was named defensive MVP of the 2009 Rose Bowl."

That's more than Obama Makes.

Monday, July 27, 2009

Higher Education in Hawai‘i

A couple of weeks ago, I was asked to be a panelist on "Insights with Dan Boylan," a live PBS broadcast. I accepted. Such an ample opportunity to have student voices heard through a professional and public forum should never be passed up. To student readers, I encourage you to watch the program if you haven't already. It is important to be informed, because with 33 departments, 150 faculty positions, and 500 classes up for cuts, you WILL be affected. Be involved and learn what you can do to help remedy the financial situation we are facing.

[vodpod id=ExternalVideo.853770&w=425&h=250&]

"As the State faces massive budget cuts the impact on higher education will be significant. Which programs are on the chopping block and how will faculty and students be affected?"

Scheduled Panelists were as followed:
VIRGINIA HINSHAW - Chancellor, University of Hawai‘i at Mānoa
MICHAEL UNEBASAMI - Associate VP, Administrative Affairs for Community Colleges
DAVID ROSS - Chair, Mānoa Faculty Senate Executive Committee
MARK ING - President, Associated Students of the University of Hawai‘i (ASUH)

Friday, July 24, 2009

A Blogger's Paradox

Our generation is often criticized for being frenziedly narcissistic. Since personal weblogs are sometimes considered to be at the epitome of egotism, a smidgen of irony may characterize my creation of a blog in an effort to help to defeat this stereotype of our generation. But there are many types of blogs, and blogs remain the best new medium to push forward the next big ideas. It's time that we step up and set the pace in society.

...proof that the youth can be heard! But poor kid needs to be allowed to have some real fun!!! Parents, you're not fooling anyone. He needs a social life.

CONVERSELY, I encourage everyone to put aside some time of solitude everyday and start blogging, no matter if you are interested in world politics or extra large ball-jointed dolls. Whether or not we are being truly represented by these usually way cooler, cyber extensions of ourselves is besides the point of purpose. The pervasiveness our cyber-selves could achieve through blogging usually can't even be realized by ourselves "IRL". Would 26.3 million people (not counting the millions more views of re-posts) been able to see Crocker cry for Britney if it wasn't for the magic of blogging? And even if not a single person reads (or views) your blog (...vlog), it creates a beautifully creative, multi-media journal of your life. And as long as you don't pull a Michael "The Gold Medal Bongmaster" Phelps, your blog could be great for the old resume!!!

Just, keep it civil: