SO much for Ben, Norm and Joe's excellent adventure. Hopping a plane to the West Coast last week were the governor, the speaker of the House and the president of the Senate. Task force plan is
gubernatorial politicsThey were pitching the state's credit-rating agencies, hoping that the folks who decide how much Hawaii is worth, would love the new tax plan.
This is a plan that is doing a lot more looking than finding.
If you had a plan designed behind closed doors, a plan that specifically ignores the finances of the city and counties and a plan that its own supporters say needs a million dollars worth of public relations firepower to sell, you might be anxious to shop it around.
But, as former Honolulu Mayor Frank Fasi used to warn: When the Legislature and the governor are in agreement, you'd better start worrying.
So if Gov. Ben Cayetano, Sen. Norman Mizuguchi and Rep. Joe Souki wing off together to assure the people who loan the state money that they are the three amigos of Hawaii tax reform, should we worry?
The art of government, Voltaire said, consists of "taking as much money as possible from one party of the citizens to give to the other."
Or more popularly put by P.J. O'Rourke: "Giving money and power to government is like giving whiskey and car keys to teen-age boys."
The Cayetano/Souki/Mizuguchi tax plan continued to make people nervous. It also managed to again escape fulsome praise, exhortations or even a couple of high-fives on the West Coast.
Robert Kurtter, the lead analyst for Hawaii at Moody's Investor Service, remained unconverted, noting that states rarely make dramatic changes to the economy by moving around the tax structure.
"Don't come and tell us as a result, economic development is going to surge," Kurtter told Star-Bulletin reporter Rob Perez.
Critics may dismiss economists, calling them "experts who know tomorrow why the things predicted yesterday didn't happen today," but when Wall Street shrugs off Hawaii's bonds, the state will shudder.
There's more. In part the Cayetano tax plan seeks to balance the state books by taking money from the counties. Because the Economic Revitalization Task Force didn't have any county or city members, it was easy for the task force to take $25 million from the city's share of the hotel room tax.
Now Mayor Jeremy Harris is hollering that the cuts will be "devastating" and will result in shutting down city services.
There is a certain remorsely grim logic to the city's finances. The city is allowed to tax property. If local real estate is worth more, the city gets more money; when the property goes down in value so does the city's take.
So Harris, much like Cayetano, is jammed. He has to raise property taxes, lay off workers and cut services. Only Cayetano's plan makes the city's plight all the more ruinous.
THE entire revitalization plan is heavily larded with gubernatorial politics. As far back as the days of Gov. John Burns, an unpopular state administration has sought a major task force to answer critics' questions.
Burns had a widely displayed housing fair as the protests against Hawaii's high rents and housing costs were increasing.
Tom Gill, Burns' opponent called it "puffing...bordering on fraud." Critics of Cayetano's plan have been kinder, but there are no indications that the Cayetano plan will move the economy enough to guarantee an election victory.
Full text of the Governor's
Economic Task Force recommendations.