Economy in Hawaii on life support
As the state's $10.5 billion budget grew fatter, Ira Rohter, University of Hawaii political scientist, begged the state to rethink its love affair with tourism.
Jet fuel would be beyond expensive, it would be almost unaffordable except for the rich, Rohter predicted. The middle class could forget about hopping on any jets for 2,500-mile flights to Waikiki, Rohter warned.
Fools making foolish decisions, Rohter, the former head of the local Green Party, grumbled as we continued to celebrate more than seven million tourists a year coming to Hawaii.
It must be a miracle, everyone said, as oil prices climbed and airfares stayed low.
Then the real rules of the road slapped some sense into the Hawaii economy, tossing away Aloha Airlines and for good measure dropping ATA down the drain. Oil prices do mean something after all.
Here at the state Capitol, the Legislature shuddered.
"Clearly, these are unsettled economic times. Hawaii's economy has slowed substantially, and the state's budget must account for and reflect the economic slowdown," the Senate Ways and Means Committee report on the state budget noted.
The state knows how much money it has to spend by checking with the state Council on Revenues, which predicts the amount in taxes the state will collect. A good economy equals more taxes, which means more money for the state to hand out.
Since March 2007 the economic projections have dropped nearly a half-billion dollars. That means the state has $487,000,000 less to spread around this year.
First Molokai Ranch closed, then Aloha and now ATA.
Tough times indeed.
In the next month, the House and Senate will go into conference on the budget. The Senate actually wants to spend a bit more than the House, although both want to spend less than the budget first prepared by Gov. Linda Lingle back in the good old days of 2007.
The financial plan this year is mostly an exercise in triage. Delay this building, scrap this program, order 4 percent cuts in new spending.
Keep a brave front for the grants-in-aid given to the community groups that do good things such as support the symphony and the homeless shelters. But if last year those groups were lucky to get a dime for every dollar promised, this year the reality will bite even harder.
When you are in the economic emergency room trying to decide what programs live or die, it is not the time to ask whether the disaster could have been avoided.
But I did query Rohter, asking for suggestions about what to do with the oil crisis and economy mess.
Rohter sent me a picture of a horse and buggy.