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To Our Readers
THERE'S been lots of good economic news lately: Unemployment is down; auto and home sales are surging; tourism shows year-over-year gains; major Hawaii companies are posting solid profits and tax revenues are trending upward. But, just as every cloud has a silver lining, every silver lining has a cloud. First, the good news
Two annoying things about cliches: They're often true and they're usually old. In 1658, Richard Franck wrote, "necessity is the mother of invention."
It took necessity, in fact a deep, severe recession, to push the U.S. government to balance the national budget and American industries to reinvent themselves.
Necessity drove changes that fostered a boom in the national economy that began in 1991 and has lasted longer than any other in U.S. history.
Necessity led to a period of intense entrepreneurial activity, with new businesses popping up and old ones changing.
For example, Ford Motor Co. says it is transforming itself from a manufacturer into a consumer-marketing enterprise. In the biggest change since Henry Ford set up the Model T assembly line, the company will use the Internet to connect directly to customers whose online orders will drive the production system that fills them.
In Hawaii, the law that requires a balanced state budget prompted necessary changes, too. Old ways of doing things came under review, entrenched interests were attacked and featherbedding bureaucracies were challenged. When a few powerful individuals found themselves out of office, elected officials developed a new respect for voters who demanded change. Now, technology is beginning to grease the wheels of productivity.
Just as necessity creates opportunity, however, prosperity breeds complacency. So, the good economic news has implicit dangers.
Politics being the art of the possible, as long as recession threatened to dry up the tax base, freeze salaries, eliminate jobs and slash unnecessary programs, benefits and perks, change was possible.
Much remains to be done, but expect good news to stiffen resistance.
John Flanagan is editor and publisher of the Star-Bulletin.
To reach him call 525-8612, fax to 523-8509, send
e-mail to publisher@starbulletin.com or write to
P.O. Box 3080, Honolulu, Hawaii 96802.