The Budget, Tax And More Taxes

Rick Hamada
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Wednesday - May 20, 2009

The recently completed legislative session will be known for emotional debate on social issues, political gamesmanship and unequivocal support for government unions. Oh, by the way, we’re mired in the worst economic situation we’ve seen in ages and your lawmakers increased taxes and fees. Would somebody please tell Nero to start fiddling?

The impression outsiders have of Hawaii is that we are a melting pot of differences that peacefully and enjoyably coexist. It is a notion that is perpetrated by us. It is an essential part of our identity that the “Aloha Spirit” courses through our citizens. And, for the most part, it does.

But you need look no further than the raucous debate on civil unions (HB444) to see that despite our claim of ecumenical love and tolerance, we can throw verbal cheap shots, trample over sensitivities and shred our opponents just as fiercely as our brethren on the Mainland. Although the civil unions bill died this session, you can bet the only dollar you have left (after this session) that this issue will be even more dominant in an election year.


 

The budget: That’s all you had to say to any governmental official and you would see the color drain from their face, the eyes would roll back in their sockets and even atheists would whisper a prayer for salvation. Facing a daunting shortfall from hundreds of millions to multiple billions (depending on the time frame), the governor and the Legislature needed to submit their proposals for how to deal with the paucity of pesos.

In lay terms, the Democrat-controlled Legislature opted for tax increases and Republican Gov. Linda Lingle favored reducing expenditures. Yes, there were proposals to eliminate various programs and costs submitted by both sides. But the clear difference was the predictability that Democrats would block, stop, mitigate, prevent and/or halt any efforts to reduce wages and benefits to general fund union employees. The Democratic majority of representatives and senators chose to increase taxes. The GOP governor very publicly vetoed three specific tax increases. The Democratic majority summarily overrode those vetoes. There should not be a single doubt in any Hawaii voter’s mind about which political party represents tax, spend and protectionist politics, and which political party represents tax reduction and taxpayer advocacy. Hopefully, this expensive lesson will be remembered in 2010.


On a side note, although much attention is being paid to the state Legislature, let’s not forget that Honolulu Hale also is on a money-sniffing “recon” mission for your cash. The increase in real property tax rates is virtually a given. The increase in the vehicle weight tax, highway beautification fees, bus fares, park-attendant fees, alarm permit fees and more should signal the game is on. Not to ruin your day, but don’t forget about the $5 billion train, too. As Bill Murray memorably said in Caddyshack, “So, I got that going for me. Which is nice.”

Did I mention the federal government is contemplating tax and fee increases to soften the blow of a trillion-dollar-plus budget? Did you know that we will eventually be spending 46 cents of every dollar on debt?

I’m curious. Since China owns an increasing share of our nation, just how long will it be before Times Square is renamed Tiannamen Square?

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