Lingle Vetoes Just Political Theatre
Wednesday - May 13, 2009
This column is about political theatre. But before I get to that, allow me to get personal.
I’m not much a travelin’ man, but I’ve been around a bit in my time: I spent nights in Chicago (often), San Francisco (a few times), Washington (maybe five times), Seattle (twice), Indianapolis, Toronto, Milwaukee and assorted other cities (once each). In making my decision to stay in each of these cities, I can’t remember ever checking the town’s hotel room tax rate.
Now, I know that’s hard to believe - particularly if you read the recent essay by Doc Kelly on the disastrous effect raising the hotel room tax would have on Hawaii’s tourist industry. It would cripple us, he argued.
Of course, our tourist industry is limping badly with the hotel room tax we already have. But anyone with a functioning, unself-interested brain knows the reason for our economic slump is to be found in causes far, far deeper than our hotel room tax.
Long before our current crisis, Kelly and the rest of Hawaii’s tourist industry argued for years against any hotel room tax at all. And their argument was always the same: Folks would stop coming to Hawaii, stop seeking our beaches, sunsets, friendly people and glorious vistas if we deigned to levy a single percent of hotel room tax.
They went further. They poured invective on the loudest proponent of hotel room tax - then Honolulu Mayor Frank Fasi - and oodles of money into the campaign coffers of any politician who would oppose - and perhaps exile Fasi from the political scene.
Ultimately, of course, we got a hotel room tax, and the sky didn’t fall. Our visitor numbers continued to rise: to 5 million per year, 6 million, 7 million. Our visitor numbers are falling now, but the decline has nothing to do with our hotel room tax rate. Nor will it if we raise the rate, as the Legislature suggests, from 12 percent to 14 percent over the next two years.
At 14 percent, it will still trail New York and the Jersey Shore (21 percent), San Francisco and Los Angeles (19 percent each), San Diego (18 percent), Nashville, Sacramento, Houston and Columbus (17 percent each).
Now let’s talk houses. The Bank of Hawaii, my wife and I own a modest house in Pearl City. Some folks a couple of years ago valued our fragile, single-walled, three-and-one-half bedroom at $600,000. It sure isn’t that now. But we don’t really care. We’re not moving anywhere; we’re not selling. Our little home will end up the possession of our children (and perhaps the Bank of Hawaii).
Now the Legislature this session passed a conveyance tax hike on the sale of homes in the $2 million range. That’s not the Boylans, nor is it our neighbors to the immediate east of us or to the west of us.
The Legislature also passed an increase in personal income taxes on individuals making $150,000 per year, couples making $300,000. The wife and I, in our middle 60s, made - as a couple - in the neighborhood of $150,000 last year for the first and probably the last time in our lives. No state income tax hike for us, prosperous, comparatively, as we are.
Who, then, would see an increase in their taxes? Visitors who, I would argue, don’t consider the hotel room tax rate when deciding whether or not to visit Hawaii; owners of real estate valued at $2 million (rich folks, that seems to me), and individuals making $150,000 or couples making $300,000 per year (semi-rich folks?).
So last Thursday Gov. Linda Lingle gathered “a boisterous crowd” of 400 in the Capitol atrium and vetoed all three tax measures: one on the rich, one on the semi-rich and one on the unconcerned visitor. The crowd chanted: “Veto! Veto! Veto!” Said the governor: “They (the Democratic members of the Legislature) can’t tax their way out of this economic crisis.”
No, they can’t. But neither can a faux populist tax revolt in the Capitol atrium do much to get us “out this economic crisis” either. It’s shilling for the rich. It’s political theatre.
Which is not a bad thing. Frank Fasi put on wonderful political theatre as mayor. He’d don a cowboy hat, stick his pipe in his mouth and take the wheel of a brand new bus, the first of a fleet of them purchased by the city - buses that would carry working class people to their jobs. And ol’ Frank would grab a hoe, proclaim himself the friend “of the little guy,” and drag the press to a municipal garden where any renter or public housing resident could mark out a plot on city property and grow vegetables for his family.
That was populist political theatre of the highest order. We need more of it in these difficult times.
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