The Bad News Just Keeps Coming

Dan Boylan
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Wednesday - March 30, 2011
| Del.icio.us

Last week in this space I lamented the loss of more than 4,000 dead and 12,000 missing as a result of the earthquake and tsunami in Japan. A week later, the death toll stands at more than 9,500 with an additional 16,000 still missing. The physical damage to Japan has been so great that I’ve yet to hear anyone venture an estimate of the cost of rebuilding, or a timeline.

Fortunately, Hawaii’s losses to the tsunami were minimal in comparison. No one lost their lives. Indeed, most of us lost nothing save sleep to the sirens that blared through the night.

But don’t talk minimal damage to the Big Island hotel workers who lost their paychecks and some their jobs because of the waves that swept the Kona Coast. Nor to the Hawaii visitor industry that will surely suffer in the weeks and months ahead.

Two million of the Islands’ 7 million visitors in 2010 came from Japan. Post-tsunami, prospective Japanese tourists will have more serious concerns than their desire for a couple of weeks in Hawaii’s sun.


Then there’s the worsening state fiscal situation. The state Council on Revenues’ most recent report adjusted Hawaii’s 2011 economic growth rate downward: from 3 percent annually to 0.5 percent. Thus overnight Gov. Neil Abercrombie and the state legislators were struggling with a more than $100 million deficit for the remainder of this fiscal year and a $1 billion deficit for fiscal years 2012 and 2013, rather than the $71 million and $700 million they faced assuming 3 percent growth.

The prospect appeared to rattle Abercrombie (as well it should). He spoke of the fiscal “canoe” in which we are all traveling is about to “capsize.” The day after the council’s lowered growth projections, the tsunami struck Japan. The guv asked the council to reconvene and factor in the effect of Japan’s crisis on Hawaii’s revenue picture. At least for the time being, the members of the council demurred.

Then there’s the turmoil in the Middle East. Libyans have joined the citizens of some half-dozen other Middle Eastern states in mass demonstrations against their autocratic rulers. Muammar Gaddafi, an autocrat among autocrats, responded with tanks and air strikes against his own people. Last week, President Barack Obama announced that United States would join those of other NATO nations in establishing a no-fly zone over Libya.

But we’ve already felt the impact of Libyan unrest and that in the region’s other oil-producing countries - at the gas pump. My most recent fill-up cost me $4.06 per gallon. Some are predicting $5 per gallon by Memorial Day. From the way things are going around the world, it may be more.

How are we responding to this bushel of bad news? Depends on which bad apple we’re examining.


Japan’s ambassador to the United States has expressed his nation’s appreciation for international aid. Hawaii’s people are doing their part. But Japan’s travail is deep and it will persist. Friends need to stick around.

As for the state’s fiscal crisis, we’ve responded like a state of special interests, not neighbors. Pensioners, labor, the rich, state workers, businesses small and large all wail. Their pensions shouldn’t be taxed, ending their excise tax exclusions will ruin them, raising the excise tax will ruin us all. “Cut government instead!” they yell. “What?” you ask. “Education and welfare!” one replies. “The train!” shouts another. There you have it - gore the young, the poor and those paying $5 per gallon.

Bad news, those responses.

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