High "Wealth" Ranking Cannot Disguise Hawaii's Status as 2nd Worst "Sinkhole State" for Debt and Unfunded Liabilities
News Release from Grassroot Institute
HONOLULU, Hawaii--October 28, 2013--Today, Grassroot Institute of Hawaii and the Institute for Truth in Accounting warned Hawaii citizens about our serious sad state of financial affairs. Recently, Truth in Accounting named Hawaii the nation's number two "Sinkhole State" based on the fact that the state government has overspent income for six consecutive years. In particular, Grassroot warned Hawaii taxpayers not to get the wrong impression from recent reports that appear to have "good news" about Hawaii's economic health. For example, according to a study from Wall Street 24/7, Hawaii is the fifth "richest" state in the nation, with a median household income of $66,000. However, that ranking fails to take into account the substantial debt and unpaid liabilities that create a per taxpayer burden of $39,900.
Meanwhile, a report from the Tax Foundation lists Hawaii near the middle of the pack, with the 30th most business-friendly tax climate. However, it remains important to take into account the substantial state debt, unfunded liabilities, and the hidden costs of doing business in Hawaii.
"For the fifth year in a row, our analysis shows Hawaii is one of our 'Sinkhole States,' since it has one of the five worst 'Taxpayer Burdens.' Taxpayer Burden is each taxpayer's share of state debt after available assets are used. In fiscal year 2012 Hawaii moved from third worst to second worst in this category," stated Donna Rook, President of State Data Lab, a project of Truth in Accounting. "Government accounting practices have allowed states like Hawaii to hide significant liabilities from their citizens," Ms. Rook concluded.
"In addition to the burden caused by our state's unfunded liabilities and the refusal of the legislature to properly address the problem, we also have the hidden penalties of doing business in Hawaii," stated Keli'i Akina, Ph.D., President of Grassroot Institute. "Of course, there are regulations and red tape that restrict small business and entrepreneurs, but we cannot dismiss the impact of the Jones Act, an outmoded form of protectionism that acts as a de facto tax on every Hawaii citizen and business, hiking up both our cost of living and the cost of doing business here."
Grassroot Executive Director Tim Lussier added "States across the country are tackling their serious debt and unfunded liabilities. Oregon, my original home, held a special session this month and passed sweeping government pension reform. We in Hawaii must eliminate our status as a 'Sinkhole State' and improve the economic well-being of our state." Lussier continued: "We urge Hawaii's lawmakers to take real and effective action to address these hidden costs of living and working in Hawaii. We must reduce state debt and unfunded liabilities and work to reform the Jones Act. Through serious reforms Hawaii's rankings and indicators could improve and we can all have a better economy, government and society."
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For more information or for press inquiries contact Grassroot Executive Director Tim Lussier at (808) 591.9193 or email tim@grassrootinstitute.org.
About the Grassroot Institute of Hawaii:
Grassroot Institute of Hawaii is a nonprofit, nonpartisan research institute dedicated to the principles of individual liberty, the free market, and limited, accountable government throughout Hawai`i and the Asia-Pacific region. Read more about us at http://www.grassrootinstitute.org/
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About Truth in Accounting
The mission of Truth in Accounting™ (TIA™) is, in a non-partisan manner, to compel governments to produce financial reports that are understandable, reliable, transparent and correct. We believe truthful accounting is the key for citizens, legislators and the press to clearly understand the truth about government debt and to enable informed proposals for its resolution. Read more at http://www.statedatalab.org/about/.
About Keli'i Akina:
Dr. Akina is a recognized scholar, educator, public policy spokesperson, and community leader. In2012, he was a candidate for the non-partisan position of Trustee in the Office of Hawaiian Affairs. Akina has decades-long experience leading non-profit organizations including Youth for Christ Hawai`i and the Center for Tomorrow's Leaders. An expert in East-West Philosophy, he has taught at universities in China and the United States, and continues as an adjunct instructor at Hawai`i Pacific University and the University of Hawai`i at Mānoa. Read more here.