Kicking Someone Who's Already Down

by Keli'i Akina, Ph.D., President/CEO, Grassroot Institute of Hawaii

Tax watchdog Tom Yamachika, head of the Tax Foundation of Hawaii, has recently exposed more counterproductive thinking by the state government.  In an economic study for which the state paid consultants $100,000, the most significant recommendation is to raise taxes on gasoline by $.85 per gallon to discourage consumption and ostensibly improve the environment.  (Read the full article here.)

One problem with this punitive behavior is that it's like kicking a person when he's already down.  Hawaii's cost-of-living, business regulatory climate, affordable housing shortage, rising homelessness, and countless other economic problems have already crippled the average taxpayer and business owner. 

Adding a Draconian increase to what is already one of the nation's highest gasoline tax rates will not incentivize cleaner energy, but will further damage the economic capacity of middle-class and poorer residents.   Even the study points out that fuel taxes are "highly regressive," meaning that they hurt the poor the most.  And for an increasing number of people, such a tax will simply be the last straw as they flee Hawaii for other states such as Texas or Nevada.

Given the illogical premise of this tax-hike proposal, perhaps the real motive is that it aims to generate $418 million in tax dollars for the state!

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Video: Measuring Economic Freedom (with Dean Stansel)

In this episode of E Hana Kakou, economist Dean Stansel and host Kelii Akina discuss the importance of economic freedom and how to measure it.  They examine trends for America and discuss the low ranking of Hawaii and what can be done about it.  Stansel is principal author of Economic Freedom of North America, published by Fraser Institute.

Click the image below to view the interview in its entirety or go here to see it on You Tube.