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Akina recaps victories, disappointments of 2022; is optimistic about 2023
By Keli'i Akina PhD @ 7:31 PM :: 1997 Views :: Hawaii State Government, Jones Act, Taxes, Cost of Living

Akina recaps victories, disappointments of 2022; is optimistic about 2023

by Grassroot Institute of Hawaii, January 2, 2023

“They weren’t wins so much for the Institute as they were for the people of Hawaii.”

That was how Keli’i Akina responded when radio host Johnny Miro asked him to name some of the Grassroot Institute of Hawaii’s “wins” over the past year. 

Akina, president and CEO of the Grassroot Institute of Hawaii, was the guest on Miro’s Sunday morning program on the H. Hawaii Media network of Oahu radio stations on Dec. 20, 2022.

Akina said the wins included:

>> Helping to defeat every major proposed tax increase during the 2022 legislative session, including the gas tax, the liquor tax, the income tax and the capital gains tax.

>> Helping taxpayers receive a larger tax rebate than the $100 former Gov. David Ige had originally proposed. The institute had suggested $1,361. The eventual amount was $300.

>> Increasing awareness among Hawaii residents about the Jones Act, a federal maritime law that limits shipping competition between U.S. ports and contributes to the state’s exceptionally  high cost of living.

>> Producing a report showing that out-of-state buyers are not a significant driver of Hawaii’s high housing prices, and that the real culprit is the state’s excessive land-use and zoning regulations.

Akina said two disappointments in 2022 were the failure to defeat both the increase of the state’s minimum wage to $18 an hour over the next few years and of Maui’s Bill 107, which is likely to thwart rather than encourage more affordable housing on the Valley Isle.

Looking ahead, Akina said the two biggest issues facing Hawaii are the lack of affordable housing and the critical shortage of medical personnel

Another focus for the Institute in 2023 is reforming the general excise tax, which makes food and medicine far more expensive in Hawaii than they need to be.

Asked if the Institute will be able to have a good relationship with Hawaii’s new governor, Akina responded affirmatively.

“We are looking forward to a great relationship with all government officials,” he said, “from Gov. [Josh] Green to Mayor [Rick] Blangiardi to our legislators and to our Council people, because we’re not partisan. We’re not trying to promote those who are of one party over another party. And we stand for what I believe our public officials went into office to serve, and that is the people. So from our end, we’re going to do everything we can to be supportive.”

At the same time, he said, “We will be bold in our proposals, and that sometimes rubs people the wrong way. But our heart is not to do that; our heart is to be supportive so that we can all work together for greater outcomes for the people of Hawaii.”

 

TRANSCRIPT

12-30-22 Keli‘i Akina with Johnny Miro of H. Hawaii Media radio network

Johnny Miro: Good Sunday morning to you, this is Johnny Miro of H. Hawaii Media. It’s time for public access programming on our six Oahu radio stations here at 101.1 FM, 101.5 FM, 103.9 FM, 96.7 FM, also 97.1 FM and 107.5 FM. 

Happy to be joined once again by the president and CEO of the Grassroot Institute of Hawaii. That would be Keli’i Akina. Good morning to you, Keli‘i, and Happy New Year to you.

Keli‘i Akina: Well, same to you, Johnny, and to all your listeners. 2022 was such a momentous year in so many ways, but we’ve got a lot of great things to look forward to in 2023.

Miro: Correct. What were some of the Grassroot Institute’s wins in 2022, in your opinion?

Akina: Well, they weren’t wins so much for the Institute as they were for the people of Hawaii. 

One area happens to be in terms of the amount of tax that we pay. As you know, we pay — when you add up all the taxes and all of the fees that our citizens pay — one of the highest rates in the entire nation. 

But there’s good news. This year it was an election year — and so maybe our public officials were conscious of this — but this year, Grassroot was instrumental in helping to defeat every major tax increase.

For example, we were able, together with the people of Hawaii, to defeat bills to increase the gas tax and the liquor tax and the income tax and the capital gains tax —  and that was just to name a few. 

So it’s a good time to have just a little bit more that we can keep in our pockets, because we all know how expensive life is becoming. But I would say that’s a big win for the people of Hawaii, and as we look forward to the coming year, we hope that we’re going to see more things that will help people live in this state.

Miro: Exactly. Grassroot Institute of Hawaii, Keli’i Akina joining us, grassrootinstitute.org for more information on that. 

So, on the topic of taxes, tell me a little bit about the tax rebate. Did you have a hand in getting that passed?

Akina: Well, yes, we did, but I think that the big win goes again to the people because we were able to get a little more out there than was originally promised. The governor had originally proposed only $100. 

You see, in a year in which we collect far more money than we actually need in the government, there’s some triggers that say some of that has to be given back to the people. 

We actually suggested from the Grassroot Institute $1,000 to go back to every taxpayer, and that’s because we had an enormous surplus compared to previous years.

But in the end, taxpayers got up to $300, which is something, at least. And so we’re glad for that to take place. 

On the other hand, we don’t think that that’s enough to really stimulate the economy as much as it needs to be done. But let’s not look a gift horse in the mouth. At least we can be grateful we got some of our money back.

Miro: Yeah, so what about next year? Do you see any chance that we’ll see another rebate?

Akina: Well, that really depends upon how much pressure the people put on their government leaders. 

What we are being told now by the administration and by our Legislature is that we have a record year of surplus, a huge amount of money that comes really from two sources: No. 1, a large amount of funding that has come from the federal government due to COVID, and No. 2, monies that are coming back to us through the form of taxes because our economy is starting to grow, and, also, because property values are going up. 

And so the government itself is getting more money. I would like that to be a message that they should be giving some of that back to the people. That would be a good message to give to our leaders.

Miro: Exactly. Now, Keli’i, I seem to remember that the Grassroot [Institute] supported some limits on the governor’s emergency powers. How did that end up for you, and did the Legislature do anything about that?

Akina: Well, that was a great win for the people of Hawaii in one way, although it’s not complete whatsoever. 

There’s no question about it: We do need to have a state that has the ability to respond in an emergency. And during the COVID crisis, we had our government declare — our governor in particular — multiple emergency decrees to deal with it. 

However, there are time limits that are set by the law in terms of these decrees, and we believe that they were exceeded multiple times. So that, really, for over a period of two years, we were under the Emergency Powers Act that were extended.

I think it’s important to understand that during such a time, the people have less recourse, less power to really balance out the actions of government. For example, the Legislature didn’t have the power to modify the governor’s decree. 

So last year, a real win for the people was that our state Legislature — and we were very much involved in helping to bring this about — our state Legislature decided overwhelmingly — about 75% of the legislators — that a bill should be passed — which they did, in both houses — saying that the governor’s powers can be limited if two-thirds of the Legislature comes together and says that they need to modify or rescind an emergency decree.

Now, that’s important because it maintains the balance of power. Unfortunately — and this is why the story’s not over — at the end of the legislative session, the governor vetoed that bill. And the Legislature was not called back into session. 

So, as a result, that decision to have the Legislature play a role in being able to override a governor’s emergency decree did not go forward. 

Many legislators are still talking about that. We’re waiting to see what will come about in this coming legislative session.

Miro: Yes, it seems like a very important measure. 

Alright. Johnny Miro with Keli’i Akina of Grassroot Institute of Hawaii, grassrootinstitute.org. 

Now, you’ve all been working on the Jones Act for quite some time, quite a long time. Did you see any progress there?

Akina: Oh, absolutely. One of the ways progress is made is by awareness, and as we measure the number of people in Hawaii who are aware of the Jones Act and the need to modify it, that has grown significantly year after year. And so we’re grateful for the research and the reports that are going out. 

Now, while Hawaii is inordinately impacted by this 100-year-old shipping law — as is Alaska and Puerto Rico — we are not the bodies that actually have the power to change that. It’s a federal law.

And so we need to actually get more people in Congress aware of this and working towards positive change. 

And we’re grateful, for example, to Rep. Ed Case, who sponsored three bills in Congress in order to bring about reforms to the Jones Act that would benefit Hawaii. And he’s looking at perhaps launching another bill this coming session. 

But, you know, there is a role that local people can play because when our own government officials in our state and county government speak up, those voices are eventually heard.

So we worked with the counties — and the most recent one was Maui County, the Maui County Council in particular — to pass a resolution asking for a Jones Act waiver for oil from the mainland. And that’s very important because during times of international crisis such as the Russian invasion of Ukraine, our oil security becomes challenged. 

So that’s progress. Inch by inch we make progress, and hopefully, we’ll see bigger progress in the years to come.

Miro: So the Jones Act, you just said, is a national issue. So maybe you can inform listeners: Why work with Maui County on it?

Akina: Well, if Maui County speaks out, as the Big Island and Kauai County and so forth, there’s a growing resounding voice locally. And as our legislators jump on board, as more and more have become open to change in the Jones Act, Washington can hear us. 

That’s very important because our Washington, D.C., delegation, which consists of two senators and two Congress members, needs to hear that other officials and leaders in the state of Hawaii want change. Currently right now only one of our congressional leaders, Ed Case, is out in the open about his desire to update the Jones Act in order to help Hawaii’s economy.

Miro: Alright, so how about some less tangible things? Did you have any wins outside of the Legislature?

Akina: Well, thanks for asking that, Johnny. Many of your listeners are familiar with the Grassroot Institute as an independent organization that takes no money from political parties or the government, so that the people have a voice. And so it’s very important for us to grow in our community. 

Sometimes people aren’t aware that our funding comes from local people for the most part, and we have 500 local donors who’ve really made it possible for us to get the resources we need to help the people.

For example, we were able to add a couple of staff, so that by the end of the year we had eight to nine full-time staff and 10 part-time staff. That’s a great team that has been growing from year to year dedicated to doing independent research and getting the word out to as many people as possible about positive changes here in Hawaii. 

Other changes include growing influence and being able to provide needed materials and research to legislators and Council members.

We hosted events with local and mainland experts. For example, you were just talking about the Jones Act. We recently had one of the nation’s leading experts on that, Colin Grabow, do island-wide events. And Scott Grosskreutz and Jim Winker talked about the physician shortage as we went from island to island. And Tobias Peter spoke about housing. 

We’re going to continue in 2023 to bring these very important events and experts to the people of Hawaii.

Miro: OK, so what about the research you folks have been doing out there? Was your team able to produce anything that made some big waves out there?

Akina: Yes. In fact, research is at the heart of what we do. We don’t just take positions as if they were bumper stickers and run after getting people to support them. Instead, we begin with the data. We look at what the best research in Hawaii across the country and the nation show[s] and then we formulate a position and, based upon that, we find solutions for our economic condition.

One has to deal with the problem of the shortage of housing and the exorbitant cost of housing here in the state of Hawaii. We had a very well-received report this past year that our institute produced that debunked a common theory that a lot of people have.

Many people simply say that the reason our housing is so scarce and the reason it costs so much is because of outside buyers — people from the mainland and people from foreign countries buying everything up and pushing up the prices.

It’s easy to say that and it’s easy to blame that, but when you really look at the data, it doesn’t show that, and that’s the remarkable thing. We were able to debunk this theory. 

What we did was, we looked at every county in the entire United States and we examined whether there was outside buying and what that had as an impact upon the price and the scarcity of houses. In some cases, when there were a lot of outside buyers, prices went up in that county. In other cases, prices went down. 

But the remarkable finding of this nationwide research study that the Grassroot Institute conducted is that there is no causal relationship between outside buying and local housing prices. None throughout the nation and not in Hawaii. 

In fact, because we were able to clear up this misconception and show that it is not outside buying that drives up the price of homes in Hawaii, we were able to focus on other causes. And that’s the real beauty of this report. It cleared the way for looking at what the real cause is for Hawaii’s exorbitant housing prices. 

Now, everybody knows that in many areas there’s just not enough housing, but why is that? Well, the University of Hawaii Economic Research Organization has come out with the same reason that we are publishing at Grassroot Institute and it’s this: The level of government regulation — the multiple layers of approvals and hearings and applications that developers have to go through in order to develop housing — has risen to the point where we are leading the nation. 

Unfortunately, we don’t want to be leaders in this way, but we’re leading the nation in terms of red tape and government regulation. In fact, Hawaii County has the most red tape and regulation in order to get anything built, and we have the smallest amount of housing – less than 3% of the island has housing on it — and so this is something that’s so important. 

And Johnny, let me tell you why. When we don’t have the right cause of a problem — whether it’s for housing or homelessness or the high cost of living or whatever we’re dealing with — our leaders go after the wrong solution. Now we can focus on the right solution. 

Dealing with the housing crisis means, first and foremost, we’ve got to loosen up the exceedingly high level of government regulation we have in Hawaii.

Miro: Yeah. When I read your piece on the outside buyer theory, I was shocked myself. So, how was that report received, I mean locally and maybe nationally. Do a lot of people seem to agree with it?

Akina: Oh, absolutely. In fact, it followed a funny pattern that we’ve seen in the past. 

When at first we released it, it wasn’t really picked up immediately by local media, but then, when national sources began to publish this, our local media took note and they published it as well. 

And so this was covered in all major television stations, newspapers and most news radio programs, and it was really something.

Let me correct that: I’m not sure it was most news radio programs, because I’m not as familiar with the radio market, but it was extensive, especially in television and in newsprint. And we were very pleased with the reception. 

Sure, there were some people who still said, I can see it with my own eyes, or I drive by certain buildings and see that they’re dark at night. But that’s not the basis for research. That’s anecdotal. That’s a story. We did the research county by county and found that the myth of the outside buyer causing our prices to go up with housing as the major cause is simply that: It’s a myth.

Miro: Well, grassrootinstitute.org has a lot of policy papers on there, a lot of work you’ve done. Any other research you’d like to mention here?

Akina: Well, our outside buyer theory and other reports have been published and covered by [The] Wall Street Journal and other media across the nation. 

And I’d just like to share that anyone can go to our website and get numerous studies about the causes of our problems in the economy, our cost of living and so forth, as well as the solutions. And those reports are all available at www.grassrootinstitute org. Grassroot, there’s no “s” there. Just grassrootinstitute.org.

Miro: OK. What were some of the things that might have been disappointing? We’ve been talking about the positives; what about anything that was disappointing in 2022?

Akina: Well, we’re certainly glad for every measure that helps those in our economy who are the least well off. 

But as we’ve shown, the research tells us that increasing minimum wages and forcing small companies to pay an amount that they can’t afford actually hurts the poor, because those businesses end up laying off workers or not hiring them and even reducing their hours.

So minimum wage laws, the data shows, don’t really work well. But, unfortunately, our minimum wage increased even more this past year, to $18 an hour. And that is definitely hurting a lot of small businesses and hurting a lot of employees. 

Now, another disappointment was Maui’s Bill 107, which added a lot of red tape to the housing market, and as I mentioned before, that’s really going in the wrong direction altogether.

Miro: Alright, Keli’i Akina joining us from Grassroot Institute of Hawaii, president and CEO of the organization. 

What do you believe is the biggest issue facing Hawaii right now, Keli’i?

Akina: Well, we’ve got a lot of big issues and there are two, if you’d allow me, that I think I really would point to as something that public leaders need to do something about, and I think most are in agreement. 

No, 1 is the supply of housing — the supply of housing that people can afford, in particular. We have a median home price on Oahu that exceeds a million dollars; on Maui, $1.5 million. It’s growing to such a level that not only do people find it impossible to afford buying a home, it’s becoming harder and harder to rent homes. 

And then you just follow that chain down, and eventually we see the homeless problem continuing to grow, so that’s one major issue that we need solutions to. And that’s what we’re working on constantly at Grassroot Institute.

In addition to that, we need to do something about our healthcare. There’s a critical doctor shortage in our state and a shortage of medical personnel. This is felt nowhere so severely as on our neighbor islands, where it can take weeks and months to get an appointment with a specialist, and in many cases, you can’t get one with a specialist there on the island. You have to come to Oahu or fly to the mainland.

That simply shouldn’t be the case, and our analysis shows that there are many factors that lead to that, including the cost of living, of course, and the difficulty of medical personnel being able to get housing themselves. 

But it’s also a result of a good deal of government red tape that prevents us from having as open a market with regard to medical care as we need. So those are definitely problems that we’re facing in 2022 that will continue in 2023 and beyond.

Miro: My question is: What is Grassroot planning to do about this in the coming year, in 2023?

Akina: We are absolutely committed to getting the best research out there, so that our government and our public can understand what the actual problem is, what the causes are and what the best-practice solutions across the nation are. And we definitely have these projects going on with respect to housing and to health.

In addition to that, we’re taking this information to lawmakers and to other government officials in ways that can be understood and used and immediately translated into newer laws and revisions of regulations. We need to do that.

But most of all — and this is why I really want to appeal to your listeners — we need to get more and more of the public aware of and on board with the solutions. 

And that’s why we want to be available – whether it’s through our website, grassrootinstitute.org, or our events that are held on multiple islands. We want to be able to get this information out so that people can talk to their leaders about it.

Miro: Alright, what are you looking forward to, of course, 2023, the brand new year, all the excitement, the anticipation, the good vibes about the coming year and the new year? 

I know you’ve been talking a lot about reforming the excise tax. Seems like there’s some possibility of something happening. Can you tell me a little bit about that?

Akina: Yes. In fact, that’s one of many measures that we started to work on in previous years that we’re going to continue going after. Our general excise tax makes food and medicine far more expensive in Hawaii than they need to be. 

And this is a regressive impact upon the population, which means, basically, that those who have the least income and the least ability to purchase food and medicine are the ones who are impacted the worst and the hardest, because of our GE tax fund.

And, in addition to that, it contributes to the shortage of medical personnel. Doctors in private practice are hit very hard with that GE tax, and it makes a huge negative impact where they have very little margin on what they make. So we’re definitely going to be going after that.

And we’re very pleased that our governor, Gov. Josh Green, during his campaign said that that would be a priority for him. So we want to be available to be of service in terms of research and in terms of being able to push that issue forward as much as possible. That’s a very big thing for us.

Miro: Indeed. Is there anything else that you hope the Legislature will pass?

Akina: Overall, we want to encourage the Legislature to get rid of layers of regulation and red tape that are making it hard to impossible to build housing that people can afford. Until we do that, we’re not going to see the kind of affordability that is needed, and we’re going to continue to see people leaving Hawaii in large numbers. 

And that’s something we can talk about perhaps later on:  the exodus [from] Hawaii by so many people. That’s crucial to deal with. Cost of living is the No. 1 reason for that.

And another factor that contributes to the cost of living is the amount that we pay in our taxes, whether it’s by new taxes and direct taxes or all things. So many people recently — for example, I know where I live in Honolulu County — have been hit by the fact that our property taxes that we actually pay have gone up. Even though our rates have not gone up. 

But because of inflation, the value that the government attaches to the homes that we live in has soared and people —  a lot of kupuna and elderly people, for example — are hit hard because they’re on fixed incomes and they can hardly afford to pay the property taxes that have been increased. 

So these are some of the items that we’re working on.

Miro: Keli’i Akina from Grassroot Institute of Hawaii, president and CEO. Keli’i, do you think the Legislature will seriously consider any bills that you would oppose?

Akina: Well, we expect that the Legislature and the governor’s office may try to grow the size and the scope of government. We’re very concerned about that, because the larger the government gets, the more expensive it becomes. And the cost of government has been soaring over the past decade while, at the same time, the output of the private sector in terms of business has not been growing at the same rate. 

And this is not a very healthy sign. A little bit of government should be resulting in the private sector and the economy growing a great deal. It shouldn’t be the other way around.

The current budget proposal that is before the Legislature is setting increasing spending levels at new highs. And one of the concerns is that part of the thinking is we have all of this surplus. But when you look at the surplus, it’s not sustainable. A good deal of it is from federal funding due to the COVID, the pandemic management. And another amount of this surplus is due to the fact that we have had inflation. 

So we have government taxes going up at the expense of the taxpayer. That’s not the basis on which you want to set your spending level. So we’re very concerned about bills that are going to call for a lot of spending.

Miro: Alright, Keli’i, you mentioned that Gov. Green is open to looking at the excise tax, the food, the medicine, the what-have-you. So based on that, do you believe that Grassroot will be able to have a good relationship with Gov. Green?

Akina: Well, we are looking forward to a great relationship with all government officials, from Gov. Green to Mayor [Rick] Blangiardi to our legislators and to our Council people, because we’re not partisan. We’re not trying to promote those who are of one party over another party. And we stand for what I believe our public officials went into office to serve, and that is the people. 

So from our end, we’re going to do everything we can to be supportive. And that means that when we see our government officials doing things that are good, we’re going to give them kudos.

So as you heard me mention earlier, we’re very pleased that Gov. Green is looking at lifting the excise tax from food and medicine. And so we commend him. 

At the same time, we’re also going to continue to urge our government officials to go in the right direction when perhaps they may be pressured by politics or other reasons not to do so. 

So we will be bold in our proposals, and that sometimes rubs people the wrong way. But our heart is not to do that; our heart is to be supportive so that we can all work together for greater outcomes for the people of Hawaii.

Miro: And that’s what we’re all hoping for. And there was a recent survey on this: The public trust in Honolulu city [and] county governments. Only 22% — 22% — of people said that they had a trust in the government. Why do you think this is?

Akina: Overall, people in Hawaii over the last couple of decades have been concerned that the outcomes that we’re supposed to see aren’t there. We have an economy that people can’t afford. We have a housing crisis, we have a medical supply crisis in terms of personnel. We have a homelessness problem. 

I could go on and on and identify areas where we have not seen the government provide us the solutions we need. Now, that creates a certain kind of distrust, but our distrust of government actually goes beyond that.

You mentioned a survey of people in Honolulu County, and it’s really no different in other counties, but there we’ve seen, unfortunately, a slate of cases of corruption where federal officials have really shown us that we have a high level of corruption in the City and County of Honolulu. 

Hawaii is a small place compared to New York or Los Angeles or Chicago, but we’ve been seeing cases of government officials involved in the same kind of corruption that have been celebrated in these big cities. And that naturally causes people not to trust.

And so government officials really need to hold themselves accountable to the highest standard and have to be able to move beyond the distrust that has been generated by the revelation of so much corruption recently.

Miro: Yeah, and with that, Keli’i, is there anything else that you’d like to add as we wrap things up here?

Akina: Well, I’d like to say this to all of your listeners, Johnny: Mahalo for caring about public policy. I know that when we come on board your program, we spend half an hour or so talking about deep issues that are of great concern, but they may not be the most fun or entertaining issues, if you know what I mean.

Miro: Yeah.

Akina: So I really want to congratulate your listeners for taking the time to care about public policy. And I want to express a Happy New Year, and our desire to work with all of you to build a better Hawaii. All the best to you, Johnny, and your listeners from the Grassroot Institute of Hawaii.

Miro: Yeah, same to you folks. The happiest of New Years to everybody at Grassroot Institute of Hawaii. And we’ll be talking to you definitely within 2023, hopefully, many times on important topics. 

Hau’oli Makahiki Hou to you and yours at the Grassroot Institute of Hawaii and your family and friends. Keli’i, thanks for joining us once again, and once again, Happy New Year.

Akina: Aloha to you.

Miro: Mahalo for listening to this H. Hawaii Media radio station. Have a great day.

 

 

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