Wednesday, November 30, 2011

What Would Rail Do for APEC?

The Asia-Pacific Economic Council or APEC 2011 was recently completed at various venues on Oahu. About 20 top leaders attended including the Presidents of US and China and the Prime Ministers of Japan and Australia. It was an important and crowded event. Oahu’s experienced hospitality industry proved that they can handle major visitation challenges.

Oahu’s transportation system was no problem for the “prime” visitors because security forces blocked it off for their exclusive usage. Oahu’s citizens and visitors were inconvenienced from mildly to tremendously because of the lack of redundant routes given that Honolulu is the most lane deficient metro area in the nation.

So a fair question is this: If rail was already present, what would have it done for APEC? What would rail do for future major conventions?

Nothing! Remember that the rail dead-ends at Ala Moana Center. (More on this later.)

Meanwhile, APEC dignitaries and visitors would be appalled by the ghastly superstructure that blighted the waterfront and Ala Moana. Those more akamai would ask: Why did you build something so big for your modest city? Why are your roads so congested and the trains are almost empty?

The answer is that rail was built big to create as many temporary jobs as possible. It’s not well used because the bulk of its ridership comes from deleted bus lines, along with a few thousand white collar workers who soon enough will ask the public to pay more money to put WiFi in the rail cars.

Rail dead ends at Ala Moana Center. Over one billion dollars will be needed to backtrack to Kapiolani Boulevard to get to Waikiki. Rail will permanently blight the Convention Center and the spine of Waikiki: With the elevated rail and stations, sun will barely reach Kuhio Avenue.

Recall that the federal judges signed a letter of objection to the city: They do not want rail to use Halekauwila Street because they consider it a security breech to the nearby federal building. How can rail go by the Convention Center? If it does, Hawaii won't be able to use it for any high-security event such as APEC, ADB, UN and other top level political and business meetings. Or it could, if we installed airport-style security at all 21 stations. Sounds ridiculous? Considering that the powers that be are pushing a $6 Billion rail system on a less than 600,000 population corridor, very little else can top this for ridiculous.

Obviously we need a different and better solution for transportation. What if we had HOT Lanes instead, that is, elevated HOT Lanes between the H1/H2 merge and Iwilei with exits at Aloha Stadium, airport, Kalihi and downtown?

With HOT Lanes, during APEC we would have problem-free travel between the H1/H2 merge and downtown regardless of freeway closures. There would be no visible blight because HOT Lanes run mostly next to H1 freeway and terminate one half mile before Honolulu’s prime waterfront.

As a bonus, HOT lanes have no part in the destruction of Aloun Farms and the prime agricultural land that is slated as a 12,000 - 15,000 residential unit Transit Oriented Development (TOD) in the Ewa plains.

Tuesday, November 29, 2011

Five Myths about US Gasoline Taxes

A good summary article by Shin-pei Tsay and Deborah Gordon. CNN, November 19, 2011.

There is no doubt that federal gasoline and diesel tax should go to 40 cents per gallon and none of it should be used to fund transit and rail projects.

Honolulu Rail is a Rube Goldberg

Now that the comedy of Honolulu Rail is in full swing I finally found a good metaphor for it. It's a Rube Goldberg. A Rube Goldberg is (by definition) a comically involved, complicated invention, laboriously contrived to perform a simple operation or minimal work!

I must apologize to Rube Godberg's memory because Honolulu Rail also involves copious amounts of sleaze, deceit, corruption and stupidity. Politicians and professionals continue to fail the island constituencies who they are supposed to serve, and they do so for their own enrichment.

Monday, November 28, 2011

Why Does Carlisle / Hamayasu / Horner Stick with Ansaldo while Under so Much Fire?

Edit: Mid. January 2012 u p d a t e.

Samples of recent "fire" from rail advocates:

Perhaps Carlisle / Hamayasu / Horner are stubborn (or worse...) but their vices alone are hard to justify their glaring lack of responsibility for a $1.4 Billion public contract that they officiate over. There must be something else and it probably has to do with money and corruption.

Another thing that should make us suspicious is that City, HART and Ansaldo plan to sign this contract between Thanksgiving and Christmas, that is, during the time period that the public pays little attention to the news and the media tends to cover "holiday spirit" stories. This is exactly when the Alternatives Analysis was approved in 2006 which cemented the City's choice of "elevated rail" as the Locally Preferred Alternative.

There is no reason for selecting an inferior rail manufacturer that belongs to a troubled company (that wants to sell off its rail business), located in Italy, a country with possibly insurmountable debt problems. With so many qualified and reliable rail manufacturers, why are Carlisle/Hamayasu/Horner sticking with Ansaldo, the most troubled one, and one one of the most complaint-prone? Why would Hawaii source a train in Italy instead of Japan, China or Korea?

Of course FTA's "Buy America" requirement is nothing short of a joke because there is no comparable US manufacturer for passenger trains and rail cars. All of them are wholly owned subsidiaries of foreign manufacturers.

Note that when I wrote the piece on Don Horner copied below, Finmeccanica's stock had crashed to $5. Yesterday it closed down to $3.

-------- Original Message --------
Subject: Is HART Chair Don Horner Shamelessly Dishonest?
Date: Fri, 16 Sep 2011 15:07:26 -1000
From: Panos D. Prevedouros

Why would he say this?

Pacific Business News reported:

Don Horner, chairman of HART’s finance committee and CEO of First Hawaiian Bank, said he was satisfied that Ansaldo’s finances are in order and the city can proceed with negotiating a contract with the firm. He said he it also gave him “strong comfort” to hear Finmeccanica’s commitment to the project.

“Overall, and I can speak as a banker, I was very impressed with the substantial amount of profitability, the liquidity, the history, and the commitment from the parent company,” Horner said. “I am very pleased with the progress that we made today.”

When the truth is this:

WHEN Finmeccanica announced bad results on July 27th, investors strafed its share price, cutting it down by 28% in four days (see chart). In the first half of 2011, excluding a gain from the sale of one of its businesses, the firm made barely any profit: €13m ($18.2m) on revenues of €8.4 billion. Shareholders are spitting fire.

The Italian government holds a 32% stake. That prevents the company from sensibly quitting unprofitable businesses. Meshed together from a ragbag of defence and technology businesses formerly owned by the state’s IRI and EFIM holding companies, Finmeccanica has everything from helicopters to trains to gas turbines. Its former boss, Pier Francesco Guarguaglini, tried to simplify the group down to three areas: aeronautics, helicopters and defence. But the group still owns several businesses that do not fit.

Its biggest problem is AnsaldoBreda, a maker of trains and trams, which has lost more than €1 billion. The government’s unwillingness to allow job cuts makes a solution impossible. Politicians from AnsaldoBreda’s home region in Tuscany objected loudly this week after Finmeccanica’s new boss, Giuseppe Orsi, talked about selling the division. Some 60% of Finmeccanica’s employees are Italian, though the domestic market yields just a fifth of its revenues.

Finmeccanica is used as a dumping-ground for unwanted state assets. In 2008, when the government finally found a solution for Alitalia, the country’s loss-making airline, private investors gobbled up its profitable flight division but curled their lips at its maintenance business, so in 2009 it was sold to another group of Italian firms, with Finmeccanica taking 10%. Politicians have long pushed for a merger with Fincantieri, a troubled shipbuilder also under the government’s thumb. Last September Mr Guarguaglini was obliged to point out that Fincantieri’s activities have little to do with Finmeccanica’s.


  • Horner is Chair of HART
  • HART has an $1.1 Billion contract with Ansaldo
  • Ansaldo is owned by Finmeccanica
  • Finmeccanica has large debts to BNP Paribas (2nd largest French Bank)
  • BNP Paribas owns 1st Hawaiian Bank
  • Horner is CEO of 1st Hawaiian Bank

Thanks to Ian Lind for bringing this up:

Lessons from US Mainland on How to Ease Congestion and Build Infrastructure

GOAL: Ease traffic congestion that cripples economy and quality of life

: Deliver lanes and tunnels as quickly as possible

: US mainland success stories involve private financing and tolls so that infrastructure can actually be done instead of squeezing local taxpayers and depending on broke state and federal coffers.


(1) There is plenty monies in private funds: Pension Fund Invests in Florida Toll Project. One of America’s largest pension funds—Teachers Insurance and Annuity Association of America (TIAA) has purchased a 50% stake in Florida’s I-595 concession project, a complete reconstruction of this major freeway, including the addition of three reversible express toll lanes. TIAA purchased the stake from developer/operator ACS Infrastructure Development, which holds a 35-year concession to develop and operate the highway, which is now under construction.
Honolulu application: The level of traffic demand between H-1/H-2 merge and downtown easily justifies a tolled HOT Lanes and mainland investors as well as local pension funds will be attracted to it. (Note that none of them will invest a dime in the rail project.)

(2) Use Public Private Partnerships or PPP:
A well-researched and fairly comprehensive overview of long-term concession toll projects appeared in the Oct. 22nd issue of The Washington Post. Written by Cezary Podkul, formerly of Infrastructure Investor, the article discusses a number of recent projects, both large-scale investment in new highways and bridges and the leasing of existing toll roads. It includes the growing involvement of pension funds as investors, and also discusses who won and who lost when a recent start-up toll road filed Chapter 11. (Note: at press time, this piece was available on the Post’s website, but with a very long URL. It’s simpler to just Google the title: “With U.S. Infrastructure Ailing, Public Funds Scant, More Projects Going Private.”)
Honolulu application: State of Hawaii does not have a suitable PPP yet.

(3) Deliver network short-cuts with tunneling
: Tunnel Boring Begins for Port of Miami Tunnel. The huge (41-ft. diameter) tunnel boring machine from Germany began digging the first of two parallel tubes for the new Port of Miami Tunnel on Nov. 4, 2011. Each of the two tubes is expected to take six months to drill and line with concrete panels. The $1 billion project is being procured by Florida DOT under a 35-year concession awarded to a team led by France-based Meridiam Infrastructure Partners and Bouygues Travaux Publics.
Honolulu application: A toll tunnel from Iroquois Point to Lagoon drive will save leeward Oahu commuters to town over 30 minutes one way.

(4) Use
Congestion Pricing to spread traffic demand: Higher peak-period tolls, and charging half-price (instead of zero) to carpools have reduced congestion and increased speeds on the San Francisco-Oakland Bay Bridge, according to UC Berkeley research commissioned by the Metropolitan Transportation Commission. The biggest impact was that more than half the traffic formerly in the carpool lanes disappeared; officials speculate that some shifted to BART and some changed the time of their commute, and many were probably cheaters who now drive in the regular lanes. The overall reduction in AM peak traffic was about 4%, and time savings varied greatly depending on which approach road people use to get to the bridge and the time (within the peak period) that they travel.
Honolulu application: Both tolls and bus fares need to have peak and off-peak pricing. Use of inexpensive passes should not be allowed for 3-4 peak hours during normal workdays.

Thanks to Robert Poole of the Reason Foundation for these recent examples.

Wednesday, November 23, 2011

Real and Affordable Green or Misguideded Dream?

Bjørn Lomborg is the author of The Skeptical Environmentalist and Cool It, head of the Copenhagen Consensus Center, and an adjunct professor at Copenhagen Business School. I trust his analyses much more than the "data free" propaganda of the Sierra Club and the Blue Plant Foundation of Hawaii. Here is a summary in his words of his latest assessment titled Seeming Green.

  • Danish politicians – like politicians elsewhere – claim that a green economy will cost nothing, or may even be a source of new growth. Unfortunately, this is not true. Globally, there is a clear correlation between higher growth rates and higher CO2 emissions. Furthermore, nearly every green energy source is still more expensive than fossil fuels, even when calculating pollution costs. We do not burn fossil fuels simply to annoy environmentalists. We burn them because fossil fuels have facilitated virtually all of the material advances that civilization has achieved over the last few hundred years.
  • Politicians in Denmark and elsewhere argue as if this were no longer true: a transition to a green economy will create millions of new “green jobs.” But, while green-energy subsidies generate more jobs in green-energy sectors, they also displace similar numbers of jobs elsewhere.
  • Many politicians are drawn to photo opportunities and lofty rhetoric about “building a green economy.” Unfortunately, the green-energy policies currently being pursued are not helping the environment or the economy. More likely, they will lead to greater emissions in China, more outsourcing to India, and lower growth rates for the well-intentioned “green” countries.

Monday, November 21, 2011

APEC 2011 in Honolulu Ended. Was there a Result?

Yes, although we did not get much information about it in Hawaii. In general, coverage of APEC 2011 in the international press was limited and mostly focused on countries other than the US. There was little or no mention of Honolulu, Hawaii other than as a reference to the location of the meeting. The lack of leis and aloha shirts in official pictures made the exposure of Aloha even more minimal.

The APEC 2011 accomplishment “headline” was the formal initiation of a possible free trade agreement among Pacific nations, which is referred to as the Trans-Pacific Partnership (TPP). This, in turn, put Japan squarely in the middle of the issue and pinned China in a defensive position.

President Obama made even bigger headlines ... in Australia where he announced that WE ARE BACK!

The Economist’s summaries of “We are Back” and of the TPP are informative. See below. We should be following these developments closely because along with expedited visas for tourists from China these have strong implications for Hawaii.

America in the Asia-Pacific - We’re back
America reaches a pivot point in Asia


BORN in Hawaii, raised for some of his childhood in Indonesia, Barack Obama has since his election wanted to be known as America’s first “Pacific President”. Until recently, he has not done much to earn the title. That, Mr. Obama declares, is now changing.

Allies in Asia have complained about only intermittent American attention to their region. But in a speech to Australia’s parliament on November 17th Mr Obama announced that America is back. “Let there be no doubt: in the Asia-Pacific in the 21st century, the United States of America is all in.” It was, he said, a “deliberate and strategic decision”: America was “here to stay”.

Senior administration officials back up the president. They talk of a new “pivot” in foreign policy towards Asia. America will be around to ensure that China’s “peaceful rise” remains just that.

Free trade in the Pacific - A small reason to be cheerful
An inspiring idea to liberalize transpacific trade hinges on the courage of America and, especially, Japan

Nov 19th 2011 | from the print edition

WITH thunderclouds looming over the trans-Atlantic economy, it was easy to miss a bright piece of news last weekend from the other crucible of world trade, the Pacific Rim. In Honolulu, where Barack Obama hosted a summit of Asia-Pacific leaders, Canada, Japan and Mexico expressed interest in joining nine countries (America, Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam) in discussing a free-trade pact. Altogether, the possible members of the Trans-Pacific Partnership (TPP) produce 40% of world GDP—far more than the European Union.

The creation of a wider TPP is still some way off. For it to come into being its architects—Mr Obama, who faces a tough election battle next year, and Japan’s Yoshihiko Noda, who faces crony politics laced with passionate protectionism—need to show more leadership.

Opening up the Pacific
Nov 12th 2011 | TOKYO

MOST Americans have not heard of the Trans-Pacific Partnership (TPP), a free-trade area of countries dotted around the Pacific Ocean. They will soon. The news has electrified the summit of Asia-Pacific Exporting Countries (APEC) convening in Honolulu this weekend. President Barack Obama, who acts as the meeting’s host, hopes the TPP will be the cornerstone of an APEC-wide free-trade area.

There are, however, huge hurdles to overcome in the meantime. Mr Noda’s decision was delayed by a day because of the extent of opposition to trade liberalization within his own Democratic Party of Japan (DPJ), let alone the opposition.

Asia-Pacific trade initiatives - Dreams and realities
A battle over American-led free trade brews in Asia
Nov 12th 2011 | SEOUL AND TOKYO

THE American president is bringing a new—or at least re-warmed—cause to the Asia-Pacific region: free trade. Barack Obama recently signed a ground-breaking free-trade agreement (FTA) with South Korea, after years of Washington foot-dragging. He signed FTAs with Colombia and Panama on the same day. On November 12th-13th the president hosts an Asia-Pacific trade jamboree in Honolulu which, he seems to hope, will give momentum to the idea of a remarkably ambitious free-trade zone at just the time when global trade talks are going nowhere.

Mr Noda will need to convince his counterparts that he has enough domestic support to negotiate in good faith. If he can achieve that, Japan might start a long-overdue push to reform and revitalize its economy. And then the TPP might become more than just another Asia-Pacific acronym that only wonks have heard of.

Friday, November 18, 2011

Mortgage Deduction On the Chopping Block - Big Deal?

The headline reads as follows: Proposal to Limit or Eliminate Tax Deduction for Homes Is Unpopular, Could Raise Billions

There is no doubt that this headline is true on both counts: Unpopular and a Tax Loss for the government. On the opposite side, the mortgage interest tax deduction is Popular with homeowners but is it a big deal?

I set out to answer this for myself in detail using my records. I file separately as head of household with one dependent and I carry a large mortgage in its second year (in 2010), so the effect of a mortgage deduction elimination would be "as big as it gets" in my case.

In the process of estimating all taxes I paid in 2010 I discovered so many hidden charges such as tire disposal fees, and chemical and pollution fees. I do not travel a lot but taxes on hotels, car rentals and airlines are so heavy that they show up clearly.

Also, 2010 was an election year and I run a campaign. My dry clean bill was substantial and I discovered that the actual tax was 10.3% because of the chemical and pollution fees that government has added to the cleaners. The 10.3% includes Honolulu/Hawaii 4.67% general excise tax (GET). So a visit to the cleaners cleans both clothes and wallet!

Utility bills and car fees are vehicles for tax collection and the two of them combined are just as bad as Hawaii's GET which I went at length to calculate from a pile of receipts and statements.

Long story short, my aggregated breakdown of taxes in percentages is shown below, for the actual case with my mortgage and for an estimated case where my $36,000 deduction in mortgage interest was taken away.

It is quite clear that given my total income A, with mortgage deduction in 2101 I paid 0.311A in taxes. If I could no longer deduct mortgage interest then my total tax would have been 0.375A. The difference between the two is substantial and is roughly equal to my 3-year-old's annual day care cost. That's a big deal!

The bottom line is that being in Hawaii without a mortgage interest tax reduction would make me feel quite European. (EU is infamous about its high taxes due to the extensive socialist policies.) Nearly 40% of my middle class income would be lost to taxation.

While the elimination of this deduction may have a small impact in low cost residential markets, it's effects at regions with median housing prices over $300,000 would be significant to the housing and real estate markets, to the taxpayers of those areas and by extension to the general economies of those regions. It would be devastating for the handful of regions with median housing prices over $500,000, and Honolulu is one of them.

Friday, November 11, 2011

Greece Elects a Non-politician as its Savior Prime Minister

Dr. Lukas Papadimos became Greece's Prime Minister on November 11, 2011 through a consensus process that included the ruling socialist party, the opposition conservative party and the President of the Republic.

A member of no political party, Dr. Papdimos is a wise and unusual choice. A physicist and electrical engineer with a doctorate in economics, all from MIT, and professor of economics at Columbia University and the University of Athens. An academic and a numbers man.

Furthermore, Dr. Papadimos has had extensive experience in national banking affairs. Between 1980 and 1985 he worked at the US Federal Bank in Boston. Between 1993 and 2002 he was manager at The Bank of Greece. This was followed by the vice-presidency at the Central Bank of Europe until 2010 when he became financial adviser to the prime minister.

It appears that Dr. Papadimos is "what the doctor ordered" for Greece with its huge banking and debt financing crises. It remains to be seen whether the members of the Greek Parliament will re-orient their thinking around the goal of saving the country as opposed to their petty politicking, service to special interests, and focus on pet regional projects and re-election ambitions. (This may be too much to ask of parliamentarians who consistently did wrong for the country for decades.**)

I can only wish Dr. Papadimos the best of luck, and congratulate him for his bravery to pilot a half-sank ship in the middle of a hurricane.

(**) As an outside observer with a bit of knowledge of politics I am alarmed by the similarities among the Greek Parliament, the US Congress, and the Hawaii Legislature. Simply put, they keep making the wrong choices time and again, and driving the debt to the Billions and Trillions.

Like in Greece's past, all political "change" in the US and Hawaii has been fake. Until the knife reached the citizens' bones (as it has in Greece.) Although I hope for a big improvement, it may be too late and too painful to return Greece (and the US and Hawaii) to fiscal health and prosperity within a generation.

Thursday, November 10, 2011

OCCUPY'd by APEC 2011

Latest update: 11/19/11

Big events are critical for obscure regions because "they put them on the map." Everyone knew Greece quite well before the 2004 Summer Olympics. The Olympics were a success. What did Greece gain in tourism? A minor temporary bump, if any. (And a whopping debt from infrastructure preparations.)

Mature tourist destinations do not have much to gain from large media exposure. At least the Olympics was a long sports event and many people watched it here and there. Do you think people in China, Russia, Australia and the US paid much attention to APEC politicians?

Despite what hyperbola Abercrombie and Schatz serve for APEC, there will be very little gain for Hawaii from APEC. The tourist growth market for us hinges on visa rule relaxation for Chinese, Russians, etc. But that can be done only with prolonged bilateral negotiations.

So what did APEC 2011 do for the 99.9% of us?
  • And loss of business. Several small stores closed during APEC due to loss of access to them. Either the workers could not get to the store, or the customers were on the other side of the barricades.
  • And now, a week after APEC, several small businesses plan to file claims and/or a lawsuit for significant business losses for a week. Of course one week or 1/52nd means very little to a callous politician. (Gov. and LG statements come to mind.) But that 2% annual loss is a big part of the profit margin for some businesses.
  • And reallocation of emergency services.
  • And political visitors who do NOT pay the hotel tax.
  • And tremendous loss of tourism because agents did not book Waikiki for their clients.
  • And lost bookings from the 11/11/11 wedding extravaganza.
  • And mounting bills for security and other detail paid by local taxpayer.
  • And all those APEC shirts, last minute beatifications, free tickets for the "in crowd," etc.
  • And the top two of Honolulu's parks are police and security depots: Ala Moana and Kapiolani Parks.
  • And one APEC-related murder. Auwe!
Sample UH alert below...

Find alternative routes/options if you were traveling or planning to travel on
UH Mānoa East West Road or near the APEC Hawai‘i Convention Center.

1 Army Humvee, 2 motorcycle Honolulu Police officers and 100s of motorists caught in a jam...

Tuesday, November 8, 2011

APEC 2011 in Honolulu, Hawaii -- Embarrassments 1, 2, 3 and 4

Honolulu made a late, sketchily planned and underfunded effort to host the Asian Pacific Economic Cooperation (APEC) conference in 2011. APEC 2011 was largely forced on Honolulu by President Obama in 2009. Another beltway unfunded federal mandate, as usual.

This series is a partial tally of embarrassments during APEC 2011 (November 6 to 13).

1. SOPOGY at APEC's "See It" Exhibit at the Hawaii Convention Center. What an embarrassment! Not only they are not making energy at a cost effective rate they are a technological dead end as well given the 2011 dive in photovoltaic pricing.

2. Terrible road pavement on Ward Avenue between Kinau and King Streets, and the same on Beretania Street in front of our Police main station. What an embarrassment! Last month George, Esther, Francis, Katherine and other low traffic streets in Kaimuki got done. By George! This speaks volumes about messed up priorities.

3. The traffic lights on Kapahulu Avenue and McCully Street are out of sync. These are the only connections of Waikiki with the H-1 freeway. What an embarassment! We can't use computers to actuate green lights along arterials for motorcades so we spend thousands of dollars on police to block the flow of cross streets. I guess we might tell them that we apply third world-friendly traffic management.

4. Obviously the City has messed with the traffic lights. Now for no reason whatsoever Ward Avenue is gridlocked from the top of the hill to Beretania Street. Unbelievable mess this morning. See the 8:30 am snapshot below.

Friday, November 4, 2011

The Scariest Halloween Story: The Debt per Hawaii Resident

I am particularly jittery with the financial maelstrom in Greece, but our own back yard in Hawaii seems to be in a very bad financial condition.

Take a look at this article: Hawaii State Liabilities Climb by 60 Percent in Two Years; Expert Calls the News 'Shocking'

So the Hawaii State Health Fund liability comes to ... "a total of $14.0 Billion. (These numbers are for July 1, 2009)" and likely much higher right now. The article does not cover the government employee pensions liability which takes this total to over $23 Billion.

Budget & Finance Director Kalbert Young: "Credit downgrades impact taxpayers because they translate to higher interest rates and borrowing costs. As a result, taxpayers will have to pay more for government or they will have to accept a larger portion of their taxes going towards debt."

Actually his statement sounds like a single blow although it is really a quadruple blow to us:
  1. We need to pay more taxes so we'll have less take-home income.
  2. More of our taxes must go to pay down the debt and less will go to services and infrastructure maintenance and expansion.
  3. The lower bond rating and the corresponding higher finance charge means that the same infrastructure projects will cost more.
  4. In addition to their direct impact, points 1, 2 and 3 combined mean fewer jobs because we will have less to spend as individuals and families, have less to spend on projects, and less to pay for services.
To sum it up, the two major state liabilities combined (that is, health and pension which are constitutionally promised to government workers) mean that each person in Hawaii now owes more than $50,000. Then there is the federal debt which is approaching 15 trillion dollars. Simply divide by 330 million for your own share of $45,500.

But wait! The City and County of Honolulu has signed a Consent Decree with the EPA to fix its sewers and provide Secondary Sewage Treatment. The cost is no less than $4,500 per person on Oahu.

I bet you did not know that today you carry a "mortgage" in the amount of $100,000 (and climbing). But in reality only about a third of people pay substantial taxes and it is these same people that will shoulder this burden. A household with two high income earners (say a combined income of about $150,000) and two kids should face a "mortgage" of roughly one half million dollars. Lucky, you now "own" a second unit in Hawaii!

Right now in Hawaii, the only uku-billion project that is discretionary and deletable is the rail. If rail gets into construction, it will cost well more than seven billion dollars and open a hole to sink tens of millions of dollars for annual operations. And don't forget this: Given how tough things are going to get for us, a dollar spent on rail is a dollar not spent on a number of other far more critical needs.

Trick or Treat?

I am five days late relative to Halloween, but that shouldn't be a big problem. This scare will last our lifetimes.)

John Pritchett's Hawaii's Unfunded Liabilities cartoon: