Restating the Obvious

Reality checks are in the mail

I had intended to comment on a page one story Aug. 19 (a wire story, not online) headlined: FORECASTS SUNNY FOR HAWAII'S ECONOMY. I didn't, for lack of time, and also because the story came from Ted Liu's DBEDT, which has had a prefrontal lobotomy when it comes to the economy: Always smiling and cheerful and no memory.

Well, nobody expects the head of any state's economic development office to be anything more than a cheerleader. Let it pass.

So, I pick up today's paper, and there's an op-ed by Russell Pang, the governor's chief of media relations. Everything's jake, according to him. Our prospects are good, outside ranking agencies are pleased and those are “more telling than a temperature check of current economic conditions.”

Sorry, Russell. Unless you have a trust fund, current economic conditions are the ones to worry about.

There is also the problem of disaggregating the aggregates. The unemployment rate is a low 3.9%, but if you just lost your job -- as thousands just did -- then your personal rate is 100%. It isn't really very good news for Maui's important construction business that military housing projects are going to bring in billions of dollars and thousands of jobs to Oahu.

After Hurricane Iniki swept through Kauai in 1992, the state aggregate economic numbers went down instantaneously, but they quickly went back up, driven by transfer payments from offshore insurance companies. Go back in the files, and you'll see stories by me quoting economists touting this as recovery.

I wrote those stories with gritted teeth. Kauai never recovered, which would be important if you live on Kauai.

Before Iniki, Kauai regularly attracted more than 100,000 tourists a month and was far ahead of the Big Island. Today, after 15 years of recovery, Kauai seldom reaches 100,000 tourists in a month and is far behind the Big Island, which itself is not doing so hot in the visitor business. That might not be important if Kauai had replaced tourism with something else, but it didn't.

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Member Comments

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KulaKoa
08-28-08 2:28 AM »Report Abuse	On second thought, only some realtors have been saying that for 20 years. There are some who are very realistic about the situation.
KulaKoa
08-27-08 5:26 PM »Report Abuse	Yup. Just like the realtors telling us it has never been a better time to buy -- for the past 20 years or so.

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