Cost of living, especially housing, causes decline in Maui agriculture

Hawaii has lost over 540,000 acres of cropland and pastureland since 1980, and the imminent closing of Hawaiian Commercial & Sugar Co. may add 36,000 acres to that total unless we can solve the real problems behind the decline of agriculture on Maui.

One of the biggest factors in the decline of agriculture has been the high cost of living, especially housing. Housing costs on Maui have risen over the past 30 years, adding significantly to labor costs. Ironically, agricultural zoning, which was meant to preserve agriculture, has created a situation where farmworkers cannot easily find an affordable place to live.

Only 5 percent of the land on Maui is zoned for urban housing, which is where most of the population lives. This has restricted the supply of affordable housing and caused rents to skyrocket. As farm laborers pay more for housing, the cost of farm labor rises as well, ultimately causing a rise in farm products.

The result is that Maui agriculture is unable to compete with overseas labor, leading to the flight of our large agricultural producers, which must move their operations overseas to survive. That’s why the 1990s saw Dole, Del Monte and Maui Land & Pineapple begin to move overseas to take advantage of cheaper labor.

Transportation costs have also risen, a problem that has been exacerbated by the effect of the Jones Act, a protectionist cabotage law (and relic of the 1920s), that contributes to Hawaii’s high shipping prices. Not only has the act constrained the growth of the shipping market, but it has had a detrimental impact on Maui agriculture where, in many cases, it’s cheaper to ship products internationally to the Mainland than it is to ship from Maui to the Mainland.

Uncertainty amongst farmers and prospective investors has also risen with the fall of HC&S, increased regulations and the growing influence of protesters on Maui. This has caused uncertainty about the future, which affects the overall willingness to invest in otherwise good projects. As protesters on Maui promote initiatives that would violate property rights, the potential investor becomes hesitant about the future and decides against taking a risk.

The unfortunate fact is that many of the policies that groups promote to save agriculture are the very policies that may end up hurting agriculture even more. For example, a new initiative that would seize agricultural lands via eminent domain and redistribute these lands for exclusively organic farming is a clear violation of property rights, and would likely destroy Maui’s agricultural economy.

The time has come to raise our voices together and envision a Maui and Hawaii where agriculture thrives, and where we are economically competitive. There is no magic silver bullet, but there are concrete steps that that can be used to educate citizens and policymakers.

The Grassroot Institute is actively researching solutions for agriculture on Maui. Our report “10 Free Market Solutions for Agriculture” is available on our website at www.grassrootinstitute.org.

* Keli’i Akina, Ph.D., is a recognized scholar, educator, public policy spokesperson and community leader in Hawaii. Currently, he is president/CEO of Grassroot Institute of Hawaii, a public policy think tank dedicated to the principles of individual liberty, free markets and limited, accountable government.

* This article includes a correction from the original published on Sunday, May, 1, 2016.