With all the havoc that has been visited upon the islands the last few weeks you would think our elected officials would adjust their thinking, maybe just a little. Core functions of government should always take precedence over trying to tinker with the economy trying to make it better. Too bad so many of our state legislators simply don’t understand this.

In The Honolulu Advertiser dated April 10, 2006, is an article that our legislators want to provide venture capital to “tech companies” in order to diversify the economy. Why? Hawaii already has the lowest unemployment rate in the country.

What was really interesting was this sentence from the article “With the state flush with cash, support for two bills that would create such a fund seems strong.” The state isn’t “flush with cash” we are collectively over-taxed. It isn’t their money to spend, it is yours and mine. And it should be returned. Why should a company benefit simply because it is a certain type of business by the over taxation of the populace?

The budget surplus is one of the worst things that could have happened to this state. It has already been spent six-ways-to-Sunday. It is fascinating, and tragic, that that is all our elected officials can think of to do, spend more money. And not on core services but to support an industry that is already privy to one of the most generous tax breaks in the country.

Over the weekend there were a number of opinion pieces in the dailies about how Waikiki and Honolulu are at the limits of growth. The sewage debacle, the upcoming landfill crisis and our well known traffic congestion problem are all used to justify the point of view that we need to curb any further growth until the infrastructure can be upgraded. Some want to see no further growth at all or not allow any newcomers to move here.

If that is the case then why are we trying to attract more “high tech” companies to Hawaii? Why is the state going to invest in these companies when our resources are at their limit? Shouldn’t those that run this state be trying to figure out how to funnel some of the “surplus” to the city so it can get to work on repairing the sewer system as quickly as possible before we have another 50 million gallon sewage spill?

Does this simply make too much sense? Our legislators always play catch-up, reacting to events that were predictable but that they never see coming. They are too busy tinkering with things that are not the province of government in the first place to do the job of governing the way they should.

These venture capital bills for tech companies are a perfect example of misplaced priorities. With all the problems facing this state wouldn’t this money be better spent elsewhere if the legislature absolutely refuses to return it to the taxpayers it overtaxed in the first place? This is never the mindset though, it is: This is free money, let’s see where we can spend it.

Hope fully these two bills House Bill 2181 and Senate Bill 2546 will not survive this session, as has been the fate of similar bills the last two sessions. They shouldn’t pass this year either. If technology companies need venture capital then they should find it in the private sector, not have it handed to them by government. Maybe there is a good reason why the private sector doesn’t provide more venture capital to tech companies in Hawaii. Maybe it isn’t a good idea. Perhaps this is what legislators in their zeal to spend our money fail to see.

Link to article.

Don Newman, senior policy analyst for the Grassroot Institute of Hawaii, Hawaii's first and only free market public policy institute focused on individual freedom and liberty, can be reached at: mailto:newmand001@hawaii.rr.com