Political issues can seem complicated and unapproachable for many citizens. But the driving force behind all of the Grassroot Institute of Hawaii’s advocacy efforts and policy recommendations is simple: Improve life in the islands for everyone.
During the Dec. 28 episode of the “Liberty Arise!” podcast hosted by Scott Adam, Institute Executive Vice President Joe Kent said priorities of the group include removing red tape that makes Hawaii housing so expensive; reforming the 1920 federal law known as the Jones Act, which inflates shipping costs to the islands; and encouraging fiscal responsibility.
“A lot of what we talk about at the Grassroot Institute is thinking about ways to offer solutions that involve less government instead of more government,” Kent told Adam, a fMaui political candidate in the 2022 election.
“We think that the solutions that we talk about — whether … taxes or shipping or regulations or businesses or housing — they affect so many different areas of life. And if we would just do things another way, we could … make Hawaii a more livable place, a more affordable place to live in, a place with more opportunities for getting a good job and a place where you can raise a family easier than it is to do now.”
Adam said the state’s “irresponsible spending … [has] been just shooting the people in the foot,” and Kent agreed, joking that “fiscal responsibility is almost a dirty word in Hawaii.”
“We’ve got people leaving Hawaii, as I’ve said many times, and that means that there are fewer taxpayers to pay for a bigger and bloated government,” Kent said. “The taxpayers that are left behind have to pay more for this outsized government.”
Kent said the state is in a good position to implement tax cuts, especially on necessities such as food and medical services, due to a current $2 billion budget surplus that’s expected to grow to over $10 billion in just a few years.
“If they’ve got a surplus of $10 billion on an $8 billion budget, then that means they have way, way, way more money than they need, and it’s time to cut,” he said.
Kent noted that the Institute “works with any politicians or any media or leaders or the public — anyone who will listen to us, really. We don’t pick teams, we don’t choose favorites, we don’t play partisan games. We just try to get the right information in the hands of everyone, especially decision-makers.”
To hear the entire interview, click on the image below. A complete transcript follows.
12-28-22 Scott Adam hosts Joe Kent on “Liberty Arise” podcast
Editor’s note: Host Scott Adams began the show by showing a video of Grassroot Institute of Hawaii officials talking about the Institute.
]Transcript of the introductory video]
Keliʻi Akina (Institute president and CEO): Hawaii is our home, but it has many problems. People are leaving. The cost of living is out of control. Home prices are among the highest in the nation. Our economy is struggling, and so are our people. Hawaii desperately needs a solution.
Aloha, I’m Keli’i Akina, and I have the most wonderful job in the world. I get to lead the most talented and dedicated group of men and women who are transforming the future of Hawaii.
Grassroot Institute is not just a research think tank. We’re more than that. We’re dedicated to bringing to Hawaii the principles of individual liberty, economic freedom and limited accountable government.
Robin Stueber (Institute chairman): We’re independent. Basically, what we work on are things to help Hawaii’s people afford to live here and work here.
Joe Kent (Institute executive vice president): We’re a government watchdog that holds the government accountable. But we also recommend better policies for the government as well.
Akina: Oftentimes in the policy world, people find themselves at odds with each other: pro or con, for or against.
What we believe at the Grassroot Institute is that to change society, we need to work together. That’s why we practice “E hna kākou,” which means “let’s work together.”
Stueber: E hana kākou is the Hawaiian phrase for “Let’s work together,” and that’s exactly what we do and what we need to do in order to be effective.
Kevin Takamori (Institute development director): I think it’s primarily important to have a “work together” attitude in Hawaii because of our cultural history in the islands.
Our very diverse, multi-ethnic culture and our unique history lends itself, of course, in this island kind of state and economy to work together rather than to be polarized.
Stueber: We welcome everyone who is curious about what the issues are and why they are.
Kent: Why is the cost of living so high? Why [does] milk cost so much? Why is gas so expensive? What brings up the cost of housing so much?
These are all questions that everyone’s mystified about, and they’re seeking the answers to.
Akina: We take a look at problems from a practical point of view, look at their causes, their solutions, and how we can create partnerships with others to bring about change.
Stueber: The reason why I’m so committed to the Grassroot Institute is because I do believe in an optimistic future for Hawaii.
Kent: We’ve saved taxpayers hundreds of millions of dollars over the years.
Sean Mitsui (Institute finance director): We’re about lowering taxes, reducing regulations, but ultimately bringing the power back to the people.
Malia Blom Hill (Institute policy director): Economic freedom is directly tied to prosperity. So when we say we’re in favor of economic freedom, what we’re really in favor of is a more prosperous, happier Hawaii where people really have the freedom to pursue their dreams and live a happy, fulfilled life.
Akina: We believe we owe it to our principles to learn how to win. And in order to win, we have to gain influence. That influence extends to the media, to government and society at large.
At the Grassroot Institute, we are constantly doing those things that will build the influence. Our vision is to become the most influential public policy voice in the next several years.
Ted Kefalas (Institute director of strategic campaigns): So we’re working now to put our reports and our studies into the hands of legislators, members of the media and supporters, so that everyone gets a chance to learn about the things that we’ve learned about Hawaii.
Stueber: It’s so satisfying to be able to have a role in an organization like the Grassroot Institute, where I know that I’m making a difference.
Akina: When we all work together toward a common goal, nothing can stop us.
At the Grassroot Institute, we want to invite you to join us in bringing to society individual liberty, economic freedom and limited accountable government. Together, we can transform Hawaii into the place it needs to become.
Scott Adam: That’s the Grassroot Institute, and we’re honored to have Joe Kent coming on in. I’m going to bring in Joe. Aloha, Joe.
Kent: Aloha, Scott, thanks for having me on your program.
Adam: Absolutely. It’s a pleasure. Thank you for joining us. Would you like to tell us a little bit about yourself and about Grassroot Institute?
Kent: Yeah, sure. So, I’m the executive vice president of the Grassroot Institute of Hawaii, and I’ve worked here for about nine years.
Before that, I was a public school teacher. I taught kindergarten through fifth grade on Maui at King Kamehameha III Elementary School and in Minnesota before that. And so, I saw government from the inside.
I think that there’s a better way in a lot of situations, and so that’s a lot of what we talk about at the Grassroot Institute, is thinking about ways to offer solutions that involve less government instead of more government all the time.
Now Hawaii is, of course, a Big Government state, and so we’ve got our work cut out for us. We are probably more of a big government-minded state than most other states in the nation, and so our message is pretty unique here. But it’s really important and sorely needed.
We think that the solutions that we talk about, whether it comes from about taxes or shipping or regulations or businesses or housing, they affect so many different areas of life, and if we would just do things another way, we could live happier, more fulfilled, more prosperous lives in Hawaii.
So that’s kind of what we do at the Grassroot Institute, is try to make Hawaii a better place for everyone.
Adam: Absolutely. It’s really wonderful, the information that you guys put out and the seminars that you put together. I was just got done running for office myself in this last term, and I went to a few of the affordable housing meetings that you guys had and just absolutely great stuff, and it’s a voice that’s needed in our community and absolutely in the state.
Kent: Thanks so much and, you know, applause to your run. It’d be great if more people could step up and give us more options [chuckles] for elected officials.
Hopefully, we’ll see some good change after this election. But either way, you know, Grassroots Institute works with any politicians or any media or leaders or the public — anyone who will listen to us, really.
And so we don’t pick teams, we don’t choose favorites, we don’t play partisan games. We just try to get the right information in the hands of everyone, especially decision-makers.
So, yes, we do want to be influential in what we’re doing. But we want to be influential about the right things.
I mean, the things that we want to do is make Hawaii a more livable place, a more affordable place to live in, a place with more opportunities for getting a good job and a place where you can raise a family easier than it is to do now.
And right now, we’re seeing the opposite, though. We’re seeing this outflow of our population, we have for the past five years, to the mainland. And, you know, we’ve lost thousands of people who have said, “Enough is enough. The taxes are too high. The opportunities are too low. I’m out of here.”
And these are people who have lived here their whole lives, born and raised. They, maybe they’ve been — maybe generations, actually, are leaving together.
We actually have a place on our website dedicated to stories from folks who are leaving. We reach out to them and share their stories on our website. It’s at “Why we left Hawaii” on our website.
So, our website is grassrootinstitute.org, by the way, if you ever want to visit that.
Adam: I think we have it right here.
Kent: There it is, yeah.
Adam: Excellent. I mean, being that one of the big issues that is causing a lot of people to leave the state is the housing crisis. So, we have a major housing crisis, especially here in Maui County, but I don’t think we’re, you know, the rest of the islands are, you know, immune to that.
What is the — I know that you guys had a whole series of speakers regarding affordable housing, and I would love to hear what it is that — your perspective on it, you know, solutions going forward.
Kent: Sure. Well, they did a study that showed that Hawaii has the most burdensome housing regulations in the nation.
It takes over 10 years, many times, to take a raw piece of land and just get approval to build. You can build the house faster than you can get approval, much faster. It takes maybe three months to build the house. It might take years, 7 to 10 years to just get approval to build the house.
And so our housing regulations are so burdensome that it’s causing the highest housing prices in the nation as well. We’ve got a median housing price of over $1 million on many of the islands, including Maui, and that makes it so, just so difficult to live here.
Now, what housing regulations are we talking about? Well, let’s start with the state Land Use Commission, which is a layer at the very top.
Then below that, you have the island plans, and then — so each island has their own plan.
And then within that, each community within each island, has their own plan.
And then below that, you have county-level zoning.
And if it’s in the historic district, that’s another layer.
And if it’s near the ocean side of the road, that’s another layer.
So, you’ve got — that’s just six layers, and they’re adding a seventh on top of that, which is the Water Commission.
So now all of these commissions and layers of government are well-meaning. They’re well-intended — we want to make sure we have roads and bridges where needed, that we don’t have too much traffic near schools, and that the kids can get to the schools without danger.
And so these are all well-meaning types of regulations about water and land use and environment, but a lot of the regulations are redundant within each other. They’re duplicative, you know. Why have one layer when the second layer does the same thing, and the third layer does the same thing as the second layer?
And so, for a developer trying to get through these hoops, it adds a lot of time to get through each layer and a lot of costs too. And so a lot of developers just say, “Alright, forget it. I’m not going to go through these layers.”
But there is a loophole in all of these layers, an end-run that you can do, which is to not build closely dense housing.
So if you have an affordable housing complex, if you have a low-rise or duplexes or close-knit housing, you know, this is housing that’s more affordable, often, and this is the type of housing that would have to get through all of those six layers.
Well, if you just build one house on 1 acre, though, then you don’t have to go through all those layers. All you do is you pick up a permit and build. And so, it’s actually much easier to build a mansion than it is to build affordable housing on Maui and on, in the rest of the state.
And so, actually, these regulations are well-intentioned, but the effect of the regulations are to hurt the people that they’re intended to help — the people who can’t afford to find a home on Maui and have lived here for generations, and are saying, “I’m out of here.”
Adam: Yeah, absolutely. I remember in the last, one of the last meetings that we had on affordable housing, I can’t remember who it was exactly, but they said, you know, our approach to affordable housing is schizophrenic. And it’s like, you know …
Kent: That’s right. That’s right.
Adam: We want more housing, but we don’t want to, like, make laws easier to build more houses.
Kent: That’s right. That was Tobias Peter, who visited at that time. He was coming from a context of looking at all of the housing regulations around the world and comparing them.
He compared — he contrasted Hawaii’s housing regulations with those of Japan and also contrasted them with Singapore, and tried to see, you know, “Where do we rank?” And yeah, he was really surprised at how burdensome our regulations are.
Now, in Japan, they do things very differently. They have a very light-touch approach to regulations, where if you — generally, if you want to build, you can do it without too much hassle.
Their zoning laws are not so strict. They don’t say that “Only malls can go here,” and “Only corner stores can go there” as much as we do.
And so that looser approach may have, you know, store shops next to housing or maybe it’ll be underneath the housing and — you know, the store is underneath and the house is on top — or you might have a garage underneath and the house on top.
So it’s a little more densely packed in some places, but the result has been a completely flat housing prices for over, for two decades. And so it’s very affordable to live in Tokyo, that I’m talking about. And this is what we call the Tokyo Model.
Now, as compared to Maui, there is — it’s almost like there is no place to rent, there is no place to buy, there is no place to — you know, you might be able to sleep on your friend’s couch, but that’s illegal now, too, [chuckles] with short-term rentals. So it’s very hard to find a place on Maui.
Adam: Yeah, oh, absolutely. And it just seems like new regulation on top of new regulation, and I know they just made some newer regulations going forward. And then …
Kent: That’s true.
Adam: They were planning on, you know, artificially adjusting home costs, and I’m not sure if that actually went through or not, but …
Kent: That’s right. What, they did, actually. They passed Bill 107 on Maui at the County Council this year, which basically would force home builders to sell their homes for less than what it cost them to build it.
And so, imagine you’re trying to build a home, and then when you’re done, you now have to sell it for less than the price that it cost to build it.
So, well, what do you do as the developer? Well, now you also have to build very high-end homes so that it pays for the low-end homes, the lower-priced homes.
And that’s how our affordable housing policies work normally, but now they’ve skewed that even more. So at some point, the calculation doesn’t work. These projects just don’t pencil out.
And what we’re going to see is developers who throw up their hands at affordable housing-type projects and instead do what I was saying before: “Okay, maybe we’ll — instead of building 20 homes or 30 homes on an acre, we’ll just build one home, and then skip that process.”
Adam: Yeah. Do you see any hope in the future to changing these regulations — to, you know, reducing some of these, this government overreach as I would like to see it, or say it?
Kent: Absolutely, absolutely. With housing, you know, it’s interesting, the No. 1 thing said on the campaign trail amongst all politicians was, “We need more housing.”
And the number one thing, though, that people are against is development, right? People want housing, they don’t want development. So I don’t know how much of this is actual policy or just rhetoric, but there is an inkling of hope.
The [Maui County] Council has fresh membership on it, and so if we can help educate all of the members of the council about the detrimental impacts of well-meaning legislation that they’ve passed, then hopefully we can repeal some of those old laws — like Bill 107, which would be a good first step to at least getting back to where we were and not making things worse.
But ultimately, we want to make things better than they are, and the county can go a long way to do that.
Let’s start with the permitting department, for example. I mean, the permitting department across all islands — we have the longest permit wait times amongst any state as well. And, you know, it can take a year, sometimes, to get a permit, depending on which county you’re on. Sometimes it can take two years.
You can hire a third-party reviewer in Honolulu if you want to speed up the process. But that might knock it down to one year instead of two, so you’re still, you know, waiting a long time to get these permits.
Keep in mind that on the mainland, there are places where you can get a permit the same day while you’re standing in line.
I was just in Johns Creek, Georgia, earlier this year, and I went to the planning department there because I was curious. I wanted to see: How long does it take to get a permit?
And, you know, I’m not sure [of] anyone else in the world who would do something like that except for me [laughs] — go to a, visit the permitting department when you’re on vacation.
But I talked to the permitting director, and he told me that yes, indeed, many times, it’s the same day while people are waiting in line. Sometimes the longest it’ll take is five days, for like a housing project or something. And maybe for a hospital, like something really complicated, it’ll take a month. But even those really complicated ones, they do much more quickly than we do in Hawaii.
Now, I asked him, “Why is it so quick for you guys, and it takes so long for Hawaii?” And he said that it’s because of outsourcing. It’s very simple. If they have a backlog or if they have a complicated housing project or complicated let’s say a mall or a hospital, then they will outsource that to a private company, who the city pays to review it and get through it quickly.
And so they — that’s something that we could do in Hawaii, except outsourcing is illegal in Hawaii. We have a law at the state [level] that says you are not allowed to have private sector workers doing, hired for jobs that government workers typically do. So you can’t outsource, basically.
Adam: Except when it comes to elections, apparently.
Kent: That’s right. Now, except for a few — and there’s actually a bunch of holes in that law I mentioned. That privatization ban law has more holes than Swiss cheese in it, actually.
And if Council/county members would actually look at the law closely, they would find that there actually are many ways that they can outsource, and permitting is one of them.
So, if — the law says, “If there aren’t enough government workers to do the job, then you can outsource,” and that’s clearly the case when it comes to permitting.
I mean, this is why the permitting departments are saying, “We can’t get through the backlog because we don’t have enough workers to do the job.”
So we don’t even need a change of law or anything like that; they could do it today if they had the right ideas.
Adam: Yeah, absolutely. Yeah. And the other thing that you mentioned a little earlier that is another issue that’s on the table is the new water department and the new, the regulations with water that was just passed through on this last election.
And, you know, that is another thing that we’re going to run into with outsourcing. I mean, we’re currently outsourcing, if I remember right, the maintainment of our water systems.
And now with the creation of these new water departments, the new water districts, we’re going to see a lot more, I guess, regulation. We’re going to see a lot more obstacles standing in the way of building, it seems like.
Kent: Yes, that’s right. So water is a very complicated — and you could do a whole show just on water itself, but …
Adam: And maybe we should, soon.
Kent: Yeah, maybe. Yeah. That’s a very important topic. But, you know, on Maui, I think there are more private sector water purveyors than any other county.
I’m not sure exactly why that is, but there are basically a lot of private companies who are helping to source the water instead of the county doing everything.
Now, on Oahu, it’s mostly the county doing everything. But even then, they outsource a lot of the private — some of the private functions for water on Oahu. So actually, there’s a lot of opportunity here, too, except that the state — oh, excuse me. I have to, I feel like I have to sneeze here. [laughs] How about that? OK, just shake it out, right?
The state Commission on Water Resource Management oversees a lot of the water. It’s like the Land Use Commission, which oversees land statewide. Well, this is the water commission, which oversees water statewide.
And they’ve sort of delegated a lot of those responsibilities to the counties. Except now, they’re starting to ramp up their jurisdiction and delegation amongst themselves. So now — which will constitute yet another layer in the development process.
So like I said, there’s six layers, and this might be adding a seventh on top of it.
Adam: Yeah, it sounds like a really complicated situation, for sure, and I look forward — we should do a show just on water, and I’ll reach out to you when I …
Kent: Yeah, absolutely.
Adam: Get that planned. So, I wanted to save a good amount of time talking about the Jones Act. That’s been a really hot topic, and it’s been something that I dove into and heard a lot from from both sides or, I guess, all three sides of the topic.
You know, there’s the “Don’t touch the Jones Act.” There’s “Abolish the Jones Act.” And then there’s “Reform the Jones Act,” which I fall somewhere in the middle there.
And I would love to hear — I know the last, you guys just did a seminar recently, a meeting on the Jones Act — and I would love to hear from you on your perspective on the Jones Act.
What it is that — I think reforming [the] Jones Act is kind of where at least the Grassroot Institute falls mostly on ideals, and I would love to hear from you on that.
Kent: Sure. Well, the Jones Act is a shipping law that makes everything a bit more expensive in Hawaii. It was created in 1920, so it’s more than a hundred years old now.
And the law says that if you want to ship goods from one U.S. port to another U.S. port, it needs to be on a U.S. ship. And so that ship needs to be built in the U.S., it needs to be mostly owned by U.S. citizens, mostly crewed by U.S. citizens, and it has to fly the American flag.
And so all of those requirements, though, increase the cost of the ship. So U.S. ships cost much more to build than ships built overseas — maybe double or triple in some cases — and the crews are more expensive.
And so there’s all of these little planks that are required by the Jones Act [that] make the shipping more expensive.
And they also have burdened the U.S. shipping industry, which has — in other words, we used to have hundreds and hundreds of Jones Act ships. Now, we’re at less than a hundred Jones Act ships and dwindling, I think.
And so, pretty soon, you know, we’re going to wonder if we have any of these Jones Act ships left anymore to do the shipping that’s needed.
Now, the Jones Act is supposed to help in military defense — you know, national security — and for a vibrant merchant marine. But when it comes to defense, it’s really questionable whether it helps at all or whether it hinders us, actually.
So the idea is that we need — you know, if we get into some kind of war overseas or military conflict overseas, that we’ll need some suppliers to be able to carry goods to that conflict, and, well, thank goodness we have Jones Act ships, right?
Well, except that the military already carries goods to overseas military conflicts on ships that are not Jones Act ships. These are ships that are built overseas, and so it’s puzzling as to why we would even need the Jones Act for that.
Also, it’s said that maybe we could commandeer those ships or activate those ships for use in military skirmishes overseas. But the problem with that is, well then, who’s going to ship goods to Hawaii? [laughs] If we take all of the Jones Act ships out of service, then who’s going to do our shipping?
Well, foreign ships can’t do it because of the Jones Act. So maybe they’d have to waive the Jones Act if that happened, you know? Which] now, you know, you’re doing this jungle gym backflip to try to justify it on national security grounds, and it just doesn’t make sense.
So actually, the whole military argument is somewhat dubious. So then we have to ask: Is it actually helping our economy? And on that one, hands down, the answer is no.
I mean, the Jones Act increases the cost of living in Hawaii. Now, many debate how much it increases. But even Jones Act proponents say it does increase the cost of shipping to Hawaii.
So, now, we did a study, which came out with the result of $1.2 billion annually that the Jones Act adds to the cost. But, you know, there are many different estimates out there of what they are. But my point is: They’re there, you know, it’s higher. And so what can we do to lower the cost of living in Hawaii?
Now, one thing that we could do with the Jones Act is, of course, repeal the whole thing. But that’s very difficult to do. If we were to repeal the entire Jones Act, that would require major surgery [laughs], which might actually affect a lot of other things too. And at the least, it would be very difficult politically to accomplish.
Something that would be a little more attainable is trying to get rid of one of the planks of the Jones Act. Remember, I said there were four planks, right? Well, one of the planks was the ship build requirement that ships have to be built in the U.S. But for our cars, we buy our cars overseas. We buy our planes overseas. We buy our trains overseas.
And so, why not buy our ships overseas too? And that would help us bring down the costs for U.S. companies, actually. That means U.S. companies would get to pay lower prices for their ships, and the hope is that that could translate to lower costs for consumers or for our economy.
So that’s an innovative solution that may actually help U.S. shipping companies and would certainly help, you know, the people on the docks — the dockworkers, the stevedores — who may see more shipping activity, which would be, you know, beneficial for their jobs.
It might hurt the shipping, you know, the shipbuilders. But it might not, actually.
If you look at shipbuilders across the U.S., there are only three or four major shipbuilding companies, and most of the vast majority of the ships that they build are for the military. And so the military is protected by a different law — something like the Buy American Act, which says they have to buy American goods when creating ships.
But for the Jones Act, that applies to the Jones Act domestic trade. And so, if you were to change the Jones Act to exempt ships built overseas, then all of those shipping companies on the mainland, the three companies that there are, would still have a lot of work to do in, you know, creating ships for military contracts.
So the downsides are minimal, but the upsides are great to reforming the Jones Act.
Adam: Yeah, absolutely. Yeah, I feel very similar.
One of the biggest arguments that I — well, the two biggest arguments that I’ve heard against reforming the Jones Act came from a ship captain herself. And she says that she’s worked on foreign ships before as well, and their level of standards — both, you know, morally and environmentally — aren’t at the same level.
And, you know, by putting — with getting rid of the Jones Act and, you know, we would get into a situation where we’d have foreign companies that don’t [adhere] to the same standards that we do.
But by reforming the Jones Act and allowing for international ships that were built internationally [to] be used within our fleet, that seems that is a great compromise.
One of the other things we’ve seen that the Jones Act seems to really hurt overall our people in general, was the hurricane that hit Puerto Rico. And it took months, I think it was, to get an exception to the Jones Act to get goods and services delivered to Puerto Rico. So that’s another concern that I’ve seen for Hawaii itself, you know …
Kent: Oh, absolutely. If a hurricane were to hit Hawaii, would they waive the Jones Act? I’m not sure that they would. In fact, they probably wouldn’t, because they are very resistant to do so whenever a hurricane hits Puerto Rico.
I mean, look at Hurricane Maria that hit Puerto Rico. That was — they only waived the Jones Act for two weeks for that. They needed to waive it for more than a year. I mean, the rebuilding of Puerto Rico happens not during the hurricane, but in the years afterwards. And so that’s when they need the assistance when it comes to shipping costs.
But after that, I think that was in 2017, they — Congress — tightened the law to make it more difficult to waive. So why is Congress making the Jones Act more difficult to waive in times of emergency?
You’d think that if they, you know, want to do any help, they would do the opposite. But what it means for Hawaii is that if we get hit by a hurricane, we can’t expect Congress to act very quickly, if at all, in trying to relieve the burden of the Jones Act so that we can rebuild.
Adam: Yeah, absolutely.
For our listeners out there and any concerned citizen about the Jones Act in particular, what recommendations would you give them to get involved or to help move the needle in the direction of reform?
Kent: That’s a great question. You know, all politics is local, I think. For citizens on the ground, they may feel like the Congress is thousands of miles away, and this law is a hundred years old. But getting involved in the issue is important, even at the local level.
I mean, Grassroot Institute was overjoyed when we saw the Maui Council [last] year actually passed a resolution to fix the Jones Act, and that’s a huge step forward.
Because otherwise, in Congress, what they say is, “OK, well what do Hawaii politicians think about the law?” And if the Hawaii politicians are squawking the Jones Act line, then they’re going to say, “Well, why do we need to change it? All your politicians seem to love it.”
So it’s very important for citizens to voice their opinions about the Jones Act, even, you know, at the Council level, at the state Legislature level, certainly, but even to our elected folks in Congress, [who] have typically held the Jones Act in place, supported the Jones Act. In other words, they have supported the protectionist law that hurts Hawaii.
And so you might ask, “Well, why is it that folks, you know, in Congress representing Hawaii would be so supportive of a law that actually hurts Hawaii?” And it could be that the campaign donations that they get are a lot.
When, if you look at OpenSecrets or any website that tabulates that — it’s all public data — you can see that, you know, our congressional representatives get tens of thousands, over the years hundreds of thousands, of dollars from the shipping industry.
And you have to wonder if that influences their vote on an issue that affects citizens of Hawaii so negatively.
Adam: Yeah, absolutely. That’s something that I recommend all the time to our, any listener and, you know, I was actually touting a lot on the campaign trail is, you know, use OpenSecrets, use CSC [the state Campaign Spending Commission] and follow the money, you know.
Depending on where that money comes from is a good barometer of how your candidate’s going to vote.
Kent: Although I should say that there is one politician, Ed Case, in Congress, who says he doesn’t get any donations from the shipping companies.
It’s probably true, because he opposes the Jones Act. So that is the one glimmer of hope, you might say. But I hope that some of the other politicians follow in his footsteps on that.
Adam: Yeah. Yeah, absolutely. It’d be good to actually have some movement in that direction.
And I know on this last round of election speeches and talks, it was a hot-button topic and, you know, it had been discussed quite a bit.
Kent: Yeah, but local politicians typically like to, you know, divert on that issue. They say, “Oh, that’s a federal topic, that’s a federal law, you know, I’m out of it,” [chuckles].
But the truth is you should hold their feet to the fire, because there’s a lot that local politicians can do to voice objection to that law, which can be heard loudly on the national stage.
Adam: Absolutely. I think that’s one of the biggest misconceptions on the local politics side. You know, we do have, you know — the actual local politics have way more power than we think. And, you know, we can have that voice communicating with the national politicians, the national representatives.
And I think that that’s something that’s — you know, we can’t just bail out of the national topics and focus on your local needs and speed bumps, I mean, and whatever road changes and, you know, whatever it might be, our budgets.
We need to really take a look nationally and realize that we represent the constituents of our region. And that needs to go all the way to the top, whether it’s a national topic or a local county topic.
Kent: That’s right.
Adam: Yeah. So, we’re coming to the end of our time, but I wanted to just ask you one last question, and I know that one of the biggest issues that I’ve seen around the state is also lack of fiscal responsibility.
The irresponsible spending of this government [has] been just shooting the people in the foot and, you know, like the train to nowhere on Oahu. I would love to get your perspective on that, and that’s a huge topic that we need to really look at going forward.
Kent: Oh, yes. Fiscal responsibility is almost a dirty word in Hawaii. [laughs] It’s really difficult to cut any spending in Hawaii.
In fact, we just went through a pandemic, or the pandemic years, the lockdown years as we call them, and where the economy just dropped off a cliff. We saw so many people losing their jobs, businesses cutting back, everyone had to tighten their belts.
But for the government, it was a huge windfall. In their budget, they saw, you know, an over 20% increase in their revenues because of, you know, all of this aid money that came from the federal government. And also, you know, the hiking inflation has also boosted their budgets too.
So for the government, they’re celebrating. They’re in the money, you know. They’ve got a big party going on. Whereas, in the economy, you know, people on the ground are still struggling to get back on their feet.
The labor market is not healthy right now. We still have people leaving. And the cost of living is going up, you know, faster than salaries. And so, the economy is struggling while the government is growing.
The government is growing much faster than the economy. I believe it’s at more than double the rate. So the number one rule when it comes to fiscal accountability and responsibility for governments is the government should grow slower than the economy.
And why is that? It’s because the government derives its revenues from the economy. And so, if the government is growing faster than the economy, then that is a pace that’s unsustainable. And so eventually, if you have that scenario, then you’re going to see a big bloated government.
We’ve got people leaving Hawaii, as I’ve said many times, and that means that there are fewer taxpayers to pay for a bigger and bloated government. And that means that the taxpayers that are left behind have to pay more for this outsized government. And so that’s why it’s so important for officials to cut.
Now, when should they cut, though? You know, it’s never a good time to cut, right? Because they always have costs that are going up and so on. But now is the perfect time to cut. The government is having a party, and we’re not paying the government to party. We’re paying them to, you know, do the minimum necessary that a government should do.
And so we have a $2 billion surplus, for example, at the state level, and that’s going to grow to over $10 billion in just a few years. And so can you imagine that the government would have $10 billion of your money that it doesn’t even need?
You know, this is extra money. This is after all the bills have been paid — which, by the way, the entire general fund budget of the state is only $8 billion. So if they’ve got a surplus of $10 billion on an $8 billion budget, then that means they have way, way, way more money than they need, and it’s time to cut.
And they could start — if they don’t want to cut spending, they could start by cutting taxes. They could cut taxes without cutting spending, actually.
I hope they cut spending, because that’s a more sustainable route to go. But they could actually cut — let’s say they cut a billion dollars out of the budget, for example. Well, that would be about a thousand dollars back into the pockets of every single man, woman and child in the state — every taxpayer, anyway.
And you could keep that money in their pockets where it could be better used, rather than putting it in the government’s pocket, where the government now has to say, “Gee, what should we spend on?”
I remember working for the government, and I was told to spend as much of my budget as possible. Because otherwise, I wouldn’t see it next year. And so all of us government employees were trying to spend as much as possible. Buy copying paper, I don’t know? Buy more paper clips, I don’t know? What do I need, you know?
And just — and so that’s the incentive structure of the way that government spends, which, you know, there’s nothing wrong with that, except it doesn’t work.
The incentive structure for businesses and for family budgets, and the private sector is to spend as little as possible and save for the long term and to build your wealth and capital so you can prosper in the future.
And so government operates on a different system, and we need to figure out a way to get more money back into the pockets of Hawaii’s residents.
Adam: Yeah, absolutely.
And the government’s really gotten out of control, and I think the people have really lost sight of the actual responsibilities of government and given them way too much power, currently. But hopefully we can wrangle that in.
Kent: Yeah and, you know, I’ve been talking about the state, but the counties is the same picture, by the way. Don’t let the counties get away with it either. [chuckles] The counties are in the money too, and there’s plenty of places to cut.
Adam: Yeah, absolutely. Well, Joe, we’re reaching the end of our time. I would love to hear — if you just want to share what’s next for you and the Grassroot Institute and where can the people find you and how can they get involved.
Kent: Sure. Well, this year, we’re focused on tax cuts like I was just talking about — for foodwould be a start. A lot of people are talking about a general excise tax exemption for food.
Or health services would be another good one. You know, our hospitals, especially on the neighbor islands, are struggling. The, you know, private practice docs have to pay taxes where the mainlanders don’t, so, and they’re struggling too. So, if we could — lawmakers could go a long way to cut taxes.
And so, and like I said, now is the perfect time to do that.
So we’re gunning for that. But we’ve got a lot of other things on our plate too: housing, Jones Act. There’s a lot of different issues that we’re looking at.
And so if you’d like to learn more about that, get on our newsletter list. You could go to grassrootinstitute.org. We send out a newsletter list to over 30,000 people every week. So you — if you want to know what’s going on behind the scenes in Hawaii, make sure to get on that newsletter.
So, again, I hope your viewers can look us up and get on our list, and let’s work together. E, as they say.
Adam: Absolutely. Well, Joe, it’s been an absolute pleasure having you on, and it’s great to connect with you.
And please, any time you have some information, you have something, an event coming up, come on the show and get that information out to our viewers.
Kent: Absolutely. And thanks so much, Scott, for having me on. You know, I see this “Liberty Arise” is the name of your program, and it reminds me of something our founder at the Grassroot Institute, Dick Rowland, used to say, which is, “When the government gets bigger, you get smaller.” [laughs] So …
Kent: That’s always important to remember.
Adam: 100%. 100%. Well, thank you so much again, and have a great day. Aloha, Joe.
Kent: Thanks, you too. Aloha.