Help for business needed for economic health, Case says
By Lynda Arakawa
Advertiser Capitol Bureau
Revitalizing Hawai'i's economy must begin with helping local businesses rather than looking elsewhere for a silver bullet, Democratic gubernatorial candidate Ed Case said yesterday.
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In detailing his economic portion of his Blueprint for Real Change, Case said the state can no longer overlook its own businesses when seeking to improve the economy.
Ed Case said the state must contain taxes and fees on local businesses.
"We have been looking for that silver bullet for the last 10 years," he said, standing behind a table piled with locally made produce, snacks and other products. "We have been waiting for the Japanese economy to recover and for another wave of investment to reach Hawai'i.
"We have been waiting for the U.S. economy to recover.
"You know what? We have to look right here in our own back yard.
"These local businesses are the backbone of our economy and these local businesses are going to be the future of economic revitalization. These are the businesses that need our help."
Case said the state must help local businesses compete by containing taxes and fees and reducing or streamlining government regulation. The state can also attract more investment by improving public education, maintaining highways and harbors and keeping crime down. Drug abuse must be treated as an economic issue, he said, later adding that more money could be directed to existing drug rehabilitation programs.
Case also said he wants to draft more business people into government and create an emergency economic public-private team to include people representing business, unions, non-profits and community groups. He said it is modeled after the Economic Revitalization Task Force convened by Gov. Ben Cayetano in 1997 but added it would include more segments of the community.
"When you go in this direction, it can't be the downtown bankers and a couple of senior legislators and a couple of senior members of public unions," he said. "You have to be inclusive. I would put together a truly representative team and turn them loose on exactly what we have to do to revitalize the economy."
Case also talked about maintaining and perhaps creating other tax incentives and providing building and infrastructure improvements to support industries including technology, agriculture, health care, entertainment and education.
He said he wants to give the University of Hawai'i full autonomy to help it become a major economic catalyst. Gasoline price controls, increasing alternative energy and promoting local agriculture will help keep more Hawai'i money here, he said.
Meanwhile, Cayetano yesterday responded in detail to a plan that Case disclosed earlier to balance the state budget by cutting state spending and without raising taxes or raiding special funds.
"It would seem difficult to implement the Case plan, and still deliver the level of services we now offer," Cayetano said. "The plan pledges to keep the significant tax cuts we've put in place, and at the same time precludes the use of special funds such as the $200 million left in the Hawai'i Hurricane Relief Fund. Under the Case plan, significant reductions in government services and/or elimination of programs would be required to balance the state budget."
He said if the state protects the Department of Education and the University of Hawai'i, under Case's plan all other departments would have to reduce their budgets by about 20 percent. He also said the state has been using an "attrition" strategy to balance the state budget since 1995 and that politicians — including Case — who propose to reduce spending through attrition will find the savings will be small and that it is easier said than done.
Case said he and Cayetano agree that the state has a budget problem but that they disagree on what to do about it.
"The governor says we have no choice but to balance the budget on the revenues side by taking money out of special funds, by possibly suspending some of the pending tax cuts, and I say we have to do it on the other side," Case said. "We have to do it on the cost side."
Reach Lynda Arakawa at larakawa@honoluluadvertiser.com.
