That whoosh is the sound of Act 221 capital leaving town, leaving an empty vacuum behind. The news moves on, but it remains that without 221 there will be less capital for our startups.

The recession is emptying our beaches, real estate and construction are wilting, our last project at Kaka'ako, the Cancer Research Center, has been canceled, our tax base is declining and federal stimulus funds are elusive.

More than ever, we need to focus on remaking our economy.

DEMORALIZATION

Do you feel it? While businesses are failing and people are getting fired and furloughed all over town, both the state and city are trying to raise taxes. Disposable income is going down, but the cost of living is rising.

The end of 221 makes it worse. In a widely circulated e-mail, observer Johnson Choi pointed out that designation of the swine flu as a pandemic will further diminish our tourism, adding that without 221, our investors are also diminishing.

At the Hawaii Science and Technology Council meeting last week, one local company imparted that a project it was developing on the Big Island had been stopped when its investors pulled back because of what happened to 221. This is only one of many such stories.

Gov. Linda Lingle has intimated that she might veto Senate Bill 199, the bill that killed 221, and some people are hoping she will do that. Level heads say no way. She's been trying to undo 221 from the beginning, so why should she stop now?

Whatever she does, Act 221, mangled as it is, will expire at the end of next year. To avoid a hiatus, we'll have to pick up the pieces in the 2010 session.

CONSENSUS GROUP

That session starts in January, and we need to be ready for it. We need a collaborative effort of those who would benefit by 221-type deals and those who only seek a greater good. The Hawaii Venture Capital Association, the primary capital formation trade organization in Hawai'i, should initiate and lead a group including HSTC, the dual-use sector, the film sector and HiBEAM, as well as HTDC, NELHA and HSDC — assuming they can avoid DBEDT's domination.

It's not a conversation in the mall — hammering out a new package will be an intense interaction among policy wonks, including legislators. One size won't fit all, so each sector should be treated separately. This will avoid competitive lobbying later. We want to reach a broad consensus, not one that can't get through the session.

Accord doesn't come easily. Many of the players just want 221 back for five years. Others have made a practical peace with SB199 and have come to feel we can live without the 2:1 ratio that was so central to 221, even if the new 1:1 ratio will draw less money from the Mainland.

Many say we should craft a more refined "son-of-221" tax incentive, warning us not to call it that — so it doesn't carry the baggage the media has hung on 221 — and that we need to have a decent transition from one to the other.

JOB ONE

It's no small matter. We need to bear down and create a package that will stimulate the central nervous system of our economy. In the wake of 221, we need a progressive rallying point for startups and investors in 2010.

Can the industry organize? If it is not together, how can it expect support from legislators? Collaboration and unity is therefore Job One. Job Two is public outreach and legislative familiarization.

We're not tinkering with extremities here — this is the heart and brain of our state's future. If we don't take responsibility for it, who will? No one is going to bail us out. If we do more crabs in the bucket, we'll all wind up at the bottom.