The empire strikes back
By David Shapiro
It's hard to muster sympathy for the four county mayors whining about Gov. Linda Lingle's announced plan to help ease a $1.2 billion state budget shortfall by taking the counties' $99 million share of the hotel room tax.
The mayors have scored political points by boasting that their financial condition is better than the state's and have curried favor with public worker unions by not implementing worker furloughs this year that the state was forced to impose to balance its budget.
The mayors, not needing the money from furloughs until next year, have delayed labor settlements that would enable the state to maximize its payroll savings this year.
The counties can afford to play Santa with the unions because the property taxes counties rely on don't nosedive as early in a recession as the excise and income taxes the state relies on.
Lingle and state legislators seem to feel it's only fair for the state to recoup some of the losses the counties have cost the state in labor talks by scooping the counties' share of the hotel tax.
House Speaker Calvin Say said, "No furloughs for this fiscal year ... they must have had a lot of money for this fiscal year that the State of Hawai'i did not have, and we're the ones implementing the furloughs."
It's all politics, of course, and the same taxpayers end up paying whether the hit is taken at the state or county level.
But if the mayors are going to rack up favor by embellishing their financial acumen at the expense of the state, they shouldn't be surprised to see some of the political pain thrown back at them.
Volcanic Ash
December 22nd, 2009 at 6:08 am
Aloha ~
It's hard to muster sympathy ... Yes, we have become a cynical and selfish society. We have no sympathy for the other guy any longer. I'll just grab mine and let the sh*t run downhill to the least powerful political group.
Our teachers and Keiki suffered first. Now counties are targeted ... add delayed tax refunds to families living month to month. Take away life insurance programs. If a worker dies the whole families collapses - yet we save PENNIES.
O'ahu's property tax is $3.42 per $1,000 of valuation. Friends in New Mexico pay $12.87 per $1,000. Owners of multi-million dollar condos and homes here skate by - while middle class and working families collapse.
What a great social study! Reminds me of Hitler's Germany. Storm troopers breaking down doors to take a family away while neighbors hid in silence. As long as it happens to the other family ...
Keep lying to yourselves ... our tax structure is KILLING our state and nation. See America's Wealthy Wage War Against the Middle Class
A*L*O*H*A
December 22nd, 2009 at 6:23 am
Simple...just let the state take care of police security, fire and EMS at all resort areas. Oh, yeah...water and sewage services too.
December 22nd, 2009 at 6:53 am
have delayed labor settlements that would enable the state to maximize its payroll savings this year.
Huh? What are you talking about?
December 22nd, 2009 at 8:25 am
Yes, this isnt about money, its about whats right! The Counties are going to have to find a way to tax the tourists somehow. Maybe the non residents fees at all County facilities need to quadruple. of course that will hurt tourism and both STate/County.
Why doesnt the State just raise the TAT another percent??
December 22nd, 2009 at 9:40 am
Aloha Kailuaresident ~
You wrote, "its about whats right! Interesting concept ... right ...
Was it right for America to be involved in the 1893 overthrow of the Kingdom of Hawai'i. Is it right for haoles to be here at all? Is it right for Americans to be killing Iraqis or Afghans and dictating to them about their homelands?
Is it right for the state to take TAT revenues? These are county boundaries which have been preempted by the state for fiscal purposes.
Is it right that our Keiki suffer furloughs because FAT CATS on Wall Street greedily destroyed the financial world? This is what lies behind this entire crisis. Why should these BANKSTERS receive huge bonuses and million dollar salaries while Hawai'ians suffer? Why is it right that we are victims in this RICH MAN'S tragedy?
A*L*O*H*A
December 22nd, 2009 at 9:41 am
The counties need and should have a portion of the Transient Accommodations Tax. They have to provide a lot of services for visitors, who do not contribute by way of the property tax. Tourists use the emergency responders the County pays for; they create garbage the county has to pay to get rid of; they use the streets, parks and beaches. They get all the County services I get but pay only the GET and TAT, which go to the State.And now the State says they don't want to give any of it to the County? Why should residents pay through their property taxes for the services the tourists use?
December 22nd, 2009 at 10:31 am
The HGEA settlement was delayed and the UPW contract is still unresolved in part because the mayors wouldn't sign off on the state's offer.
December 22nd, 2009 at 11:30 am
Honolulu has one of the lowest real property tax burdens in the nation. Part of this is because the State pays for many services--such as K-12 education--that are provided by counties in other states.
December 22nd, 2009 at 1:47 pm
Dave I know I will pay either way but I was thinking the same thing.
Scott, the FAT CATS on Wall Street did not force peple to take out loans they could not afford, they didn't keep interest rates aritifically low, that was the Government and Fed. You can blame them all you want but that does not make it so.
December 22nd, 2009 at 5:18 pm
onesolution for the government caused budget problems is to privatize ALL state government agencies and services.one effect would be a permanent elimination of revenue seeking by the state.another effect would be a permanent elimination of a state government.it is cost effective and efficient to let the private market serve the needs of its' citizens.eliminates politics,interest groups and would greatly benefit government workers as they transitioned to the private sectors.taxes would go down,capital will be freed up and made available at market rates.wealth will be created rather than distributed.it can be done!
December 22nd, 2009 at 9:03 pm
You can go on believing what you will, but the truth of the matter is that the mayors were the only ones who could conclude the HGEA negotiations for the governor. She's so inept. Just look at the evidence in HSTA and UHPA..she could use the mayors' help there, and probably with UPW too.
The counties should not be punished as over the hill speaker say suggests. Perhaps they can find a way to scoop a little something from the state in this silly game lingle-aiona want to play.
December 22nd, 2009 at 9:12 pm
Regarding HGEA and UPW, there is no "state offer." There is an employers' group offer, the employers group consisting of the state and the 4 counties and the judiciary, DOE, UH, et al. So to suggest that the mayors' somehow delayed a state offer is wrong completely. There was no offer until all members of the employer group could agree on a position, an offer, and the mayors were able to drive the agreement that led to the employers and employees agreeing to a contract. Never mentioned, of course, is the delay in presenting a state budget while waiting for the council on revenues to meet. That's where the delay is/was.
December 23rd, 2009 at 7:14 am
Aloha HItaxpayer ~
You wrote, "FAT CATS on Wall Street did not force peple [sic] to take out loans they could not afford ..."
As they say ... tis the season and I agree with you that it's time to correct the record about FAT CATS.
You are currently telling your grandchildren that a really FAT CAT will put on a physics-defying red suit and slide down every chimney in America - as well as the world - in a single night. He will be pulled by bionic reindeer that can surpass the speed of sound on their worldwide mission. Their HQ remains hidden near the North Pole in a remote vortex where global warming does not affect the thickness of ice. Thousands of Republican non-union elves have slaved for 364 days to assemble toys for free. Wal-Mart shopping rampages shown on TV are purposely staged to keep Keiki from knowing the truth.
Likewise, it was Bill and Pat Smith from Cedar Rapids, Iowa, who walked into a Countrywide branch office in late 2002 and proposed a creative home mortgage package to local brokers.
While Harvard and Yale PhDs and MBAs from the Wharton School of Economics were unable to devise such a proposal, Bill Smith, with only a HS education and who struggled in consumer math, led the revolution. Yet this is America ... and Bill is a product of our prestigious public schools.
Bill and Pat have three kids. Bill makes about $36K per year while Pat works only periodically due to her rheumatoid arthritis. They have no equity, as they have been crammed into a two-bedroom apartment. Bill and Pat knew they were behind on their retirement and thus proposed this "get-rich" scheme to the nation's leading investment banking firm.
It is not disputed that Bill and Pat were "sub-prime," yet this didn't matter to Compassionate Countrywide, whose motto is, We're here to help Americans even if we lose our shirts.
They accepted the Smith's proposal and graciously gifted them with a Jumbo ARM for $540,000. For the first five years the plan reversed terms on the loan and the Smith's received a cash payment of $1,000/month. Beginning in Year 6 this payment would decrease by 10% per year.
Following Bill's plan Countrywide agreed to resell his sub-prime loan along with other similar bargains - rated AAA. The notes were subdivided into high quality tranches and packaged into CDOs. AIG agreed to cover the entire transaction for free using a FAT CAT credit default swap, again all part of Smith's brainstorm.
Bill was so stoked about this opportunity that he posted the entire plan on his website for other interested families. His proposal went viral and soon 1,000s of struggling families rushed various mortgage offices around the country.
Compassionate Conservatism swept the nation. Mortgage brokers worked for free day after day and well into long nights to provide absolutely amazing deals to Americans. With selfless precision the nation's FAT CATS rewrote both residential and commercial lending rules. These were, may I say, gifts from heaven.
Sadly the entire system crashed in late 2007, as Bill refused to accept his monthly $1,000 payment. Bill wanted more. He told Countrywide the sum was too small ... he demanded to renegotiate or wanted out.
As we know today, poor Countrywide was in no position to handle Bill and Pat's selfish demand. They were forced to close their doors. Now 10,000s of hard working brokers and mortgage lenders are unemployed - due to the unwarranted greed of the Smiths and others like them.
Yes, tis the season, HItaxpyer ... tis the season ... to suspend truth and reason.
A*L*O*H*A
December 23rd, 2009 at 7:20 am
davidandgoliath,
I wouldn't give the counties that much credit for settling negotiations with HGEA and UPW. After all, it's relatively easy to close when you still have a bunch of money to pay salaries. While I really don't like to defend Lingle, her situation was a lot tougher than the one the mayors were in.
As for "over the hill" Speaker Say, as you call him, he's one of very few people who's had the foresight to plan ahead. Unfortunately, many others, including the mayors, the unions, and a bunch of self-serving lawmakers in the legislature have not wanted to listen to a voice of wisdom.
December 23rd, 2009 at 9:14 am
Earl,
I don't disagree completely, but the reason the counties had money was, at least in Honolulu's case, they raised fees and taxes, something the state doesn't want to do...You can only cut so much before you have to realize that what you have is a revenue problem.
Regarding the Speaker, whom I've always admired, I thought he was unwise and sounded actually very immature when he said the counties must have a lot of money because they haven't yet had to furlough anyone. He sounded like a sixth grader, very punitive. If he is wise, he knows better and should speak accordingly.
December 23rd, 2009 at 10:29 am
Fair enough, daveandgoliath. In that respect, I do agree the state shouldn't "punish" the counties. Everyone's got hard times now....
December 23rd, 2009 at 12:04 pm
something bothers me about the fact that there is an ever expanding government nationally and locally that has a majority of its' employees in government unions.the government is a monopoly.its very existence is detrimental to citizens' personal liberties.government workers face the same dangers as the rest of society.unions,especially under these conditions have enormous powers.the government stimulus has been a boon for federal jobs mostly.we need to keep a weather eye on this crisis.
December 24th, 2009 at 8:22 am
Aloha shaftalley ~
You wrote, "[governments] very existence is detrimental to citizens' personal liberties."
Where did you go to school? Apparently you didn't have much time for civics or U.S. history. Go back and study 1776 through 1787 ... our Founders created a "government" my friend. They didn't create a Corporation of the 13 Original Colonies.
You have been sold a tremendous amount of propaganda in your life ... by those who hate government. They are false prophets.
Why? Government is open and transparent (although not perfectly). A corporation makes no apologies for being closed, secret and opaque. Government regulates the private sector. Thus those in the private sector disdain government because it - THE PEOPLE - puts controls and limitations on private activity.
Let's take food, for example ... if we leave the private sector to themselves, giving them absolute freedom, farmers would overproduce - as they individually seek to maximize profit. They see the market from a micro perspective, not an aggregate or macro point of view. Fisherman would deplete all the fish in one area and simply move on. Dead waters would be left in return.
As we witnessed in the Great Depression our farmers produced so much food that prices fell below the cost of production.
Today government pays farmers to leave some land fallow ... good for the long run. The government ensures price supports that allow farmers to produce something less than their maximum and still make sufficient profit to remain in business.
Since you're claiming to be an economic expert, please give us statistics to support your point that the "stimulus has been a boon for federal jobs mostly."
A*L*O*H*A
December 24th, 2009 at 11:50 am
hey scott! still fighting that fight,huh? if you go to the12-20-09 edition of the USA Today.article written by dennis cauchon. http://www.uusatoday.com/news/washington/2009-12-10-federal-pay-salaries_N.htm. government support to benefit the economy has been so discredited and exposed.it's only a matter of time that keynesianism is sent to the museum to collect dust along with marxism and socialism,fascism.a complete scam taught in your precious public schools.
December 24th, 2009 at 2:24 pm
scott, it's usa today 12-10-09 online edition by dennis cauchon. http://www.usatoday.com/news/washington/2009-12-10-federal-pay-salaries_N.htm. and merry christmas and happy new years to you.
December 28th, 2009 at 10:13 am
The blessing from this period of financial unrest is that we (the tax payers) need to assess the size and breadth of our government.
Aloha,
Keahi