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Politics // Mostly Politics
Dan Boylan

Now You See It, Now You Don’t

All politics,” it’s said, “are local.” So let’s start here at home, but be forewarned that before the period’s placed on this edition of “Mostly Politics,” we’ll go global, or at least roam as far away as the Ukraine.

For the past few months, Gov. Neil Abercrombie’s been crowing about an $840 million state revenue surplus. He’s crowed in print; he’s crowed on the airwaves. He’s crowed so persuasively that we’ve all breathed more easily. By golly, Hawaii’s economy has recovered. “Happy days,” as the old song goes, “are here again.”

But last week the Council on Revenues said not so fast. Hold the songfest. After crunching the current numbers, the much-venerated panel of three economists plus a tax lawyer, a bank treasurer, a tourism expert and an accountant revised their forecast of state revenues downward.

In January, they had predicted 3.3 percent growth for the fiscal year ending in June; last week they estimated 0 percent growth. While they were at it, they adjusted their prediction for fiscal year 2015 downward as well, from 7.4 percent to 5.5 percent. What do these numbers mean?

Senate Ways and Means chairman and gubernatorial candidate David Ige told the Star-Advertiser it means the governor’s “surplus has evaporated.”

What caused the flattening growth rate? Fewer tourists arrived than expected. Maybe folks, snowbound by the Mainland’s polar vortex, just decided to hunker down in front of a fireplace rather than risk flight cancellations on a sojourn to the storied isles of Hawaii. Maybe.

For certain, the council’s predictions remind us of the fragile nature of Hawaii’s economy: tourism, military spending, construction, agriculture. That’s about it.

Move then to Washington, D.C., where last month Secretary of Defense Chuck Hagel announced Pentagon’s plan to shrink the size of the nation’s armed forces from 490,000 to 440,000. He also called for reductions in housing allowances for military personnel and limiting pay raises to 1 percent.

Cut force numbers, limit its pay raises and you threaten Hawaii’s economy. Military spending has contributed mightily to Hawaii’s economy since before the bombs fell on Pearl Harbor. And when the hot war ended, a cold one kept federal dollars flowing to Hawaii and its military bases.

But it’s been dicey since the end of the Cold War, and those responsible for shepherding the Islands’ economy have been in the uncomfortable position of being of two minds about peace breaking out. Could it mean base closures? A loss of civilian jobs?

Peace has broken out, and the fulminations of Arizona’s John McCain and South Carolina’s Lindsey Graham will not change that. They, along with President Barack Obama, threatened military action against Syria’s Bashar al-Assad for using chemical weapons against his own people.

Overnight polls showed that the American people would have none of it. They had no stomach for another Afghanistan, another Iraq or another Vietnam.

Obama appears to have learned that lesson. When Russian President Vladimir Putin recently sent troops into the Ukraine and seized the Crimea, the American president chatted with Putin on the telephone. But Putin apparently told Obama that Russia would do what Russians have always done on their borders. So Obama rang off and began talking, in ever so muted tones, about sanctions.

There. We made it to the Ukraine and to peace and sanctions, a combination that could be as injurious to Hawaii’s economy as that polar vortex.

dbboylan@yahoo.com

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