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Line Item Veto of Slush Fund ‘the responsible thing to do'
By Grassroot Institute @ 11:10 PM :: 1931 Views :: Ethics, Hawaii State Government

Kent says deleting slush fund is ‘the responsible thing to do’

by Grassroot Institute of Hawaii, May 24, 2023

It’s bad enough that Hawaii lawmakers have proposed exceeding the state’s legal spending by almost 25%, but they also appropriated $200 million to Gov. Josh Green for him to spend however he likes, and that’s not right, according to Joe Kent, Grassroot Institute of Hawaii executive vice president.

Interviewed by radio host Rick Hamada of News Radio KHVH 830 AM, Kent said the budget approved by the 2023 Legislature — if also approved by the governor — will virtually wipe out the state’s much-touted $10 billion surplus. But especially disturbing was the $200 million that “magically appeared” at the last minute to be used by the governor at his sole discretion.

He said: “This begs the question about the … separation of powers, right? … But now we’re giving the governor all this money to do as he wishes, unchecked. People say, ‘Oh, don’t worry. He has to let us know what he’s going to use it for, right?’ [But] that’s not a check. That’s a blank check, right? … So this is unchecked government power, and it’s a little disturbing, especially since they’ve already blown the spending limit.

“So, we’re urging the governor to veto this $200 million slush fund, as we call it …. And, you know, it’s the responsible thing to do as far as the taxpayer is concerned.”

Also in the interview, which included Institute research associate Jensen Ahokovi, Kent talked about money that seems to be getting wasted on government housing initiatives, and various bills approved by the Legislature that Gov. Green should either “slash or pass.”

About housing, he said Hawaii’s taxpayers have paid about $1.5 billion in just the past two years for housing, but “Where’s all the affordable housing?” he asked.

Kent said state and county lawmakers like to point their fingers at imagined culprits for the housing crisis, such as “outsiders” and “empty homes,” rather than addressing the real cause: regulation.

“Lawmakers could almost just close their eyes, hold the scissors and snip any regulation in front of them, and that would actually be a more effective way to create much more housing than spending money,” Kent said.

TRANSCRIPT

5-19-23 Joe Kent and Jensen Ahokovi with News Radio KHVH 830 radio host Rick Hamada

Rick Hamada: Speaking of in-studio, we’re delighted that we’re reunited with Joe Kent of Grassroot Institute, and Brother Joe, it’s good to see you. Good morning.

Joe Kent: Good to see you, too. Good morning.

Hamada: It’s only 30 years. I should figure out how this thing works over here.

Kent: [laughs] That’s right.

Hamada: How you been?

Kent: Good. Good. And just been looking at, you know, what’s going on at the Legislature, and well, tracking all the bills. That’s all over now, but we’re in that mysterious period between the legislative session ending and when the governor signs things, or vetoes them. And so, we’re tracking a lot of that stuff.

Hamada: Yeah. I asked you how you’re doing, you said you’re doing well, but if you’re reading all that stuff, you can’t be that good. I mean, goodness gracious.

Kent: Yeah, that’s right. That’s right.

Hamada: This was a hell of a session, because I mean, we talked about it the last time. It’s just the frenetic and all the last-minute and bundling and throwing things together, and all of that.

Kent: Oh, yes. Yeah. There was a lot of last-minute things that happened. Rabbits jumping out of the hats at the last second and, you know, even on the last day, I remember they were just about to gavel out, and we were saying, “Wait, wait, there’s one more bill.” 

And so thankfully, they put that bill forward, and it was actually a really good bill, too, to help more doctors come into the state. So, but yeah, it all came down to the wire.

Hamada: Yeah. That was nuts. Joe, we have a good friend in the studio. Introductions, please.

Kent: Yeah. So I brought my friend, research associate Jensen Ahokovi, and he’s here in the studio. He actually just authored a new report called “The ’empty homes’ theory of Hawaii’s housing crisis.” That’s authored by Jensen Ahokovi and Mark Coleman. And basically, we’re trying to look at this theory … well, I can let him explain it, but anyways, yeah.

Hamada: Well, there we go.

Jensen Ahokovi: Yeah, no. Thanks for having us on. Yeah, so, “The ’empty homes’ theory of Hawaii’s housing crisis.” it’s sort of a sequel to —  I don’t know if you remember our first report, “The ‘outsider’ theory of Hawaii’s housing crisis,”— so this is its sequel, and it’s asking the question: How much do empty homes really contribute to Hawaii’s high prices and low housing supply? 

And on that note, how effective would something like a vacancy tax, like proposed in Honolulu Bill 9 or Bill [76]? How effective would those sorts of policies be at mitigating Hawaii’s housing crisis?

A lot of legislators have seen places like Vancouver, for instance, they have a very often-cited vacancy tax that they implemented in 2017, and a lot of places have sort of seen that and have been inspired, and they, you know, use that to inspire bills like Bill 9 and Bill [76] in all this rhetoric about empty homes that are prevalent throughout Hawaii.

Hamada: What’s interesting id there’s a recent report that because of out-migration and population drop, that there are increased number of vacancies attributable to that as well. 

Gentlemen, we’re going to jump into some of the details in a moment, but our first time together and our friends that are dialed in, would you mind sharing a little bit about yourself?

Ahokovi: Yeah, no problem. I’m a recent graduate of ‘Iolani School. I’m currently an economics student at the University of Hawaii. And I also, Joe’s my boss [chuckles] at the Grassroot Institute. And yeah, really good team over there. I was really fortunate to have a good co-author in Mark Coleman for the report. And yeah, I’m just a big wonk, big nerd, and I guess that helps when it comes to producing this sort of research.

Hamada: I also appreciate the fact that you referred to Joe as the most handsome man at Grassroot.

Kent: [laughs]

Ahokovi: I did. I did. Yeah.

Hamada: I thought that was great. Yeah.

Ahokovi: Yeah, that was off-air, but yeah, that I did.

Hamada: Yeah. Just wanted to share that. Just wanted to share.

Ahokovi: That’s right.

Hamada: We’re already at 9:14 in the morning. Before we jump back in with Jensen, Joe, remind us: Grassroot, everything we need to know.

Kent: Yeah. So, we’re a nonprofit think tank, basically a watchdog. We need someone watching the government, to make sure that they’re doing the right thing. And we do that. We focus on individual liberty, economic freedom and accountable government. And so we view everything through that lens. 

So, how can we bring solutions to make Hawaii a better place that don’t always involve growing the government in every way? So, we want to do it in ways that involve less government.

Hamada: Clarification: nonpartisan. Correct?

Kent: A nonpartisan group. You know, we’ve got followers. We’ve got 35[,000] to 40,000 folks on our email list. If you’d like to get on that, you can go to our website at grassrootinstitute.org. But these are folks who are Democrats, Republicans, Libertarians, Independents, Progressives. It crosses the whole spectrum. Union members. Every single industry of folks who agree with us or even just want to know what we’re talking about. So, if you want to be on the hippest list in town, get out to our website, grassrootinstitute.org.

Hamada: Well, I do believe 1970 called and said, “Thank you for using hippest.” 

Kent: That’s right.

Hamada: -So I could could relate. So, much appreciation. Let me get this only break out of the way for the second. By the way, program notation for you: We’re together at 9 a.m. today, but Thursdays, moving forward, we have an 8:40 a.m. segment with Brother Joe, who will bring us up to speed with Grassroot on a weekly basis. And I’m excited that that’s going to happen. Thanks to Brother Dave Patterson for facilitating.

Kent: Yeah.

Hamada: And I’m glad you’re going to be with us on a regular basis.

Kent: Yeah. And thank you.

Hamada: Oh, it’s a pleasure. Short break, back in a moment, and if you’re interested in housing, oh, my goodness. Stand by, Joe and Jensen return. But today, focus on Grassroot Institute, and with Joe and Jensen in our studios. 

All right. Can we set the table? Housing, and speak legislatively first.

Kent: Yeah.

Hamada: The aggregate amount of funding under the guise of affordable housing. If we take just this session, or if you even want to go back to the previous session, Joe Kent, how much have taxpayers paid into the affordable housing umbrella?

Kent: About $1.5 billion just between these past two years.

Hamada: Yeah.

Kent: And, you know, that’s a lot of money. We’re trying to look to see if the housing is actually, you know, materializing. We are seeing some housing growth, but a lot of that housing is coming from private developers, not necessarily the government. 

And that really begs the question: What is the best way that the government can provide housing? And Hawaii has the highest housing barriers in the nation. You know, they did a study, they looked at every single state. We’ve got the highest.

So, lawmakers could almost just close their eyes, hold the scissors and snip any regulation in front of them, and that would actually be a more effective way to create much more housing than spending money. 

I mean, it’s almost like, imagine you have a brick wall, and then you’re trying to pay people to go through it, right? That’s how our housing system works.

Hamada: Maybe we can step back. Further back.

Kent: Sure.

Hamada: Is the role of government truly to provide housing for its people?

Kent: You could actually have the housing for free, if you wanted to. You know, there’s a whole lot of capital in Hawaii to build housing, and you don’t need to use taxpayer dollars to do it. So, yes, it’s not really the government’s job. The framers of the Constitution, even Hawaii’s Constitution …

Hamada: Yeah.

Kent: … didn’t say the government needs to provide housing. And so, this is a new sort of concept and paradigm that we’re in. 

Yes, it’s really good for politicians to stand on stage and say, “We’re building housing,” but let’s remember: Who’s we? It’s the taxpayer’s money that’s being used in that way. And it could be used much more effectively.

Hamada: Yeah. I would like some help from the government to pay for my housing to make it more affordable. That’d be very helpful.

Kent: That’s right. Yeah.

Hamada: So, in that context, $1.5-plus billion. Jensen, what does that number mean to you, and what should it translate into some of the great work that you and Mark have done?

Ahokovi: Well, I mean, I would equate it to the fact that, so recently I had to repair two tires on my car. And it’s similar to the rhetoric, you know, where is all this taxpayer money? Because my potholes are not getting fixed. 

It’s the same logic. There’s a lot of money being funneled into affordable housing, and yet, where’s all the affordable housing, right? Why aren’t all the potholes fixed? There’s a lot of money going to the government, too. Same logic there.

And this kind of translates to the work that I did with Mark, in that vacancy tax proposals such as Bill 9 and Bill [76] are often touted as ways to maybe not necessarily produce more housing, but to give the state more money, so that they can build more housing. 

And, you know, it’s not entirely clear, like you were mentioning earlier, that the government is the best entity to produce housing. And when we look at this report, we really question this idea that it’s empty homes that are really the cause of the fact that there are high prices here and low supply.

We do acknowledge the fact that, you know, it is intuitive that if somebody sees empty apartment units in Kakaako, and they say that that has to be contributing to Hawaii’s housing crisis. Somebody could be living there, if somebody’s not already there. 

But the fact of the matter is, if you look across the country, for instance, vacancies are disproportionately located in very cheap states in terms of housing prices. 

And it’s not necessarily because vacancies, say, cause lower housing prices. It’s just because of the fact that vacancies are more so a symptom of other factors rather than a cause of things like high housing prices and low supply.

Hamada: So, I’d like to take a little different tack, and that is: Reverse it. To have this type of legislation, I view it as a penalty for an individual that has gone through the due process, the legal acquisition and then the determination of what their personal use is for that property. 

And if they choose to keep it vacant, the government coming in and saying, “You are doing wrong, Mister Owning a Place That Nobody Lives In, and we’re going to come after you.” To do what?

Kent: That’s true. And let’s not forget, there already is a sort of a tax on a vacant home. If you got a home sitting empty, who’s paying the mortgage on that? You know, who’s paying for the monthly cost of that house if it’s empty? 

It’s the person who owns that. And so, they have every incentive in the world to fill that home with someone. I mean, and it takes time to sell a house, too. I mean, a home that’s for sale often is vacant, and that’s probably what makes it sell better, is being vacant.

If you have to, like, kick the renters out every few days to try to get someone to view it, you know, I don’t know if it’s as likely to sell. So, you know, vacant homes aren’t a bad thing. And really, when you look at our supply of vacant homes, it’s very tiny compared to the big picture of things.

Hamada: It is. Yeah.

Kent: I mean, we need to build housing regardless of how many vacant homes there are.

Ahokovi: Yeah. And, you know, the economics of it kind of works out, like Joe was saying, that there already is an implicit vacancy tax in Hawaii. And a way to think about it is, say, for instance, if the average rents here are $2,000 a month, and somebody chooses to keep their unit vacant, and you know, 12 months in the year, $24,000. That person is choosing to forego $24,000 in additional income because of the fact that they value their vacant property at more than $24,000. 

So, if you follow the logic there, then lawmakers would have to impose some sort of tax that is making the cost greater than $24,000 for vacant property owners. That seems like a pretty decent chunk of money right there. 

And so, the conclusion of the report is, somewhere along the lines of: Vacant homes are really just another scapegoat. Just like the Chinese foreign investor that people say are coming in and buying up homes. It’s another scapegoat that sidesteps the larger issue, which Joe mentioned, which is the fact that Hawaii is the most restrictive state in the nation when it comes to homebuilding.

Hamada: And a — not so recent now, but within the past year — UHERO [University of Hawaii Economic Research Organization] report basing cost of construction and homes tied directly to regulation. And you mentioned before: snip, snip, snip. You don’t even have to take a look. 

And that’s the killer about these discussions. Is that we see and understand and know how we can improve, but we have all this flowery and idealistic type of imagery, you know, that preys upon people a little bit of guilt. If you don’t support this, well, you’re really, really rejecting, and all of this.

Kent: Yeah, there’s two sides to the housing equation. One is building more supply, and the other is the demand side. Whenever we talk to lawmakers about, like, you know, make it easier to increase the supply of housing, all they want to talk about is the demand side. How can we make people want housing less in Hawaii? You know, if we could just make people want housing less. 

Well, yeah, you can make other people want housing less, but what about yourself? You know, everybody wants a house here, right? And so, there’s no way to decrease people’s wants, you know

We just need to build more housing, and there’d be enough for everyone. Just a little bit, actually. I mean, we’re not talking craziness here. We’re talking, you know, if you increased it by 1%, you know, the housing supply, by 1% or 2%, that would basically solve it.

Ahokovi: Yeah, and you know, another way to think about it is — and this relates to our outside buyer report — like, let’s say that you are able to kick out every single out-of-state buyer in the state, and you replace them with locals. Sure, you’ll have more locals in housing, but you’ll still have high housing prices because of the fact that supply hasn’t changed at all. 

And the reality is —and this is also kind of relating to, I don’t know if you saw this, but it was a recent, UHERO report as well on short-term vacation rentals — you know, it’s very plausible, and in fact, it’s expected, that if you have more outside buyers in Hawaii’s market, or if you have more short-term rentals, you should expect that there will be increases in price, right? 

And that’s just the basic economics. If supply is fixed, and you have more bidders on a scarce good like housing, the price will increase. That’s expected. 

But the reality of the problem is that the problem is rooted in the fact that supply is constrained. Not because of demand.

And another way to think about this as well is, so the UHERO article on short-term rentals, for example, said that, I believe, home prices would be in between 2% to 8% cheaper in Hawaii if there are no short-term rentals. 

Now, let’s compare that to the impact of zoning regulation, for instance. Economists Joseph Gyourko and Jacob Krimmel wrote a paper a couple years ago in which they calculated something known as the zoning tax.

The zoning tax is theoretically the amount of additional money that is added to the housing price as a result of regulation. And it’s a very simple equation. It’s just, you take the housing price, and you subtract construction cost and the cost of land, and whatever the remainder is, is the amount of money that regulation adds. 

And what they found is that the zoning tax is huge in the most regulated places in the country. For instance, Los Angeles, the zoning tax there is approximately $200,000. That is about, I would say, maybe a third of the median home prices there. 

Los Angeles also had a short-term vacation rental study done in Los Angeles, and they found that prices decreased by about 2% from a half reduction of Airbnbs.

Now, when you compare a third, 33%, roughly, to 2%, right? Well clearly, the impact of regulation dwarfs the impact of demand side factors like short-term vacation rentals. So, that’s just to put things into perspective. 

Even if there is an impact by these factors that nobody likes, like outside buyers or empty homes or short-term vacation rentals, the evidence is still clearly very indicative of the fact that regulation is the primary cause of unaffordable housing here.

Hamada: So, before we take our break and move on to more legislative issues, want to get your take. Why are homes at a million dollars, single-family home median? What’s the real causation? 

I know the … Thank you for the regulatory expense associated, but there’s a whole bunch of subsidy, and then you get into our own short-term rental actions by government squelching. Was it really housing? Was it really for tourism? Sort that out for us in about a minute. I’m just kidding. 

Kent: [laughs] Well, if you look across Hawaii, we have around 500,000 homes. And all of those homes are on about 5% of the land. Actually less than, it’s only about 2% or 3% of the land. You know, 5% is zoned for urban, but let’s not forget, in urban spaces, we’ve got airports, we’ve got industrial zones, we’ve got the harbors, we’ve got parks. You know, there’s no homes there. 

And so it actually turns out about 1% or 2% or 3% of the land in Hawaii is allowable to build housing on, and that’s why homes are so expensive, really.

It all boils down to that. And so, if you were to just increase even a half percent of that, that would be enough homes for everyone without endangering any open space, lands, without using up any ag lands or conservation lands or anything.

Hamada: So, how much is retained by government? How much is under the watch of the city, the state, the feds, military, trust lands, etc.?

Kent: We’ll come back next week with those numbers. [laughter]

Hamada: OK. I’m just saying, because of what you’re alluding to, that makes total absolute sense, because even in the pursuit of additional affordable housing, it’s invoked. “Well, we have the land, City and County. We have sufficient land that we can really” … Well, what are you doing retaining it now?

Kent: Yeah.

Hamada: Why is it not in the open market? How does it get Land Use Commission, zoning, etc.

Kent: That’s right. There’s millions of acres of land that are owned by government, that are just, you know, sitting fallow.

Hamada: Right. We are delighted, Grassroot Institute, and see how fast this goes.

Kent: Yeah, I know.

Hamada: 9:33 in the morning already, with Joe and Jensen, and we’re going to return in a minute, go through some specifics in the state Legislature, and take your calls, if you would like to, at 521-8383, but …

Hamada: And here we go. It is the second segment of this hour, already at 9:38 in the morning, with Joe and Jensen of Grassroot Institute, and I’m delighted that both gentlemen are in-studio with us. 

Transition over to the “big square building,” if we may. And I have one word. I know that George Carlin had the seven words you can’t say on television. One of the words on radio, one of those seven words, is budget.

Kent: Yeah. That’s right. The budget, you know, is exploding right now, in Hawaii. This is the biggest budget blow-up in the history of the state, probably. 

You know, we’re looking back at the data, and you know, we went to the state archives and the Legislative Reference Bureau to dig like a rat in the maze in their boxes of, like, old budgets. 

And we went as far back as the budgets go — and this is still, which is like the ’90s — and this is still the biggest increase by far. A 25% increase in the state budget from, like, $8 billion to $11 billion this year, in the general fund spending. That’s huge. That’s a huge uptick in spending.

Hamada: Yes.

Kent: And, you know, we actually used to have a surplus. You remember the surplus everyone’s talking about? “Oh, we’ve got all this extra money. Surplus is great.” 

And then we went and looked at the budget this year, after they passed it, and it’s gone. It’s all gone. 

We had a $10 billion surplus at the beginning of the year — that was supposed to be $10 billion in fiscal 2028. Then that got cut down to $7 billion halfway through the year, because they said, “Maybe the economy is looking down.” 

You know, I don’t know. So, they thought revenues might go down. But now, we looked at the new numbers, and it’s zero. It’s actually less than zero.

It’s in the red $47 million, and the reason that happened is because of the increase in spending. 

So, let’s not forget, when the government increases spending, it’s not just this year; it’s every year. And so, if you increase spending by $2 billion this year, you just increased spending by $2 billion every year going forward. 

And you project that to fiscal ’28, now that’s how you make $10 billion go poof.

Hamada: Poof. Poof is the word. All right. Oh, I have to watch my language here. [laughter] 

There are claims that the reason why the budget was utilized in such a way is there were limitations on the amount of federal monies that were realized during and post-COVID, and that those monies could not be utilized for basic fundamentals here at home. 

So, if we believe that premise, when there are singular appropriations of $600 million, for instance, DHHL [Department of Hawaiian Home Lands] or if there’s another $400 million, then it’s like we’re throwing around the “b word” — billions —  like it’s just, “I got some change..”

Kent: Yeah.

Hamada: “Here, let me just throw a little bit over there.”

Kent: [chuckles] Yeah. I remember when a billion dollars was a lot of money. Now it’s like, “Wait, what? You don’t have a billion dollars?” 

Hamada: Come on.

Kent: Yeah. [laughs]

Hamada: So, the catalyst for all of this, how much does the public really know about where money is truly spent? There’s the appropriation and all that. Do we? How do we know?

Kent: No, we don’t know anything. And even the lawmakers barely know.

Hamada: Dear heavens.

Kent: I mean, if you go to the budget committees, right? Really, it’s a few people who are, you know, dialing in the budget. And a lot of the people sitting on that committee, and even at the Legislature, are kind of left out of the loop. They’re sort of, you know, warm bodies in the seat. 

And it goes through, and even people on the budget committee were saying, at the very last budget, they said, “Where’d this $200 million come from? It just magically appeared.”

Now, this $200 million was a little slush fund that was created for the governor’s use that, I don’t know why, just so that he could use it however he wishes, to fund anything he wants, that’s politically popular. I don’t know. 

Was it a gift, because, you know, this is his first, you know, year as the governor, or was it a backroom deal, or what? I mean, I know they’ve done this type of thing in the past, but they didn’t do it last year for Gov. Ige. 

And so, and this begs the question about the division of powers, right? The separation of powers, right?

You’ve got the power of the purse, and so that’s supposed to be separate here. But now we’re giving the governor all this money to do as he wishes, unchecked. 

People say, “Oh, don’t worry. He has to let us know what he’s going to use it for, right?” 

That’s not check. That’s not a check. That’s a blank check, right? I mean, that would be like saying the unilateral power during the lockdowns was permissible because we could, I don’t know, make fun of him or criticize him or something. 

So, this is unchecked government power, and it’s, you know, a little disturbing, especially since they’ve already blown the spending limit.

The framers of the Constitution said, “We don’t want the government spending too much and wasting taxpayer dollars. We’re going to put a limit on you, and you have to, you know, do a two-thirds vote to get over that limit.” 

Well, in Hawaii, a two-thirds vote is a cinch to do. Almost all budgets are passed unanimously. And so, that’s how they get past that. But they shouldn’t even spend $1 over the limit, let alone a billion dollars. 

And so, we’re urging the governor to veto this $200 million slush fund, as we call it, or pot of money, if you want to be nice. And, you know, it’s the responsible thing to do as far as the taxpayer is concerned, is to veto that money.

Hamada: Evidently, that dollar amount would be good for, I think, dinner for four at Ruth’s Chris. [laughter] That must have been the appropriation intended. 

If we get caught up in that …. We have like just minutes remaining. 

The $200 million slush fund, it was … I’ve never heard a Democrat representative extol anger and dissent such as Rep. Della Au Belatti.

Kent: That’s right.

Hamada: Never. So when Della is standing up and going, “This makes me nauseous,” then you’re way beyond the pale.

Kent: Yeah, I know. I was really shocked at those comments from her. Actually, but what shocked me more was that more people weren’t saying that too. [chuckles] 

But anyway, you know, I’m glad that she said it, and now it’s out there. The newspapers are talking about it. I think it would be totally responsible and totally reasonable for a governor to take that money and veto it in the name of protecting taxpayer funds.

Hamada: Gosh, it’s crazy. 

We’re talking with Grassroot Institute, and will be a regular feature Thursdays at 8:40, where similar updates will be taking place. 

Jensen, I’m going to take a break in a moment, I’m going to turn it over to you. In all the conversation about budget, etc., where does that fall into, some of the specialties that you bring to Grassroot?

Ahokovi: Well, it’s, I mean, if it wasn’t apparent, I’m a housing researcher. Budget matters are not my expertise. But what I can say is that all the debate around the budget is a perfect example of why you should not trust the government to build you more housing. 

It’s a perfect example. I mean, potholes, budget, all of it. Perfect example why you shouldn’t trust the government with building more housing. And it’s really a perfect example of why the government should step back from housing policy as well.

You know, there’s just very basic fundamental flaws with the fact that, how can you trust some sort of bureaucrat to know what kind of housing to build, where to build the housing, how much to build the housing for? Lot of flaws with that sort of idea. 

And, like Joe was saying, there’s, you know, there’s a lot of problems with, you know, why should you trust some bureaucrat in the state to spend your money? You know, who knows how to spend money best? 

These are all just really fundamental questions at the core of not even housing, but also budgetary issues as well.

Kent: Yeah, and that’s a really good point about that. Because in the budget, the way lawmakers view the budget is that they think they can improve the economy, somehow. If they spend money in certain ways, they feel like they can boost the economy. 

But just like Jensen said, who is better at spending your money: the government or you, right? When the government spends money, that’s a dollar that they’re taking out of your pocket to spend the way they want. That may not necessarily be as productive as the way that you want to spend it.

And, you know, economic research, there’s a wide debate about this, but the research that we’re looking at is clear. The private sector is better at growing the economy than the government. You know, that’s the staple of economics.

Ahokovi: Yeah. And I will say that, you know, this is related to like some housing bills that have been proposed recently to reform of the zoning code for downtown Honolulu to allow things like the Walmart and other old office buildings to be converted into residential units. And a lot of people were coming out against it because some of the bills would allow for, quote-unquote, “windowless” rooms. 

Now, the question here is, why should the government decide the kind of house you should live in, right? If rents are high and you’re willing to, say, live in an affordable unit where there’s one room without a window, why should the government prevent you from doing that, right?

If the room is going to be cheaper, we should let people choose where they want to live. Now people are saying, “Oh, that, you know, nobody deserves to be caged up like a zoo animal.” Right? When it comes to all these sorts of housing reform bills. 

But the reality is, is that if you think about it, why should some bureaucrat in, you know, the “big square building” you pointed out earlier, why should they tell you where you ought to live and how your house ought to look, right? You’re best at that decision.

Hamada: Well, it’s part of the inevitable trend, because at every … And I’m just going to say one thing before the break. State of Montana just banned TikTok. Banned it. Banned it.

Kent: That’s right.

Hamada: And I’m, listen, I’m looking at this and going, “Are you kidding me?”

[laughter]

Hamada: You need to make the decisions as to what we can consume with all the inflammatory business about the Chinese. You want Chinese government, go talk to Bill Clinton and the Loral Corp. back in the ’90s. You want to talk about relationships? Government believes that they need to be in every aspect of your life and determine what is right and what is wrong. 

And if it determined to be right, you’re OK. Determined to be wrong, you’re gonna have a consequence. Whether it’s in finances, with empty homes, taxes or whatever. And it’s mind-boggling.

Ahokovi: Yeah. I mean, if we’re afraid of the content on TikTok, then we should be on TikTok and put our content on there. [laughs] That’s what we do at Grassroot, by the way. So you can join us at Oahu Joe at TikTok. [laughter]

Hamada: And that is true, and I’ve seen you out there.

Ahokovi: OK.

Hamada: So, listen, short break, final one, and then we’ll continue in a moment. 

All right. Welcome back. It is a great conversation, and it continues in a few moments, but relying on Joe and Jensen, what do you believe, that’s on the table now, that the governor should veto and what should pass?

Ahokovi: So, we’re in the season of slash or pass, right? And there’s a few that we think he should definitely pass. One is the doctor compact that I mentioned at the beginning. 

Basically, there’s this club, and certain states are in the club. If you’re in the club, doctors can easily go to your state. 

The problem is, Hawaii’s not in the club. We want to join the club, and the only way to do that, apparently, is for the governor to sign this bill. That’s SB674

And the other one is SB1437, which is basically a tax cut for businesses. That’s a good thing, because it’s not even like the state would lose any state revenues. This is a federal tax cut that the state legislators passed. I don’t know why or how …

Hamada: How did that happen?

Ahokovi: … that worked. There’s a quirk in the federal tax …

Hamada: Interesting.

Ahokovi: … law that allows us to do this.

Hamada: OK.

Ahokovi: And so, nonetheless, it would give a big tax cut to many businesses, and it’s a no-brainer for the governor to sign. So, we definitely want him to sign those. 

There’s a few that he should slash, though. Just throw them in the trash and light them on fire, if you could, please, Gov. Green. 

The first is the twin cryptocurrency bills that we’re seeing. It’s basically, cryptocurrency is really complicated, right? It’s like hard to even for individuals to understand, let alone lawmakers. 

And now lawmakers want to be the authority on cryptocurrency. They want to regulate, they want to overregulate cryptocurrency.

Hamada: To the point of rejecting …

Ahokovi: To the point of rejecting which businesses can operate in Hawaii, and which ones can’t, and which cryptocurrencies you can use, and which ones you can’t. And, by the way, you can only use our government cryptocurrency, the central bank digital currencies, and so on. 

So, this is all movement in that direction, and it’s a bad thing for this innovative space. So, get rid of those bills. 

Another one is the slush fund, like I mentioned, just veto it. It’s $200 million. You don’t need it. 

And SB1057, which would provide transparency. You know, you think transparency is a good word. Like, we all want transparency. But this is transparency for the private-sector businesses. You know, this is …

Hamada: That’s right.

Ahokovi: … the government wants transparency when it comes to the private sector, [chuckles] but they don’t want transparency for themselves, though. And private should be private. It should be up to the business whether or not they disclose their salaries on jobs postings, right? And so this is just meddling, too much meddling, so veto it.

Hamada: So much utter, absolute attempts at control. And it’s just the pushback has to be there, but our pushback is at the voting booth. And until we get to a point where we have a determined … You know, I’ll put it this way in the short time. 

I always call politics a numbers game. It’s a numbers game with campaigns, with dollars, with votes, obviously. And I always maintain, for those of us that are in opposition to this abject control, is that there’s more of us than there is of them.

Kent: Yeah.

Hamada: And it’s the mobilization through education, etc.

Ahokovi: And if you want to tell the governor what you think about these bills, go to grassrootinstitute.org/action. And we have a very easy form and process that you can pick which bill you want to tell him about, of the ones I mentioned. And we can get him to slash it or pass it the right way for Hawaii residents. So, grassrootinstitute.org/action.

Hamada: Perfect. Just a quick note because we have a couple of moments remaining. Just a reminder, log on to khvhradio.com. You can sign up to win. We have a LA Dodger Fly Away. We’re flying off to Los Angeles, “The Poor Sports” radio show, which is today, Thursday, at 12 noon on Fox Sports 990. Enter to win, because you could come out with us. We’ll fly you out, put you up, and I’ll be, along with Jimmy, wearing a Cubs jersey at a Dodgers game. But sign up and win now. 

Jensen, final thoughts today. What would you like to leave us with?

Ahokovi: You know, similar line to what you were saying, voting. When it comes to housing, especially, there’s too much opposition at City Council meetings, or when people propose projects. And part of the reason why is that all Council members here are the voices of the people inside the community, but they don’t hear enough voices of the people who could be living in the community. And that means the younger generation, that means people who are working class, that means a lot of people. 

And we just don’t hear enough about that for housing here. And that’s probably the biggest step we can take, outside of legislative action. And that is voter action.

Hamada: I’ll say this. That, Jensen, today our first time together, you definitely deserve a 64% raise.

[laughter]

Kent: I’ll follow what they do at the legislative. Yeah.

Hamada: If you could continue that trend. Joe, thank you very much, as always.

Kent: Thank you.

Hamada: And I’m glad we’re going to get together on a regular basis.

Kent: Yeah. Great.

Ahokovi: Thank you.

Hamada: Gentlemen, thank you so very much, and thank you for being a part of the program.

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