Earlier this week, we covered the publication of “Beyond the Price of Paradise," by UH’s Economic Research Organization. That paper described how Hawai‘i doesn't only have a high cost of living, it has an intrinsically weak, slow-growth local economy of stagnant wages.
"ʻA byzantine labyrinth of laws, bureaucratic red tapeʻ [are] choking Hawai‘i's business climate. "Government intervention in the marketplace could be tolerated when the economy was booming ... but the economy has [since] been stagnant and the business climate and economic development have emerged as major political issues."
Wait, hold on. That quote is not from UHERO's February 2026 report.
It's from me, in a September 1998 cover story for Honolulu Magazine called "We Were Warned," and most of it is, in turn, from a September 1985 Wall Street Journal article.
Kama‘āina of certain age will recall that while the Mainland boomed through the hot dot-com ’90s, Hawai‘i stagnated, badly, seemingly endlessly. "We Were Warned" was a detailed history of all the times local observers and Mainland business journalists noticed the flaws in Hawai‘i's economy, going back as far as 1973. Again and again, observers went into great detail about how Hawai‘i was buoyed up by external money while being dragged down by internal weaknesses — small, isolated, no manufacturing, no exports post-sugar and post-pineapple, expensive transportation costs, all overseen by an overbearing government class that treated profit as an evil.
It is a strange feeling to read our article this week about UHERO's report, then get up, walk past ‘Iolani Palace, march into the main State Library and pluck my nearly 28-year-old story off the shelf.
The pages were all yellowed. Because that issue is old.
Even more distressing is reading that, "generally, the lost decade of the 1990s never really ended but rather it has persisted for 35 years." That quote does indeed come UHERO's lead authors, Steven Bond-Smith and Erich Schwartz.
Yes! We know!
Their report directs our attention from the high cost of living to the low wages, seeing the latter problem as more significant, particularly when they looked at the motivations of people who have moved away over the past two-plus decades years.
"Crucially, the combination of high prices and low incomes predicts as much outmigration as in some of the nation’s most struggling cities, where low costs of living typically cushion economic disadvantages," they write. "In short, Hawaiʻi’s residents face a unique mix of high prices and low incomes that, together, match the economic pressures found in struggling regions more than in prosperous, high-cost cities."
I applaud their efforts to qualify this mathematically. But my Gen X friends and I have literally been joking for decades, "We have the highest cost of living in the nation ... and we make up for it with the lowest wages!"
The UHERO authors have a prescription for their diagnosis.
"Revitalizing growth will require deliberate, well-designed policies that identify and remove barriers to diversification and innovation, supported by strong governance that emphasizes continuous monitoring, accountability, and adaptation," they write.
Sounds great!
But what I learned writing that 1998 article, and have seen repeated since, is a consistent pattern:
Someone publishes a report critical of the structures that impede the local economy. If the report comes from a Mainland writer, local leaders react with rage and denunciation. Eventually, the political class notices that we, the people, actually agree with the report and are quite angry. Then politicians announce, with some fanfare, a Task Force to identify the barriers to economic growth and diversification.
Former governors George Ariyoshi and Ben Cayetano had a Task Force.
More recently, former Gov. David Ige created a Task Force during his Covid-19 panic. Remember when he appointed Alan Oshima, retired CEO of Hawaiian Electric, to be the Hawai‘i Economic and Community Recovery and Resiliency Navigator?
That effort went nowhere.
Just like the findings of all the previous Task Forces. There's a press conference for the big debut of the Task Force, then crickets when its final report is filed away. These reports are probably on a shelf somewhere just yards away from my old article.
I think the reason for that failure to act is that the last thing our government class wants to do is exactly what these reports have said over and over.
It needs to get out of our way. Deregulate. Cut taxes.
We are all partly to blame for this. We, collectively, continue to beseech governor after governor, legislature after legislature — please, diversify our economy. Please, do something about the economy!
But the economy doesn't come from the government. The economy is just you and me, exchanging goods and services for money.
That's it. We make the economy. Government comes after, ideally to facilitate our interactions. It's handy, for example, when we have it build roads or standardize weights and measures. Less so when it behaves, decade after decade, as if its purpose were still to constrain the Big Five sugar companies.
So simple, and yet so complex that you need a Ph.D. to be a UHERO author.
Here's the reality going on in the Big Square Building: The Legislature gave some mighty fine speeches on opening day about affordability, about economic diversification, about housing opportunities, about stemming the tide of kama‘āina fleeing for better pay and lower costs on the Mainland, all that.
That's what they said. What have they done so far? I see a parade of bills that mainly add regulations, punish businesses, micromanage our behavior, and raise taxes.
There's lot of tax-raising getting discussed over there. The fear is palpable in the Legislature, an extension of Gov. Josh Green's sudden hesitancy to let us keep the tax breaks he once bragged about. That fear is, "The economy is lousy and the feds are cutting back: Where are we going to get the money for our jobs and pensions?"
Every buck they extract from a local business is a dollar that employer doesn't have for salaries. Every buck they extract from you eats into your buying power.
And it's totally going to happen if you don't speak up. These people really, seriously want their state revenue.
You and your needs will not come first in the Legislature if you don't demand it. Follow the bills. Testify. Call your representatives, email them. Show up for hearings. Ask them, "How does bill grow the economy, build houses or lower costs? If it doesn't do any of those things, why are you wasting time on it?"
Even better: It's an election year — run for office! Encourage good, smart people to run for office. Campaign for better representatives. I'm seeing this Legislature advance bad bills over business-group opposition simply because individual legislators are filled with paternalism and too few of their peers are opposing them. Ultimately, running for office is the most meaningful thing you could do, as the legislators are remarkably resistant to public opinion.
If you don't like where we're going, change the navigators.
A. Kam Napier is editor in chief of Aloha State Daily. His opinions in Pipikaula Corner are his own and not reflective of the ASD team.
For the latest news of Hawai‘i, sign up here for our free Daily Edition newsletter.
A. Kam Napier can be reached at kam@alohastatedaily.com.
