Wednesday, March 30, 2011


SPILL YOUR GUTS: Like the clockwork of a broken timepiece the legislative session reaches one of its more absurd dances-of-the-headless-chicken, usually once each session when the Council on Revenues (COR) causes all the budget work done to that point to be chucked in the circular file when they apparently use the poor dead poultry's entrails to divine the economic future of the state.

But, as is the case with many broken political systems, the Hawai`i solution is to repeat the screwed-up process until the whole damn thing collapses.

For the uninitiated, the Hawaii legislative budget system is designed to create a balanced budget but it relies on economists- you know those guys who never agree on anything, basing their opinions on what they had for breakfast that day- to predict the revenues the state will pull in during the budget period.

And as if to prove how unreliable it is, they change their projections every time they meet with wild swings based on current events.

And are always- yes always- wrong.

That they meet at all is objectionable. That they schedule a meeting in the middle of the brief four month legislative session- after the governor presents a budget and the lege works on it- is ridiculous. But when they meet a second time- as they did yesterday at the behest of the governor due to the supposed economic effect of the Libyan war and the Japanese earthquake and tsunami- is disgustingly short sighted... although so is the whole process.

So when the COR lowered projected revenues yesterday no one really questioned why because we'd been told in advance by various pinheaded pundits what the cause was.

But the real foolishness was never more apparent than after reading Honolulu Star-Advertiser Capitol Correspondent Derrick DePledge's blog post today where he reveals what may be the real reason for the lowered projections.

After listing the conventional wisdom he notes that the actual amount collected last month was, shockingly, lower than the last projection predicted he writes that:

While the drop could be an anomaly, it could also mean the economy is not recovering as fast as economists believed.

Pearl Iboshi, an economist, and others on the council found the February figure hard to believe. She had a theory for the state Department of Taxation. “Is there a chance that there’s, uh, you know, lots of …”

“A drawer there with a bunch of checks in it?” University of Hawaii-Manoa economist Carl Bonham said.

“Yes, lots of checks,” Iboshi said.

“That somebody forgot to open because everything slowed down?” Bonham said.

A state Department of Taxation staffer slowly nodded her head.

“There is a chance of that?” Jack Suyderhoud, a University of Hawaii-Manoa business economics professor, asked the staffer. “Is that why you’re going like that?”

“That’s not saying yes, but …” Bonham said.

Of course the end of that sentence is "I'm not saying no".

So we suggest gathering up all your spare tea leaves, tarot cards and crystal balls putting them in a box and shipping them off to the COR. They just may be more valuable tools than the ones they're using now.

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