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Hawaii leaders should march in Lim's parade

For Tuesday, June 21, 2011

By Jay Fidell

POSTED:
LAST UPDATED: 02:27 p.m. HST, Aug 05, 2011



In his recent remarks to the Hawaii Economic Association, Richard Lim (banker, venture capitalist and director of the state Department of Business, Economic Development & Tourism) said something that should have been said, and done, a long time ago. He said let's diversify the economy and stop relying on tourism. We should be moved by his clarity and courage.

In growth, Hawaii is 44th in the country; not good. In a state with a stagnant economy, the director may be the most important director of all. It's up to him to find a way to rebuild and remake that economy. It's mission critical on every level, so let's listen well and support him all we can.

For reasons rooted in momentum, local economists and bankers have repeatedly urged us to rely on tourism as the proven cash cow. So advised, we've taken things for granted and haven't made any serious effort to diversify. And Linda Lingle's "innovation" initiative was unpersuasive given her attacks on Act 221.

Our complacency has been complete. Tourism has become our cargo cult. We pay millions for ads, and hope they will come. We keep careful figures about them, noting it's up or it's down, without knowing why. Remote factors dictate our occupancy, and we've become captive beneficiaries of faraway global events.

If we really cared about tourism, we would make far greater investment in it, well beyond ads. How about beautiful parks (without the homeless), perfect beaches, soaring arts centers, repaved roads, upgraded sewers, a world-class airport, an interisland ferry and lots more. While we've given up doing any of that, competing destinations have been doing plenty of it, and eating our lunch.

We're not on top anymore. Our plant and franchise are aging. And what can we fall back on? Our agricultural exports are curiosities, the military is here by dint of one senior senator, our construction industry is stuck in labor and seventh-circle obstacles, and our retail juggernaut is owned offshore. Our largest industry is our entrenched bureaucracy, entangling our entrepreneurs.

Richard Lim's remarks speak of a New Day for Hawaii's economy. Although some wags reacted with knee-jerk skepticism, warning us it'd better not give up tourism, others, like the Star-Advertiser, welcomed his message. Lim will need to keep repeating that message to get commitment and action from the business community.

Shelley Mark, director of DBEDT under John Burns, wrote a chicken-skin letter to the editor about this last week, reminding us that Burns had said that "Hawaii is not a tourism state" and that the future of our children must rely instead on "science, technology and knowledge innovation." That was 40 years ago.

Since then, we've developed dynamics that go the other way — the lack of good jobs, careers and skilled work force; a broadening economic disparity; a narrowing tax base and routine budgetary crises; ubiquitous NIMBY that blocks projects and progress; an inhumane lack of affordable housing; and worst of all the loss of our children to the mainland. Relying on tourism gives us all of these things.

The worry is that Richard Lim's admonition will drift off with the words of John Burns. We can't let that happen. We must join Richard Lim and Neil Abercrombie in their efforts to diversify before it's too late, perhaps by a parade, which would be appropriate, but at least by fervent participation in local investment and public-private partnerships, as they suggest. We need to get off the fence.

If Lim can be courageous and passionate about the future, so can we and, for that matter, so can legislators. They need to understand that it's not a zero sum game — diversification can only improve whatever we've already got.

It's thrilling to witness history, and this administration, at least for now, is an example of history rising to correct its course. Diversification of our economy after all these years will be the most important thing since our exodus from the plantations. Let's make a chorus to show we are in agreement. This is not a time for fragmentation. We've had enough of that. Parade, anyone?

Jay Fidell, a longtime business lawyer, founded ThinkTech Hawaii, a digital media company that reports on Hawaii's tech and energy sectors of the economy. He can be reached at fidell@lava.net






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