Pundits are all over the board with the bears and bulls in a dead heat. The markets were up in 2010, and so far in 2011 they continue to stay up with positive economic news of the day. Still, consensus is that the fundamentals remain worrisome. New regulations under Basel III have few teeth and cannot be counted upon to prevent another economic crisis. The cost of the wars in Iraq and Afghanistan combined with massive expenditures to stimulate the economy have placed future American generations in unimaginable debt.
In contrast, the European Union has chosen to focus on austerity measures with dramatic wage cuts, reduced government spending and new laws that require citizens to work longer and harder before retirement. China is taking measures to cool down growth and thereby avoid a property bubble that could burst. Meanwhile, emerging markets are making a significant positive impact on the global economy.
The net effect is upward pressure on commodities and natural resources including minerals and petroleum. Governments are keeping a close eye on inflation. So long as growth persists and gathers momentum, the stock market will remain solid. As the consumer mood improves, people will spend, and the increased tax base will take some pressure off of our national budget and debt accumulation.
History never repeats itself. It just spirals back around. Sure, mistakes are often repeated, but it is always a "New Day." Although we appear to be in economic recovery, Americans still have to adjust to a new normal. House prices cannot be expected to bounce back to the boom days, and household debt and taxes remain onerous. There is increased competition and, in many quarters, fewer job opportunities under more challenging conditions.
As tourism recovers, Hawaii can breathe a sigh of relief that despite the economic hits our state has taken, we are extremely fortunate compared with most. Many others have had to do more with less. I recently returned from the Middle East and Europe and offer some examples:
Egypt, a net oil importer, does not possess the abundant natural resources of its neighbors. Its infrastructure is dismal. Yet, in the stark and dry Sinai Peninsula, it has developed a flourishing eco-tourism industry centered on diving. The developments look like a cross between Florida and Las Vegas and lack the sense of place we work to preserve in Hawaii, but the diving is great and the tourist volume is impressive.
Israel, neighbor to the north, contends with comparable geography plus daunting security issues. Nevertheless, the country is in the midst of an amazing technology and IPO boom. The country is deeply committed to renewable energy. Due to a scarce water supply, it is forced to develop efficient methods for desalinatization. There are also solar water heaters on the rooftops as far as the eye can see.
Ireland, still reeling from its boom-to-bust housing market and IMF bailout, is working to reinvent itself. It is using its core strengths, education and a creative work force to leverage information technology and increase productivity through enhanced data management. It is also using IT to reduce energy requirements for existing manufacturing processes boasting a rapid ROI for multinational pharmaceutical companies.
Hawaii enjoys security, not seen in Israel, infrastructure that surpasses Egypt and, despite budget woes, no sign of an IMF bailout.
Sure, we need to manage our natural resources more efficiently, improve public transportation and heal damaged investor confidence from a bumbled Act 221, but efforts afoot are highly promising as we employ the talents of our multicultural island community and its core values, sense of place and relationship to environment. We still have a long way to go, but we are getting there.
Ira Zunin, M.D., M.P.H., M.B.A., is medical director of Manakai o Malama Integrative Healthcare Group and Rehabilitation Center and CEO of Global Advisory Services Inc. Please submit your questions to firstname.lastname@example.org.