Beyond Tourism

[John Maple]

For almost two centuries, the Hawai'i economy has worked on a cash crop system: from sandalwood to sugar to pineapple to defense and finally tourism, our island economy has usually over-invested in one sector, leading inevitably to problems. A diversified economy, I believe, is important

Some of the problems with tourism that I see:

• Exploitation of Hawaiian culture.
• Lower paying jobs
• Decreased quality of public schools
• Distorted real estate market
• Environmental impacts

Tourists, because of the dollars they bring, are often favored at the expense of residents.

In this thread, I'd like to open a discussion on new economic sectors that go beyond our current tourist-centered economy. For example, I think strong technology and finance sectors would benefit Hawai'i. How can we achieve these goals? What skills would workers in these sectors need? What are the likely consequences? What can we do to manage these? To become a technology center, for instance, Hawai'i would need a labor force with exceptional mathematical and science training. Do we have the educational infrastructure to accomplish this? What steps could we take to ensure this?

Anyway, I'd like to hear ideas on this.

[sinjin]

Re: Beyond Tourism

For almost two centuries, the Hawai'i economy has worked on a cash crop system: from sandalwood to sugar to pineapple to defense and finally tourism, our island economy has usually over-invested in one sector, leading inevitably to problems. A diversified economy, I believe, is important

Some of the problems with tourism that I see:

• Exploitation of Hawaiian culture.
• Lower paying jobs
• Decreased quality of public schools
• Distorted real estate market
• Environmental impacts

Tourists, because of the dollars they bring, are often favored at the expense of residents.

In this thread, I'd like to open a discussion on new economic sectors that go beyond our current tourist-centered economy. For example, I think strong technology and finance sectors would benefit Hawai'i. How can we achieve these goals? What skills would workers in these sectors need? What are the likely consequences? What can we do to manage these? To become a technology center, for instance, Hawai'i would need a labor force with exceptional mathematical and science training. Do we have the educational infrastructure to accomplish this? What steps could we take to ensure this?

Anyway, I'd like to hear ideas on this.

Tough nut to crack IMO. If it's manufacturing there seems little reason to produce so far from your market if that's the mainland of North America. To sweeten that deal Hawaii might have to consider environmental/tax concessions that would be unattractive. If it's online services maybe, but how does Hawaii compete with India on wages? If it's banking, why use Hawaii when other "offshore" options are situated where the standard of living for locals is already below Hawaii's? It has to be something unique to Hawaii, available only in Hawaii or almost. Beyond specialized agriculture Hawaii has little other than itself to market. Is there some direction tourism could be steered that would actually improve the quality on life for residents? This is what I would concentrate on.

[John Maple]

Re: Beyond Tourism

We can move on all three fronts.

You're right that manufacturing would not work if we consider the only market to be the CONUS. But that isn't necessarily so; China is an excellent market opportunity, and Hawai'i has an advantage if the market in question is the entire Pacific Rim.

With respect to banking, I'm envisioning something closer to an actual financial center, like Singapore or perhaps even Hong Kong, rather than a simple off-shore banking option. While tax incentives might be an initial step, the major attraction would be a bread-and-butter matter: the ability of an investment bank here to turn out a profit. If banks here do that better than anyone else, that's what matters. And that comes down to the labor force.

What this underscores, IMO, is that the major investment Hawai'i ought to make is churning out a highly skilled labor force. India may produce cheaper watches, for example, but Switzerland makes better ones. Hawai'i benefits from the easy confluence of Asian and Western influences, as well as a strategic place in the Pacific. Again, IMHO, the reason similar attempts at developing a tech-sector have not exactly succeeded is because the necessary educational infrastructure doesn't yet exist. A serious attempt at developing a tech sector would require the creation of a technical school on par with MIT or Cal-Tech. I certainly believe we're capable of that without importing outsiders in large numbers--just take a look at the kids Punahou, Iolani and the rest send to schools like that every year.

[sinjin]

Re: Beyond Tourism

We can move on all three fronts.

You're right that manufacturing would not work if we consider the only market to be the CONUS. But that isn't necessarily so; China is an excellent market opportunity, and Hawai'i has an advantage if the market in question is the entire Pacific Rim.

As the dollar falls this opportunity becomes more plausible. Does that translate into high wage jobs in Hawaii? Not necessarily.

With respect to banking, I'm envisioning something closer to an actual financial center, like Singapore or perhaps even Hong Kong, rather than a simple off-shore banking option. While tax incentives might be an initial step, the major attraction would be a bread-and-butter matter: the ability of an investment bank here to turn out a profit. If banks here do that better than anyone else, that's what matters. And that comes down to the labor force.

Build a better mouse trap and yes. Competition is already pretty stiff though and residents of Hawaii are not known for being the "early birds". No offense. I like laid back.

What this underscores, IMO, is that the major investment Hawai'i ought to make is churning out a highly skilled labor force. India may produce cheaper watches, for example, but Switzerland makes better ones. Hawai'i benefits from the easy confluence of Asian and Western influences, as well as a strategic place in the Pacific. Again, IMHO, the reason similar attempts at developing a tech-sector have not exactly succeeded is because the necessary educational infrastructure doesn't yet exist. A serious attempt at developing a tech sector would require the creation of a technical school on par with MIT or Cal-Tech. I certainly believe we're capable of that without importing outsiders in large numbers--just take a look at the kids Punahou, Iolani and the rest send to schools like that every year.

Why not just send the kids to MIT or Cal Tech like rich foreigners do with their kids?

[John Maple]

Re: Beyond Tourism

As the dollar falls this opportunity becomes more plausible. Does that translate into high wage jobs in Hawaii? Not necessarily.

Nothing is a guarantee, but if done correctly, certainly provides an alternative sector to tourism. That alone puts more competition for the labor force and helps workers.

Build a better mouse trap and yes. Competition is already pretty stiff though and residents of Hawaii are not known for being the "early birds". No offense. I like laid back.

I realize you don't mean offense, but I still find this comment condescending. Nothing says we have to become workaholics, but people in Hawai'i are not adverse to work. People who aren't "early birds" don't pull two or three jobs just to make ends meet, which many people here do. If they're going to put in the hours, with a small population and limited resources, it makes sense to invest in high-skill jobs which are, in the long run, safer from competition. We have the brains to do this.

Why not just send the kids to MIT or Cal Tech like rich foreigners do with their kids?

Because, unlike those kids, our MIT/Cal Tech caliber locals don't have an incentive to return. They can make more money in New York City or Silicon Valley, save up enough to buy a vacation home here (contributing to the distorted real estate market for long-term residents), and otherwise stay out of the Hawai'i economy. Over the long term, that amounts to a brain drain of those who could best contribute to our islands.

[craigwatanabe]

Re: Beyond Tourism

High tech businesses can work here if their are good tax incentives to operate locally.

One thing about business and taxes, they don't like each other and with Democrats against most tax breaks (who's gonna pay for the subsidies) here in Hawaii, it's become a political hot potato when you combine business venture and toss in our political climate.

Then there's the cost of housing and food. It's one thing to earn a good wage here, it's another to see it being swallowed up by housing costs and eating.

If we can address these two issues then I think we can attract the better and the brighter to Hawaii. But then again is that what Hawaii needs? With limited space for those of us here already, many individuals and families will be displaced when places for living become a premium and prices start to soar due to a limited housing inventory.

And who will be affected the most? Typically the poor, many of which are in fact our Kanaka Maoli.

I think Hawaii is fast becoming the text book example of how an economy can destroy a culture. We do have a vibrant economy now but at what cost? Our homeless and the education of our Keiki. The difference here in Hawaii versus Japan and Hong Kong is that we have culturally sensitive lands that cannot be developed and a fragile eco-system that cannot tolerate progress like many other geographic spots around the world.

That's one side of the problem. Another side is our cost of labor and the cost to bring in material for labor to build with.

Hawaii being the most isolated port in the world plus being a part of the United States means high labor costs, high freight costs, strict environmental laws, strong civil liberty laws, and most of all limited resources and land for businesses to thrive upon.

Hawaii is an expensive place to do business in and to live in. Great place to visit though and that's why Tourism is our #1 fuel for Hawaii's economic engine. I think if I were a native Hawaiian and had to depend on an industry to sustain my way of life, I'd rather have a business that caters to transients rather than transplants. At least that way those who visit do in fact leave instead of making it harder for those who are struggling already.

Heck if our sugar and pineapple plantations could provide housing for their workers, why can't the hotel corporations? Here on the Big Island some of the hotels in Waikoloa are helping retain their workers by helping with their housing needs. Yes it's an additional cost for business but unless you like to waste thousands of dollars in training new employees over and over again everytime one leaves for a better paying job locally or on the mainland, it's a cost worth paying.

[sinjin]

Re: Beyond Tourism

I realize you don't mean offense, but I still find this comment condescending. Nothing says we have to become workaholics, but people in Hawai'i are not adverse to work. People who aren't "early birds" don't pull two or three jobs just to make ends meet, which many people here do. If they're going to put in the hours, with a small population and limited resources, it makes sense to invest in high-skill jobs which are, in the long run, safer from competition. We have the brains to do this.

As long as there are people willing to sacrifice more for monetary reward, anyone wanting to out-compete them will have to do likewise and then some. Does that mean becoming a workaholic? Probably IMO. Condescending maybe but just because someone works three jobs doesn't mean they know squat about business and building wealth.

[John Maple]

Re: Beyond Tourism

High tech businesses can work here if their are good tax incentives to operate locally.

One thing about business and taxes, they don't like each other and with Democrats against most tax breaks (who's gonna pay for the subsidies) here in Hawaii, it's become a political hot potato when you combine business venture and toss in our political climate.

Politicians are ultimately beholden to votes or, in the last resort, money. The problem with tourism right now is that politicians are more beholden to a transient population--one that makes only a temporary investment in Hawai'i and has no long-term interest in the islands. Do you really think that a tourist here on a week long vacation cares whether or not your children can do trigonometry? Politicians know that they can pay lip service to the public schools because the interest group they're beholden to most--the tourist interest--doesn't care about the public school.

Tax incentives are certainly a part of the package, but nothing earns a tax incentive like success. If locals invest in (preferably local) highly skilled workers and commit themselves to turning out profits in this manner, they will earn the influence to get those tax incentives, spurring further growth. The ball's in our court, not the Legislature's.

Then there's the cost of housing and food. It's one thing to earn a good wage here, it's another to see it being swallowed up by housing costs and eating.

Eating costs are for the most part fixed, a function of our geographically isolated position. The solution to this is to consistently make more money than our eating costs. The strongest strategy, to me, is to develop a highly skilled tech sector and to invest in human capital, the way other small places have done.

Housing costs are a function of the transient population. Vacation homes are linked to the tourist industry. I expect that between better wages and a less distorted real estate market, Hawai'i could quickly become an economic success story.

If we can address these two issues then I think we can attract the better and the brighter to Hawaii. But then again is that what Hawaii needs? With limited space for those of us here already, many individuals and families will be displaced when places for living become a premium and prices start to soar due to a limited housing inventory.

And who will be affected the most? Typically the poor, many of which are in fact our Kanaka Maoli.

Which is precisely why we need to focusing now on training and educating residents so that they can grab high demand jobs that pay a living wage. We can either helplessly allow ourselves to be priced out of paradise or we can make the investments necessary now to keep up with those prices.

I think Hawaii is fast becoming the text book example of how an economy can destroy a culture. We do have a vibrant economy now but at what cost? Our homeless and the education of our Keiki. The difference here in Hawaii versus Japan and Hong Kong is that we have culturally sensitive lands that cannot be developed and a fragile eco-system that cannot tolerate progress like many other geographic spots around the world.

There's no need for extensive development--no more than already has been done if we're willing to sacrifice tourism and devote more of our existing infrastructure to educating our keiki, so that they can be the leaders, not just the servants, of tomorrow.

Hawaii being the most isolated port in the world plus being a part of the United States means high labor costs, high freight costs, strict environmental laws, strong civil liberty laws, and most of all limited resources and land for businesses to thrive upon.

And all of these disadvantages can become comparative advantages. High labor costs can be mitigated by developing expertise, so that you deserve the high wages. High freight costs don't mean much when you're discussing things like international banking (which nowadays is handled electronically). Strong environmental laws translate into a better quality of life, which doesn't hurt when discussing professional jobs. Civil liberty laws mean we have the legal infrastructure to support complex business models (you don't need to worry about the government confiscating your assets in the middle of the night). Resources and land are always limited; it's more about maximizing the output of our resources. But we do have human capital and because we have a small population, we can afford to provide our residents with more extensive education and training.

Hawaii is an expensive place to do business in and to live in. Great place to visit though and that's why Tourism is our #1 fuel for Hawaii's economic engine. I think if I were a native Hawaiian and had to depend on an industry to sustain my way of life, I'd rather have a business that caters to transients rather than transplants. At least that way those who visit do in fact leave instead of making it harder for those who are struggling already.

I don't see why the choice is between transplants and transients. There's no reason why a Hawai'i technology sector cannot . Intelligent outsiders certainly should have the right to compete (they will anyway, no matter how you fix it). Understandably, Hawai'i residents don't want to be displaced by outsiders--but the solution is to beat them at the game, not shoot yourself in the foot. As a Native Hawaiian, I can say that I'm confident Hawaiians can compete with the best of them, given the training. Hawai'i has a lot of talent, and it's a shame if that talent winds up contributing to the CONUS economy. Furthermore, as I noted, a transient population has little incentive to concentrate on needed infrastructure here, especially education.

Heck if our sugar and pineapple plantations could provide housing for their workers, why can't the hotel corporations? Here on the Big Island some of the hotels in Waikoloa are helping retain their workers by helping with their housing needs. Yes it's an additional cost for business but unless you like to waste thousands of dollars in training new employees over and over again everytime one leaves for a better paying job locally or on the mainland, it's a cost worth paying.

The hotels have no incentive to do so. Whereas agricultural workers need to be on hand to constantly maintain the plantation, the hotels see their workers as easily replaceable.

[John Maple]

Re: Beyond Tourism

As long as there are people willing to sacrifice more for monetary reward, anyone wanting to out-compete them will have to do likewise and then some. Does that mean becoming a workaholic? Probably IMO. Condescending maybe but just because someone works three jobs doesn't mean they know squat about business and building wealth.

I wasn't claiming that Hawai'i workers were all investment gurus, simply that they weren't lazy, as your comment seemed to imply.

Working harder is not the key here--it's working smarter. Some of the greatest advances in technology come from fundamental human laziness and ingenuity. Competing effectively means finding efficient systems to get things done faster. That comes down to brainpower and I think Hawai'i has that in natural abundance.

[sinjin]

Re: Beyond Tourism

I wasn't claiming that Hawai'i workers were all investment gurus, simply that they weren't lazy, as your comment seemed to imply.

Working harder is not the key here--it's working smarter. Some of the greatest advances in technology come from fundamental human laziness and ingenuity. Competing effectively means finding efficient systems to get things done faster. That comes down to brainpower and I think Hawai'i has that in natural abundance.

No, I wasn't suggesting laziness but simply that to compete with aggresive mainland business types you have to do what they do. "Early birds" as in those that are always on the lookout for new ways to capitalize and make a buck. Sorry if I was unclear. I think this a bad idea btw. A sure way to change Hawaii for the worse as is happening anyway as we speak.

You keep referring to these high tech jobs commanding high wages. Like?

[John Maple]

Re: Beyond Tourism

No, I wasn't suggesting laziness but simply that to compete with aggresive mainland business types you have to do what they do. "Early birds" as in those that are always on the lookout for new ways to capitalize and make a buck.

You do have to be willing to innovate, but that doesn't translate into becoming a Type A perpetually angry workaholic. There's nothing wrong with looking for new ways to capitalize and make a buck. And again, innovation doesn't necessarily mean acting like Donald Trump. It can also mean mastering high-demand skills which are not easily replicated. It doesn't matter how "aggressive" a CONUS mathematician or engineer is; if the equation is incorrect or the design is faulty, that's what matters.

Hawai'i, incidentally and contrary to stereotype, has some of the most time efficient workers in the country. Only South Carolina and Rhode Island workers waste less time than the average Hawai'i worker.

Sorry if I was unclear. I think this a bad idea btw. A sure way to change Hawaii for the worse as is happening anyway as we speak.

How is innovation a change for the worse? How is increased investment in education a change for the worse? How is ensuring that our keiki are the best trained, best qualified professionals in elite fields a change for the worse?

The change is inevitable. Either Hawai'i will adapt and innovate, keeping its local population here with good paying jobs, or highly skilled locals will leave for CONUS and other places, while above-average CONUS technocrats will supplant the upper and upper-middle classes. The poor here will only get poorer, until the tourism industry collapses from its own weight, sending the islands into a ruinous depression. That's what happened in the '90s--the result was a massive outmigration of residents. Hawai'i is temporarily recovering because of the influx of transplants, but they won't tolerate localisms for long. You can then expect either another depression, leading to more outmigration, or the emergence of a transplanted meritocratic elite that will be making money off the ash heap of tourism.

You keep referring to these high tech jobs commanding high wages. Like?

The average MIT graduate (with a master's degree) commands over $76,000 a year fresh out of school whereas hotel workers (even with years of work and union protection, which won't be sustainable in the long-term) make about $31,000 a year. And many of these MIT graduates go into fields like consulting and finance, where they can expect huge bonuses as they continue with a company. The truly brilliant go on to innovate and own companies that line Silicon Valley.

[sinjin]

Re: Beyond Tourism

The average MIT graduate (with a master's degree) commands over $76,000 a year fresh out of school whereas hotel workers (even with years of work and union protection, which won't be sustainable in the long-term) make about $31,000 a year. And many of these MIT graduates go into fields like consulting and finance, where they can expect huge bonuses as they continue with a company. The truly brilliant go on to innovate and own companies that line Silicon Valley.

What industry will relocate to Hawaii and for what advantage?

Are you in politics?

[joshuatree]

Re: Beyond Tourism

Some thoughts to the discussion.

First off, Hawaii needs to clean up it's govt, whether it be corruption or inefficiency. People can argue that this is symptomatic of CONUS as well but one more incentive for Hawaii to do this. So it can stand out amongst the other 49 states.

Diversification has always been key to growing and also insulating Hawaii's economy from cyclicals in tourism or military spending. But it's always been elusive because any attempt to diversify has always lacked followup. Politicians talk much hype and then it fizzles because there's no followup. Successful diversification doesn't happen in a year or two, it can take decades.

I agree high tech is a good area to get into. The truth is, it's probably even better than tourism because the jobs are high pay, I'm not talking about tech manufacturing, rather tech design and innovation. Even all the companies in Silicon Valley hardly manufacture there, it's all in Asia. So it's really an ideal industry in Hawaii. But UHM does need to be pushed to be an intellectual powerhouse. Tax incentives only help so much, you need a local brain center as well. And because Hawaii's time zone can just about cover US East Coast all the way to Asia, that's an advantage Hawaii can leverage. Probably should also offer land incentives to companies. When Silicon Valley first sprung up, the location was chosen partially because it was cheap farmland.

Happily cheering on bright Hawaii students to go to MIT, etc, is just encouraging brain drain. Some people in Hawaii may feel that's fine, these intellectuals don't fit here in the surf and sun but that's so wrong cuz they can bring a whole lot back to Hawaii.

Either way, the population of Hawaii will grow, so why reject transplants that want to work in fields such as high tech or finance? If anything, their high paying jobs translates to a larger tax base, thereby giving the govt more flexibility in shifting the tax burden away from the poor. A transient population may spend a few dollars for their short duration here but they do nothing for the local populace in the long term. And in fact, catering to the transient tourist is what is undermining the support for the local population.

Finance is a little harder to develop because we are still subject to US financial laws. City-states like Hong Kong or Singapore have more liberal financial law so they can become the financial power houses that they are. However, maybe if we did something like what Deleware does, we could attract more corporations to incorporate in Hawaii? I'm sure that would be attractive for Asia Pacific companies that would want to establish an American shell corporation or subsidiary.

There's not a lot in terms of manufacturing for Hawaii, we don't have the raw materials, we are not convenient in terms of transporting the goods. However, one thing I could see as a possibility is manufacturing of planes. Boeing for instance is considering opening up a second assembly plant for their new 787 because of the insatiable demand and back order. Nothing needs to be manufactured. Infact, the assembly plant in Seattle will only be assembling wings and center fusalage flown in from Japan, front fuselage from Kansas, and rear fusalage from Italy. Finished products are flown to their respective customers. Hawaii could lobby with a lot of incentives to Boeing but will Hawaii ever accept that? We're so anti-manufacturing.

I think too many people of Hawaii see work in just black and white, instead of varying shades of grey. It's either you're laid back or you're a workaholic. There's so much in between.

[John Maple]

Re: Beyond Tourism

First off, Hawaii needs to clean up it's govt, whether it be corruption or inefficiency. People can argue that this is symptomatic of CONUS as well but one more incentive for Hawaii to do this. So it can stand out amongst the other 49 states.

Diversification has always been key to growing and also insulating Hawaii's economy from cyclicals in tourism or military spending. But it's always been elusive because any attempt to diversify has always lacked followup. Politicians talk much hype and then it fizzles because there's no followup. Successful diversification doesn't happen in a year or two, it can take decades.

I agree high tech is a good area to get into. The truth is, it's probably even better than tourism because the jobs are high pay, I'm not talking about tech manufacturing, rather tech design and innovation. Even all the companies in Silicon Valley hardly manufacture there, it's all in Asia. So it's really an ideal industry in Hawaii. But UHM does need to be pushed to be an intellectual powerhouse. Tax incentives only help so much, you need a local brain center as well. And because Hawaii's time zone can just about cover US East Coast all the way to Asia, that's an advantage Hawaii can leverage. Probably should also offer land incentives to companies. When Silicon Valley first sprung up, the location was chosen partially because it was cheap farmland.

Happily cheering on bright Hawaii students to go to MIT, etc, is just encouraging brain drain. Some people in Hawaii may feel that's fine, these intellectuals don't fit here in the surf and sun but that's so wrong cuz they can bring a whole lot back to Hawaii.

Either way, the population of Hawaii will grow, so why reject transplants that want to work in fields such as high tech or finance? If anything, their high paying jobs translates to a larger tax base, thereby giving the govt more flexibility in shifting the tax burden away from the poor. A transient population may spend a few dollars for their short duration here but they do nothing for the local populace in the long term. And in fact, catering to the transient tourist is what is undermining the support for the local population.

Finance is a little harder to develop because we are still subject to US financial laws. City-states like Hong Kong or Singapore have more liberal financial law so they can become the financial power houses that they are. However, maybe if we did something like what Deleware does, we could attract more corporations to incorporate in Hawaii? I'm sure that would be attractive for Asia Pacific companies that would want to establish an American shell corporation or subsidiary.

There's not a lot in terms of manufacturing for Hawaii, we don't have the raw materials, we are not convenient in terms of transporting the goods. However, one thing I could see as a possibility is manufacturing of planes. Boeing for instance is considering opening up a second assembly plant for their new 787 because of the insatiable demand and back order. Nothing needs to be manufactured. Infact, the assembly plant in Seattle will only be assembling wings and center fusalage flown in from Japan, front fuselage from Kansas, and rear fusalage from Italy. Finished products are flown to their respective customers. Hawaii could lobby with a lot of incentives to Boeing but will Hawaii ever accept that? We're so anti-manufacturing.

I think too many people of Hawaii see work in just black and white, instead of varying shades of grey. It's either you're laid back or you're a workaholic. There's so much in between.

joshuatree's post is right on the money with every single point. We need to be thinking in this direction. Specifically on government corruption, I do agree with that clean and efficient government will distinguish Hawai'i. Politicians are responsive to votes, and voters should deny those votes to politicians who place Waikiki ahead of residents. The rail debate (I hope I'm not opening a can of worms here) seems to me one of these cases. It's no surprise that Charles Djou and Barbara Marshall both seem unsympathetic to a mass transit solution, since The Bus works fine for tourists (the wait time in Waikiki can be as short as eight or nine minutes, depending on where you want to go), but is much less reliable for residents, especially those on the Leeward. This isn't quite the same as official corruption, but this mentality can be just as damaging.

As for finance, yes, we do have to play the rules of American financial laws, but these can be quite beneficial as well. Because of the lack of U.S. safeguards, many investments in Asia are also high-risk. An Asian company looking to balance their portfolio and limit their risk could be attracted to a strong Hawai'i financial sector.

I agree that manufacturing is probably never going to be a large industry for Hawai'i, but there's much more beyond this, like high tech and finance. And yes, it will take time. Windfalls won't come overnight; I'm not even sure they're to be expected. It's not easy money. But a diversified economy will help Hawai'i weather the winds of change much better.

[Pua'i Mana'o]

Re: Beyond Tourism

How will Hawaii become a financial hub if it must obey the same laws as Wall Street, when W.S. is physically/time zone-wise closer to Europe and the M.E. (i.e. oil and the Euro)? Asia is very much an emerging market in comparison.

How will Hawai'i become a tech hub if our resources are too finite to support industries with high physical demands/waste by-product? Unless we can make ourselves more attractive than India, we cannot compete with India as the physical locale of the next Silicon Valley. They have a lot of land, a cheaper cost-of-living, less legal entanglements than the U.S. (hello, stem cell research) and 200 engineer students for each American one.

I, as much as anyone, believe in raising up our ed standards to produce a highly numerate generation. I disagree that the result will replace that key economic engine that all successful isle economies throughout the planet run upon: tourism.

They come. They spend. They leave. As a transient population, they require the varied infrastructure of housing, transportation, entertainment, and shopping. Unlike a resident population, the do not require much of, or suppress significantly our other critical resources, such as schools, hospitals, property tax valuations, etc.