Modern Issues in Hawaii

Hawaiian Hero

Sunday, October 5, 2008

Credit Crisis

Credit Crisis
How will it affect Maui and the State of Hawaii?

As stated in the New York Times October 2, 2008 “This is what a credit crisis looks like.” Comparing it to a stock market crisis, where the plunge of stocks is obvious to all. The credit crisis is played out in places most people can’t see, and has caused a lack of confidence in the banking system where banks are refusing to lend to each other. You have to understand that monies flowing between institutions are like water flowing from the mountain to the ocean for marine life; it’s the most essential function of a banking system.

The effect of this crisis is not just detrimental to financial institutions, its put fear into everyone, and will affect people globally in some way or another. The effect it has on our economy here on Maui will hurt most of our small businesses, and people in the tour industry. We depend on tourism in many way’s, and many tourist who vacation here usually do so using credit of some sort, many hotel workers have made loans to purchase homes while our economy was thriving. In the past ten years we’ve already witness family owned businesses closing because they couldn’t keep up with the large corporations moving in. Small businesses are closing all over Maui. The larger issue will be how it’s going to affect our states operation budget for next year. Gov. Linda Lingle has already postponed selling $625 million in bonds, saying the state would get a better deal waiting. Some analysts expect that the national downturn will lead to a recession in Hawaii as tourism has already been hit hard.

The question becomes “Is the bail out plan the best solution for Hawaii?” Both of Hawaii’s senators struggled with their decision before ultimately going along with the bailout package. Sen. Dan Akaka believes that if we didn’t do anything we would be in big trouble. He agrees that it’s not a perfect bill, but it includes accountability and it includes oversight to prevent abuse. Senator Inouye says," The senate plan puts average Americans first, not those wall street executives whose greed and reckless actions have brought us to this financial crisis." Local observers say if the legislation fails once again in the House, the impact will be felt by every family in Hawaii.

I Understand, why our Hawaii Senators were in favor of the “Bailout Plan,” but I don’t understand why our U.S. Senate couldn’t just do it as part of the right thing to do to benefit everyone. I don’t understand how this 4 page proposal was rejected only to pass a 400 page proposal with the added pork. In my opinion it goes to show you that people in our government won’t choose to do what’s right! They only agree when the added pork benefits them!

Works Cited
Prah, Pamela M. “States Act to Cushion Wall Street Meltdown.”
infoZine News. 01 Oct. 2008. 05 Oct. 2008

Joe Nocera, ‘As Credit Crisis Spiraled, Alarm Led to Action” The New York Times
October 2, 2008

Mangieri, Gina, “Akaka and Inouye Vote in Favor of Bailout Plan” Online posting. 1 Oct. 2008


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