Danny De Gracia: Want To Reduce Inequality? Let People Make Money Off What They Own - Honolulu Civil Beat

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About the Author

Danny de Gracia

Danny de Gracia is a resident of Waipahu, a political scientist and an ordained minister. Opinions are the author's own and do not necessarily reflect Civil Beat's views. You can reach him by email at dgracia@civilbeat.org or follow him on Twitter at @ddg2cb.

A mainland friend that I hadn’t seen for 20 years wanted to visit me for his birthday, along with his entourage of 12 other social media creators from around the world. In advance of his visit, he shot me over an iMessage: “Get me a house, with a large pool, that’s close to where you live, where I and my team can stay and hang out for the next three days.”

“Forget it,” I texted him back. “Just stay in Waikiki and get multiple rooms or a presidential suite.”

“Why?” he demanded to know.

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“It’s too complicated for me to explain to you in a short time, this is Honolulu we’re talking about,” I answered.

And so, he and his associates came to Hawaii, stayed for three nights in Waikiki, and brought all their bucks to the altar of Big Tourism, just like the millions of other visitors who daily come to Oahu.

And if you ask me, that is precisely what’s wrong with our state. In case you haven’t noticed, Hawaii, and most especially, Honolulu, are places where money amasses with big corporations while the rest of the local population fights over a token trickle of cash that barely percolates down to them.

Oahu residents are living on a 21st century neo-plantation of haves and have-nots. The difference between these two is stark. Those who are “haves” get money by influencing politicians to create preferential regulation and subsidies that allow them to maintain monopolies by eliminating competition (or making it too expensive to compete). Like the fictional Gordon Gekko of the movie Wall Street, these people can be summed up in a single sentence: “I create nothing; I own!”

Those who are “have-nots” earn money in the form of salaries by creating value through back breaking labor or intellectual servitude for the haves. They pay subscription costs for their sheer existence in the form of income and property taxes to the government, and through the purchase of consumer goods and services from corporations. Because they don’t own things, or because their ownership of things is subject to severe regulation, unlike haves, they can’t use the things they own to make money for themselves.

That, dear friends, is why, regardless of pandemics, recession, inflation, stock market crashes, or even war, the rich will get richer and the poor will get poorer.

Honolulu can’t completely enforce the full provisions of the law that targets vacation rentals, and we should use this pause to consider how we move forward from here. Cory Lum/Civil Beat/2021

If you have time, and you didn’t have the benefit of reading it in high school, I recommend all of you read John Steinbeck’s novella, “The Pearl.” An impoverished fisherman finds a giant pearl of great value and plans to sell it to improve the life of his family – but unbeknownst to him, everyone in his town is controlled by the same pearl cartel.

His doctor wants him to give up the pearl in exchange for medical care. His church wants him to give the pearl to “God” (which in turn will be sold by the church for profit). And all of the pearl local merchants are owned by the same company, but pretend to be competitors so they can fix the purchase price of pearls at below market rate. Sounds like how Hawaii operates during an election year, if you ask me.

We like to virtue signal a lot about “reducing inequality” in Hawaii. If you really want to reduce inequality and close the gap between haves and have nots, you must let ordinary people have the freedom to own things and monetize those things to make a profit.

This is why it was somewhat of a welcome relief that U.S. District Judge Derrick Watson granted a preliminary injunction against parts of Honolulu Ordinance 22-7. The law as originally codified severely restricted homeowners from renting out properties for less than 90 days, which makes it extremely hard to make money as a vacation rental.

The federal government seems to be allergic to Honolulu officials and their policies lately, but I won’t get into that today. The point is, for now, Honolulu can’t completely enforce the full provisions of the law that targets vacation rentals, and we should use this pause to think and consider how we move forward from here.

If you ask me, we should just abolish Ordinance 22-7. And before you government-subsidized rent-a-nonprofits come out against me with your minions citing white papers saying that vacation rentals create inequality, the real “inequality” is a government that sets us up to fail and forces us to fight amongst each other for scraps.

Instead of blaming homeowners for the housing shortage, why don’t we point the finger at the state and county who have a myriad of complex regulations and approval processes which have throttled the construction of new homes on Oahu? In fact, how’s the state doing with meeting its commitment to housing Native Hawaiians?

Instead of blaming tourists for crowded streets, heavy traffic and no parking, why don’t you point the finger at the state and county for not building better, modern streets and creating more room for visitors? Remember those online memes where people used to ask, “If not for government, who would build the roads?” Yeah? How come Honolulu government can’t build roads?

Stop talking about “inequality” when you’re allowing the greatest driver of inequality of all – a government that won’t do its job when it comes to roads, sewers, parks, housing – to operate without any accountability.

This is precisely what big corporations want, where we fight amongst ourselves and blame each other rather than helping each other to each get wealthy and empowering each other to all own a piece of the American Dream. Small businesses and homeowners built America, and if we can learn a lesson from that, small businesses and homeowners can also save Hawaii.


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About the Author

Danny de Gracia

Danny de Gracia is a resident of Waipahu, a political scientist and an ordained minister. Opinions are the author's own and do not necessarily reflect Civil Beat's views. You can reach him by email at dgracia@civilbeat.org or follow him on Twitter at @ddg2cb.


Latest Comments (0)

They are many facets to this argument, but there's at least one big Red Herring here and that is the emotional argument of investors are gobbling up homes for locals to rent out as TVR's. There has been one factual study by the Grassroots Institute that completely disproves this theory and while people can argue without basis, fact is a vacation home would normally be something coveted by tourists to stay in that is around the beach, or attractions. They are not a starter home in Ewa or Mililani that local families are looking at, as first time home buyers. These are homes in Kahala, Lanikai and the North Shore, where first time home buying isn't happening, period.The second forgotten fact about renting local is the city's outdated and punitive landlord tenant code. It's because of these laws that landlords do not want to rent locally and that is not just because of Ige's pandemic ordinance allowing renters to live rent free for over a year, it is because there are no protections for homeowners. Why would an owner rent to a tenant they cannot remove for months for not paying rent, when they can rent hassle free for cash? There's your answer to increased housing stock.

wailani1961 · 3 weeks ago

Everyone renting even a portion of their home should be reviewed for legal compliance. There are laws in place to protect tenants and landlords regarding conditions for rental properties. I believe this is one area where the government needs to grow and oversight is needed. Instead of starting at the legal or illegal STR end of the spectrum let's take a look at the whole category and get legal compliance on all rental property.

ClaudeRains · 4 weeks ago

One point I'd like to make irrespective of owners concerns is why has this become so important? Tourists don't want to stay in hotels anymore. Well, enough of them anyway to make it a problem for those thinking they are missing out on business. Tourists aren't going for golf and alcohol imbibed steak dinners anymore either. They want to go on a hike. And I don't mean a shopping excursion in the recently ruined part of Waikiki that sacrificed fun for glamour. I mean doesn't everyone go downtown on Friday nights now? What's next an ordinance restricting alcohol usage after 10 pm anywhere before Kaka'ako? They got those big piles of crap all around.. oh excuse me , that was another scam on the public to give junk haulers that business. But they're all the same, run the opponent down and at least give the business to someone who contributed to your campaign (as long they don't put out more than 5 items.) A meaningless dig these days, people have heard it too much even if it's true.God that's an awful thing to say and I bet Civil Beat won't accept this language. Times are changing and so should we whether we like it or not. Our tourism model is outdated.

youknowyouknow · 4 weeks ago

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