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The Honolulu Advertiser
Posted on: Wednesday, April 2, 2008

State can't always be lifesaver

By Jerry Burris
Advertiser Columnist

For all the complaining we do about government, it's interesting how that's where we go when faced with what looks like an intractable problem.

Latest case-in-point: The shocking shutdown of venerable Aloha Airlines.

The list of reasons why Aloha failed is as long as your arm: fuel costs, "legacy" labor contracts, direct Mainland-Neighbor Island flights and, of course, hardball pricing strategies by newcomer go! Airlines. But it is interesting that once the sad day came, attention immediately shifted to government, particularly the governor's office and the state Legislature. Why, came the cry, didn't somebody do something?

Aloha CEO David Banmiller was the most pointed. For two years, he said, he has been fruitlessly telling officials about Aloha's difficulties. At the same time, Banmiller noted, the state bent over backward to get the Superferry up and running and stepped in with tax incentives to introduce new industries to the Islands.

But here's the central point: Much as we would wish it, government cannot be the white knight who rescues us out of every bad patch. In Hawai'i, we became accustomed to the "white knight" theory over the years when the combination of a powerful governorship, single-minded Legislature and a close relationship with the unions resulted in some fairly successful efforts.

But even at the height of its powers, government never was and probably never will be strong enough to completely turn the tide of economic reality. That was true in the wake of a rash of sugar plantation closures when the state stepped in with less-than-fully successful task forces designed to let new industries rise out of the ashes.

What we have now is largely examining the barn door once the horse has left. Washington hearings will look into claims of predatory pricing and whether government can do anything about soaring fuel prices.

At home, lawmakers have discovered new interest in a longstanding request from the airlines to buy jet fuel free of the state general excise tax. They are also looking at loan guarantees, which might be interesting bait for a future buyer of Aloha, if one could be found.

But these moves, sensible as they might be, will do little to reverse the current situation. The local airlines have argued for years that they deserve state support because they serve as a de facto interisland "highway" for commerce. That's a powerful argument, but it is one that should have been listened to before a big chunk of the highway had to be shut down.

Jerry Burris' column appears Wednesdays in this space. See his blog at blogs.honoluluadvertiser.com/akamaipolitics. Reach him at jrryburris@yahoo.com.