Wall Street Journal op-ed: ‘Aloha’ Increasingly Means Goodbye Thanks to High Taxes, by Keli‘i Akina (Grassroot Institute of Hawaii):
With an 11% top tax rate, many Hawaii residents are looking for two tickets out of paradise.
“Why would anyone leave Hawaii?” Former Hawaii residents hear the question a lot, often from someone eager to relay the details of an incredible vacation in Maui or Kauai. But when you’re living paycheck to paycheck and working two jobs, you don’t get many chances to enjoy the island archipelago’s crystal blue waters and soft white sand. People leave Hawaii for the same reasons they leave Illinois and California: high costs and lack of opportunity.
About a year ago, the Grassroot Institute of Hawaii started asking former residents why they decided to leave paradise. Retirees, young parents, business executives and teachers said the same thing: As painful as it was to leave, getting out was the only option. Tom and Ycrem Holloman left because they couldn’t afford to raise a family in Hawaii. “At the time we moved, gasoline was $5.04 and milk $6.99 a gallon,” said Tom. The Hollomans, who have three children, sold their 704-square-foot home and bought a house in Georgetown, Ind. “Our tiny Hawaiian home was valued at $25,000 more than our four-bedroom home on one full acre here.” ...
Despite being consistently rated as the “happiest state” in the nation, Hawaii is experiencing its third straight year of negative migration. Some 35,000 residents moved to the mainland from 2015-18. The young, highly educated and well-off are most likely to leave, which means fewer new businesses, more-crowded classrooms, and shortages of doctors and nurses.
The Aloha State has the highest cost of living in the country. According to the Tax Foundation, the real value of $100 in Hawaii is $84.39—worse than California and New York. Purchasing a home is out of reach for many residents. According to Zillow, the median list price for a house in Hawaii is $630,000, compared with $284,999 for the U.S. as a whole. Rents in Honolulu are roughly 40% higher than the national average.
Many assume that a high cost of living is “the price of paradise.” But while some of the costs related to living on an island in the middle of the Pacific are unavoidable, government policy makes the problem significantly worse. ...
Hawaii residents are being bled financially by costs imposed by government policy. Ask former residents why they left and they’re likely to say, “We had to.” But if policy makers would get off the path toward fiscal ruin, they could help stop the exodus of residents seeking more-affordable pastures.