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Editor’s Note:��On Friday, asking debate teams to argue whether there should be a further increase in the general excise tax to fund rail. Sterling Higa argues against the motion.

This legislative session, lawmakers have advanced multiple bills that would extend and/or increase the GET rail tax. In this piece, I will examine four potential arguments against these measures that could be advanced in the Debate Hawaii and Civil Beat’s upcoming public debate on the issue. These arguments will remain principled rather than focusing on the manifest technical deficiencies of certain proposals.

First, those who propose using the GET to fund rail ought prove that other methods have been exhausted. Each year, the City and Council of Honolulu issues bonds. For instance, the City and Council of Honolulu issued $888.6M in tax-exempt and taxable general obligation bonds during 2015. None of those bonds were related to the rail transit project, but future bond issues could be used to fund rail.

Whatever legal arguments are set against this practice can be overcome with political will. Of course, a bond issue would rely on some predicted economic benefit to Honolulu from the completion of rail. Absent such incentive, the City and Council is unlikely to risk its high bond ratings with Fitch and Moody’s.

Second, arguments for extending or increasing the tax rely on the questionable proposition that rail should be completed either in truncated or original form. The sunk cost fallacy is the idea that humans are likely to continue projects they’ve invested in, even when future investments are unproductive.

Traditional microeconomic theory holds that costs already incurred, “sunk costs,” should not factor into future decision making. Otherwise, you might continue to throw money at a project that will never be completed.

Most people who try managing their own home improvements without a subcontractor experience the sunk cost fallacy. Though they struggle with the project and exceed the budget they originally conceived, they refuse to concede defeat and continue their sloppy work, often at the cost of time, money, and happy relationships.

Third, the GET effectively taxes all to pay for a good which primarily benefits only some within the City and County of Honolulu. Various estimates of economic benefit have been advanced, but these studies remain hypothetical.

There are valid arguments against taxing the residents of Kauai for a rail they can’t ride. Similar arguments for those on the Windward side of Oahu. Of course, government must tax citizens to pay for services they won’t use, but arguments for taxes usually rely on those taxed having the potential to benefit from the good in question.

In this case, the link between rail and benefit for distant populations is tenuous at best. Moreover, there is an unspecified administrative portion of the tax that would be appropriated by the state as an administration fee, an effective kickback to the legislature for the privilege of increasing the GET.

Fourth, even if advocates could prove (1) that all other funding methods have been exhausted, (2) that rail should be completed and that additional funding is required for its completion, and (3) that the benefits of rail outweigh the costs to taxpayers, they would then have to prove (4) that funding rail is the best use of funds raised.

The present housing crisis, deferred maintenance for existing infrastructure, and lingering concerns for the state pension fund seem more pressing issues. Those who would increase taxes to pay for rail must show not only that the investment is worthwhile, but that it is worth the lost opportunity to invest in solutions to all the other problems we task our government with managing.