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The big question that people like to ask here in Hawaii is, “How do we diversify the economy?” This is usually followed by a similar question, “How do we stop being so dependent on tourism or real estate in Hawaii?”

To be honest, I suspect most people in Hawaii already know the answers, or at least, those who have spent more than five seconds in local government most definitely should. Asking these questions has become an intellectual form of virtue signaling, much like the fictional Patrick Bateman of “American Psycho”  with his friends over dinner with polished talking points while internally boiling over with narcissistic resentment.

Can we dispense with the pretentiousness and concern trolling and just tell the truth for once in Honolulu? We’re not dependent on tourism and real estate in Hawaii because that’s all we’ve got; we’re dependent on tourism and real estate because that’s all we’re allowed to do here.

I feel sorry for the average Honolulu resident. Most of them probably grew up like the average 20th century American did, learning to tie their shoes, color coloring books inside the lines, be polite, work hard, study hard in school, be a good sport, and always obey the rules. 

Why do we obey the rules? Because the rules are supposedly there to make things fair for everyone, and as long as you obey the rules, wait your turn, work hard, and be persistent, you will succeed in life. (I agree, by the way.)

But then we notice something interesting: The vast majority of people making the rules here in Hawaii are not elected by “average people” but by corporations, political action committees and powerful unions, all of which benefit from rules, regulations, laws, exemptions, licenses, subsidies and contracts or partnerships with the government. Rules, in their case, are made to make things unfair for their competitors.

All that stuff you learned to do growing up? Forget it, that’s just for you to obey, not those who made the rules and those who get the exemptions.

Yes, everyone wants to run for office in Hawaii because everyone knows that this is a palace economy and the only way to get what you want is to have someone in office who can give it to you.

Don’t believe me? Next time someone throws their hat into the ring for a local election, try having a discussion with someone about their chances of success. I guarantee you won’t hear “this person will win because they’re extremely egalitarian and a math whiz.” Instead you will hear “such-and-such group wants this person” or “the so-and-so people are backing him because they need this-and-that.” It’s disgusting.

These are entities that compete by making it illegal to compete with them, that socialize expenses by making the public pay for investments but then privatize profits for themselves, and that always come out on top, because what they do is conveniently considered “an important part of the economy” by those in power. 

These same groups through advertising dollars hold powerful sway over for-profit media to influence public opinion, and for those they can’t trick or cajole, they intimidate through the use of synthetic activist movements and protests in the community. 

So how does this pertain to “diversifying” the economy in Hawaii?

If you haven’t already, you should make it this week’s homework assignment to get a copy of  “The Pearl” and read it. The story revolves around a poor fisherman who by chance discovers a giant pearl large enough to sell for a price that could get him and his family out of poverty.

The fisherman can’t actually sell the pearl for the price he wants, however, because everyone in his town is directly or indirectly on the payroll of the same pearl cartel. His physician, his church, his friends, and even the pearl buyers at the market are all owned by the same entity, and so, everyone is hellbent on getting him to sell his pearl for less than it’s worth or tricking him into giving it up for free. He’s stuck in poverty because the town keeps him in poverty, even when he has value to offer.

That’s not diversity; that’s monopoly, and it’s a perfect allegory for what Hawaii has become.

The key to economic success has always been the innovation of small business owners. Why is that? Because the people in your community who live next door to you understand your interests, observe your habits and are able to adapt to your needs. They can invent a solution to your problem, create a product for your desire and find a price that you can afford to get it to you.

The problem is, the minute they start to do that, established and entrenched corporate and government interests start to say to themselves, “wait a minute, these guys are taking away our business, or making money and we’re not getting our cut … let’s find a way to claim what they’re doing is bad for the environment, culturally insensitive, or dangerous to public safety, and then we’ll get it banned or heavily regulated.”

America was built by small business, and Hawaii, and America, can be saved by small business, if we allow it.

The fact that things as seemingly innocuous as cesspools, building permits, even vehicle safety checks are all corrupted in Hawaii tells you just how deep the tentacles of manipulation can go in this state. We can’t compete and we can’t succeed so long as the rules benefit some at the expense of others.

So let’s be honest. If we really want to “diversify” Hawaii and build the economy, we have to allow the mom-and-pop small businesses to be able to innovate and profit without someone shutting them down.

These are the people who are eliminated by compliance costs that are set by those who can afford to pay them in the hopes that others cannot. These are the people who have the ability to see the world in a new and better way, but are often shut out by those who depend on the world being run in an old and outdated way. These are the people who get their startup funds from their family and neighbors, not taxpayers and central banks.

America was built by small business, and Hawaii, and America, can be saved by small business, if we allow it.

So if we are serious about increasing the quality of life and the abundance of wealth for the average person, we have to allow people to do the things that they enjoy and that their community makes profitable. 

If we’re going to ask questions like “how do we diversify the economy” we need to be prepared for the honest answer: We diversify it by allowing people to do what they want, not what the government and their friends want.