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The Grassroot Institute, a think tank with libertarian roots, has chalked up some big policy wins this year, which some see as evidence of a shifting political landscape in Democratic-dominated Hawaii.

“They had a uniquely successful year,” Colin Moore, an associate professor at the University of Hawaii Manoa, said.

Frustration over Hawaii’s high cost of living, especially in housing, helped convince a large group of Democrats to embrace ideas championed by Grassroot Institute like a big tax cut and policies designed to boost the supply of housing.

This doesn’t mean Democrats are losing power in Hawaii. But it does signify to some that mainstream Democrats are embracing more free market ideas. Critics worry that those kinds of proposals mostly benefit the rich.

These ideas have been on the Grassroot Institute’s agenda for years, but Hawaii’s political leaders are more receptive to them now than they have been in recent memory. 

“The winds were at their back,” Moore said. “They weren’t the only groups calling for these sorts of changes.”

No Labels

Richard Rowland founded Grassroot Institute of Hawaii in 2001 to oppose government overreach, the hallmark of libertarianism.

It’s part of a nationwide network of like-minded think tanks called the , which partners with libertarian and free market organizations like the Cato Institute and American Enterprise Institute. Tax forms $30,916 in donations in 2002, its second year of existence. Ten years later it raised $164,115 and 10 years after that $1.8 million. 

Much of its success this year was at the state level. Legislators passed a massive income tax cut and forced the counties to allow more housing in both residential and downtown office areas, which Grassroot Institute advocated for .

Senate Bill 3202 forces counties , which supporters welcome as a way to increase the state’s housing supply but opponents fear would cause overcrowding and just be a boon to developers. 

The bill’s free market approach to help fix the housing crisis fits with Grassroot Institute’s overall philosophy. In oral and written testimony, they argued the bill would allow more homebuilding, dovetailing with pro-development groups who say that housing prices will go down if more units are built. 

Honolulu City Council members resolved almost unanimously after a last-minute special committee meeting. Ted Kefalas, director of strategic campaigns for Grassroot Institute and a frequent testifier at the council, spoke forcefully in support of the bill and against the council’s resolution.

“To say we’re disappointed in this resolution is an understatement,” Kefalas said at the hearing. Over the next 10 minutes, he debated the bill’s merits with council chair Tommy Waters and council member Calvin Say. 

The council stuck to its opposition. But state lawmakers nonetheless passed the bill by a narrow margin, a victory for the think tank, which in addition to testifying had also co-authored an opinion piece in support with Hawaii Appleseed and Hawaii Housing Affordability Coalition .

“That op-ed is an example of being able to find a common ground,” Grassroot Institute President and CEO Keliʻi Akina said. Akina is also running for reelection as trustee for the Office of Hawaiian Affairs. 

Since Akina joined Grassroot Institute in 2013, he said he has tried to broaden its appeal beyond ideology-focused libertarians. 

To help with that, the think tank shuns party labels in favor of focusing on specific issues like cost of living. Democrats have long dominated Hawaii politics, where the governor and 68 of 76 state lawmakers are Democratic, and it’s hard for a group perceived as conservative to succeed. 

So Akina is careful with words. 

He said that Grassroot Institute promotes “limited” rather than “small” government, the difference being that the number of government employees is not always directly correlated to how much power they hold over residents. The institute’s in-house style guide encourages employees to use the word “homebuilder” rather than “developer.”

And Akina rejected the premise that the group is libertarian or conservative, saying that was true when it was founded more than 20 years ago but is no longer the case. 

“Labels don’t fully describe what we are. And they are loaded with preconceived meanings,” he said.

Its employees lean libertarian, to varying extents. In 2023, its executive vice president Joseph Kent and finance director Sean Mitsui to organizations backing libertarian-leaning Republican U.S. Sen. Rand Paul. And Mark Coleman, the communications director, said that he has been a libertarian “forever.”

Brenner Danielson, who runs the group’s Instagram, said that one of his economics professors from Hawaii Pacific University connected him to Grassroot Institute. In school, he paid more attention to economics than to politics, and he tries to communicate these ideas through Instagram captions on the page’s widely shared memes and reels.  

Danielson’s Instagram posts have helped increase its follower count from about 5,000 to almost 28,000 in the span of a year, mostly by focusing on issues like raw milk legalization, which the group favors, and high tax rates, which the group opposes, through Minecraft videos and “Simpsons” memes. 

“Usually if a video can draw them in and I can put more info in the caption for them to learn more about the subject, I’d like to think that hopefully some people are reading those and getting a better idea of the issue that’s presented,” Danielson said.

A Split Among Democrats

Democratic Rep. Amy Perruso is skeptical about Grassroot Institute’s professed political neutrality.

Grassroot Institute has not changed its stances, Perruso said. Instead, elected Democrats have started leaning more toward the group’s positions. 

“Just in terms of the policies that are passing, it seems to be a more right-wing, right-leaning group” of Democratic lawmakers, she said. 

She cited the housing bills, which she said would just allow developers to build more with no guarantee that the units would be affordable, as well as the state’s big income tax cut that she said gave too much of a break to the wealthy.

“The narrative that we are going to be looking at vacancies in the public workforce as a way to make up the difference, make up the gaps in our budget — those are all Republican talking points,” Perruso said.

These ideas have also reached the Honolulu City Council, where during this year’s budget process council chair Tommy Waters suggested slashing long-vacant positions so that the money appropriated for them can be used elsewhere. 

“Grassroot has always had its libertarian perspective,” UH political scientist Moore said. But nationally, some left-leaning policy leaders have become more open to the idea of increasing the supply of housing and other commodities by getting rid of taxes and regulation that can increase costs.

“I think a lot of this comes from people’s frustration in blue states that often failed on delivering things like affordable housing to their residents,” he said. 

Moore said that this is a big divide within the Democratic party right now, and was particularly felt in Hawaii when policymakers and residents discussed the bill that allowed more housing units on smaller lots. 

For now, the balance of power on some issues aligns with the Grassroot Institute’s goals.

“There is agreement between people who are traditionally thought of conservatives and people who are traditionally thought of as liberals around some of these issues, and I think housing in particular,” Moore said.