“The Coming Collapse of the Middle Class”

Here is a very interesting video that talks about the incredible changes that have taken place in American in only one generation.

It’s called “The Coming Collapse of the Middle Class: Higher Risks, Lower Rewards, and a Shrinking Safety Net,” and it’s a talk by distinguished law scholar Elizabeth Warren, who teaches contract law, bankruptcy, and commercial law at Harvard Law School.

She is an outspoken critic of America’s credit economy, which she has linked to the continuing rise in bankruptcy among the middle-class.

Her talk covers much more than that, though. [Editor Leslie’s note: I just sat and watched that entire one-hour video, practically without blinking. I didn’t have time to, but it is fascinating and I watched it all the way to the end. I highly recommend it.]

Some of her points: In the 1970s, a married couple with two kids had one parent in the workforce and saved 11 percent of their income. To get into the middle class, their kids needed to get a high school diploma and to be willing to work hard. That 12 years of education that their children needed, to get into the middle class, was free.

Warren says that the most important thing that happened in the first two-thirds of the 20th century was that women entered the work force.

In the 2000’s, a similar married couple with two kids must have two people in the work force – because, she says using numbers adjusted for inflation, median mortgage payments in 2005 are 76 percent higher than they were in 1970. Health insurance – in a healthy family with employee-sponsored health insurance – costs the family 74 percent more. Childcare costs have increased 100 percent, and as compared to the 1970s family a 2000s family has the expense of a second car because of that second person in the workforce, and because of that second income their tax rate is up by 25 percent.

In comparable dollars, the 2005 family is actually spending much less on clothes, food, appliances and cars than the 1970s family did; it’s the non-flexible, big ticket and important expenses that have increased so dramatically and that require that second income.

So a comparable married couple with two kids in 2005 has no savings (compared to the 1970s couple, who saved 11 percent of their earnings), and 15 percent of their income is in credit card debt as they try to keep up.

To launch their kids into the middle class requires 16 years of schooling, and the 2005 family has to pay  for the first two years (preschool) and the last four years (college) themselves.

She also discusses how, compared to the 1970s, hospitals now send people home “quicker and sicker” (their phrase, she says) in order to control costs, and the family is shown how to and expected to care for, say, a post-surgery patient themselves. Which generally requires someone taking time off work.

And there is so much more on that video. It is a real eye-opener.

So today’s middle class is under terrific debt pressure. I think the effect is called a lower marginal propensity to consume. They get too many bills!

How is this related to the economy in general?

Gail Tverberg writes that a multiplicity of debt rests on a small base personal income. She writes: “It looks to me as though we are due for a debt unwind, and with it a rapid decline in the U.S. standard of living. Exactly what form it will take, and what the timing will be (for example, sudden one month from now or sudden three years from now, or gradual over a longer period), isn’t certain. I would expect that many (or most) other economies in the world will be dragged along in this debt unwind and will experience a decline in their standards of living.”

If Elizabeth Warren and Gail Tverberg are right, then it appears that an external shock to personal income would cause a ripple effect throughout the economy. Could this latest shock have been caused by the demand of a growing population pushing up against a finite resource, such as oil?

If so, we are facing an economic future of highs and lows where the lows become increasingly deeper and longer. We cannot afford to wait; we need to pay attention to the basics – food and energy!

We need to plan for the worse and hope for the best. We must utilize every advantage available to us as we transition away from imported energy.

It is not about us anymore – now it is about future generations.

We’ve been hearing that the American consumer is under pressure and that our economic system is a house of cards. Will Peak Oil come to be the straw that broke the camels back? Because of the resources we have available to us, I think that we in Hawai‘i have a very good future if we focus our attention on future generations.

There is a reason I am talking about all this right now. Check back here on Monday and I’ll tell you about Part 2.

Kino‘ole Farmers Market: Ho‘oluana Ranch

Tom and Luana Beck own Ho‘oluana Ranch in Mountain View, where they raise livestock and native plants. Every Saturday morning from 7 a.m. to noon you can find them at the Kino‘ole Farmers Market, located at the Kino‘ole Shopping Plaza (the old Sure Save Market) at 1990 Kino‘ole St (at the corner of Kahaopea St.).

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I asked Luana if she’s named after their ranch, or if the ranch was named after her, and she laughed. “I came first,” she said. “Ho‘oluana” means to relax, to be at ease, she explained.

They raise wagyu cattle at their place and sell the weaned cattle. “We’re trying to get the breed out there,” she said. “We’re selling them faster than we can get them.”

They also raise Peking ducks. “The majority of my ducks go to Waipi‘o Valley taro farmers,” she said. “They use them for the snails.”

What they bring to the market every week, though, are their native plants. “We do a lot of ‘ohi‘a,” she told me. “Red, yellow, orange. We also have an Australian ‘ohi‘a. My husband air layers the ‘ohi‘a at the ranch, and then after about eight or nine months, after we make sure they’re established, then we bring them down to the market.”

Rusty, Hooluana Ranch (30) Baby yellow lehua

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She also grows and sells different varieties of native hibiscus. “I have whites, yellow, which is the state flower, a couple varieties of red,” she said. And she raises endangered plants like ko‘oloaula, which she says pigs have almost decimated; ho‘awa, which is a native evergreen; palapalai, kokia and more.

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Before he went into the Army, my son Bryan worked with Tom (below left) at the Canada-France telescope.

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Luana is President of the Hilo County Farm Bureau, which, along with the County of Hawai‘i, started the Kino‘ole Farmers Market a couple years ago with six vendors. Now there are 20.

Part of what makes the Kino‘ole Farmers Market unique is that farmers (who must be members of the Farm Bureau) can only sell products grown here in Hawai‘i. If they are selling value-added products, those products must use a local product grown here.

Also, it’s really nice that you generally find the actual farmers there with their products, and can chat with them or ask questions.

“And we have a nice area,” she said of the market’s location. It’s surrounded by plenty of parking, and vendors set up tents over their tables. “It’s paved, so it’s really convenient. Some of our customers have been coming in wheelchairs, there are people with walkers, so it’s really convenient for older people to shop. We get a lot of people from the downtown market – I think because of that and also because it’s all local grown. Everything is from here.”

It’s also interesting in that every Saturday morning at 10 a.m. there’s an educational speaker. “Every week a different speaker comes in and talks about an ag-related issue,” she said, “whether it’s air layering, or the coqui frog….” There’s also a free chi gung class every Saturday at the market.

Listen to Mynah Bird on the radio (KHBC, 1060 AM) for information about what’s happening at the Kino‘ole Farmers Market every week. There’s also an email that now goes out to about 200 people every week; ask at the market to be added to the list.

“When we started, there were very few people,” said Luana. “But now it seems like we get probably 400-500 people coming by every Saturday.”

I asked her what her dream is for the market, and she said she’d like to see the whole parking lot full.

“We don’t want to get too big, and run out of space, but it would be nice to have about 30 regular vendors.”

It’s nice now, but that would be even better!

Kailiawa Coffee in Ka‘u Places 7th in International Coffee Competition

After Chef Alan Wong and his crew did the cookout at Hamakua Springs last month, they went down to Ka‘u to meet some of the farmers there.  Alan tasted the coffee that Thomas “Bull” and Jamie Kailiawa grow and harvest, and he immediately said, “Hey, send me some.” He ordered ten pounds on the spot. We all know that Chef Alan has a special talent in terms of tasting.

Last week his taste buds were validated –  Bull and Jamie Kailiawa’s Ka‘u coffee placed in the Top Ten in an international cupping competition held by the Specialty Coffee Association of America in Atlanta.

Their coffee was the only coffee from Hawai‘i to place, and it was up against the finest coffees of the world – coffees from Colombia, Panama, Ethiopia and other renowned growing regions. Their Kailiawa Coffee ranked seventh best in the world.

Imagine – a coffee growing in the hills of Pahala ranking as one of the world’s finest coffees.

Bull was born and raised at Mill Camp in Pahala, graduated from Ka‘u High School in 1981 and worked at the sugar plantation as a harvester and later a crane operator.

Kailiawa Jamie and Bull Kailiawa, with nephew Lyndon “Baba” Kailiawa-George in center

When the sugar plantation was poised to shut down, Bull moved to Hilo where he worked as a crane operator, operated his own landscaping business, and worked his way up the ropes to head security at Hilo Pier where cruise ships come in. He and his wife also ran a catering business, and he worked nights at restaurants, doing cooking, cleaning and security – but all he wanted was to go back home to Pahala.

When his aunties needed help with their coffee farm at Moa‘ula, they went, and ultimately the aunties turned the farm over to him. It’s a beautiful farm, with views of the ocean and steep hillsides, and an imu and waterfalls and rushing water.

“One thing good with my field,” he says, “is that my trees always get something to drink. Before noon there is mist and in the afternoons, it rains most every day.” Where they are, he says, the season is long, and while most farmers are pruning their coffee trees, his coffee is flowering again.

He says he learned about growing coffee by asking questions of other coffee farmers and putting it all together. This season, they netted almost 5000 pounds of parchment.

Bull acknowledges his nephew, Lyndon “Baba” Kailiawa-George, a ninth-grader who Bull says “has been my partner in work from the very beginning.”

The Kailiawas also do ranch work, raise chickens, and trade coffee for beef and pretty much any other food they need.

“It’s terrific that the highest ranking coffee in the state, the coffee recognized as having the highest quality, is grown by this Hawaiian guy,” says Richard. “And he’s just a regular guy. A former sugar cane worker who hunts and fishes and that kind of thing. Not a gentleman farmer.”

Congratulations to Bull, Jamie and Baba!

Hawai‘i to Become a “Better Place”

Do you know about Better Place coming to Hawai‘i?

Better Place is working to build an electric car network, using technology available today. Our goals? Sustainable transportation, global energy independence and freedom from oil.

Shai Agassi is founder and CEO of Better Place, and in the following video he talks about his mission. His company has a plan to take entire countries oil-free by 2020.

From ted.com: Agassi stunned the software industry in 2007 by  resigning from SAP to focus on his vision for breaking the world’s fossil-fuel habit, a cause he had championed since his fuse was lit at a Young Global Leaders conference in 2005. Through his enthusiastic persistence, Agassi’s startup Better Place has signed up some impressive partners — including Nissan-Renault and the countries
of Israel and Denmark.

Electric vehicles for our transportation needs are starting to come into focus. Better Place has announced that it is partnering with Hawai‘i to make mass adoption of electric vehicles powered by renewable energy a reality in the state by 2012.

From Better Place:

The state’s partnership with Better Place will play a significant role in the economic growth of Hawaii and will serve as a model for the rest of the U.S. for how green technology infrastructure can fuel job creation. The implementation of electric infrastructure will reignite the Hawaii economy with local jobs, while creating a model for renewable energy growth. It will also expose the millions of annual visitors to Hawaii to the real possibilities of life with clean energy and renewable fuel.

A bill currently going through the Hawai‘i State Legislature will require that large parking facilities have charging stations for electric vehicles.

People are even developing heavy transportation electric vehicles.

Why is Hamakua Springs Country Farms interested in electric cars?

It’s because we are building a hydroelectric plant, where we will generate electricity from water that runs through a flume on our property. We will sell the excess electricity back to the public utility.

We wonder how farmers everywhere in Hawai‘i can participate in renewable energy production.

Oil is a finite resource and world population is increasing at the rate of 70 million annually. We all know that oil prices will rise to unbearable heights in the future.

We also know that our food security depends on Hawai‘i’s farmers farming, and making enough money that they stay in farming. How can we position our farmers so they make money on renewable energy they generate on their farm, in addition to the money they make farming? Because we know that if the farmers make money, the farmers will farm.

Renewable energy production is capital-intensive, not labor-intensive. There is no weeding, spraying, plowing or harvesting. Once a renewable energy project is installed, the farmer can go back to farming.

In conjunction with this need for food security, I suggested to the Farm Bureau that we initiate a bill that would authorize preferential rates of return for bonafide farmers who produce renewable energy. HB 591 HD1 SD2 is likely to be passed by the Legislature this session.

If the farmers make money, the farmers will farm. And then we will have food security.

Green Point Nurseries at Kino‘ole Farmers Market

One of the companies you’ll find at the Kino‘ole Farmers Market on Saturday mornings is Green Point Nurseries. The family-run business is usually represented at the market by John Tanouye, son of the company’s Eric Tanouye and grandson of founder Harold Tanouye.

Harold Tanouye started the nursery business in the late 1950s, when he returned home to Hawai‘i after having been at college on the mainland. Growing anthuriums in Hilo was only a part-time, backyard-type cottage industry then. Now, half a century later, Green Point Nurseries is a very successful commercial operation known for its innovation, customer service and work toward sustainability.

And also its beautiful anthuriums, of course.

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John Tanouye with a customer

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John’s friend, with Green Point Nurseries anthuriums

UH Board of Regents Accepts Responsibility for Mauna Kea CMP

On Friday, the University of Hawai‘i Board of Regents officially accepted the responsibility of implementing the Comprehensive Management Plan for taking care of Mauna Kea. They also appointed two Regents to sit ex-officio on the Mauna Kea Management Board. This is great news for those who want to be assured that management of Mauna Kea be done on the local level.

And in the legislature, conferees from the House and the Senate, who will reconcile HB 1174, HD3 SD2, the rule making bill that enables the Comprehensive Management Plan, have been set. The conferees all voted “aye” to the bill with large majorities when it passed through their respective Houses. The final bill was not very different from the ones that passed through both chambers and there should not be much difficulty reconciling the differences.

This is a good example of what it means to “follow the process.” There were no shortcuts or end arounds. Everyone had a chance to speak their mind and in the end, it made for a better document. Congratulations all!

Kawate Seed Shop, Hilo

Kawate Seed Shop is next door to the Kino‘ole Farmers Market, where we bring our produce on Saturday mornings.

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All I knew is it always existed and it always will exist. I do not go to the crackseed shop very often; it is enough for me to know that it is there.

But my salivary glands do not forget. They start to work before I even bite into a li hing mui or honey lemon. Hawai‘i without crackseed is unimaginable.

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Crack Seed Center is an online store that sells crackseed (in case you cannot get to Kawate Seed Shop in Hilo), and they have a good explanation of what the stuff is.

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What on Earth is Crack Seed?

Crack seed, a popular local snack in Hawaii, comes in a variety of shapes, sizes, and flavors. Also known as Li Hing Mui or See Mui, crack seed is actually a variety of dehydrated and preserved fruits. If you’ve never tried this local favorite, read on!

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Why Preserve Fruit?


Before canned goods were available, merchants heading west across the rugged terrain of China carried dehydrated fruits to supplement their meals of plain rice. The salt in crack seed was useful for long distance travelers in several ways: besides replenishing the salt lost by the body in perspiration, it also helps the body retain water and lessen muscle cramps.

The concept of fruit preservation is simple: salt absorbs the natural moisture in fresh foods and inhibits the growth of germs that need water to survive. Salted seeds can be stored for extended periods of time. Moreover, crack seed had the desired illusion of quenching thirst.  Read more here.

If you come by the Kino‘ole Farmers Market one Saturday morning, remember you can also stop in to Kawate Seed Shop.

Adopt-A-Class, Year Three

Last night I sent in testimony supporting the Senate Bill that would give authority to the University of Hawai‘i at Hilo’s Mauna Kea Rangers to implement the Comprehensive Management Plan. (See below.)

The Senate passed the bill today, which was good.

But I kept on thinking about our Adopt-A-Class project, and wanting to make sure the Keaukaha Elementary School children can continue to go on excursions. Six hundred dollars adopts a class at Keauakaha Elementary School and sends the students on an excursion they would otherwise not take.

This is the third year we are seeking donations for our Adopt-A-Class program. At our website, you’ll see that a person or group can sponsor the whole excursion for one class ($600), or make a donation of $100 or more and contribute toward that class excursion.

If you can help, please look at the website and tell us which class you’d like to sponsor, and for what amount. There is more information about the process here.

In the meantime, here is the testimony I sent in. Among other things, it explains how we came to start the Adopt-A-Class program in the first place.

Dear Senators,



I am testifying in very strong support of HB 1174, HD3, SD2, the bill that enables us to malama Mauna Kea. Mauna Kea is our kuleana. We know what to do.

I am Richard Ha and I’m a native Hawaiian and a life-long Big Island farmer. We farm 600 acres at Pepeekeo. We have farmed bananas for 25 years and hydroponic vegetables for the last five. Over the years we have produced millions of pounds of food. We sell under the Hamakua Springs brand in the supermarkets. Nearly 70 of us work on the farm. We are concerned with food security and sustainability, especially since we sit out here on islands in the middle of the Pacific.

I would like to share with you how I came to be involved with issues related to Mauna Kea. Three years ago, when I was a new member of the Hawai‘i Island Economic Development Board, the Thirty-Meter Telescope people inquired about siting their telescope on Mauna Kea and the HIEDB formed a special TMT committee. I had strong feelings about the way it should be done: It should be done right! So I volunteered to sit on that committee. Before that, I was just a banana farmer.

When you talk about Mauna Kea you automatically talk about the Hawaiian culture, and when you talk about that, you end up in Keaukaha, the oldest Hawaiian Homes community on the Big Island (75 years). I found that the elementary school there is the center of the Keaukaha community.

I went to see Kumu Lehua Veincent, principal of Keaukaha Elementary School, with what I thought was a good proposal: “The TMT wants to come to the Big Island; what happens if we can convince them to give some kids from the community five, full-ride scholarships to the best schools in the nation?”

Kumu Lehua listened, and then he asked me: “What about the rest?” I could feel my ears getting hot and I felt kind of stupid. Yes, what about the rest?

Also, because the TMT had intentions to do things for the community, I expected the community would be receptive. Instead, I found that the Keaukaha people were very wary, wanting to know: “What do you really want?” They had been promised things many times before.

In the meantime, the TMT board decided to deal directly with UH system. But having met and liked the people in the Keaukaha community and elementary school, I went back again and again to talk story.

One day, I offered to sponsor an excursion to my farm. In the course of that trip, I asked Kumu: “Eh, where you guys go on excursion?” He told me they did not go. “No more money.” Instead, they walked around the neighborhood. I said: “What you mean?” He said, “The bus costs $300 and we don’t have enough money for all the classes.”

I was shocked. How could this be? There were hundreds of millions of dollars’ worth of telescopes on Mauna Kea and there was no evidence of any benefit to Keaukaha, the most Hawaiian of Hawaiian communities?  This no can! We needed to do something.

So, myself, Duane Kanuha, Leslie Lang and Macario decided to copy the Adopt a Child template—where you pay $20 a month and the child sends you a letter and a picture every so often. We decided to do an Adopt A Class project so each class could go on excursions.

We figured $300 for the bus and $300 for entry fees to ‘Imiloa – the world-class Hawaiian culture astronomy museum. So for $600, people could adopt one class and send them on excursion. In four months, we had all the classes going on excursions both semesters.



The idea was contagious. Gordon and Betty Moore heard about the project and donated money to send all classes on the Big Island, from kindergarden to high school – in all public, private and charter schools – to ‘Imiloa. That was nearly three years ago. Now I hear they plan to expand this idea to the San Francisco Bay area.

And due to Kumu Lehua’s leadership, Keaukaha Elementary, a perpetually low-achieving school, had two consecutive years of improvements and came off the No Child Left Behind non-performing list. It was the only elementary school on the Big Island to achieve this distinction. Now they are role models. Imagine that.

Kumu Lehua told me this story: He said a teacher recently came in to interview to see if she could teach at Keaukaha Elementary. He rolled his chair back and told me, “She said it was a career move!”

I have attended at least eight public hearings about Mauna Kea, and many regular meetings of the Keaukaha Community Association, as well as meetings of the Kanaka Council. I have friends on all sides of the issue.

I see myself as a bridge between the shiny shoe crowd and the rubbah slippah crowd. I think that if we all can move toward the center a bit, we can make this work for all of us and especially for future generations.

It is no secret that I think that the TMT can bring benefit to the community. But when I first volunteered for the TMT committee, I insisted it be done right.

So we must malama Mauna Kea before we do anything else. HB 1174, HD3, SD2 helps to enforce the rules that the Comprehensive Management Plan proposes.

I started off by saying that we should not let the perfect be the enemy of the good. When I was a young boy, my dad told me: “There are a thousand reasons why, no can; I only looking for one reason why: CAN!

Richard Ha, President, Hamakua Springs Country Farms

Kinoole Farmers Market on Saturday Mornings

The Kino‘ole Street Farmers Market, located on Kino‘ole Street two streets mauka of Puainako Town Center, is growing. When we started last January there were maybe eight vendors’ tents. It has doubled since then and new vendors keep coming.

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First traffic sign!

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It’s great to see more and more variety of stuff. This Farmers Market is sponsored by the Big Island Farm Bureau, and most of the products are produced by the people manning the booths. There is plenty of easy parking.

The market is open on Saturdays from 7 a.m. to 12 noon. You should come early.

We have a booth there every Saturday morning and it is great to talk story with people. It puts one in a good mood all day.

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This little old lady with a walker has a strong, booming voice and a strong wit. We enjoyed chatting with her.

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Darren, from Island Notes, who won a prize in our caption contest, picking up his box of produce.

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Aaron and Vionel Sugino of Blue Kalo work out of the old Fujii Bakery at Wailea.

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More of Blue Kalo’s products.

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Watercress from Mountain View.

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Best rice soup.

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There is a class or a talk every Farmers Market day.

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Cookies, popcorn and vegetables.

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Coming up: Every Wednesday for awhile we’re going to tell you about one of the vendors you will find at the Kino‘ole Farmers Market.

The Mauna Kea Comprehensive Management is Accepted

After listening to two days of testimony, the Board of Land and Natural Resources accepted the Comprehensive Management Plan (CMP) with some conditions. The most significant condition is that the University of Hawai‘i Board of Regents accept responsibility for enforcing the CMP.

There is a requirement to include information from two resource plans that are nearing completion. There is an addition of a decommissioning plan, including upfront funding for returning the site to its original condition. And finally, a plan to delineate access. People did not want access to be taken away. I thought these were very good additions.

The Board of Land and Natural Resources Chair, Laura Thielen, did a very good job of giving everyone a chance to share their thoughts. I was very impressed that they spent two days in Hilo accepting testimony.

University of Hawai‘i President David McClain stayed for the better part of two days. In his introduction, he mentioned the recent Board of Regents declaration of a special relationship with native Hawaiians. This has far-reaching implications.

He went on to make three main points:

  1. That, in the interest of home rule, the University system is committed to the University of Hawai‘i at Hilo being the entity that would manage the CMP.
  2. He committed to funding that would ensure that the CMP could be implemented.
  3. He apologized for the pain and anguish that the native Hawaiian community feels due to the university’s mismanagement prior to 2000.

At the end of the session, Dr. McClain talked about compensation. There is not much that can be done to change the original lease, which gives the IfA a percentage of viewing time as compensation.

He emphasized that the University of Hawai‘i has been providing $2.5 million annually in scholarships to native Hawaiian students. This means that UH is paying the equivalent of 20 percent of what would be $10,000,000 if telescope time were monetized.

From here forward, he said, lease rents for new projects will be determined differently instead of all the telescope time going to UH Manoa. It could include telescope time for the University of Hawai‘i at Hilo, and an amount could go toward community benefits. This is in the early conceptual stages.

The people opposed to the CMP were very organized and people kept on coming through the door to testify. They did a very good job. Out of the 80 or so testifiers overall, I would say that it was evenly split; maybe slightly more in favor than not.

The people who testified in favor were also highly motivated. I have not seen that level of participation before at the eight public hearings that I attended. It clearly made a difference in the decision to accept the CMP.

People were very respectful and tolerant of each other, and this is very encouraging. We all live here on an island in the middle of the ocean and we need to be able to have these discussions, go through the process, come to a conclusion, live with the decision and remain friends. More than anything, I was pleased that we all went through this process together. The result is a better CMP.