Exposing Hawaii Democrats' Political Funding Mechanism

By Malia Zimmerman, HawaiiReporter

Recent investigations by the Honolulu city prosecutor, state Campaign Spending Commission, state attorney general and U.S. Attorney show some local Democrats are funding their political campaigns illegally with taxpayer dollars.

More than 1,000 violations been issued by the Hawaii State Campaign Spending Commission to those individuals and corporations making illegal contributions ‚ the vast majority of which went to the campaign of Honolulu Mayor Jeremy Harris from companies receiving or benefiting from city contracts, zoning or permitting. However, considerable illegal campaign contributions also flowed to other prominent Democrats including former Gov. Benjamin Cayetano, former Lieutenant Gov. Mazie Hirono and former Maui Mayor Kimo Apana.

In addition, the Honolulu City Prosecutor has charged and arrested a number of people for illegal contributions, specifically for money laundering. So far, 3 defendants pleaded no contest to felonies and misdemeanors; 16 defendants pleaded no contest or guilty to misdemeanors; 7 defendants were charged with misdemeanors prosecutors dismissed; 15 suspects were arrested and not yet charged; 2 defendants were charged with misdemeanors. One vice president of SSFM International admitted in court last week that the political contributions to Democrats in exchange for contracts are part of a 50-year tradition. SSFM President Michael Matsumoto is now notorious for money laundering over $400,000 to Democrat candidates, including $200,000 to Honolulu Mayor Jeremy Harris, for which he received a slap on the wrist (no jail time) from a judge whose wife is an appointee of the mayor. The state judge appointed by a former Democrat governor, never admitted or acknowledged a potential conflict or answered questions posed to him by HawaiiReporter.com.

On Wednesday, June 30, 2004, U.S. and local prosecutors announced they indicted two men in a bid rigging scheme run by government contractors and state employees at the Honolulu International Airport, which has led to millions of dollars being stolen from Hawaii taxpayers. A large portion of those stolen funds were reportedly kicked back to unnamed Democratic candidates, law enforcement officials say. Local contractor Arthur Inada admitted in state court in 2003 that after he received airport repair and maintenance contracts, he paid $129,000 in kickbacks and $40,000 in campaign contribution to Richard Okada and Dennis Hirokawa, then both employees at the Honolulu International Airport. Though U.S. prosecutors have so far indicted just two men in the bid-rigging scheme on conspiracy and mail fraud, dozens of people are involved, some of who are cooperating with law enforcement, and others are still under investigation.

The money circulating in the "pay to play" system comes directly from taxpayers, then goes to government agencies, to contractors who support Democrats, and then back to the elected officials who helped ensure the contract went to the contractors involved in the scheme. Sometimes money is sent from taxpayers, to agencies, to contractors and back to the Democrat National Committee, which then filters money to local candidates.

In Japan, this same well-established "pay to play" system is called "Dango," and was exposed when American contractors attempted to get government contracts in Japan.

The system in Hawaii is extremely pervasive throughout the entire state and county procurement system, according to both contractors and law enforcement interviewed by Hawaii Reporter.

Laws recently passed to combat the system have not yet had an impact, if they will at all, on the sophisticated system.

If elected Republicans and Democrats, who are not benefiting from the system, care about Hawaii and the future of the state, they will find a way to stop this pay to play and bring justice to the taxpayers. If Republicans don‚'t find a way to stop the illegal flow of funds from taxpayers to Democrat supporters and ultimately candidates and the Democratic Party, they will never have a real chance at breaking the Democrats' political stranglehold in Hawaii. A stronghold that has been in existence for the last 50 years in the 50th state. A stronghold that has prevented badly needed political balance from being established and any new ideas from Republicans, Democrats not part of the "in" crowd or others from being implemented.

Building Poverty

By Richard Rowland, President, The Grassroot Institute of Hawaii, Inc.

If you want more of something, subsidize it, reward it, help it. If we sincerely wanted more tourists here just to have more, the solution is simple: provide a government subsidy of $25 per day to each tourist. The result is very predictable.

Now comes the lead editorial in the Honolulu Advertiser 7/14/04 "Improving economy must be used on needy." To quote from it, "Every free dollar should be targeted to the least among us, whether through direct or state subsidies or through grants to private agencies."

Are we to conclude that the Advertiser wants the numbers of needy to expand? And, that it is good public policy to keep the needy ìdown on the needy farm?

Without asking I can tell you positively that the vast majority of our productive, hard working, tax paying citizens want the needy to be more productive and prosperous via earned income. In fact, many harbor a vision of a society with almost no needy, with that few helped by enthusiastic volunteers.

It is recommended that all of us, including the Advertiser, embrace that positive vision and abandon the negative, destructive one which, continuing unchecked, will lead us all to impoverishment.