Maui Chamber: Initiative Would Be “Devastating” to Economy

October 10, 2014, 8:38 AM HST · Updated October 13, 6:24 AM
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Paul Brewbaker. Photo courtesy Hawaiʻi Crop Improvement Association.

Paul Brewbaker. Photo courtesy Hawaiʻi Crop Improvement Association.

By Wendy Osher

The Maui Chamber of Commerce released a report saying the Maui County Voter Initiative “would be crippling for the county and have a disastrous impact on the state’s agricultural sector.”

The report entitled, “Economic Aspects of Maui County’s Seed Industry,” was prepared by Hawaiʻi economist Paul Brewbaker, principal at TZ Economics, during a Maui Chamber of Commerce luncheon on Thursday.

“The Maui Chamber of Commerce has long supported the triple bottom line approach to policy-making,” said Pamela Tumpap, president of the Maui Chamber of Commerce in a press release statement.

Paul Brewbaker. Photo courtesy Hawaiʻi Crop Improvement Association.

Paul Brewbaker. Photo courtesy Hawaiʻi Crop Improvement Association.

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“We have learned that passage of the initiative and loss of the seed crop industry would be devastating to our local economy. The effects would ripple throughout our business community, affecting many small and medium sized enterprises,” she said.

Brewbaker estimates that the initiative would result in a two year halt on the cultivation of transgenetically modified crops such as Rainbow papaya, while the county studies impacts, and result in millions of dollars in direct and indirect losses for the economy.

In addition to the economic output, Brewbaker’s report states that other risks to the local economy and the community include job losses, tax impacts and scholarship funding including the following risks:

  • $55.8 million in direct and indirect seed industry annual impacts on Maui County’s economic output;
  • $34.2 million in total Maui County economic output including household consumption from incomes originating from seed farming;
  • 770 jobs directly and indirectly associated with the seed farms;
  • At least $4 million in state taxes;
  • More than 3,500 volunteer hours annually; and
  • $20,000 in scholarships in life sciences and more than $35,000 in donations for science, technology, engineering, and mathematics or STEM education in local schools.

“Nearly a thousand Maui County families’ livelihoods depend on employment with the seed farms or as suppliers and providers of services to those families,” Brewbaker said in the report. “This seed industry community is as extensive and deeply-rooted in the community as those of the plantations that preceded them.”

Leaders with the SHAKA Movement who introduced the initiative claim the chamber has a “financial conflict of interest, trickle down or direct.”  The organization’s Mark Sheehan called the report a “PR brochure that extols the benefits, while glossing over the risks” to health and the environment.

Dr. Lorrin Pang, one of the five citizens who filed the petition seeking a moratorium on genetically engineered organisms in Maui County responded to the report saying any suggestion of potential job loss is enticement and does not carry weight.  “Jobs do not enter into the argument when one is arguing the risk and benefits of the products themselves… because under normal regulatory conditions the products are assessed before they come to market, before actual jobs are involved,” he said.

“Perhaps potential jobs might be an issue, but not actual jobs.  Because GMO marketed products have a backwards sense (cart before horse) of regulation they are using actual jobs to blackmail and influence a true assessment of the health risk,” said Dr. Pang.

Dr. Pang further stated that, the extent of the economic impact “might be not as big as they claim since there are alternatives–planting or farming non GMO crops.  At the other extreme,” he said, if there are as many healthy effects as others are reporting overseas, then the economic impact on health should be considered. “When this upper limit risk is weighed against the jobs it is economically horrendous to continue on the track we are going.  Just the cost of doubling the rate of certain kinds of lymphoma, quadrupling the rates of craniofacial defects is enormous,” he said.

In explaining the economic impacts, Brewbaker cited the “temporary shutdowns” that permanently closed Aloha Airlines, Maui Land & Pine, and Del Monte Plantation on Molokaʻi.  He said, “Seed farming is Maui’s second largest agricultural activity after sugarcane cultivation, and the largest on Molokaʻi. It is too important to Maui County’s economy to be placed on a so-called hiatus.”

On Maui, he said the seed industry is a generator of $84 in economic output, employs hundreds of individuals, with a potential multiplier effect county-wide, and represents a quarter of all Maui County agricultural activity.  He further states that on Molokaʻi, the seed industry comprises 10% of all private sector jobs.

Brewbaker further states that, “Nothing prevents Maui County from studying the issue,” and that a moratorium is not required to do so.

The SHAKA Movement’s Sheehan said that under the precautionary principle, benefits are hyped, while data on the real impacts are overlooked.  “Just look at how little information is available about pesticide residues in our soils, aquifers, streams, ocean and air.”  Sheehan said under the approach, “Corporations get the profits, we get the pollution–for very long periods of time as the pesticides bioaccumulate.

Dr. Pang also weighed in saying, “As far as I am concerned the discussion of the risks and benefits of these products when used long term as a food is grossly incomplete. There are no pivotal premarket clinical trials, and only three clinical trials, which are  peripheral and anecdotal; so, there is a backdrop of uncertainty of the health effects and benefits.”

According to the Maui Chamber of Commerce, the presence of corn crops in Hawaiʻi dates back to the 19th century.  The organization says that today’s seed industry began as winter nurseries on Molokaʻi in the 1960s.  Over 50 years, the organization says seed crops have been the “fastest growing agricultural activity” in the state.

“About 95 percent of our membership at the Maui Chamber of Commerce is comprised by small businesses that employ 25 or less people,” said Tumpap. “These are restaurants, retailers and vital services that shape our community. Many depend on their neighbors for business. If their neighbor is put out of work by this initiative, they lose a customer and vital revenues,” she said.

Brewbaker’s shared a preliminary working version of his report with economist Thomas Loudat in an effort to validate the research presented.  He received feedback on his working paper from Dr. Tian, chief economist at DBEDT and from Dr. Loke, Economist at the Hawaiʻi Department of Agriculture.  The Maui Chamber of Commerce, with support from the Hawaiʻi Crop Improvement Association, purchased the rights to publish the research.

Leaders with the SHAKA Movement responded saying, “Anything that is released in comment must be based on the fact that their conclusions and projections are based simply on circumstantial hear-say evidence that would not be admissible in any court of law.”

Brewbaker is not the only economist who has outlined potential economic impacts associated with the seed industry in Hawaiʻi.  A similar assessment was made by First Hawaiian Bank economist Dr. Jack Suyderhoud during an outlook forum held on Maui in September.  While Suyderhoud did not address the initiative head on, he did issue an opinion on how the industry would be affected if if activity created by the industry were absent.

During his address, Suyderhoud said, “The seed corn industry has diversified Maui County’s economy. Monsanto farms about 1,900 acres on Maui and Molokaʻi.  They have 540 employees with an annual payroll of $17.8 million.  Cumulatively they have invested $100 million in Maui County.  Dow Agro Sciences employs another 100 employees on Molokaʻi.  Seed companies purchase supplies and services from local vendors, maintaining a distribution channel that other farmers can tap into.  Without the activity created by seed corn, those channels would either not be there or the distribution costs would be much higher,” Suyderhoud said.

Brewbaker’s report notes that Maui County has a long “fruitful history of agriculture and gene modification.” It also states that the county is at the “forefront of global agricultural biotechnology,” playing a “pivotal role in global knowledge.”

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