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Honestly it's basic economics on why it's not going to change. I believe there ARE a few other factors at work, but mostly supply and demand.
You assume supply and demand is controled by the avrg person? Its not. Common since would say anyone would rather pay $6 for a gallon of milk then $8 or $9? Correct? I would also assume if we had a vote tomorrow on lowering the cost of things in Hawai'i, most would vote yes.
if we had a vote tomorrow on lowering the cost of things in Hawai'i, most would vote yes.
Brilliant - I can't believe nobody ever thought of that - let us have a vote, I feel like heading downtown to the capital right now - how do we get that gem on the ballot?
May point being Hawai'i is always going to be expensive. But there is a difference between being expensive and taking advantage of people. I used an example of the gallon of milk earlier. Do you think that the same gallon of milk could be one $ cheaper and still be very profitable?
Hawai'i will always be expensive, but we can make life easier for people in costs. Small things add up.
Brilliant - I can't believe nobody ever thought of that - let us have a vote, I feel like heading downtown to the capital right now - how do we get that gem on the ballot?
What im refering to is do you think the majority of people in Hawai'i really want to pay such a high price for everything? As like most people I would assume a majority of people will say we would like to pay a lower cost wouldn't you agree? So if supply and demand isnt controled by the avrg person or the majority then who is it controled by? Big business?
May point being Hawai'i is always going to be expensive. But there is a difference between being expensive and taking advantage of people. I used an example of the gallon of milk earlier. Do you think that the same gallon of milk could be one $ cheaper and still be very profitable?
Hawai'i will always be expensive, but we can make life easier for people in costs. Small things add up.
Well, having a GET instead of sales tax hurts, heck getting taxed on food hurts. But the government is not going to give up taking what it can take.
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May point being Hawai'i is always going to be expensive. But there is a difference between being expensive and taking advantage of people. I used an example of the gallon of milk earlier. Do you think that the same gallon of milk could be one $ cheaper and still be very profitable? Hawai'i will always be expensive, but we can make life easier for people in costs. Small things add up.
Where do you think it can come from? The supermarket business is one of the most competitive businesses there is. On a broad range of goods their markup is in the 14 - 17% range, and their net profit for the year is in the 1 - 3% range. One of the things that throws people off is that milk prices on the mainland are artificially low, often being sold at cost as a "loss leader" to attract shoppers who will hopefully buy something else while they are in the store.
Quote:
Originally Posted by hawaiian by heart
What im refering to is do you think the majority of people in Hawai'i really want to pay such a high price for everything? As like most people I would assume a majority of people will say we would like to pay a lower cost wouldn't you agree? So if supply and demand isnt controled by the avrg person or the majority then who is it controlled by? Big business?
Who says it isn't controlled by supply and demand? If a price on something is too high it doesn't sell. If it's too low it sells out and pisses off people who didn't get there in time. Look at the weekend ads. For the most part the advertised specials are sold at cost, to try to get you into their store for your weekend shopping.
Quote:
Originally Posted by whtviper1
This article does a nice explaining high prices of milk....
Unfortunately this is a completely lame article that gets a few of the general concepts right, but completely blows it on the details. So much for the "Atheist Libertarian" view...
Quote:
I interviewed economist Ken Schoolland from Oahu, who attributed the problem to a federal law called the “Jones Act”. He explained that the law creates shipping protections. Any ship that travels between Hawaii and the mainland United States must be built, manned, and flagged in America. That means international ships have trouble visiting us.
I asked, “And do they cause our prices here to rise?”
“Very much so!” he said. According to professor Schoolland, a ship coming from Hong Kong can no longer stop in Maui to drop off goods.
No longer? The Jones Act has been in effect since 1917. Big surprise!
And what The Jones Act does is ensure the security of shipping to and from the mainland and Hawai'i. IOW, without it another country could lower prices and totally dominate the market, forcing Matson and Horizon and Pasha out of business, then if hostilities broke out between our countries, they could cut off our supply chain. That's the key thing the Jones Act is supposed to prevent.
And let's be clear... other countries can ship direct to Hawai'i. They just can't go on to the mainland from here. But Hawai'i is not a big enough market to justify direct shipments on the larger ships, which would just have to turn away from the mainland. That's why Asian cars, for example, go to LA first and then get transferred to American ships for delivery to Hawai'i, adding a couple grand to the sticker price.
Quote:
It must first go to California, and then be transported onto an American ship, with an American crew, and then it could finally come to Maui. Hardly an efficient way to run a business!
Efficiency is not the purpose. Food security is, along with the security of other critical consumer goods.
Quote:
“Because everything about producing those local eggs, from the iron that is used for the cages of the chickens, to the feed of the chickens, to the buildings that are produced to house the chickens . . . everything is shipped in. And by the time we pay that surcharge because of the Jones Act, even though the eggs have been laid in Waimanalo and trucked down to your Safeway, they cost more than eggs that are shipped in.”
One of the local chicken guys recently calculated that the feed costs alone, to produce a dozen eggs on the Island of Hawai'i, amounted to about $5 per dozen. That's no distribution, no profit, just the raw cost of producing a dozen eggs here. So no way local producers can compete on price with a million-chicken egg factory in Arkansas that can turn out a dozen eggs for maybe $1, to be shipped in and sold a few months later for $2.95 in Hilo.
Quote:
I was amazed. I added, “And the same is true with milk! I was at the store the other day, and the milk imported from Texas is maybe five dollars, and the local Lani-Moo is maybe eight dollars.”
“Well, that’s an interesting case,” Dr. Akina said, “Parker Ranch, in order to get it’s cattle, would have to ship them from Asia to Canada, have them trucked down to San Francisco, put onto vessels owned by a local Hawaiian company and brought to Hawaii. Now think about that – the huge cost added.”
This is where this account drifted off into Fantasia.
Parker Ranch not only breeds its own cattle, it is a net exporter of what are called "weener calves," which are sold on the mainland as soon as they have been weened here. And Parker Ranch cows are raised for beef, not dairy. In the past the bulk of their cattle were raised on grass pasture around Waimea, then shipped to their feedlots in Oregon and Texas to be fattened up on grain there. The last few years the drought has been severe enough that they've had to sell more beef locally to cull their herds, which is why local grass-fed beef has been so much more readily available in markets the last 3 years or so.
And the actual dairy herds at Big Island Dairy and Hawi Dairy? They are produced by breeding dairy cows, which is a required step to keep dairy cows producing milk.
Not to mention that mainland mega-factory-dairies can produce milk at prices that the much smaller dairies in Hawai'i cannot touch, so they don't try... selling what they offer as a fresh, local, premium product.
Quote:
I asked, “So you’re saying that not only imports would be better, but exports would be better without the Jones Act.”
Dr. Akina agreed. “If we had more ships coming to Hawaii, disembarking their cargo, they would have empty hulls. Those hulls would be like a vacuum and siphon in products, that at low cost, could help revive our export industry.”
That sound that you hear, that's the giant sucking sound of brains being hijacked by a truly dumb idea.
Shipping FROM Hawai'i is currently a small fraction of the shipping TO Hawai'i. This is precisely why shipping a package via UPS to the mainland costs 1/2 what the same package costs sending it to Hawai'i. The ships, the planes all head back to the mainland half full, even with the big bulky shipments of goods that are actually in demand, like live flowers, and fresh fish, and tropical fruits. What would get shipped if the shipping were cheaper... seriously?
So do you pay $8 or $9 for a gallon of milk? Or $9.73 to $10.00 for a pack of cigarettes? Sorry here a gallon of milk maybe at most $5 and cigarettes $5.50 pack. quite hogging the pakalolo brah!
Nope. I don't drink milk and never have and never will smoke!
Your quote:Where do you think it can come from? The supermarket business is one of the most competitive businesses there is. On a broad range of goods their markup is in the 14 - 17% range, and their net profit for the year is in the 1 - 3% range. One of the things that throws people off is that milk prices on the mainland are artificially low, often being sold at cost as a "loss leader" to attract shoppers who will hopefully buy something else while they are in the store. End quote
So basically what your saying is the avg price difference between a gallon of honolulu milk from the mainland vs avg price of a gallon of milk here in Oregon. The difference is shipping costs? So the $5 to $6 cost difference for one gallon of milk is to pay for shipping one gallon of milk to Honolulu? Thats more then the value of the milk alone.
Im no economic expert but if your running a business that is only making 1-3% profit period you need to quit doing that business.
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