Maui News

Abercrombie Makes Plans as National Debt Deadline Nears

July 28, 2011, 9:37 AM HST
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By Wendy Osher

Governor Neil Abercrombie, file photo by Wendy Osher.

Governor Neil Abercrombie today announced plans for Hawai’i, as lawmakers continue to search for a resolution to the national debt crisis.

To ensure that the State of Hawai’i is prepared, Gov. Abercrombie convened members of his cabinet and the state’s financial leaders to devise a plan.  The objective, the Governor said, is to avoid interruptions to programs that rely heavily on federal funds.

“Together we are taking a sober look at the possibility of a federal default and the impact it could have on the State of Hawai’i,” said Governor Abercrombie.

State Budget Director Kalbert Young called the state plan a “cash conservation strategy” that would cover the federally-funded state programs for a short period of time. “We will have to wait to see which federal programs might see reduced funding, and by how much,” said Young.

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Should temporary funding disruptions occur, Abercrombie said the state’s top bankers have pledged their support.  “We are ready to work with the state to ensure the continuance of a stable economy in Hawai’i,” said Gary Fujitani, Executive Director of the Hawai’i Bankers Association.  Fujitani said the state’s banking community has “substantial liquidity” that would enable temporary financial correction.

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Congress has five days left to make a decision on how to avoid default, and address its financial obligations.  Proposals that have surfaced so far include suggestions to raise the nations debt ceiling, limiting discretionary spending, and putting a cap on federal spending.

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