Gov: Need for fed policy framework is overwhelming
One of the meetings Gov. Togiola Tulafono attended while on his recent trip to Washington, D.C. was the Interagency Group on Insular Areas, where he presented his last written testimony to the group, summarizing conditions and trends in American Samoa as they relate to the focus of IGIA.
As noted in his testimony, he is barred by the American Samoa constitution from running for a third consecutive term.
In his written statement, provided by the governor’s office, Togiola notes that American Samoa’s economy is “recovering very slowly from the adversity of the 2008 global financial collapse and recession.” In particular he points to the territory’s recession as being “exacerbated by a devastating tsunami and the imposition of the US minimum wage in American Samoa.”
The minimum wage raises, the governor says, “contributed to employment losses across all industries and contributed to the closure of one of two major canneries in 2009. Total employment declined by an estimated 30 percent by 2010. The rate of unemployment reached almost 20 percent by 2010.”
Togiola stated that while “there were other influences at work especially in the fish canning industry. Nevertheless, there were substantial losses in most industries, and GAO surveys of the business community indicated a strong role for the rising minimum wage in employment reductions.”
He cites “the minimum wage as just one, albeit a very critical issue to American Samoa’s economic future, that is essentially in the hands of the federal government.”
The governor said, “there are other federalization issues including international trade policy, corporate tax policies, immigration and possibly others. As it stands, federal issues concerning the territories are decided in the absence of any guiding federal policy or consideration of the effects on those territories.”
Quoting former deputy assistant secretary of the Interior for Territorial and International Affairs, Allen Stayman, Togiola makes a case for the lack of a US development policy for all US territories, and its detrimental affect on the territories’ economic wellbeing.
Stayman said, “In the case of the unincorporated territories, however, there is no political status goal, and therefore no policy-guiding principle. These islands remain in a status limbo, neither fully domestic nor foreign – a condition that complicates the development of solutions.”
The governor comments that “the good news is that we may be leaving limbo; the bad news is that we may be going to purgatory for an extended stay before we get to the Promised Land.”
He in particular points to Stayman’s comment of ‘muddling through’ as acceptable to developing effective policies for the territories, saying: “Just muddling through is no acceptable substitute for effective policy…” that is a policy that would include not just economic development but “also include education, health care, environmental, political status and other policy areas affecting economic development.”
Togiola said, “Had such a federal policy been in place, those federal economic development concessions in the minimum wage, international trade and federal territorial taxation might not have been revoked. Or, they might have been modified or replaced by other programs less damaging to US territories.”
The governor also said that IGIA has been remiss in its goals, which are defined under Federal law (Title 48 U.S.C. § 2002: US Code - Section 2002). The law “requires the Secretary of the Interior to submit to the Congress and the President a report on United States Pacific Insular Area policy together with such recommendations as may be necessary to accomplish the objectives of such policy. These reports are required to set forth clearly defined policies regarding the United States and its Pacific Insular Areas.”
He says, “I regret to say that I have never seen an IGIA report to the President. As far as I can tell the only reports or testimony on the OIA (IGIA) website is now exclusively that of federal agencies. Previously, Insular Area testimony has been on the site, but it appears that this has been discontinued. While this current approach highlights the federal actions on Territories’ issues, it does not provide the proper context, which in this case, are the requests of the Territories. In other words, this approach gives the impression that federal agencies are working on certain Territorial issues, and the reality continues to be that some major issues go unaddressed.
“One serious result of this is that the pivotal issue of minimum wage in American Samoa was not even mentioned by the IGIA in 2011, even though it was one of, if not THE critical issue in recent years to the IGIA.
“We are also aware of the limitations of such interagency groups. In the past few years you have made recommendations to improve the IGIA’s operation. Those recommendations were fully consistent with the new Executive Order for IGIA. Some of the federal agency testimony has been useful, but it does not often go to Insular Area priorities.
“We have had some notable achievements especially in getting the US Department of Labor to take over the estimates of GDP for the territories and securing observer status for us with the Pacific Island Forum.”
Noting that the territories have “had less success with IGIA on issues of minimum wage,” the governor also points to the lack of action on Insular Area exemptions from DOT air service cabotage restrictions, “which have been raised every year by American Samoa.”
Togiola has over the past years railed against what he calls the Hawaiian Air monopoly of air travel in the territory, as evidenced by the unusually high cost of a ticket to Hawai’i state alone.
In his IGIA testimony, he says, “Although US cabotage policy has been raised, there has not been any analysis of why this policy must continue to hold sway over a major economic development factor for Territories such as American Samoa.
“Therefore, I am asking IGIA for a substantive look at cabotage — a study to make the case that cabotage makes more economic sense to small territories as opposed to opening restricted markets to foreign operators who may jump start and maintain major economic development to our small, fledgling economies.
“If maintenance of this policy does not have a major cost to the federal government, then it would not stand to reason that this should continue to hamper economic development.”
Togiola concluded his testimony with the notion that IGIA can do better and “I believe that in order for American Samoa to cultivate all that it deserves in this day and age, we must continue to strive to do better. And I sincerely hope that you agree with me.”
For pdf copy of entire statement, download attachment