Originally Posted by
fadeforward
The legality and logic of kama'aina discounts seem to me to be straightforward. Discounts for state residency are common, perfectly legal, and usually make good business sense Whether they are fair is the real question. I have no problem with them. Residents pay state taxes and the overall price of paradise, and the discounts engender good will amongst neighbors.
You apparently missed the key phrase
they violate the spirit if not the letter of the equal protection and commerce clauses of the U.S. Constitution, which require equal treatment for all.
Nobody is claiming that the discounts are not legal or logical. My point was simply that (1) one could easily argue that the discounts are really based on race (given the ethnic composition of Hawaii) or have the effect of discriminating on the basis of race and (2) the effect of the discounts is to discriminate - economically - against the residents of the other 49 states. The reasoning behind both the equal protection clause and the commerce clauses is that people should be treated the same regardless of residency and local business should not get any special preferences. So I think the discount definitely violates the spirit of both provisions, even though no state action is involved. And as I said - the unfairness smells because it is not based upon ability to pay but rather residence. On this point we can agree to disagree.
I pay higher taxes than people who live in Hawaii, in fact one could argue that I already subsidize Hawaiians based upon overal federal income and expenditures - so they should give me a bigger discount. So I think your argument about taxes falls on itself. The overall price of paradise? It should be high, just as it is high to live in SF, Manhattan or any other highly desireable place. There is a reason real estate is cheap in Buffalo and Detroit (no offense).