Unintended Consequences: Breeding True Hawaiians

Coyote Blog has a great example of unintended consequences. The state of Hawaii lets native Hawaiians lease land for 1$ a year, but they can only pass on the lease (and the homes they've built on the land) to their kids if the kids also qualify. How do you qualify?

Qualifying for the program requires that the recipient pass a strict racial test, which the HHL web site says is "50% or greater native Hawaiian blood". Setting eligibility for a government program based on racial tests is pretty outlandish in and of itself, but it gets worse. People taking advantage of the program need to think carefully about the race of their mate before they decide how much to invest in their home. A 75% Hawaiian who marries a full-blooded Hawaiian will be able to pass the improvements on to their children (since the children will be more than 50% Hawaiian), and thus can justify a large home investment. The same person who marries a full-blooded Japanese or African or Anglo-Saxon will not be able to pass their home on to their kids, since their kids will fail the race test. So, not only is there a race-test for a government program, but the government is providing strong financial incentives not to "dilute" a certain race. Hawaii über alles.

A law that bad can only have been designed by a committee of lawmakers...oh, wait...

Unsurprisingly, it turns out that people act quite differently when they have the incentive of knowing their kids will inherit their houses:

By the way, those who don't think that passing assets to one's kids is an important part of long-term investment thinking should compare the houses built by program participants who know their kids cannot inherit to those built by those who will be able to pass the investment to their kids -- there is no comparison. This would make a very fertile ground for an economics graduate student trying to quantify the value people assign to the of passing assets to one's kids in long-range investment planning.

Share this

If Micha were around I'm

If Micha were around I'm sure he'd question the rationality of wanting to leave your home to your kids. After all, why should they benefit from all your hard work?

Who says the consequences

Who says the consequences were unintended?

It reminds me of the

It reminds me of the infamous Nuremberg Laws...


"50% or greater native

"50% or greater native Hawaiian blood"?! People still talk like this in the genomic age?

A law that bad can only have

A law that bad can only have been designed by a committee of lawmakers…oh, wait…

Okay, that's really funny. :)

This lesson can be applied

This lesson can be applied more generally to all taxation of inheritance, to all arguments based on envy against the children of the well off.

I don't get it. Does the

I don't get it. Does the 14th Amendment not apply to Hawaii at all?!? This is the most egregious violation of the equal protection clause that I have ever heard of.