Back in 1978 when Hawaii had its last constitutional convention, delegates grappled with a number of fiscal issues and adopted provisions that they hoped would help to stem the rising tide of taxes and spending in the 50th state.
It was the same year that disgruntled taxpayers in California went to the polls in droves and adopted the infamous Proposition 13 that limits the amount of annual growth in property taxes. Seeing the shortcomings of Proposition 13, delegates to the Hawaii constitutional convention wanted to find another way to control the growth in the size of government.
The result was a pair of provisions that delegates hoped would help contain the size of government and make sure taxpayers paid attention to the burden of taxes state government imposed. The first provision attacks the growth of government from the spending side as opposed to the revenue side which is what Proposition 13 does. In doing so, it avoids the numerous problems a revenue cap creates such as the inability to issue debt because bond buyers are less than confident a government can repay its debt if it can