Submitted by Looking Glass
According to the leader of the opposition inappropriate macro-economic policies have aggravated our present depressed economic circumstance. He blames the current government for incompetence and neglect including improperly kept financial trails and that we are lurching dangerously close on a financial brink. (Advocate 1/26/2012). Inappropriate macro-economic policies have aggravated Barbados present depressed economic circumstances for which apparently blames the global condition which is totally untrue.
Having defined Stagflation as a situation “where a country experiences economic or no growth accompanied rising unemployment and rampant inflation,” he notes “the growth that has been recorded and projected following steep decline in 2008 and 2009 means that the country is in Stagflation. As was noted in Fallacy In Shoddy Robes and elsewhere we were on in a “royal mess” and stagflation long before the global meltdown.
The sale of scarce assets and borrowing do not constitute growth. Economic growth as people understand it is misleading. It ignores debt accumulation, non-monetary transactions and unemployment; does not reflect the true state of the economy or nation and perpetuates an illusion of progress. Such growth is largely a function of the private sector and the people not the government.
Looking back he seems to be talking about himself. Selling scarce profitable resources does not constitute appropriate macro-economic policy and results ultimately in the loss of income. The sale of the national bank exposed the people to the mercy of the foreign banks. Borrowing money to build a new prison etc. provided temporary employment and added significantly to the national debt. The absence of non-cyclical job generating industries, sale of profitable assets, and the unrestricted entry of thousands of Europeans via the backdoor which facilitated unemployment and social problems help to set the deck on the Titanic (Mixing Fact with Fiction). No wonder the IMF 2006 and 2008 Reports noted among other things the “weaknesses in statistical information,” the coverage and transparency of data on public service entities and capital accounts, the lack of development and vulnerability to external shock and likened us to “a breeding ground” for social unrest and disorder.
Non-economic policies are equally disturbing. Who for example paid for the repair of the West Wing of Parliament: and why? The sale of the St Peter Hospital for which some blame the current government, failure to update the old one (QEH) and the education system was a disservice to the country.
Yes the current Prime Minister is a bad joke bordering on disaster, but it is unfair and shameless to blame the government for the current socio-economic condition which did not happen overnight and is largely the product of the last regime. In reality the current administration inherited tremendous national debt, “deficits” and an empty bucket with which to water the garden.
It is unlikely the condition will improve significantly in the short term. For one thing the global situation is in a depressed state and we are short of water with which to water the garden. In real terms government cannot be better than its leader but we should not be too quick to blame the current. They are some good and able souls in the government, but they cannot perform as entities and lack leadership and direction. For this to happen the mentally and morally corrupt head man is clueless and needs to be replaced in a hurry. Until then recovery and restructuring remain a pipe dream..
Now the Prime Minister tells us that despite economic vulnerability and fiscal consolidation government will continue to maintain a much needed economic presence, “wants to see a more vibrant private sector” and will maintain high international standards of tourism products (Advocate 26/1/2012). Exactly what does he mean? The private sector cannot make blood out of stone. Hotels closures, potential investors backing away and basic marketing is a bad word there. That he has the audacity to maintain high standards suggests his ignorance. He is the first head man anywhere to accommodate a minister who accepted a seat on the board of a foreign company, and in a matter related to air travel solely responsible for the government loss of respect and criticism in the region and beyond. Are these the standards to be maintained?
Exactly what does he mean by fiscal consolidation? Borrowing to pay bills consolidates debt and selling resources is not consolidation. So is he talking about personal fiscal consolidation, and does it refer to a politician who sells both country and soul for pieces of silver? If so he might be thinking of himself. As noted in About Rising Prices and Oil two of our late PMs said no to the company that wanted drill for oil, last year the current one accommodated the company. Last year David Thompson declined or at least hesitated to sell land in St George, Bathsheba and St Lucy to three foreign companies to build hotels and houses to sell to foreigners. He sold the land in St Lucy and this year sold about 20 acres of agricultural land in St George to one of them to build homes for sale to foreigners.
Now some others other claim it is a mistake to increase VAT which they claim will shift it would shift and stifle growth. The middle class needs to have to pay for everything for everything from food to eating out, entertainment, eating out and travel. The key to growth they say is to “keep the middle class alive. So others must support you and your unproductive lifestyle. So where will we get the money from to do all they claim is needed to be done: borrow more and increase the debt or sell more of the country?
The amount of foreign owned small businesses in and around the city suggests the existence for productive endeavour. It is cheaper and better to grow your own food but cutting the grass in your own backyard is a disgrace. Instead you import everything and produce nothing and in so doing support the foreign exporters at the country’s expense.
You and you alone are the Bajan economy. Either cutback on the unproductive life-style and become more productive or prepare to welcome servitude. Time is not on your side.