Government Between a Rock and a Hard Place With General Elections Looming
Submitted by Inkwell
1. Consider this argument. The Central Bank (CB) Governor has refused to print any more money for the Minister of Finance (MOF). The MOF needs printing to continue to pay civil servants and keep Government running. If the Government can’t pay the civil servants this month, all hell will break loose. Therefore the CB Governor has to be fired so that somebody who will agree to print the money can be appointed. These delays being granted by the High Court are making the MOF nervous. Time is of the essence. But Jeez, if the printing continues, the economy will only get sicker.
2. Foreign reserves are at an all-time low and heading further south, and with the poor tourist season we are now having, not much hope for recovery. The Government can’t even put its hands on the US$100 million from Kyffin for BNTCL in a hurry as that has to go through FTC regulatory process. Let us see if the Government is going to try to railroad the FTC and also what stuff the Chairman is made of.
3. Government can’t borrow externally because of low credit rating and the existing high debt service requirements are continuing to hurt the foreign reserves.
3. Every economist who has said anything (Frank Alleyne has been predictably silent) has told the Government it must act NOW to avoid a disaster, latest being the CDB which has issued a dire warning: “CDB President Dr. Warren Smith is warning there is “no painless way” to rein in the fiscal deficit and ballooning debt.” “But I think it is also important to appreciate that we need action now. The Government of Barbados knows what to do.” “Let me just repeat that we are ready to help but there are certain things that need to be done before the assistance of the multi-lateral institutions like ourselves can become available in a fulsome way. I think that the debt situation is one that needs to be addressed urgently.”
4. The Government’s hand is being forced every way it turns. It must act.
5. BIG Problem. Elections are imminent and the harsh measures required will doom the DLP’s chances of re-election. What would you do? Think like Stuart (and hope not to get a brain freeze). You have to call elections NOW. If you wait any longer, you will be forced to inflict much pain, especially on the civil service and statutory corporations, send home another eight to ten thousand people; you will have to further cut financial support to the QEH and UWI, BWA and SSA; you will have to increase bus fares; you will have to dismantle the community councils and cancel the football tournament and condemn the DLP to the annals of Barbadian political notoriety. A few of the painful pills.
The only hope of survival is to go to the polls BEFORE you are forced to inflict the pain. Tempus is fugiting and the hour must come. Truly between a rock and a hard place.