Central Bank of Barbados Governor Cleviston Haynes delivers the Bank’s review of Barbados’ economic performance in 2020 and takes questions from the media.
Central Bank of Barbados Governor Cleviston Haynes delivers the Bank’s review of Barbados’ economic performance in 2020 and takes questions from the media.
I was referring to short term tourist. I did not even think about the PTL visitors when I made my prediction. The cruiser and hotel staying tourists is who i was talking about. PTL tourist is new I will not venture to predict how many will visit by 2025 – maybe i tak on you bet in 2023 🙂
I thought you were. But this is BU, cannot take anything for granted. That is why I always ask people to explain what they mean.
To explain myself, I know nothing about the workings of the UWI, but from what is in the public domain, it disappoints me.
When Larry King the broadcast died last week, one commentator said he loved his suspenders; I laughed as someone in my house looked around.
I had to explain that what we call braces, the Yanks call suspenders. I get it on BU quite often, an assumption that words have the same meaning for all readers.
My favourite at present is the Yanks tendency to answer some questions with the word ‘correct’; we say ‘yes’. There is also the long empirical explanation in reply to a theoretical question, which some people find intelligent and I think is a good example of someone misunderstanding what is being discussed.
In a federation there would be no need for ralphie or mia to take order from each other. Did como in NY take orders from Trump?
The constitution for leaving the federation just have to be harder than it was under the adams led federation.
like a like a 75 – 90 voter approval from the want to break away country + a similar vote from the leaders of the member countries + if any country break away then they will be isolated for all the benifits/agreements of “caricom” ( a very harsh brexit)
also we have caricom nationals voting in whichever country they reside in so with free movement you may find that the nationalist votes may become diluted over time,
short term visitors
We have just had a discussion about Trump that had over (or nearly) 4000 contributions. f ten we have serious topics about Barbados and can just about manage a dozen.
We talk about divide and rule, but do we understand it. I remember as a youth a manager in a Lebanese-owned shop on Swan Street insulting a black shopper and people crowding down Swan Street to deal with the problem.
Next day they were back in the store shopping. That Lebanese family is now highly respected and are pillars of the establishment. Our collective assumption is that they are real Bajans now and we are all in this together.
I have said on BU on a number of occasions that our strength is as consumers (our sons and daughters, mostly lawyers, have sold us out politically) and we should form a national consumer council.
With such an organisation, we we put a ban on any company or organisation, then it has to go out of business. No retail business can operate in Barbados WITHOUT THE SUPORT OF BLACK CONSUMERS. It is not the Asians or whites that are holding us down, but we ourselves.
This is where an old Barbadian saying comes in: This is not your money; you did not work for that. The etymology of a word or phrase tells us everything we want to know about a culture. You may have the last word.
If you will bet against me then i willing to take up you offer of an increase
The blogmaster does not gamble.
Watch these fellows you betting with when the time come to pay you might get a bond yielding 0.05% and maturing in 10 years with option of rollover. LOL
Will take the bet if the payout is in gold LOL.
The truth is the politicians all over the world are the same. Before they make a change they consider political fall out and many other factors first.
We all harp about Singapore as the model to follow. You think any politician here looking for a vote every 4 years would risk to follow the Singapore model! Not a fellow will do that. So what are we left with? Well we have a Situation where we will only make small changes as long as they don’t rock the boat too badly. The thing is that might of half work pre covid, but the radical changes needed post covid you will not see.
Why do you think 12 months into covid we are banking on the same economic playing field we have banked on for decades?
Talk cheap it is doing that causes the challenge.
Imagine if 12 months ago we took $100M of the $300M we gave tourism and put it into a green house project and an alternative energy project where we would be today.
@ John A
Imagine if two years ago we had taken Bds$100m and put it in to a balance sheet post office bank? As CoVid recedes we will have another vehicle fora the financialisation of small businesses.
@January 30, 2021 10:49 AM
“short term visitors
You’re on! 🙂
@john2 January 30, 2021 10:32 AM
“… maybe i tak on you bet in 2023 🙂”
2023 is fine with me! 🙂
We dealing with the FX/greenbacks that the country needs. no bonds here. $100US = 2 of cruise passenger spend 🙂
Alright bud I will be the witness for the bet if we all alive in 2023.😊
Short term visitors is 2025
iI will decide if to take on the PTL visitors by 23.
I see David ducked out
I was not around for the federation nor have I done any research. it would be interesting to how jamacia economy did before and after the break up and compare it to the OECS and Barbados.
Fools gold ?
The payout is going to charity
And who say u will win?
If you so confident then put ur money where your mouth is
Thought he was a Bajan.
@ David January 30, 2021 4:38 AM
COVID-19 news had overtaken all matters that were preciously on the table..”
So too has its ‘mutated’ version now facing the nation.
Those who were ‘selected’ to the various councils/committees to ‘advise’ the Cabinet on the challenges posed by that Covid-19 did not produce any recommendations to make any difference to the “18 %” propagandistic drop in GDP even though there was no mention of its ‘measurable’ impact on unemployment which is a reliable indicator of potential social dislocation or unrest.
As a result, the PM MAM ought to upgrade the ‘quality’ of those selected to sit on the same ‘economic recovery councils/committees’ to confront the mutated and more ‘impacting’ Covid-20 which is posing to be a more ‘dangerous’ challenge to the Bajan economy and society and must therefore be fast tracked and put on the front burner, tout suite.
The question to you Blogmaster, do you see the need for the upcoming palaver called the “Estimates 2021/2022 usually timetabled for February / March of each year?
Why not just accept the ‘much-reduced budgeted income and expenditure numbers’ submitted by the technocrats as the only version of the Appropriation(s) Bill in town for 2021/2022 without all the verbal masturbation by the 29+1 political Onans in the Bajan HoA?
After all, given such a significant drop in GDP for the year 2020, wouldn’t it be folly to expect revenue collection not to suffer a similar fate thereby forcing any proposed expenditures for the coming financial year (except debt servicing commitments) to be cut by an embarrassingly similar order of magnitude?
We need the estimates. It is a rigour we should not surrender, managing the national finances is serious business.
The winter season is now unofficially over. That means we are back among ourselves again. Remember: Maximum social distancing, so don’t bump into your neighbour on the golf course between your mansions!
I’m really curious how this will affect our foreign currency reserves … Based on the data from the summer, I would assume we are not losing anything because our islanders are broke and can’t consume anything. On the other hand … the Christmas shopping may have burnt a lot more foreign currency than the few tourists brought us.
We might be able to sustain the current financial drought through the summer at the most. If the Corona protocol terror continues through the next winter because our islanders are not vaccinated or not vaccinated enough, the tourists will continue to come in too low numbers. We should then really take drastic measures. That means adjusting wages to the halved gross national product, which means halving wages as well. To compensate, we could lower import duties and devalue the BBD (politically correct: “optimise”).
In any case, it is clear that there can be no simple “business as usual”. COVID19 has ruined our national budget, the consolidation plans have failed or been postponed. We must therefore also finally get to work on the civil servants. Fewer civil servants and half pay.
Of course, our government is not to blame for this mess. However, such drastic cure will, of course, cause turmoil. Therefore, we should postpone the next elections until 2030. Those who call for elections in two years are irresponsible and not patriotic.
@ DavidJ anuary 30, 2021 5:05 PM
We need the estimates. It is a rigour we should not surrender, managing the national finances is serious business.”
No one is arguing to the contrary. That would be a futile exercise in pursuit of folly of the “ac” kind.
Even so, it is indeed an annual exercise as prescribed by the Constitution.
What should be of ‘greater’ concern is if there would be a need for the associated palaver and the partisan political backslapping this time around since there are no politically-coloured fighting cocks of a different breed in the barnyard of the still ‘poor-rakey’ HoA even if on parade in cyberspace.
Moreso, what ought to be presented is an ‘informed’ projection of revenues and a commitment to expenditures for the coming financial year which ‘genuinely’ reflect the very negative impact of Covid-19 for the soon ending (current) financial year and what can be easily assumed would arise from Covid-20.
In other words, devoid of unrealistic revenue targets given the expected further large drop in the country’s GDP and lacking in any airy-fairy wish list of expenditures to achieve narrow political short-term goals.
But here is a rather serious question of an ‘aside’ for you, Blogmaster!
Given the stark social, economic and political impact of Covid on the Barbadian landscape would you recommend the postponing of the ‘Going Republic in 20 21’ thingie (just like the ‘We Gatherin’ 2020’) until after the country comes to grip with the virus and begins to recover from its ravages?
Make sure you don’t score an ‘own’ goal in the BU gaol. LOL!!
(% unless otherwise indicated)
2020 2021 2022
US GDP -3.8 3.2 2.5
OECD GDP -5.8 3.7 2.8
World GDP -4.7 4.2 3.4
World trade -10.6 7.0 5.4
Source: The Economist Intelligence Unit
Yet barbados with no alternative to Tourism gov. tells that barbados expectation of growth is 5 percent
At least in the above article someone else is asking the same question I have been asking for months which is.
How are you going to run the economy with 20% less revenue while maintaining expenses based on the last estimates?
Maybe now brand name economist and not a shopkeeper in the bush asking the question somebody might reply.
Let us implement my STARVE plan from March 2020.
Even after more than 60 years of independence, our masses only want to be employed in government service and not to act as entrepreneurs. That is now coming back to haunt us. The time of laziness at the expense of the private sector and the hard-working business people and employees there is over.
We must do EVERYTHING to boost private business and businessmenn and EVERYTHING to lower costs of the deep welfare state including the needy masses in the civil service. The civil service in its current form shaped by OSA is a burden for the nation and at the detriment of the common good.
We barely have the money to get vaccine in time. And what are the unions doing? They want a hazard pay for working during the pandemic. Simply ridiculous. They keep wanting wage increases even though we have mass unemployment and productivity is at 1950s levels. Just look at the beaches during the week. All full of people enjoying the unemployment benefits. How appalling.
Our outspoken Senator is the number one investor bugbear in Barbados. Time for our government to send him to New York as ambassador.
Barbados in its present state unfortunately reminds me of Britain in the 1970s. The island was the sick man of Europe then because the unions were blackmailing the government.
Of course, our government knew that this wage increase was totally idiotic. But unfortunately they had to do it anyway, because otherwise the unions would have called a general strike and harmed the country.
Our citizens must finally show solidarity with our democratically legitimized government and stop against the illegitimate influence of the unions. The least we could do would be to roll back the monstrous five percent public sector wage increase. That the unions are not proposing this shows once again how ruthless they are. They are not afraid to drive the island into bankruptcy.
All power to our government! Use the emergency laws!
The government of Barbados may have to borrow and beg.
The average Bajan could limit their spending and only buy necessities for the foreseeable future.
Think of Covid 19 as similar to a natural disaster.
@ Tron January 31, 2021 11:09 AM
“They keep wanting wage increases even though we have mass unemployment and productivity is at 1950s levels.”
Productivity at 1950’s levels??
Prince Tron, you must have lost the cloth you normally use to shine the Royal brass bowl for a crown of political mimicry,
That has to the ‘dullest’ joke on BU for the year.
In the 1950’s sugar cane production was almost 7 times more than what it is estimated to be this year 2021.
In the 1950’s the thought of importing molasses to produce Bajan-made rum was as anathema to the Bajan psyche as importing flying fish from China.
In the 1950’s the roads across the country, albeit fewer, were better maintained and the detritus removed within 48 hrs even with the manual productivity involving only a man with a hoe, broom, shovel and donkey-drawn cart all without the ‘modern’ aids of weed-w(h)ackers, bobcats or fancy trucks to boot.
In addition, the “old-time” Civil Service was efficiently manned with less than half the amount of the bloated parasites currently sucking at the overly sore nipples of the poor taxpayers while staring all day at their workstation computer screens and android phones to play games or to follow social media distractions instead of ‘reading’ BU to be better informed about what is happening of serious import in their little island.
If real “productivity” was at the 1950’s levels the country ‘today’ would not have to borrow so much from the loan shark IMF to finance the current level of conspicuous consumption but would have been in a position to borrow, on the open market, to build infrastructural capacity like the Deep Water Harbour, the QEH, the East Coast “Highway” and the many secondary schools in both the urban and rural geographic residential corridors along with proper sewerage systems and a state-of-the-art Cahill type solid waste disposal system to match (sans the politicians’ kickbacks and corruption).
There is absolutely no comparison between the productivity painting of 1950’s Barbados and the 2020 ‘still’ photo of ‘educated’ incompetence.
Maybe one of 1970’s vintage but clearly nothing to write home about since 2008.
The invention of smartphones and WhatsApp have brought a turtle to a stop basically. I was in a government office last week to pay money and the cashier was busy on WhatsApp.
I said to her ” sorry for interrupting your WhatsApp conversation but I wanted to pay this.” Thing is she didn’t even seem too put out by my comment. Lol
“We barely have the money to get vaccine in time”
In time for what?? Go and ask White Oaks to use some of their success fees, that are not be rebated to enablers, to help buy vaccines.
FYI, only recycled Minsters in former BLP administrations or party stalwarts are sent to the USA. I think the open post should be Deputy Ambassador to China, under Ambassador Francois Jackman, where he could observe labour relations of the globe’s most productive country.
UK travel ban to be indefinite. What is the government got to put in place as Plan B?
Hal AustinJanuary 31, 2021 2:33 PM
UK travel ban to be indefinite. What is the government got to put in place as Plan B?
More PR and a possibility of blowing up more buildings
Meanwhile rebuilding the infrastructure of barbados from bridgetown to St. Lucy remainds a grave sight
I am sure the Mottley government has a Plan B, only they do not want to share it with the public yet. They cannot be that dumb as to sit waiting for tourism to take off again.
I hope she has a plan B in place. The electorate voted her in for one reason and that was to govern the country efficiently. If she sticks to plan A she will discredit the role of Prime Minister and her party by placing all her eggs in a market which has a zero short term future.
It’s time for Mia to show real leadership. She needs to abandon the tourist industry and commit the country’s precious resources on developing a robust home grown and regional market.
Civil unrest is a real possibility. We have had a failing public infrastructure for decades yet our precious resources are allocated to an “industry” which enriches itself without adding any economic benefits to the majority population.
The nation expects. It’s time for Mia to articulate her thoughts on how she plans to reboot the Barbados economy.
Meanwhile…..in Portugal, covid-19 is on the rampage. Check out the Al-Jazeera video: 3 days that stopped the world.
@ Miller January 31, 2021 1:05 PM
After all, I’m not one of those on the forum who refuses to be lectured. Thank you for your praise of the plantation. So then back to the plantation economy of the 1950s! Richard Drax and the Williams brothers will like that, PLT less. LOL.
@ John A January 31, 2021 1:16 PM
Our government urgently needs to do something about the smartphone plague. Some kind of ban on smartphones in the workplace, cameras and keyloggers everywhere. At the end of the month, AI automatically fires the laziest 5 percent.
It is a blatant injustice that civil servants are now once again allowed to sleep in their home offices on full pay, while workers in the tourism industry and closed stores face the next mass layoff. To unbiased observers like me, the feeling is growing that the civil servants’ union has blackmailed the government and declared war on the nation. The social divide between civil servants and the rest of the working population is greater today than that between plantation owners and slaves at the time of slavery.
Time for the people to rise up against the arrogant unions that are sucking the people dry like vampires! Help our government not only to reverse the insane and monstrous wage increase for civil servants of 5 percent (sic!), but to add a zero at the end.
Barbados economic report, with no tourism? 100% relying on international business sector now. For the next eight months.
Hopefully agri substitution of imported food can take some of the burden.
In order for us to save USD, supermarkets should be reserved for diplomats, expats and all locals who pay with foreign currency. Civil servants and all other islanders without foreign currency are sent to the fields for self-supply. Similarly, government should impose a ban on the purchase of cars and all other imported goods for locals without foreign currency.
All this as a lesson on the bus-crawl-orgy.
We need radical measures now. Most important is the acquisition of vaccine. I recommend AstraZeneca because this substance is the cheapest.
TronJanuary 31, 2021 7:11 PM A bit oo extreme. Bajans should just stop buying crap. Seriously, there is too much garbage in the supermarket. Stick with the old chicken, jams, honey, corned beef, tuna, rice, pasta, biscuits, fruit and veg if not available at local vendor. Butter and eggs from your local egg person.
Most of that crap in the frozen section? Except for frozen veg if a good price, leave it.
On the revenues, there is one thing that needs clarifying. How much of the gross hotel revenue i.e. what hotels book, is actually remitted to Barbados?
Has the non remitted portion been included in GDP and therefore the quoted contraction in the economy? If it is, then it should not be. If a large potion is not, then that would explain why there may not be a large fall off in spending, because much of the GDP there is a book entry and not genuine remittances, which do not find their way into the local economy.
Only remittances will generate an impact into the local economy. So, what is the real fall off, for the island?
The room revenue actually lost in gross terms, less remittances to Barbados, will have an impact wherever it is actually booked i.e. in Cayman, Panama, or Miami, where it would usually be booked and then invested or used to repay loans etc.
You are spot on again. The hotel booking system is operated like a Mafia organisation – and government falls for the old trick.
Profits are privatised, and used to buy property in Canada, the US and UK, while losses are nationalised, and used to prop up these incompetent hotels. It is the only time they do not complain.
Crusoe February 1, 2021 2:41 AM #: “On the revenues, there is one thing that needs clarifying. How much of the gross hotel revenue i.e. what hotels book, is actually remitted to Barbados?”
You’ve asked a very interesting question.
Several hotels, especially the so called ‘group of hotels,’ often have one reservations department, which is usually based at an overseas location.
I recall when Princess Hotels acquired Royal Pavillion and Glitter Bay, the new owners closed the local reservations department. The reservations for all the hotels in that group were transacted and facilitated by one department, which, (I write under correction) was based in Miami. This meant that, and depending on the type of accommodation plan guests bought, money would not pass through Barbados.
I read an interesting article in today’s Advocate. It pointed out how covid-19 was running amok, internationally, and that this was having a terrible impact on small nations with their miniscule economies.
The Adocate stated that larger nations should intervene to assist those smaller nations.
In an ideal world I would agree with this sentiment. Unfortunately we do not live in an ideal world. Barbados from the mid-sixteen hundreds was built on the slave trade and it still has a population that is largely of African descent. The vast majority of majority non-black nations loath blacks.
Why would Barbados expect to receive assistance or a measure of goodwill from these nations. Take the monstrous treatment of the UK Windrush generation and their descendants from numerous hostile British governments.
What measures has Barbados taken since her independence to create a country which is truly autonomous and capable of protecting her citizens in both the good times and especially the bad times.
For example do we have policies in place that manages our water conservation and usage? Do we have a policy in place to manage and recycle our sewage? Are we self-sufficient in providing food for our population? In the event of a major disaster would we have sufficient food stocks for a year? How close is the country to becoming energy efficient? Do our health professionals research and generate medicine and procedures that are specific to the demands of the local population? Is our nation producing a dynamic local population with the skills to contribute to all areas of life. Are we managing the country’s resources well?
If our past leaders had pursued a similar philosophy when in power then we would have absorbed reasonably well the great covid-19 disrupter.
If I were one of those large nations that were been asked to assist Barbados. I would be reluctant to come to their assistance.
TLSNFebruary 1, 2021 5:56 PM Take the monstrous treatment of the UK Windrush generation and their descendants from numerous hostile British governments.
While they try to deport Caribbean people who have worked their life in the UK, contributing to its development and even trying trying to deport descendants born in the UK, they are bending over backwards to give Hong Hong’ers citizenship.
But probably their are Hong Kong’ers $$$$$ whom they want and Hong Kong’ers who they have no use for.
The British Tory government is all about money.
Are you suggesting there is a difference between the Tories and Labour when it comes to black people?
Hal AustinFebruary 2, 2021 5:47 AM 100% YES!
You have much more knowledge of the UK than I do. But from what I am aware of, there is substantial difference.
Norman Tebbitt…you want more? The current Tories are following his disgusting lead.
Labour would never suggest anything so despicable as deporting people of West Indian ancestry, let alone those who have built the country.
We can disagree on this. It is amazing the slurs that Labour leaders get, while spoilt brats who do not give xxxt, of the top Tories, are treated like demigods. Not by you, but by the media and people in general.
There is the popular narrative, and there is the reality. Take it from me, there is no difference when it comes to race between Labour and the Tories.
I can give a long history, but will just give one or two: after Enoch Powell’s 1968 Rivers of Blood speech, it was the trade unionists who rallied behind him; it was a Labour home secretary who introduced virginity tests for women; where can we start with Callaghan, who set the standard for Thatcher; and only recently, we had Brexit.
When I told BU readers that Brexit was about race and not the mumbo jumbo of Europeans making our laws, etc, they thought I was off mark. Who were the voters who put Johnson in power, the red wall so-called?
I have said before, even many black people who have been living in the UK for 50, 60 years or more often do not fully understand UK racism. If they do not, then Barbadian politicians certainly don’t.
How many physical fights have you been in with 1 or more racists against you in your lifetime.
fist to fist
toe to toe
blow for blow
@ TLSN February 1, 2021 5:56 PM
“If our past leaders had pursued a similar philosophy when in power then we would have absorbed reasonably well the great covid-19 disrupter.
If I were one of those large nations that were been asked to assist Barbados. I would be reluctant to come to their assistance.”
Wouldn’t that be a bit “unchristian” of them to do that (speaking tongue-in-cheek, of course)?
After all, Barbados has been a loyal buyer of their goods and manufactured trinkets over the years.
In addition, Barbados has provided a steady steam of income by way of management fees and dividends to the many multi-national corporations and financial services providers like the banks headquartered in the same “large nations”.
Canada, especially, should never be on any list of traitors should Barbados find itself with one foot in the economic beggar’s grave.
Hasn’t Barbados over the years provided a ‘captured’ market for the many ‘cheap’ consumer goods and luxury-end vehicles manufactured in those same large nations’ to turn the country into a consumer h(e)aven of a dumping ground and one of the densest populated (and potentially polluted) places in the world using the ratio of motor vehicles per 1,000 of the human population as the criterion?
Why should a tiny flat island like Barbados- enjoying plenty days of ‘annual’ sunshine and ‘blessed’ with a good network of cart roads which can be turned into ‘smooth-running’ cycle paths- be so ‘saddled’ with such a ‘jam’ of a polluting situation when it could take a leaf out of one of its competitors’ book called the ‘Bermuda Way’?
The current Covid-19 (and 20) “disruptor” ought to provide the policy-makers with the ‘ideal’ opportunity to rectify the ICE-powered vehicles debilitating situation (and forex ‘challenge’) by not allowing the importation of vehicles over 2,000 c.c. for private or ‘domestic’ use given that the maximum speed allowed in any part of the small island is ‘only’ 80 Km per hr.
I Got 5 On It
Not a $5 bill
5 with a double 0
The big question is what has Barbados given in return for the CoVid vaccines? Governments do not give aid out of the kindness of their hearts.
Hal AustinFebruary 3, 2021 6:23 AM
Nothing more than any commitments that would have been given to China’s silk road or other countries, that really do not support Barbados now.
This working with India is a good thing. Should never always look to one direction for relationships.
That only applies to marriage.
Bi-lateral agreements are always give and take. I know what we take, politicians like to boast about them, but what do we give?
Hal AustinFebruary 3, 2021 7:04 AM
Political support is the obvious answer. Somebody is going to get voted against. Lol.
Everyone plays this game, as you know. From the CEO, to the Editor, to the Team Manager. Nauseating in some scenarios (not this one), I hate listening to someone wax lyrical, knowing that they are talking bare RH. But, due to obligations, we have to look at them and nod knowingly.
I usually just walking away trying to look serious, while thinking that the man is a JA.
One thing that upsets Barbadian politicians is when the EU and OECD make demands on us. Yet they go to them and beg for debt relief.
It appears as if they think the creditors should write off the debt but not demand anything in return. I will give an example. In a recent bilateral agreement with Japan and the UK, the Japanese insisted that Britain should not renationalise the Post Office. What has that to do with trade with Japan?
We are in a rh pandemic with developed countries scrambling to procure vaccines for their populations. What the rh you want Barbados and othe SIDs to rh do?
“Canadian Imperial Bank of Commerce is abandoning a deal to sell a majority stake in its Caribbean business after it was blocked by regulators.
The Toronto-based bank first reached an agreement to sell a 66.7-per-cent stake in Barbados-based FirstCaribbean International Bank to GNB Financial Group Ltd., a company run by Colombian billionaire Jaime Gilinski, in November of 2019. The deal was to be worth US$797-million, and CIBC had pledged to provide secured financing for part of the purchase price.
But the deal was mired in regulatory delays and uncertainty, exacerbated by the novel coronavirus pandemic. On Wednesday, CIBC said it “did not receive approval from FirstCaribbean’s regulators.” (Globe & Mail Feb 3 2021)
“Italian President Sergio Mattarella asked former European Central Bank chief Mario Draghi on Wednesday to form a government to tackle the twin coronavirus and economic crises battering the country.
Draghi must now try and muster support in the fractured parliament, with some political parties reluctant to back an administration led by a technocrat.”
Oh to be a Republic.
The study of economics has lost its way because economists have laboured for decades to make their social science more mathematical and thus more like a physical science. They’ve failed to see that what they should have been doing is deepening their understanding of how the behaviour of “economic agents” (aka humans) is driven by them being social animals.
In short, to be of more use to humanity, economics should have become more of a social science, not less.
This is the conclusion I draw from the sweeping criticism of modern economics made by two leading British economics professors, John Kay and Mervyn King, in their book, Radical Uncertainty: Decision-making for an unknowable future.
But don’t hold your breath waiting for economists to see the error of their ways. There are two kinds of economists: academic economists and practising economists, who work for banks, businesses and particularly governments or, these days, are self-employed as “economic consultants”.
Whenever I criticise “economists” – which I see as part of the service I provide to readers – the academics always assume I’m talking about them.
It rarely occurs to them that I’m usually talking about their former students, economic practitioners – the ones who matter more to readers because they have far more direct influence over the policies governments and businesses pursue.
You see from this just how inward-looking, self-referential and self-sustaining academic economics has become. The discipline’s almost impervious to criticism.
Criticism from outside the profession (including “the popular press”) can usually be dismissed as coming from fools who know no economics. If you’re not an economist, how could anything you say have merit?
But Kay and King are insiders. As governor of the Bank of England, King was highly regarded internationally. Kay has had a long career as an academic, author, management consultant, Financial Times columnist and head of government inquiries.
So their criticism will just be ignored, as has been most of the informed criticism that came before them. Their arguments will be misrepresented – such as that they seem opposed to all use of maths and statistics in economics. They’re not. But there’ll be little face-to-face debate. Too discomforting.
Trouble is, the push to increase the “mathiness” of economics has gone for so long that all the people at the top of the world’s economics faculties got there by being better mathematicians than their rivals.
They don’t want to be told their greatest area of expertise was a wrong turn. Similarly, all the people at the bottom of the academic tree know promotion will come mainly by demonstrating how good they are at maths.
Kay and King complain that economics has become more about technique – how you do it – than about the importance of the problems it is (or isn’t) helping people grapple with in the real world. (This may help explain why, in many universities, economics is losing out to business faculties.)
In support of their case for economics needing to be more of a social science, Kay and King note there are three styles of reasoning: deductive, inductive and “abductive”. Deductive reasoning reaches logical conclusions from stated premises.
Inductive reasoning seeks to generalise from observations, and may be supported or refuted by later experience. Abductive reasoning seeks to provide the best explanation for a particular event. We do this all the time. When we say, for instance, “I think the bus is late because of congestion in Collins Street”.
Kay and King say all three forms of reasoning have a role to play in our efforts to understand the world. Physical scientists (and mathy economists) prefer to stick to deductive reasoning.
But this is possible only when we study the “small world” where all the facts and probabilities are known – the world of the laws of physics and games of chance.
In the “large world”, where we must make decisions with far from complete knowledge, we have to rely more on inductive and abductive reasoning. “When events are essentially one-of-a-kind, which is often the case in the world of radical uncertainty, abductive reasoning is indispensable,” they say.
And, so far from thinking “as if” we were human calculating machines, “humans are social animals and communication plays an important role in decision-making. We frame our thinking in terms of narratives.”
Able leaders – whether in business, politics or everyday life – make decisions, both personal and collective, by talking with others and being open to challenge from them.
The Nobel prize-winning economist Professor Robert Schiller, of Yale, has cottoned on to the importance of narratives in explaining the behaviour of financial markets, but few others have seen it. Most academic economists just want to be left alone to play the mathematical games they find so fascinating…..(Quote)
Barbados was in a reasonable position where it could have ridden out this pandemic unscathed. It would have placed the country at a considerable advantage over the majority of other countries.
However, like a professional thief, in the process of retiring; this final heist has led to humiliation and a tragedy for an island that does not have the capacity to bounce back.
Mia and her backers could not resist the temptation of allowing a mottley crew from the minority communitity to satisfy their lust for making money.
Bad choice. So what will happen next? No skillful PR or the enforcement of curfews on the masses will protect our Prime Minister who will probably be blamed for this catastrophe. The next general election could resolve this problem or we could see a challenge to her leadership by someone within her current cabinet.
As for the minority communities who have wrecked the country’s economy. They will have to be held accountable to the people. They could be in for a very sticky ride.
What did we get in return for slavery? They built their economies off our backs. Steupse!
The conservative Barbados Advocate appears deeply agitated and convinced that this is a failed government. With little to offer apart from words that carry little value.
Here’s a very interesting investigative production on how organised crime has infiltrated the corridors of government in Bangladesh. It makes one wonder if Barbados has also been affected by this particular form of virus.
Good to see our Rhianna raising her head above the parapet. Go girl!
Is it the job of Barbados governments to frustrate the ambitions of their people by deliberately undermining the capacity of the nation to develop industries that could create prosperity for her people.
Are our governments encouraged by outside players to create a toxic economic environment in the country; in the hope it it will persuade a large number of our citizens to migrate! Whilst leaving the remainers to accept whatever crumbs are left on the floor.
The exploitation of the labour market has similarities to the era of the plantation system.
@ TLSN February 3, 2021 7:08 PM
Our beloved government should ban the Advocate, close the editorial office, and have the editorial staff arrested for inciting the public.
Those who want to read true news can do so on our government’s webpage or watch our Supreme Leader´s almost daily speeches on television. That is enough information. We do not need independent newspapers, because they can never be as well informed about governing as the government itself.
Whoever trusts the government is a patriot. Whoever distrusts it is not.
Fuh true? Fuh real ?
” What we are hearing is that activities surrounding the Christmas holidays, may have contributed to the explosion of cases. Major attention was paid to the bus crawl – low hanging fruit; however other clusters, particularly, the West Coast have been glossed over by some who have been communicating with the country, which was not comparable to the attention which was being paid to the bus crawl nor the activities on Paradise Beach on Boxing Day.”
What is the status of Hyatt Ziva? Have issues of compensation to the displaced owners occurred yet? What is the status of the site of the former NIS Building?
What is the status of the Transport Board, especially given increased bus fares? What about income since bus loads were impacted by COVID-19?
Nuff words, but little action seems to be par for the course, but wasn’t the country promised a departure from the Implementation Deficit which apparently plagued the last Administration? “
HantsFebruary 3, 2021 9:33 PM but wasn’t the country promised a departure from the Implementation Deficit which apparently plagued the last Administration? “
You can actually posit that with a straight face, in light of the brutal impact of a worldwide pandemic?
I know that you are a hardcore DLP, but really???
The only country right now that is thinking about anything else than Covid right now is China and its World Dom… oops, sorry.