The Effect of Ten Year Austerity

Austerity has had nothing to do with economics. It was about getting out from under welfare. It’s about politics abandoning vulnerable people.

Barry Kushner, a Labour Party councilman in Liverpool

The political campaign in Barbados crescendoed to its unprecedented result last week. First time in our history a political party won all the seats contested. The euphoria of the win for 70% of those who voted has receded. The reality of going to the supermarket to buy food, pay the mortgage, avoid potholes which dot our highways and byways to compete with the joy of living in a tropical paradise.

In a boast by the major political parties, Barbadians were promised that policy prescriptions are available to fix all of our problems in the near time- yes with a little sacrifice from all our people. In the sharp glare of the post election period again there is the reality that for the last – approximately – ten years, Barbadians have had to suffer austerity measures. The prospect of having to suffer more belt tightening- though not appealing- appears to be required given the chronic nonperforming domestic economy.

As a boy attending secondary school, we were taught that the mixed economy of Barbados with its rich social services offering mirrored what obtained in Britain at the time. Over the years as preferential arrangements with the Mother country were retired, leaving our small islands to compete in an era of globalization, a lack of fiscal disciple of the public and household purses have seen an increase in debt. This has inevitable led to our ability to sustain the standard of life we have become addicted to in the 80s, 90s and 2000s.

The negative effect poor of budgeting at the household level will impact a family’s ability to satisfy its day to day needs to put food on the table, pay the bills, send the children to school, credit rating at the bank etc, the same can will be mirrored at the country level. Barbados is reported to be the third highest indebted country the world and the highest in the Caribbean region. We have been hit with a junk credit rating by the international rating agencies, AND, an a visit to the lone primary care hospital sees patients being feed dry bread and corn beef for lunch and sometimes dinner.

What Barbados has had to endure with a poorly performing economy in the period 2008 to 2018 is unprecedented. We can debate if the current state of the economy was caused by Arthur’s injudicious spending under his fourteen year rein, whether it was the incompetence if the former administration that was unceremoniously booted from office last week or both. We are at a point, we have to fix it. This is where the more academic writer writes that this is a seminal moment for the country.

Relevant Article:

The link to the above NY Times article was forwarded to the blogmaster by longtime BU family member Jah Ras Jahaziel Tafari. The article paints a picture of what happens to a country – Britain in this case – when it seeks to manage by the numbers to reduce its debt burden and deficit. It is a long article, worth the read.

  • Historic building are being refashioned, sold, razed to convert state assets to cash
  • Open public spaces community spaces sold to developers
  • Budgets of state entities aggressively slashed (this includes to welfare department)
  • Rapid downsizing with ‘itinerant jobs replacing full-time positions’ and ‘voluntarism outnumbering paid staff’

Read the article for more.

The thesis of the article is about the debilitating impact of austerity measures on a society. In Barbados we have experienced similarly.

  • Sewage on the street
  • Infrequent collection of garbage because the SSA is unable to buy garbage trucks
  • Deep potholes on our roads
  • Unreliable public transportation
  • Increasing number of vagrants and homeless people
  • Unavailability of drugs on the formulary because government is unable to pay suppliers
  • 40% reduction in enrollment at tertiary institution

The article ends with an the ominous warning that austerity is here to stay!

This is Britain, this is Barbados.

The Grenville Phillips Column – Why is the Private Sector Recommending Austerity?

Grenville Phillips II, leader of Solutions Barbados

Both established parties, some of the newer ones, and almost all Barbadian and foreign based economists are warning Barbadians to brace for severe austerity measures.  Several prominent economists are even calling for a devaluation of Barbados’ dollar as a way to address our dire economic problems.  Surprisingly, none of these entities are being challenged to provide a plan showing how or when their austerity recommendations will end.  Instead, Barbadians are essentially being told to just shut-up and prepare to get used to their austerity plans.

Solutions Barbados has published the only non-austerity plan for Barbados’ economy, and it has undergone approximately 2 years of rigorous public scrutiny.  It requires no laying-off of public workers, no reduction of their salaries, and no national disruption.  The plan has been shared with the NUPW, CTUSAB, and anyone who would listen, with overwhelmingly favourable responses.  Therefore, it is highly irresponsible for persons to be advocating austerity, and it is reckless for persons to be recommending something as radical as devaluation, without them first discussing the only non-austerity published option on the proverbial table.

Why won’t they discuss our published non-austerity solutions?  I understand why the political parties won’t discuss our solutions, because they have their own political agendas.  However, why won’t members of the Barbados Chamber of Commerce and Industry (BCCI) discuss them?  This one group will be most impacted by our plans, yet we were told that since we were not yet elected, we could not be allowed to share our plans with BCCI members.

That decision is regrettable – for them.  However, it is near lunacy for them to then join with the Barbados Private Sector Association and recommend austerity for the rest of us.  Why are these, and other private sector groups, so eager to push austerity measures, rather than to discuss our non-austerity plan?  It makes no rational sense.  What could they possibly be afraid of?

For the past two years, we have encouraged discussion, even criticism of our policy solutions in order that they may be improved.  However, we have found that a specific set of persons ‘run away’ from discussion, and flippantly dismiss our solutions as too simple in order to stifle discussion.  Let me confirm that all of our solutions were consciously designed to be as simple as possible – but not simplistic.

When approaching a problem, the first step is to design a solution that works.  This initial effective solution is normally complex.  The problem with complex solutions is that they are normally implemented poorly, because they are too complex for those responsible for their implementation.  Complex solutions are also normally more expensive to both implement and maintain.

If the aim is the efficient and economical implementation of an effective solution, then the solution needs to be made as simple as possible.  This requires repeated iterations of complex analysis in order to reduce the solutions’ complexity and implementation costs, while maintaining or improving its effectiveness.  This is the approach that I have successfully taken over my 25-year structural engineering career.

Analysts of Barbados Government operations generally conclude that our principal problem is one of implementation.  What do we expect if we persist in giving our public workers unnecessarily complex plans to implement?  Why does Government insist on developing these highly complex plans?  Why would anyone design a highly complex plan when a simpler one would be more effective, more economical to implement, and less of a tax burden on Barbadians?  Why indeed.

Grenville Phillips II is the founder of Solutions Barbados and can be reached at