Thursday, April 25, 2024

IT’S MY BUSINESS: Exiting Fool’s Paradise

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“As you know, not only governments have high debts and high deficits, individuals and businesses can as well and we all have to find ways in which to ensure that we adumbrate our ambitions . . .” – Minister of Finance Chris Sinckler speaking at a press conference at Government Headquarters last Thursday, April 25.
Unable to grow?the economy during Government’s first four years in office, and with its Medium Term Fiscal Strategy (MTFS) in tatters, the Minister of Finance emerged from the weekly Cabinet meeting last week to rally the country.
But, having painted itself into a corner by debunking privatization in all possible forms, the Government seems to be now struggling to find the words to break it to the people that this may well be part of the plan.
At least that is how I read the statement by Mr Chris Sinckler that we will have to “adumbrate our ambitions to the extent where we can meet what we have to do constructively from what we produce.”
Say what? I think he is saying that we have to cut our coat to suit our cloth, which, according to one translation of that idiom, means “to plan one’s aims and activities in line with one’s resources and circumstances”.
Then, he added the word “restructure,” pointing out that getting Government’s finances back on track would mean “undertaking the structural reforms in our economy that will lay a solid and reliable platform for sustainable growth in the medium term.”
Let us contrast these statements with the text of an advertisement which the Dems ran over and over again in The NATION newspapers during the 2013 general election campaign. These were supposed to be what would result from the election of the Barbados Labour Party (BLP):
“Sanitation PRIVATIZED . . . Pay for garbage collection.
“Airport PRIVATIZED . . . Higher airfares.
“Barbados Port PRIVATIZED . . . Food prices gone up.” 
So privatization is apparently out. What else could the Government do? Let’s see, how about the following:
“Place caps on the transfers to the statutory boards, statutory corporations and Government-owned companies, such as the Queen Elizabeth Hospital, Transport Board, Barbados Agricultural and Development Marketing Corporation and the University of the West Indies.”
Or how about this one: “Eliminate transfers to other Government-owned corporations and authorities such as the National Housing Corporation and the Barbados Water Authority.”
Those lofty goals, my friends, are contained in the Government’s own Revised Medium Term Fiscal Strategy, and so were responsibilities undertaken by Mr Sinckler (see page 16 of the Revised MTFS, published in 2010, I believe.)
According to the Central Bank of Barbados in its March 2013 press release, “subventions to the UWI, QEH, Barbados Water Authority, Transport Board and other state-funded entities rose by 6 per cent (in 2012).” (Page 1)
Mr Sinckler said Government would “redouble our efforts at fiscal consolidation by undertaking further strategic reforms in the public sector, particularly the statutory entities currently owned by the people of Barbados”.
The Dems in the last election campaign consistently sought to equate the term restructuring – whenever the Bees mentioned it – with “sending people home”.
If I heard right, how are you going to achieve the last goal of strategic reforms of statutory entities, if you don’t privatize in some way, or cut labour and other expenses for loss-making enterprises owned by the Government?
These difficult options remain the dagger at the heart of the problem, and Mr Sinckler has been juggling with them for too long, afraid to plunge in the knife and start cutting. His last alternative – to set up funding through the National Insurance Scheme (NIS) – raised fears that he would run down the NIS surplus.
That was then. Elections were coming up and the Government had to keep people employed.
This is now. The Government has five years in power ahead of it. The unpopular has become less unpalatable.
Look out for the privatization.
It has to be done and we simply cannot continue to borrow a billion dollars a year to sustain this fool’s paradise.
They know it, but don’t want to admit it.
You know who else knows it?
The Governor of the Central Bank. And that is why he essentially told the Dems, via the bank’s March press release: “Captain, the ship is sinking.”
• Pat Hoyos is a publisher and business writer.

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