When it comes to the economy, everybody, it seems, is throwing in the towel.
Prime Minister Freundel Stuart throws it in, takes it back out, throws it in again, and on and on he goes. He is like the errant schoolboy reluctantly following his teacher to detention, where he will be made to write 1 000 lines of “I will do as the IMF says.”
Meanwhile, former Leader of the Opposition Owen Arthur has taken the Groucho Marx position. In his autobiography the former leader of the Marx Brothers recounted that “I sent the club a wire stating, PLEASE ACCEPT MY RESIGNATION. I DON’T WANT TO BELONG TO ANY CLUB THAT WILL ACCEPT ME AS A MEMBER.”
Groucho also declared once that “Those are my principles, and if you don’t like them . . . well I have others.” This seems somehow apropos of the Democratic Labour Party, whose leadership is now doing everything possible to convince its supporters to follow the exact opposite economic principles it laid down during last year’s election campaign. It is now doing everything it accused the Bees of planning to do should they have won the government.
People are asking which is the real Chris Sinckler, the one holding everybody’s hands or the one meticulously going over the payrolls late at night looking for people to make up that 3 000-person list, making sure not to upset the boss by “denuding” families whose income earners both work for the Government, as that would certainly not “amuse” him.
Projection for growth
Then of course there is the Central Bank of Barbados. It just changed the subject entirely.
Instead of the usual sector-by-sector analysis followed by its projection for economic growth (or not), the bank itself seems to have realized that there was no kind of hope for making a silk purse of this cow’s ear that we have for an economy, driven to the brink of ruin by the hard-headed, irrational policies of the Freundel Stuart administration.
This time round we are treated to a long discourse on competitiveness. But even here the bank had to admit that “although Barbados has remained competitive on price, there has been some decline in our share of the Caribbean market”.
Note to Central Bank: deep-discounting in desperation to salvage at least something from the marketplace – a fire sale, in short – is not an example of “sustainable” competitiveness. Just thought you should know.
The process which led to the bank’s production of this most recent report is of course unknown to me, but in my over-active imagination I envisaged a haggard toiler at the bank’s statistical department, possibly located in an air-conditioned cellar within the bank’s foundations in the marshes below the city clawing his way up the elevator to the ivory tower.
“Guv,” he says, “We been wukking dese numbers for days and extra days and they just doan get no better. Everybody dropping sleep now for tiredness. Must – go home . . . children – growing – up – without – me…”
I then envision the “guv” saying, in that booming yet well-enunciated voice, “Don’t worry, my dear colleague, the bank will proceed anyway.”
Regaining strength for a moment, the sleepless worker mutters, So wha’ you gine do?” And the guv replies, “We will simply remind the people how competitive they really are. That should give them some hope.”
Of course it didn’t happen that way, but I would really like to know how it did. How you could resile from your usual format, not when we are doing well, but when we are on the brink, to obfuscate with all this nonsense.
If you wanted to do that, put it in a paper, I say, so we will all know, except the diehard economists, not to read it.
It was this central bank which at this time last year, when it just did not seem possible, said that “Real economic growth for Barbados in 2013 is forecast at 0.7 per cent . . . . In addition, private capital inflows of $600 million are anticipated . . .” (Page 2, Press release for December 2012, released mid-January 2013.)
Last week it said, “There was a small contraction in Barbados’ real GDP in 2013, estimated at about 0.2 per cent,” and “A slump in private foreign investment flows was the major reason behind the decline in foreign exchange reserves in 2013. Reserves declined by $301 million and net capital inflows were $188 million lower.” (Pages 1-2, Press release for December 2013.)
In 2013 there was no Republic Bank or Emera to bring in boatloads of foreign money to buy up existing shares, my friends. So we are down in almost every sector and it probably was just too depressing to recite.
But despite all this, so good has been the management of the economy, the bank suggests, that the decline in GDP since 2008 has only been four per cent, while it was seven in 1981 to 82 and 14 per cent in 1990-93.
And how did we do it? Oh, just by doubling our national debt to the point where the Government can borrow no more without International Monetary Fund (IMF) conditions agreed to (check Credit Suisse loan and I bet you the Chinese loan offer too).
When the Dems took office, Central Government debt was $4.8 billion; at the end of December 2013 it was $8.2 billion. Gross Public Sector Debt was $4.8 billion; at the end of December 2013 it was $9.1 billion. (Table 5 – December Press release, Page 8). That is how we did it.
See that last number of $9.1 billion? That is 108 per cent of GDP. In this game of Monopoly, you don’t go past 100 without going to IMF jail.