Wednesday, April 17, 2024

WILD COOT: Popular apophthegm

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There is a well-known apophthegm with which Barbadians must be familiar. The longest rope has an end. Old People used to have another maxim – night run ’til day catch it. Therefore Bajans, do not lose hope. We can only go forward if we change the guard. True as John 3:16!
While I say that, I also reiterate that whatever we do, we must not devalue, as there is no yardstick for measuring the depth to which devaluation should go. Suck salt first.
I cannot rejoice at seeing people lose their jobs. However, the situation is such now that something must be done. One contradictory consequence of a sudden downsize is loss of revenue and growth. It was derelict of the Government to have waited so long before making the decision to downsize. It could have been done gradually. All along I, with a concerned few to help me, was calling for a cut. The minister’s response was “show me where to cut”.
Having “pompasetted” about not knowing where to cut, he has now reached “no man’s land”, and is fumbling at the beck and call of the International Monetary Fund (IMF). Rather than borrow from the IMF and bow to their conditionalities, he goes and borrows at 11 per cent and usurious penalties.
All through 2007 until today I blame the Central Bank’s printing money for our predicament. Isn’t it the watchdog of the people? It along with the minister was supposed to monitor our foreign exchange every Friday.
But dismissal alone now of the people will not solve the problem. The shortfall in the collection of taxes is obviously due to less spending by the people (value added tax), cash flow difficulties of businesses and the general hard situation. This will be worsened by taxes not being collected on ten per cent of our civil servant workforce now laid off, plus whatever effect the downsizing will have on the private sector. This is not economics, but common sense. Moreover, foreign investors need to have confidence in the ability of the Government to govern. The performance up to now has been atrocious. In baseball three strikes and you are out.
Furthermore, reducing salaries will not be all that this Government will be doing. There is a ripple effect on institutions that depend on the Government and cutback on the spending of the ministries – the university and the hospital are prime examples.  
Pelting rocks at journalists who were not born here but are Caricom brothers is stupidity and crass and reveals a low self-esteem.
Now we have a problem. One minister in the 16-14 configuration is highly opposed to the lay-offs, 1 800 of which are already at home. How is he to be reconciled to the proposal of the IMF? The IMF sees that cuts in spending must be done, but it does not want to get into the laying-off business. Government, having failed three times with recovery policies, is to carry out another set of policies. The minister’s proposal to have the US$3 or $5 billion sinking fund to clear our indebtedness may recall the Pied Piper of Hamelin and the reward for those who call the tune. Remember our founding father said that we are “satellites of none”. It is a theoretical plaster for our woes and one that the Wild Coot has heard bandied around from banks. A lady asked me: “You think that we gine get some of that hospitality tax that the minister is getting from the emirate, or the emirate will need it to repay the almost US$50 billion that constitute their own debt crisis?”                       
Wild Coot, the banks are confused, and confusing the public. Now they are cautioning the public not to abuse the credit card. But aren’t they the ones that withdrew the travellers cheques from the public and invited Tom Dick and . . . to take out credit cards, thus eliminating the control that had been set for foreign exchange?
The prescriptions of taxes of the IMF lack common sense. While outside investors may be watching to see that we are carrying out their suggestions, Bajans will cut and contrive, save wherever they can and the projected reduction in the deficit will be difficult to achieve even by 2016. Job No. 1 is to call fresh elections and get the rid of the bumbling. But the IMF cannot say that.

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