In 2012, some 70 years after the famous Bretton Woods conference, the International Monetary Fund (IMF) is still pitching its solutions for recovery at dislocation of the fabric of society – people.
The recent comments by the IMF’s representative, Therese Turner Jones, asked for “quick corrective action” from Barbados.
Minister of Finance Chris Sinckler was on the ball when responding to the comments and put the issue in perspective. He reminded the public of our home-grown, Medium-Term Fiscal Strategy policy and the success it has reaped. The maintenance of the dollar parity, reduction of the fiscal deficit and the maintenance of jobs continue to occupy the policy corridors of the DLP’s strategy. We have been trimming the fat across Ministries in a way that does not compromise the delivery of service.
When one peels back the current Medium-Term Fiscal Strategy, there is no doubt that the policy prescription of “quick corrective action”/“austerity” is absent by the agenda of the policy. Instead, the Government of Barbados has been fiscally prudent while exercising deep sensitivity towards the needs of households.
Barbados is a member of the IMF, and we are asked to pay a contribution just like we would to any other international agency to which we subscribe. These funds are paid out of taxpayers’ dollars just like we fund our health care system or pay our police. The IMF has not asked of us to reduce payments to the agency or cease payments for the next 20 years.
This request would be unheard of, yet policymakers of the IMF would seek to impose a one-size-fits-all prescription for small, medium and large economies. The call of austerity is preferred to staged implementation of fiscal prudence. We are asked as a country to choose between pleasing the IMF versus securing families and households in Barbados.
Barbadians must guard against global governance institutions taking aim at small open economies and assuming the local policymakers and the citizens don’t have the competence to manage their affairs. The reference by the area chief to the 1991 period is in clear reference to public sector layoffs and wage cuts. Once again, in a period with distinct economic peculiarities, characterized by the high price of fuel, reduction in foreign direct investment, reduced demand globally, soaring prices, drought, bailouts and stimulus packages, we are asked to slash and burn.
We have seen the tremors in the Eurozone with the many summits ending in a ground zero approach. What about the struggles of the United States economy and their attempt to get people off the breadline? In the bowels of all of this, we are asked by the IMF to “frontload”.
The Democratic Labour Party’s definition of “frontloaded” is to ensure people are put at the centre of the development agenda.
• Douglas Leopold Phillips is a pseudonym for the Democratic Labour Party.