MANAGING OUR national economy can be likened to managing a home. While there may be complaints about the food, washing, maintenance and other services, if the mortgage loan is not repaid, then the occupants will suffer the trauma of being forced out of their home, and their previous complaints would become entirely irrelevant.
We are being manipulated into making complains about Government services the primary criteria for judging the performance of those managing our economy.
The primary measure of their performance is therisk to making those mortgage payments. Complaints aboutservices is an important secondary concern. Of course, if we were not in debt, then the service complaints would become the primary concern.
Continuing withthe home analogy,the bank (IMF) recommends that our debts not exceed40 per cent of our gross salaries (GDP). They have now grown to over 135 per cent of our gross salaries and we have received repeated warnings by the bank about our ability to repay the debt. Concerned citizens have implored the current administration (Democratic Labour Party) to listen tobetter advice.
Many think that the solution is to go back to the previous administration (Barbados Labour Party). However, they brought us from the safe debt of around 35 per cent GDP to the unnecessary 90 per cent GDP on the sorry excuse that low-interest loans were available. It takes no special competence to negotiate a low-interest loan if you are within the safety of the responsible 40 per cent GDP debt ceiling.
It should be noted that while the 2009 Moody’s downgrade occurred during the current DLP administration, Moody’s blamed the downgradeon the recklessnessof the previous decade, which started when the BLP crossed the debt ceiling of 60 per cent GDP, which the IMF recommended as thelimit for advanced economies like Germany. But we wanted to “punch above our weight”, and used the deficit financing option irresponsibly.
By the measure of risk to repaying our loan obligations, crossing the safety of the 40 per cent GDP debt limit to over 90 per cent, and more than doubling the national debt from $4.3 billion to $9.2 billion, must rank the previous administration as our worst. The current administration is behaving as if that is an enviable position to pursue.
– GRENVILLE PHILLIPS II
