Posted on

THE HOYOS FILE: Saving private enterprise

Pat Hoyos

Social Share

FINALLY, WE ARE SEEING some light at the end of the tunnel.
That light is, of course, the big neon sign that says “elections in less than a year,” and it is suddenly making the Do-Little Administration look like a colony of busy beavers.
The Stuart government, which has admitted its sole policy during the recession has been to preserve the jobs of Government workers, a.k.a. the army of occupation, and boasts of its success in so doing even as unemployment has risen to over 11 per cent, began suggesting last week that it might try to help REDjet get back in the air.
The administration that helped this fledgling airline initially, then allegedly dragged its feet in granting needed regulatory permissions and refused to make any cash infusion into the airline despite very public appeals from one of its major shareholders, Ralph “Bizzy” Williams, and then-
CEO Ian Burns now wants to help.
That may be because somebody probably read the following paragraph to the Stuart Administration (as you know, it is not in the habit of reading reports itself):
“The number of persons travelling from the Caribbean islands increased significantly due to the specials offered by regional airlines during the review period and the regional cricket games held during January. However, the suspension of REDjet’s services is likely to weaken the degree of price competition for regional travel and may dampen the rise in CARICOM arrivals going forward.” – Central Bank of Barbados Review of the First Quarter of 2012, Page 4.
It should be noted that a chart for tourism on the same page of that Central Bank report shows “other CARICOM” arrivals for the first quarter as basically flat at around 12 000 (actually 400 arrivals down from the previous year) and arrivals from Trinidad and Tobago up by 3 500 to reach 9 000.
So it isn’t as if REDjet was that much of a market changer, in my humble opinion, since there was cricket on and the people who wanted to come here for it would have done so no matter what plane or fishing boat they had to catch.
Ironically, the administration now wants to help REDjet after its own authorities suspended and then revoked its license to fly. Why, oh why does this administration always wait until the game is almost over to say it might do something? Beats me.
The fire under the Government in respect of REDjet has been lit by the submission of a 16-page report titled Barbados Airlift Investment produced, of course, by the airline. Seriously, even I could have come up with a more imaginative title than that. How about Yet Another Way To Pour A Few More Millions Into The Bottomless Pit?
According to last Tuesday’s DAILY Nation, the airline is asking the Stuart administration for $10 million in financial support and, in return, promises to make Grantley Adams airport its hub, and LIAT “a key partner” as a short-haul provider of passengers to its own medium-haul services.
Sounds so good, you might be forgiven for wishing all this had been thought out before REDjet first lifted off the runway into the Caribbean sky a year ago.
In the classic 1998 war movie Saving Private Ryan, a small group of soldiers, selected from the thousands who landed on the beaches of Normandy, France, on D-Day in June 1944, is sent far ahead of the slowly advancing Allies into the German-held French countryside to find one paratrooper, a Private Ryan.
Their mission is to bring him home safely because his three brothers have already been killed in the war and the army wants to send at least one son back to their mother alive.
To me, any special effort to save REDjet while not doing a thing to help the rest of private enterprise can only be explained in Private Ryan terms: it is a special case because it makes us look bad, heartless and so on, and could act as a disincentive to others.
If this Government was truly interested in helping REDjet, it would have intervened in its affairs before the airline grounded itself, before hundreds of thousands of dollars had been accepted by the airline for travel it did not provide.
As a result, no matter what financial support the Government now gives, consumer confidence in REDjet will never be fully restored unless every cent of that ticket money is repaid in cash – not by offering make-goods at some future date, which is of course what they are most likely to do.
The central irony in Saving Private Ryan is that so many brave soldiers had to die so that he might live. How many businesses could be saved by that $10 million but will not get a penny so that REDjet might live again?
How many normally viable small businesses now struggling under the Government yoke of punishing taxes increases will ever be offered any similar relief by the Do-Little Administration?
The Stuart administration may be able to save the airline, but unless it sets up transparent policies which would also benefit all businesses trying to keep their doors open and not just REDjet, its actions will seem to be aimed more at saving its own face rather than any other entity.
Saving private enterprise as a whole, not just one of its members, should be the priority of every Government. Saving REDjet alone with taxpayer dollars (really, borrowed money that will have to be repaid by taxpayers) is not a real solution to our problems, but may provide some temporary cover for a Government which has failed miserably to create an enabling environment for business investment in Barbados.