WHAT MATTERS MOST: Harmonizing the needs
In designing the overall architecture for the Barbados economy, it is important to harmonize the competing needs of the public and private sectors; to emphasize the most pressing short-term goals; to balance these goals with the country’s long-term development perspective and to be aware of the rhythm of external influences. It is critical, then, that the size and structure of the economy are seen as constraining, but not defining, factors.
It is currently impossible for the competing needs of the public and private sectors to be harmonized, when the public sector has to borrow more than $40 million per month just to pay its current bills. This is unsustainable for any country, furthermore a small Caribbean island not endowed with natural resources from which significant rents can be derived. Therefore, the little that we have has to be effectively and efficiently managed for the greater good.
While no one is naïve enough to believe that politicians do not pursue their self-interest, it is imperative that the greater good be seen in the context of the country’s short-term goals. What was the greater good in the last four years? The answer is to grow the economy; which meant putting the needs of the private sector and households above those of the Government.
Instead of pursuing the greater good, the Government elevated its short-term political needs above the country’s longer term needs. The choice demanded excessive taxation in 2008 and 2010 that served the Government’s short-sightedness at the expense of the needs of the private sector and households. As a result, over 16 000 jobs have been lost, while household incomes have been suffocated with higher taxes, higher prices and no real increases in wages and salaries. The combination of policies has conspired to reduce total spending in the economy.
Having failed to address the short-term needs of Barbadians in the post-2008 period, the Government has searched for a strategy to protect its self-interest. For a time, it stumbled on “Barbados is more than an economy it is a society”. This slogan died from irrelevance as no country has yet succeeded in separating its capacity to provide social entitlements from the strength of its economy matched by political will.
Indeed Barbados’ elevation to lofty positions in the Human Development Index was always admired because it literally “punched above its weight”. The admiration came from the country’s capacity to deliver education, health and other social amenities at levels which exceeded many developed countries, from its limited economic base.
Yet a Government that has failed to deliver its most basic promises wanted to give the impression that it could rewrite the history of one of the world’s best managed small economies and societies prior to 2008. No country, but more so a country with a tradition of slavery, has a right to surrender to adversity. It is an attitude that deprives its people of their pride and industry! Our resolve must be in evidence “in plenty and in time of need”.
The slogan which suggested that Barbados is a society has now been amended to “No one has lost a job in the public sector”. This is sufficient to cause us to ignore the over 16 000 jobs in the private sector, the rising cost of living and the fact that the Barbados economy is now smaller than it was in 2007. The intention is for performance not to be used as the yardstick for measuring the competence of the Government but for emotion to override objective criteria.
The governance of a country is not to be treated like that of a social club in which bad performance is rewarded by loyalty to a particular fabric, irrespective of its quality. The losses from the club’s mismanagement and lack of leadership are confined to a peculiar social space but a country’s losses cannot be so confined and indeed are more evident among those who can least afford them.
In Barbados’ prevailing circumstances, it is not only those who can least afford but those who previously withstood losses that are more vulnerable than ever. The once able have been disabled by an administration that has failed to harmonize within and has found it impossible to harmonize its needs with the genuine needs of the people.
• Clyde Mascoll is an economist and Opposition Barbados Labour Party spokesman on the economy.