By Jerry Roker
for Bahamas Press
The FNM sucked at managing the economy, during the period 2007-2012!
Economically, what they achieved was the diminution of national wealth and the distribution of poverty. Four years later, The Bahamas is still attempting to recover.
We are reminded of the economic folly of those times, and what can happen when idealists, ideologues and populists combine to defeat common sense. Their ineptness left no wiggle room for the incoming PLP government to launch any significant capital expenditures to drive consumption and growth.
Rebuilding market credibility required that we had to put our fiscal house in order and our borrowings on a downward trajectory.
All things being equal, (and in economics they never are) the Christie PLP government has done a remarkable job. To absorb the political cost of restraint when it came to deficit spending to spur economic activity, if for no other reason than to create jobs, was noble indeed. Why risk disrupting our national economy at the feet of what is politically expedient? But you know what, he will get no credit for reigning in spending and substantially reducing our massive deficits, and placing us on a certain path to the end of deficit spending, and the sustained reduction of our national debt, barring a national catastrophe, e.g. a major hurricane. All this, with the much touted Baha Mar mega project still stalled.
It would help, too, if our economy grows, which is not happening fast enough. But the answer to insufficient growth is not, as Greece – even with the cushion of its membership in a rich members’ club – discovered, the overthrow of fiscal prudence or an increase in deficit spending. In the event, while we appreciate that government spending on social and other infrastructure can be good for an economy, it is misplaced that the State ought, somehow, to become the big engine of economic activity.
There is, however, two closely related areas where I believe the State can play a very significant role, and in so doing, increase economic growth and employment.
We need to make it substantially easier to do business in our country, for our people and equally as important, we must find a way to provide small and medium size entrepreneurs with temporary incentives that will allow them to start and develop businesses. The simplest and most cost effective way to do this is via tax holidays.
As the debate on the 2016/17 continues, I am hopeful that the way ahead for Bahamians is full of hope. We all have a choice. We can sit on the sidelines and just criticize. That’s easy to do. Or we can show strength by simply embracing hope.