By: J.Maxfield Outten
In an article published earlier in the Nassau Guardian (online), Minister of State Zhivargo Laing (The outgoing Minister) again has publicly defended his Mentor, the Hon Hubert Alexander Ingraham but has not responded adequately to claims that his Government has badly mismanaged the country’s economy. The Guardian rightly ends the infuriating article with a recap of the arguments put forth by the Opposition’s Honorable MP for Elizabeth, Ryan Pinder, last week that mismanagement of the economy is rampant and they ‘are putting handcuffs on generations of Bahamians to come’. I would like to add to Mr. Pinder’s arguments because it seems no matter what the evidence suggests, Mr. Laing will defend his government’s position, even in the face of damning condemnation by our regional economists, the Inter-American Development Bank (IDB).
The clueless Minister could not see what is happening in his own ‘backyard’ so we shouldn’t expect him to understand more important national economic issues such as debt-to-GDP ratio. This is one of the most important indicators of a country’s economic health. It is ‘a measure of a country’s national debt in relation to its gross domestic product (GDP). By comparing what a country owes to what it produces, the debt-to-GDP ratio indicates the country’s ability to pay back its debt’, plain and simple, Mr. Laing! Depending on who you speak to, our debt-to-GDP ratio is anywhere from 48.7% to 65%! In the list of nations, this places us as ‘high’ as 26th or ‘low’ as 54th on the list (by the way, Japan is No. 1 at 225% of GDP). As the ratio increases, it becomes less and less likely that a country will pay back its debt because it then has a debt level that is approaching the total sum of goods and services produced. Our economy is set to flat-line over the next year or so or grow very slowly, which means that our GDP will not expand and put more daylight between it and our national debt, so it is a good thing that Mr. Laing and his cohorts will not be around late in 2012 because we would certainly be in serious trouble!
The Tribune reported last week the concerns of the Inter-American Development Bank. It quoted Valerie Mercer-Blackman, the IDB’s lead economics specialist, as saying ‘if the Bahamas “wakes up now” and implements the necessary reforms it would avoid an ever-increasing debt mountain that eventually stagnates economic growth’ and that ‘the Bahamas “cannot sit back” and wait for US economic growth to ‘bail it out’ of its fiscal problems’. But this is exactly what the Free National Mess is waiting for, having run out of ideas how to develop the economy. The paper also reported Mercer-Blackman as saying that ‘the Government’s debt servicing (interest) costs were getting “close” to the 15 per cent of revenues ratio that represented a ‘danger zone”. So if this stark and unambiguous advice is coming from the hand that feeds us, when will our Politicians wake up?
Minister of State for Finance, Laing, supposedly studied Economics in Canada but real world decisions that affect standard and quality of life are a long way from the classroom and obviously a long way from the Minister’s comprehension. The writing is on the wall for the economy – at home, The Tribune and The Guardian have clearly reported the facts and the IDB has made it clear what needs to be done to stop the economic rot. Other news sources in the region (Jamaica’s RJR, the Guyana Times and Dominica Vibes, for example) also reiterate the worsening economic situation in The Bahamas but yet Mr. Laing, whose arrogance knows no bounds, and the Free National Mess simply ignore them. He did not listen to the voters of his long time constituency, Marco City, but is now being transferred to Fort Charlotte in the capital. Does he, his mentor and their Government not realize that firing Ministers, transferring Ministers and changing the electoral boundaries is like re-arranging the deck chairs on the Titanic? Whatever changes you make, will make no difference, the good ship ‘Free National Mess’ is going down !!!!! Enough is enough …
The mismanagement of the roads and infrastructure project is just the latest in a line of bad management and oversight by the FNM government. How can a Project Manager or Director still be in post if they could not avoid cost overruns of $51 million and how can the Minister of Works enjoy his Christmas turkey knowing he is still in a job when major infrastructural projects cannot be costed properly, projects cannot be managed effectively and which mean that projects cannot be finished on time and in budget? What we, the PLP should demand right now is a complete and transparent public accounting of the road improvement project, so we and the Nation can see exactly how the money is being spent. In hard economic times, we cannot be so callous with the public finances.