Dr. Don Marshall, Senior Fellow, UWI Cave Hill
There comes a time in the affairs of man when he must take the bull by the tail and face the situation – W. C. Fields
The recent downgrade in the outlook of Barbados investment paper by Standards & Poors given our BBB rating continues to generate much debate in Barbados. What seems to be fuelling the debate even more is the hint that a downgrade to our investment grade maybe around the corner given the rapid rate Barbados continues to accumulate debt. Barbadians have become alarmed at the prospect of having its investment paper perched at the brink of junk rating, a status most unfamiliar to Barbadians through the years. The fallout from attracting low credit rating by the credit rating agencies is the high cost to borrow if Barbados needs to float bonds in the capital markets.
Isn’t it ironic the current financial crisis which precipitated the global recession and led developing countries like Barbados to go enter an economic tailspin would have to suffer the penalty of credit rating downgrades by agencies which played a part to begin with? BU rejects the explanation by Professor Dr. Avinash Persaud that the credit rating agencies failed when rating structured products and not country ratings. How can one excuse the model for one area of their business over the next?
Dr. Avinash D. Persaud, Chairman of Intelligence Capital Ltd
The current debate from the academics has tossed out some interesting takeaways for John Citizen. In one corner we have the world renown Barbadian Professor Dr. Avinash Persaud who believes the imminent downgrade of Barbados investment paper to junk status will be disastrous and must be avoided at all cost. In the other corner we have the homegrown Senior Fellow at UWI Sir Arthur Lewis Institute Dr. Don Marshall who believes Barbados should seize the opportunity to find creative ways to reduce government spending and enable the environment to encourage entrepreneurial projects to lead growth by expanding exports. He has been very bold by suggesting the Barbados Defence Force should be bastardized to support the police recruitment drive to benefit from opportunity cost savings.
BU is on the side of Dr. Don Marshall. Interestingly we are about to celebrate our 43 year of independence and Dr. Marshall has been strident in advocating the dismantlement of the Barrow (Father of Independence) model which has served us well. The billions of dollars which Barbados has invested in our people in the post-independence period now has to spew forth results. It is crunch time! In makes no sense boasting of how Barbados has used education to enfranchise its people but we continue to build out an economy based on mendicancy i.e. tourism and foreign direct investment
It seems the opposition party remains fixed on sucking political mileage from the defensive economic position the government finds itself. The political polarization in Barbados makes it mandatory that both political parties demonstrate leadership to bring the country together now more than ever to generate ideas. What better time than in the month of November to do it.
114 responses so far ↓
Carson C. Cadogan // November 16, 2009 at 9:28 PM
“He has been very bold by suggesting the Barbados Defence Force should be bastardized to support the police recruitment drive to benefit from opportunity cost savings”
I agree with him one hundred percent. The Barbados defence force is serving no useful purpose. It is an unnecessary drain on the public purse. We could well do without it. The saving to the country would be tremendous.
We do not need the defence force, Sidney Burnett-Alleyne is no longer coming to invade to Barbados.
Carson C. Cadogan // November 16, 2009 at 9:34 PM
Persaud made no sense to me all. Far too many of these so called academics are demostrating that they have little common sense.
I wonder what job the Barbados Labour Party has promised him if he helps them to bring down the Democratic Labour Party regime.
David // November 16, 2009 at 10:20 PM
Dr. Persaud does get a lot of airplay for sure.
Dismantling the defence force is not straight forward. Releasing all those trained men and women on our streets must be well taught out if disbanding the BDF were to be considered.
Interestingly we note Dr. Persaud and Mia Mottley attended QC around the same time.
Adrian Hinds // November 16, 2009 at 10:41 PM
David we must archive everything that Persuad says.
St George's Dragon // November 16, 2009 at 11:04 PM
I am struggling to understand the basis for BU’s rejection of Dr Persuad’s position. Another downgrade of Barbados’ financial rating cannot be a good thing however you look at it.
Whether you like it or not, there is a set of rules which are applied across the world by Governments and financial institutions which dictate the availability of credit. If you don’t comply with them they won’t lend to you.
This is where Dr Persaud is coming from.
What countries like ours need to understand is that we may not want organisations like the IMF to dictate policy to us, but we are still bound by their rules.
If we called on them for assistance, the IMF would look at what our borrowings are, and how we aim to reduce them (as they would consider them too high at the moment).
In our current economic position, if we want to avoid going to the IMF and instead borrow money from international institutions, they will (strangely) also look at what our debts are and how we aim to reduce them.
We end up in the same place. The IMF would make us instigate public sector savings – and so would the private sector lenders.
You choose which one you want – IMF imposing cuts on us, or we impose cuts in order to borrow money from international banks to stay afloat.
If we do neither we end up like Haiti.
We are not immune to what happens elsewhere in the world. Whether we like it or not, we have to play by world rules.
Twitted by BarbadosNews // November 17, 2009 at 4:20 AM
[...] This post was Twitted by BarbadosNews [...]
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 4:38 AM
@St George’s Dragon: “If we called on them for assistance, the IMF would look at what our borrowings are, and how we aim to reduce them (as they would consider them too high at the moment).” [For clarity, the Fund would look at the whole economic landscape, not just debt. It has already flagged in the recent Article IV consultation that the current debt profile is unsustainable.]
“We end up in the same place. The IMF would make us instigate public sector savings – and so would the private sector lenders.” [As you identify correctly that the deficit and debt are major problems, it is better to acknowledge the need to correct those rather than say "make us instigate" as if that is unwarranted. For mainly political reasons, countries are often reluctant to do what is needed to correct agreed economic problems. The Fund is good at 'taking the blame'.]
“You choose which one you want – IMF imposing cuts on us, or we impose cuts in order to borrow money from international banks to stay afloat.” [Again, better to not say 'impose' when it is really doing what needs to be done, if revenue cannot be raised.]
A major difference with the Fund’s involvement is that their mandate for macroeconomic assessments means that most lending agencies (especically other international institutions) look for an IMF ’seal of approval’ before wanting to engage a country. That will either be in the form of an IMF-supported economic stabilisation program that is ‘on track’, or policies that the Fund feels are ‘in the right direction’. That stamp is not there from a rating agency.
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 4:51 AM
“The fallout from attracting low credit rating by the credit rating agencies is the high cost to borrow if Barbados needs to float bonds in the capital markets.” [The fall out is greater than that. Barbados may not be able to borrow in capital markets because of limits on how much non-investment grade paper private sector lenders can hold (no matter what interest rate they would wish to charge). If money is not coming from other areas such as the IMF or World Bank then the brick wall is right in front. That's how the market works, and it's not really partial to one country or another.]
Why should it be seen as ‘bold’ to rationalise government activity (in this case BDF and police)? It’s done elsewhere in the world, in the sense of national defence forces supplementing policing activities. That view may highlight why dealing with excess public sector spending will be a problem. There is nothing bold about it. The problem is really in seeing as a bold solution one piece of logical rationalization when what is needed is a wider overhaul of public sector activity.
Anonymous // November 17, 2009 at 5:15 AM
David
I disagree with you where you stated in your article that avinash persaud is world renowned.
What is this world renowned person doing,what prestigous international financial institution or university is he giving his vast wisdom to right now,and where has he given it to before?
Avinash persaud is another one of those financial empty talking heads that go around to small or developing countries like barbados spouting economic rhethoric and in the process conning the governments into giving them expensive consultancies.
Name one new thought or enlightened idea he has spoken so far?
Starcom a pro BLP station obviously thinks he is the cat’s meow,but then again they are not too bright in that place and any gloom and doom predictions which persaud is renowned for,fits right into the talking points of mia mottleey.
So it is obvious that starcom is doing the bidding of the master,the BLP.
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 5:40 AM
@Anonymous, “I disagree with you where you stated in your article that avinash persaud is world renowned.
What is this world renowned person doing,what prestigous international financial institution or university is he giving his vast wisdom to right now,and where has he given it to before?”
[It's always easy to 'rubbish' people one dislikes, but it looks so silly when there are pieces of evidence that are easy to find to answer the questions. I suggest you do a little homework, even if it's only on the Internet and Wikipedia, http://en.wikipedia.org/wiki/Avinash_Persaud.
Last time I looked Prof. Persaud was part of Barbados' National Council of Economic Advisors, so maybe he's being a devilish double agent acting as if he is helping the DLP government.
In terms of "Avinash persaud is another one of those financial empty talking heads that go around to small or developing countries like barbados spouting economic rhethoric and in the process conning the governments into giving them expensive consultancies." I guess that Canada, for one, is small and developing, to name just one country that gets the prof's advice. Sorry to disillusion you but a lot of his work does not come with much lolly.]
But what are a few inconvenient truths thrown around in the face of baseless remarks?
peltdownman // November 17, 2009 at 9:11 AM
The problems that Barbados has with the “evil” IMF stem from the last time they assisted Barbados and insisted on the country taking measures that eventually pulled us out of a situation which was not as bad as the one we are in now. At that time, the IMF team was led by a rather severe German lady (who had the private sector eating out of her hand). At any time I was expecting her to turn up in jackboots and say “vee are ze ones who tell you vot to do!” They were suggesting unpalatable measures such as devaluation, and the charging of duty on industrial inputs, among many others. In the end a compromise was reached, and it was hard, but it worked, and we had 17 years of relative prosperity that followed. Why? Because the government, the unions and the private sector decided that the country’s interests came before political posturing, and the Social Partnership was born. From what I can understand, the IMF has come a long way since those days, when it was obvious that their policies were causing unbelieveable hardship. But one way or another, we have to “bite the bullet” here in Barbados, or the consequences will be dire. We have to give up on the idea that everything should be provided free or subsidised by the state. Better a short, sharp pain than dragged-out agony. I think that the IMF could be a big help. Unfortunately however, in Barbados the acronym “IMF” actually means “political disaster”. So where do we go from here?
Anonymous // November 17, 2009 at 9:49 AM
ROK // November 17, 2009 at 9:52 AM
@David
“Dr. Marshall has been strident in advocating the dismantlement of the Barrow (Father of Independence) model which has served us well.”
I would like to suggest that the “Barrow Model” was dismantled long time. What we have is the “Tom Adams” model of government.
When I think of the miles we have rolled back downhill, it is impossible to say that what we are experiencing now is the Barrow model.
It is only in recent times that we went back to thinking that what is Bajan is good; for example the “Buy Bajan” campaign which is no different from the buy local campaign by Barrow in the 60’s & early 70’s.
The build up of the BDF would certainly not have been part of Barrow’s model because he knew the dangers of building up military in a country like ours (Grenada & Guyana for example). He felt that our military might should not exceed the requirements for security.
The man had a total vision of how Barbados should develop and he certainly thought that for Barbados to develop, the people had to develop. Hence the thrust towards free education; the investment in UWI, the establishment of SJPP and Community College.
In terms of vision, these institutions have not lived up to the vision at all. The principles which drive Government today are also far from his vision. Each Department of Government nowadays have a charge for everything. They are not far from private sector practices.
The principle of the role of Government as a facilitator has gone through the eddoes and Government is now the principal player, getting into competition with the private sector and all.
The very country whose President Barrow called a cowboy is who we have been embracing since Tom Adams. We have become a satellite and view all those against the Sun as foes.
No! No! No! Don, we are experiencing the Tom Adams legacy and not the Barrow vision of a developed “people”.
Let us put it this way: free bus fares so children have no excuse to miss school; the establishment of the constituency councils; the attention being paid to community and NGO efforts; the idea that each MP must report to his/her constituency; and the sharp increase in local CBC programming are more inkeeping with the Barrow vision and you and I know that these have not had a chance to work yet.
We need to go back to the Barrow vision as much as when we go back to Marcus Garvey we see a Black vision which we dare not implement for fear that the sun stop shining.
Adrian Hinds // November 17, 2009 at 10:02 AM
ROK i agree with you. Barrow was against the establishment of the Defense force.
ROK // November 17, 2009 at 10:14 AM
@David
This whole thing about downgrading, etc. is a whole myth created by those who intend to manipulate the system.
Having said that, I agree with Dr. Marshall about encouraging enterprise and export. I want to let him know though that I have been advocating that for many years and is now viewed as a madman.
Too many people are of the opinion that we don’t have anything to export. They also feel that we should not manufacture if we could get it cheaper elsewhere. I keep hearing this foolishness about re-inventing the wheel. It is time that this idea stops floating around.
We need to understand that even if we can make one we should make it because the day that the imports get expensive or designs change that calls for total re-investment then we in ducks guts.
Not only that, it is time that we marry culture into what we produce if we talking about branding. Stop the pepper sauce in rum bottles. The monkey should be better studied and developed for storing cool drinking water. Our clay products need developing to bring it to the quality of ware.
We need to tell people of the benefits of the molasses we produce. We need to stop the Flour Mill from bleaching flour with chemicals and let it bleach naturally because the chemical bleaching produces a bi-product called alloxan which destroys the pancreas and cause diabetes. In this regard we also need to stop telling ourselves that diabetes is hereditary, that is a myth.
It is amazing the lies and the myths upon which this society is built. Keep rolling Don. I don’t think they will call you a madman and you may actually help me change my reputation. LOL!
Anonymous // November 17, 2009 at 11:12 AM
The DLP is taking us down
Hopi // November 17, 2009 at 11:13 AM
Short of the plates shifting and submerging that 144sq miles, Barbados will be singing the same tune ten years from now. But what more would you expect from an economy that’s driven by tourism and an international business sector? Isn’t it obvious that when there are quakes in these sectors, that Barbados being as small as she is, will succumb beneath such a burden?
Barbados is constantly boasting about her education systems which turns out servant after servant year in and year out.
Didn’t she have to import foreigners to construct her new airport? What happened to all your ‘highly educated’ graduates? No architects, no engineers, no ‘constructionists’?
The sole purpose of the IMF and World Bank is to keep most nations in bondage esp. natural resource rich nations. They have removed the physical chains because they are easily recognizable, but with the consent of your vision-less leaders, they’ve imposed a more sophisticated form of slavery, i.e economic servitude. Don’t care how you look at it, it is still slavery. Its yet another case of the poor supporting the rich. These two institutions just sit there and come up with scams like providing you with computerized money in exchange for your covetable, hard assets. They also set the oil prices so that they can siphon off the middle for themselves. So yet again you are paying through both ends.
Its high time Barbados move away from these blood-suckers. Being yoked to these capitalist structures that are of the beast means that the winner takes it all. These are some of the real terrorists that are killing this planet today.
I know its “TOO MUCH TO ASK” but Africa is the best place for us to restart. All the blood-suckers get resources from there. They then take it and make inferior crap for the most part and we are so happy to lap it up. Why can’t Barbados develop strong, meaningful relationships with the MOTHERLAND? Why can’t we form an economic Bloc with them? I’m sure we’d have a more equal footing with them than with the beast!
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 11:34 AM
@ROK, if downgrading is a myth then it must be a myth within a myth, or are you suggesting it’s a myth within some reality? If the latter, what is it that you see as real?
In a country that has limited natural resources, and wants to trade with other countries, one of the best potential exports is people and their services. Barbados’ education system has not been good at developing ‘exportable’ skills and that should change. Those skills need not be ’soft’ (like medical or technology or legal skills) but could be ‘hard’ (like agricultural and food production expertise). But if you do not have them well developed at the national level then you do not have them to export.
ROK // November 17, 2009 at 11:41 AM
Yes, downgrading can only happen because of the myth that would support it.
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 11:47 AM
@Hopi, as you point out Barbados has a hard time meeting its own needs, even though it has a status of a highly developed society.
What would Barbados really want out of a relationship with African countries and what would it have to get or accept in return? Other than a certain group of educated people there is not a great deal that Barbados has to offer that African countries do not have in abundance: I do not count rum or fish.
I’ll ignore the misinformed views of the World Bank and the IMF, which do a lot more and it does not even involve money creation. Too much seeing the world as victimizer, which argues against being able to initiate any of your plans because ‘the system’ will always be out there to beat you. So, you need to do a rethink of the world. How and why would the ‘blood suckers’ let you make any move that seemed to be geared toward the progress you foresee?
Driver // November 17, 2009 at 11:49 AM
They are planning to dismantle the Transport Board too.
Right now they have not set our General Manager on vacation for 3 week this is his second week he returns on the 26&27th of this month then his is gone. Luckily he went to Cawmere so he will get a job. (they say they don’t leave each other out, seems more like a faternity to me than a school) Our chairman went there too.
We understand that about 3/4 more managers are to go too, and our deputy retires next year. Staff here are scared, some new drivers and cleaners are coming one by one, but we understand that they will be mass stripping of the staff.
It is now our fault the problem with the transport board is inefficient LEADERSHIP adn communitcation. Those are the 2 main problems, they are others but these are the main ones. Along with unqualificed supervisors and officers, imagine some supervisors getting over $5,000.00 and not even having basic qualifications.
I promise to post another time dealing with the qualificaitions part of the board’s problems.
Scared Driver
Driver // November 17, 2009 at 11:50 AM
That should have been now sent home our General Manager ….
Alex Fergusson // November 17, 2009 at 11:54 AM
NEWS FLASH, TURN YOUR RADIO TO PARLIAMENT CHANNEL. MIA IS BUSTING THOMPSON TAIL ON THE ECONOMY AND HE IS RUNNING.
HE OFFERED MIA MOTTLEY THE SAME TIME AS HIM BUT IS NOW BACKING DOWN.
MIA IS SHOWING WHY SHE IS BETTER SUITED TO BE PM THAN THOMPSON.
Barnabas Collins // November 17, 2009 at 11:58 AM
It is now obvious that if anyone says anything negative about this government, they are either getting paid from the BLP, BLP yardfowl or the new one is that they went to school at the same time as someone in the BLP. Instead of arguing that S&P was the same group who endorsed some of these same companies who now has the world in this financial mess and never gave them a negative BBB or any bad rating. Our argument is that Dr. Persaud went to school with Ms Mottley….Schupse….And this is coming from people who are obviously well educated. Anonymously or not I would be totally embarrassed to even think about making such a partisan assertion that shows a lack of intellectual acuity. This is the discourse that we are now engaging.
I sometimes think we hear but do not listen. I will give an example. Yesterday I was listening to one of the radio station’s news offerings and the PM was calling for the people that got plenty when the economy was booming to give back now in hard times. (I agree with him but I am not sure how one can make a business do such). However, my point is that this is the same economy that I never heard the DLP when in opposition thought was ever good. So which times are the PM talking about. I am fully aware that when in opposition, we mordaciously oppose irrespective of what the government of the day said. I will invoke some partisan ire for making this submission but I will qualify anything I observed by saying the reason I think Mr. Barrow thought we should have free education, was not to blindly follow anyone. Mr Barrow in his wisdom may have thought with education, our people would be able to make inform decisions and not regurgitate rum shop folly.
Finally, I endorsed the change because I thought it was time for another perspective and direction but because I endorsed the change does not mean that everything that come forth from the government is gospel according to David. And I will say that Sarah my mother who likes the BLP or Mr Henry the PM political advisor because I am a card bearing member of the island of Barbados.
David // November 17, 2009 at 12:17 PM
@ROK
The conversation which the current crisis has evoked is good for Barbados. Most Barbadians have not had to experience real pain caused by previous governments having to implement severe austerity measures if we exclude the 8% cut of the 90s. It is good to hear some of our academics coming out and debating the issues. BU stands firm on the point we will expose agendas and keep the debate honest when suspected or known.
Dr. Don Marshall made a good point yesterday, much of the investment in education is lost to the current debate because of the need to adhere to secrecy laws if a civil servant or those who work for private enterprise and business guidelines equally restrict contributions to a public discourse like this one. Of course we have other means these people can use to feedback opinion but a personal code of ethics may not support.
What has always separated Barbados from many is our ability as a people to rise to confront the challenges. In this light the current debate should be seen as positive which we hope will lead to the development of a new model to drive and sustain our success as a little giant in the global village.
Carson C. Cadogan // November 17, 2009 at 12:42 PM
DENNIS
“Barbados’ education system has not been good at developing ‘exportable’ skills”
I would risk a bet that Jamaica’s education system has. Murderers, thieves, rapists, drug dealers, gun runners, hit men and women, embezellers, fraudsters, pickpockets, false academics and other low lives.
You have done very well in Jamaica.
Alex Fergusson // November 17, 2009 at 12:45 PM
The issue is, why is the DLP running from adebate on the economy? I give Mia Mottley high marks for her debate in Parliament today on the economy.
It is clear for all to see that the Leader of the Opposition is sound on the economy whereas David Thompson is not.
We knew this from the Estimates debate on TV where she responded without a scrap of paper, while PM Thompson literally read his presentation
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 12:51 PM
@Carson C Cadogan, as is said in most fields, focus on dealing with your own weakness, and building your own strengths, not on the apparent weakness of others. As we’re discussing how Barbados needs to get past its crunch it may be useful to see how others have gotten through theirs, but you cannot lift yourself up by merely gloating others’ failings. It’s a real waste of time and energy. But, if it makes you happy…
ROK // November 17, 2009 at 1:05 PM
@CCC
Man let we do without the slurs nuh. By the way DJ, I long for the day you put up a thread to discuss Jamaica and throw away that phoney UK accent.
peltdownman // November 17, 2009 at 1:37 PM
CCC, thanks for helping us move forward in this discussion!
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 1:39 PM
@ROK, I have written about Jamaica but not for discussion here.
But, Jamaica’s problems are not the same as Barbados’, either in origin, consequence or solution. Sure, as with any failure, there are lessons in what to avoid, but that may not help much. Let me flag some key differences I see on the economic side:
Jamaica’s fiscal and debt problems are now decades old, and their potential solutions have not much changed. Some of the potential solutions for debt were institutional (eg when Jamaica had a lot of debt to the World Bank and IMF it was when these institutions were not prepared to give debt relief on such debt. That’s now changed but Jamaica was not a beneficiary.) The fiscal problem has always been about discipline–or lack of it. In the face of limited revenues, spending has never been seriously controlled, and now most of it has to go ahead as it debt service. A real Catch 22. What has been interesting is that Jamaica has found many ways to keep international capital market/investor confidence even when they were not in programs with the IMF and so was able to borrow and get by. But it happened because there were at key times good enough policies in place to satisfy lenders.
Having an economy heavily dependent on commodities creates major vulnerabilities and uncertainties (even the oil exporters have had severe ‘boom’ and ‘bust’) but the good investment of the booms is key to weathering the busts (most commodity exporters have not done that well, but those that did are solid now, eg Chile, Norway, Gulf States).
Jamaica has been a major transit point for drugs and the capital flows related to that are sizeable and complicated, but they severely distort how the economy works.
Devaluation has not worked to restructure the economy–and many have argued that Jamaica’s economy has some peculiarities that mean that it would not work as expected. But it is also the case that social and political considerations have not allowed exchange rate changes to work as they should. This is a big subject.
Tourism has worked by isolating the sector from much of the country. This is a plus and a minus.
As regards my accent. I have to laugh. When Oliver Samuels put on his show at Sherbourne a few months ago, the cast had been asked to make the accents ‘more English’ so that Bajans could understand better. We are encouraged to master standard English and some argue that the sky is tumpling if they hear Patois spoken freely. I really dont need to speak in a Jamaican accent only to have to repeat or have subtitles flowing on the screen. If what I say is not clear then that’s a different issue.
But if it makes you happy, I can write in Patois or in standard English with the caption ‘Please read with a Jamaican accent’.
donald duck esq // November 17, 2009 at 2:13 PM
What is worrying is that we are hearing nothing from the Minister of Finance or his Minister of state on the matter. As we are in a dire position, it is incumbent on them to come up with a solution. Time is running out for us. If we have to cut and contrive then so be it. Inaction is worst than taking any action to remedy the situation we find ourselves in.
In the age of transparency, why not tell us what his council of economic advisers are telling the minister of finance. Why not tell us what the council on foreign exchange matters is doing. There is no point in burying ones head in the sand.
Members of Cabinet need to remember that you were appointed to lead.
Hopi // November 17, 2009 at 3:06 PM
@DJakaLIB……..Since that question is so asinine let me turn it on its head….What did the Europeans [including the US], want or get out of a relationship with African countries and qualitatively and quantitatively what did the Africans get in return?
Adrian Hinds // November 17, 2009 at 3:21 PM
The Barbados Labour party is taking issues that occuring across all economies and presenting them to Barbadians as problems unique to Barbados with the government at fault. That is a big lie.
The various presenters are not using obvious signs of bias to present their partisan commentry, they are relient on their accomplishments, their scholarly accolades and thropies while presented agruments that if believed without question would point the finger were it should not, and glorify those that cannot do better for simply saying that they could.
But what are they saying?
Take Persuad:
According to him we should NOT take the word of congressman Henry Waxman Democrat from California who said 2008 that; “The story of the credit rating agencies is a story of colossal failure” —- somehow persuad has more information than the chairman of the House Oversight and Government Reform Committee.
Rep. Waxman’s committee was at the time investigating the credit crisis and put much of the blame on those agencies such as Standard & Poor’s (S&P) and Moody’s for giving top ratings to securities backed by subprime mortgage loans.
the committee released internal documents showing that executives of the rating agencies were “well aware that there was little basis for giving AAA ratings to thousands of increasingly complex mortgage-related securities but the companies often vouched for them anyway.”
…..But the pragmatist will tell us that we must not assume that there could be any issues with the way these agencies rate countries and this is Persuad argument which he must assume so that he can use S&P to build his point.
But what is his point? That a downgrade will make it harder for Barbados to borrow?
Was it not difficult to borrow since 2007 given the lack of credit due to the BAD GLOBAL ECONOMY cause by the subprime/derivatives problems?
as far back as 2005 had we not graduated from access to sources of concessional financing which meant that we were now largely on our own as the financiers of our development?
How many commercial loans arrangement did the BLP enter into between 2005 -2008? where they local or international? If international why?
What was the argument that the BLP used when a IMF consultation stated that the debt to GDP ratio was way too high?
Did they not claim that it was maneagble because most of it was local?
Again why was it local?
“There is now an evolving climate of public opinion in this country in which
it is difficult to sustain interest in serious but unexciting things, because of
a growing preference for controversies for their own sake.”
Could have been 2009, but the above were the words of Owen Arthur in 2005.
Carson C. Cadogan // November 17, 2009 at 3:23 PM
ROK
What slurs are you talking about?
You all are giving too much credence to the Barbados Labour Party with their gloom and doom, it’s operatives and Denis Jones.
The Democratic Labour Party is working assiduously in the interest of all Barbadians and Barbados in these tough economic times.
It would do you well to attend constituency meetings.
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 3:37 PM
@Hopi, you have not turned the argument on its head. “The Europeans” wanted economic resources (mainly mineral) and strategic political influences (some of which was gained by building economic power based on controlling land and minerals and to a lesser extent people). Even in the form of one country, these Europeans were major political, economic, and/or military powers who weilded that power to gain much of what they wanted. Barbados certainly is not any of those things. What they wanted they could extract, often without negotiation; that Barbados cannot do. Put simply, Africa either as individual countries or as a continent was not capable of resisting or prepared to do so (with the one exception of Ethiopia). So, I still do not have an answer.
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 3:48 PM
@Carson C Cadogan, it’s useful to look holistically at most problems. So, it made interesting reading to see the views of Harvard Sports Management about the ‘challenges the company had faced bringing tours to Barbados’ (p3 on Nation, today, http://www.nationnews.com/print/tourism-workshop–ncaa-charge-on-B-dos-sport-tourism-copy-for-w). If that story is correct it tells you a great deal about the weak footing of one of key economic pillars.
Now, some may accuse the Nation of bias. Some may say that the problem derives from a political party’s failing or some other systemic problem. I cannot say. The bottom line is the same, though. In a competitive environment, Barbados seems to be at risk of losing what is seen as ‘low hanging fruit’ for Caribbean tourist destinations, ie the business of sports teams from North America. Remember, the image is that the country is supposed to be good at attracting businesses.
ROK // November 17, 2009 at 3:54 PM
@CCC
Man, I disappointed that you did not get the rhetoric in that post.
David // November 17, 2009 at 4:15 PM
Prime Minister David Thompson’s closing statement in parliament on a supplementary just voted made the following statrement concerning the recent downgrade in outlook from Standard & Poors:
If Barbados has to take a step down to take 10 step up later so be it.
It seems the PM is in the camp of Dr. Marshall and Mottley is inclined to go with Dr. Persaud.
Let the discussion begin.
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 4:18 PM
@ROK/David, we debated (regarding BL&P hearings) how packaging messages so that most people can understand is a weakness, and I try to look at many different instances of how that is now being done. This may be of interest, http://www.number10.gov.uk/. It’s not meant to be off topic but may point to very different ways that governments choose to engage people in debate about policy matters. If a government is truly committed to openness and transparency should this not be the sort of thing that one would expect to have seen developed?
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 4:28 PM
@David, I heard the PM’s remarks too but I have no idea what it means. If Barbados cannot borrow from capital markets (and Trinidadians cannot be relied on to come to its aid each time), and if Barbados does not want to have a Fund program, and if it cannot get concessional financing from elsewhere, then there must be a clear plan to get the budget deficit under control, how otherwise the debt come down. It will be interesting in coming days to see if he is asked to flesh out his vision of the future that sits with the comment.
I’ll take a back seat now.
Trained Economist // November 17, 2009 at 4:55 PM
But surely, the statement that a loss of the investment grade means that Barbados cannot borrow internationally is a crude interpretation.
The loss of the investment grade rating would mean that borrowing on the open capital markets will be restricted to a smaller pool of lenders and will be more expensive. How much more expensive is debatable? Non-investment grade borrowers can still raise capital on the private capital markets.
Barbados can still borrow from mulitlateral bodies such as the IADB for example.
The PM is wise to look at his options.
If cutting the deficit to the required levels would mean an unemployment rate of 18% is that a good trade-off?
Does Barbados need to borrow internationally for the next two to three years?
Can you make the adjustments over time and recover the rating if it is in fact lost?
love // November 17, 2009 at 4:57 PM
Dennis Jones…..is a continuation of that era when imbeciles roamed the earth at will !
He and all the other BLP miscreants now join this economic debate as though the events of 14 years of BLP mis – rule did not lay the weak foundation for what we are witnessing in Barbados’ economic condition today.
How else can one refuse to ask…how come in times of plenty a BLP gov’t that claimed it was so superior could not finished a project on time and within BUDGET ?
So the BLP policy was to spend without any thought of financial prudence and accountability.
Since June 2008…check how many housing projects the DLP have completed and within budget and those soon to be completed.
REMARKABLE housing achievements in Workhall, Marchfield, Greens, Four Hill…Country Park Towers, Stuart Lodge, Constant , Coverley.
No wonder Owen Arthur and Mia Mottley are now at loggerheads !
ROK // November 17, 2009 at 5:23 PM
In Jamaica there was a saying: “Busta sow and Manley reap”. Or was it the other way around?
Well in Barbados, the DLP build up and the BLP liquidate. Maybe there needs to be a balance where there is both inflow and outflow but then there would be no need to change that party if it has balance.
So, five years of drought and then five years of wheat.
Adrian Hinds // November 17, 2009 at 5:28 PM
@ROK
I long for the day you put up a thread to discuss Jamaica and throw away that phoney UK accent.
==========================
Are you asking a person to throw away their only indentity?
man you just jealous. lol!
Dennis Jones (aka Living in Barbados) // November 17, 2009 at 5:35 PM
@Trained Economist, Your comments offer an excellent summary (including the points about trade offs). I hope I did not give the impression that Barbados would not be able to borrow. Even with ‘junk’ status, the country could borrow, and there are lenders (often called ‘vulture funds’) who specialise in financing borrowers in that situation. The problems only become apparent as and when a country needs to go to market for loans. China may decide that it can be a ‘white knight’.
I think that IADB loans (which are on commercial terms) need to be linked to specific projects, and is not available for general financing (ie to be used for any government spending).
Ratings should reflect current and future prospects, so as the PM said going down does not preclude coming back up. But the essence of that process is that the country’s overall economic situation and the policies underlying this needs to have improved sufficiently to warrant upgrades.
Adrian Hinds // November 17, 2009 at 5:56 PM
so what is the desaster that persuad speaks of?
Crusoe // November 17, 2009 at 6:02 PM
”Senior Fellow at UWI Sir Arthur Lewis Institute Dr. Don Marshall who believes Barbados should seize the opportunity to find creative ways to reduce government spending and enable the environment to encourage entrepreneurial projects to lead growth by expanding exports”
Most relevant few lines to this topic anywhere.
Exports, in whatever form, whether tourism, offshore,clothing, rum, food products, music, are the KEY to foreign exchange earning.
That is the only real tough issue.
The second important but no so tough is the reduction in Gov’t spending, while increasing revenue, to reduce local Gov’t debt but still ensure that social programmes and necessary social infrastructure remains.
Hence, the talk of increasing the tax net by IMF and Gov’t (think it was them).
So, next year will see an increase in VAT, certain other taxes being imposed, such as capital gains tax on properties and shares as well as reduction in specific, non-essential Gov’t areas.
High impetus and assistance to foreign exchange earning industry will also be driven like never before.
Crusoe // November 17, 2009 at 6:12 PM
As moentioned above, it would appear that the Gov’t is keeping a revenue ‘ace in the sleeve’ till the last i.e. VAT increase.
This increase can be used to balance the local budget /debt serviving.
I would strongly advise against rampant borrowing /spending however.
What is more horrifying to me, is that I am NOT confident nor hopeful that the international Gov’ts have a handle on the economic situation as yet.
Certainly, it would appear that thus far a wonderful job has been done to prevent a sudden ‘crash and burn’.
Nevertheless, I am concerned that the situation is far from over, the world drivers have left the fuelstation and have just entered first gear, still another long set of miles to go to the destination i.e. true stability.
Next year will not be easy for us here, but neither will it be a bed of roses internationally, anyone who thinks that will be foolhardy.
We have a long haul ahead and remember that what got Barbados this far was not any fancy stuff, just prudent management and conservative spending.
Anonymous // November 17, 2009 at 6:56 PM
Dennis jones just went on Starcom’s ‘Tell it like it is and talk a pile of jobby.
Nobody at all listening to he nor avinash persaud except VOB.
Living in Barbados // November 17, 2009 at 7:12 PM
@ Anonymous // November 17, 2009 at 6:56 PM “Dennis jones just went on Starcom’s ‘Tell it like it is and talk a pile of jobby.
Nobody at all listening to he nor avinash persaud except VOB.” [Unless I cannot understand English, and judging by a few calls I just got, someone was listening, other than VOB, including you. So, it's nice to know that the audience is alive and kicking.]
David // November 17, 2009 at 7:21 PM
Barbados has not become one of the leading developing countries by following the status quo.
All those who want Barbados to follow a model which makes us a slave to the world’s financial agencies need to keep their advice.
Carson C. Cadogan // November 17, 2009 at 7:44 PM
I am wondering what the Barbados Labour Party and it’s operatives will do when the Barbados economy does collapse by now and the end of the year?
Persaud, Mia and Dennis Jones will be so disappointed.
Living in Barbados // November 17, 2009 at 7:59 PM
@David, “Barbados has not become one of the leading developing countries by following the status quo.
All those who want Barbados to follow a model which makes us a slave to the world’s financial agencies need to keep their advice.” sounds great but what does it mean? Who but you has introduced an extreme notion such as ‘enslavement’, literal or metaphorical? You may have an empty room if you are looking for those who ascribe to your notion. Then, like Pancho Villa tilting at windmills, what will you be opposing?
But let’s get Barbados into perspective.
Barbados has about half of its government debt owned to foreigners or in foreign currency. Those lenders are reassured by knowing what financial agencies think of Barbados and by the fact that the country has a record of good debt service.
A substantial amount of Barbados’ investments are financed by foreign direct investment. Those investors also depended on knowing what financial agencies think of Barbados, as well as their own project specific assessments or general economic appraisals. They depend on financial agencies certifying that banks in Barbados are alright to deal with.
Barbados imports more goods than it exports and that is possible become foreign suppliers and their creditors believe that Barbados is a good credit risk, which is determined by another set of financial agencies.
The relative ease with which Barbados has been able to finance the developments that have allowed it to reach where it is is a reflection of good economic stewardship and a willingness to work within the status quo international financial systems. It has not been some kind of maverick country, and it has followed the good examples of many countries, so is very much part of the status quo. Had you started with ‘Cuba’ I would have understood.
Barbados also has reserves to cover about 4 months of imports. That’s viewed as ‘comfortable’ because most other flows from abroad, while lower, have not dried up. But Barbados cannot stand alone for very long with only 16 weeks of reserves.
Anonymous // November 17, 2009 at 8:40 PM
Dennis Jones/living in Barbados
Who were the few calls you got after your contribution on VOB this evening?
Avinash persaud,mia mottley and the BLP crew?
He,he,he.
Adrian Hinds // November 17, 2009 at 10:13 PM
Barbados has about half of its government debt owned to foreigners or in foreign currency? Is this true? or no one really reads what the Jamaican LIB says, and do not care to comment?
Wishing In Vain // November 17, 2009 at 10:34 PM
It seems to me that Jamaica is missing a clown for the circus, why not return to the troupe Dennis Jones (aka Living in Barbados)?
If you think so much of yourself why not provide your valued advice to the country from which you came Dennis Jones (aka Living in Barbados)?
Hopi // November 17, 2009 at 11:53 PM
@DJakaLIB………Can anything good come out of Bretton Woods? You obviously will defend such institutions because of your affiliation and your staples, but ask those countries whose economies have been ruined by them exactly what they think of them?
The Europeans only became powerhouses because of their contact with Africa. And we little peon states idolise these same crooks and criminals, emulating their every system even after they raped and pillaged us.
Capitalism as a system is bound to fail and that means that people like you will no longer have anyone to pimp.
It would serve Black nations well to sever all ties with these bloodsuckers and form their own institutions. But then again, seeing your mindset you would not understand that.
Oma akwu-kwo iyi, ima-ari ihe iyi ma!
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 3:38 AM
@Adrian Hinds: “Barbados has about half of its government debt owned to foreigners or in foreign currency? Is this true?” [Having posed the question, I would have expected confirmation or correction. But feel free to see the source I used, Barbados 2009 IMF Article IV consultation, http://www.imf.org/external/pubs/ft/scr/2009/cr09291.pdf). That shows external debt at 50% of GDP (p30), and public sector debt at 115% of GDP (p28).]
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 3:49 AM
@Hopi, stating that “The Europeans only became powerhouses because of their contact with Africa.” is not correct. Europe had been amassing power well before it had contact with Africa, part of that was by exploitation of states within Europe itself, part was from exploitation what we now call the Middle East and the Mediterranean, and part was from exploitation in Asia. Different European powers gained more from different exploitation.
If capitalism fails will be no surprise and nothing lasts forever. But, it has weathered many a storm, and other systems that promised to replace it have not.
But, who said that I am a capitalist? But even if I were who around you is not. I need not quote Proudhon that ‘property is theft’.
Non-capitalists have been might exploiters too, so maybe we have a basic human weakness to contend with.
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 3:53 AM
@ Wishing In Vain // November 17, 2009 at 10:34 PM I actually do not think that much of myself. I let others judge.
It’s so interesting that the thread of discussions get lost in searches for personalisation when the going gets tough and substantiation is sought. Does that give a hint at why problem solving is a such problem here? The fox should never forget to keep chasing the rabbit and not get distracted by what wafts in the air.
kiki // November 18, 2009 at 5:52 AM
As a (black) freedom fighter Hopi is
entitled to bang on about Africa
http://555dubstreet.wordpress.com/2009/11/18/mpla-2/
like the sound of an african drum..
http://555dubstreet.wordpress.com/2009/11/18/dreadlocks-in-moonlight/
http://555dubstreet.wordpress.com/2009/10/23/free-up-the-weed/
http://555dubstreet.wordpress.com/2009/11/18/lee-scratch-perry-mikey-dread/
kiki // November 18, 2009 at 7:31 AM
Ire Feelings (Skanga)
http://555dubstreet.wordpress.com/2009/11/18/ire-feelings-skanga/
Everyday You Wondering
http://555dubstreet.wordpress.com/2009/11/18/everyday-you-wondering/
ROK // November 18, 2009 at 7:35 AM
@DJ
Europe had been amassing what wealth? They were fighting among themselves for the scrapings they had using piracy as a means of relieving one another of the wealth they had.
You had monarchs paying explorers to go and find wealth because they had none but still had to find the money t pay their soldiers and keep a standing army to secure the monarchy; The taxes were just not enough and you know that too. There was always this dream of untold riches throughout the history of Europe prior to the invasion of Africa and the Americas.
You had Germany and Russia at one another throats like savages and a bunch of warlords ambushing people to steal their wealth for their leaders. What wealth what?
Sometimes I have to wonder where you come from and if you actually could sleep well at night. Might I suggest that if you do, it means you have no conscience.
Come on Denis man, you know that what you say could never be possible. What wealth what!
Veritas // November 18, 2009 at 7:37 AM
Dennis Jones … What a lucky man!
The IMF pays his bills, his wife has a cushy job and he spends his time eating food, chatting nuff rubbish with an affected British accent, enjoying sweet Barbados and trashing Barbados.
Why doesn’t the DLP government notice him? That’s the advice of one of his IMF colleagues who described him as, “a publicist!”
Is that all? I asked.
She said, “Yes!”
ROK // November 18, 2009 at 7:58 AM
@ DJ
“But, it has weathered many a storm, and other systems that promised to replace it have not.”
Come on Denis. Stealing has weathered the storm. Fraud has weathered the storm and can be found in every corrupt society.
Ignorance too has weathered the storm; prostitution, rape, drug abuse, etc. These are the things that have really weathered the storm and capitalism was constructed to facilitate them. So, yes, I agree but I am not putting it down to human weaknesses. I have to put it down to the white man weaknesses which he has perpetrated. One bad boy in the school don’t make the whole school bad.
As far back as the Romans and the Greeks, standing armies have been the headache for empires. Hear what they said? “An army marches upon its belly.” It speaks to the cost of paying the men which do not go away even if the men are idle. Why you think Errol Barrow called the Civil Service “An ‘Army’ of Occupation”? Takes up the biggest chunk every month and don’t produce enough.
Now you show me what wealth the Europeans got from Asia and the Middle East? There was no oil then. If it was so much why did they run and leave it when they found Africa? Why are they back in the Middle East now? Which by the way is Africa.
Europe was in a dilemma. The more lands they conquered the more they had to put out to keep them, the more they taxed the people they invaded. Where was the wealth? Give an idea of how much it was as opposed to how much they got out of Africa? There is no doubt that Africa sealed the deal. I am calling for you to provide facts for your assertions. Let’s see if problem solving is a problem for you too and not simply here (we Bajans).
Anonymous // November 18, 2009 at 8:13 AM
@ROK,
I’m not sure where you start your history of Europe. Mine starts from at least the Roman and Hellenic Empires, and took in the Ottoman. All major wealth accumulation needs to exploit resources from outside at some stage, however, you get them.
Your comments indicate that whatever systems have been in place most have had major negatives and exploitation. It’s ironic that the latest Transparency International Corruption Perception Index has most (130 of 180) countries graded as perceived to be corrupt (ie the score less than 5 on a scale of 1-10). So the absence of corruption is the norm.
The Soviet Union was rampant with corruption.
Unless you are using an odd map, the Middle East is not Africa.
Asia provided commodities at different times (tea, rubber, minerals, for instance). The Middle East did not provide much by way of tangible resources before oil, but provided important access, so control of that space was important for expansion.
ROK // November 18, 2009 at 8:57 AM
Was not both sides of the Red Sea considered Africa and dominated by the Sumerians and the Egyptians after them? The Middle East is a modern political divide and it was only after the fall of the Egyptian Dynasties that this area was dominated by these different racial groups. True, it continues to be a strategic location and was a very strategic part of the Egyptian Empire. Places like Jordan etc. were considered part of Africa and even now, Egypt is now part of the Middle East and is at least one-third of the territory referred to as the Middle East and the entire thing is the same territory that was once referred to as part and parcel of the core of the Egyptian Empire. The old books will tell you that Egypt was born between there and the Nile Valley
If I am wrong, I am willing to concede. Check the old texts and tell me if my interpretation is wrong.
kiki // November 18, 2009 at 9:22 AM
Spangy
http://555dubstreet.wordpress.com/2009/11/18/spangy/
Construction
Destruction
Eruption
Version
Ishen
We need a revolution
Tribulation
Action
Vibration
To solve this situation
Creation
To stop this frustration
All nation
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 9:56 AM
@Veritas, let’s try to look at what you are trying to say and not feel that we are still in some school play ground looking for balloons to burst or a school bag into which we can pour honey.
I presume that you will also take issue with the arrangements made for the PM, and Barbados’ Ambassador to China, for example and their spouses. To stay on topic, if the spouses paid for themselves there could be substantial savings for the budget. I’ll let you make the suggestion to your political representative or to the PM/Finance Minister himself and get due credit.
I presume that all the diplomatic and representational persons (private and public sector) posted in Barbados (or if we really want to go full out, any where in the world) will also be in for your tongue lashing. If not why not?
I guess when I was posted abroad I should have made sure that my spouse paid her own expenses. That would have been very wholesome.
Let’s think about opinions. I just had a conversation with someone who says that they know you and that of all the people in the world that they have ever met…I wont finish. But really.
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 10:07 AM
@ROK, Anonymous // November 18, 2009 at 8:13 AM was me, if it’s not apparent.
“Was not both sides of the Red Sea considered Africa and dominated by the Sumerians and the Egyptians after them?” [I've always understood the Red Sea to be the divide between Africa and Asia, and for me Africa was always a continuous space (apart from its northern connection by Egypt and the associated islands that are now considered part of Africa). If you want to include those lands that fringe the Red Sea (say Syria and Jordan) that would not bother me, as far as the general argument goes; but not all of the space to the east of the Red Sea (such as Iraq, Iran, Saudi Arabia).]
We can take this up off thread if you want, as we are drifting off topic to my mind.
Hopi // November 18, 2009 at 10:31 AM
@LIBakaDJ…………………You need a History lesson in Geography and an Economics lesson in History.
Before there was any region called the Middle East it was ALL AFRICA populated by AFRICANS! The A-rabs, the Jewish ones and the in-betweens are all Johnnies-come-lately.
And like I said before the Europeans empires would be NOTHING [not that they are] today without AFRICA!
On all the other moral issues, ROK has answered you well.
Oma akwu-kwo iyi, ima-ari ihe iyi ma!
ROK // November 18, 2009 at 10:45 AM
As a matter of fact, the wealth they found in Africa was so vast that peace reigned everywhere else and the misery of the African peoples began. Let’s not talk about the cold war or the world wars before that because those can be described as rival gangs fighting for the ill-gotten spoils of Africa.
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 10:49 AM
@Hopi, as we are all using the words and observations of many generations before, we cannot prove anything. But I would concede if you show us two independent sources that says/demonstrate that all of what is now deemed the Middle East was once called or deemed Africa. That would be a history and geography lesson not just for my benefit. If not, I will hold my view. That seems perfectly reasonable to me.
I’m not sure what moral lessons ROK has given. But here’s a take. If Europe was taxing people increasingly as he indicated was the case what was being taxed? It could not have been a source of income/assets that was not growing. Wealth is the accumulation of assets. You cannot tax what is not there.
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 10:59 AM
@ROK, Africa was a stop along the route of exploiting, not its origin, nor its end. People of European origins have also tried to exploit the sea and space, to varying degrees. Asians too have had their exploitative phases (and now also getting their feet stuck into Africa), as too have those whom we can agree are Africans (Moors), who also took their place exploiting Europe. I would not wish to leave them out as their marks are still very visible, though different. Were the Europeans better at the exploitation game? You all seem to think so. I dont share your admiration.
kiki // November 18, 2009 at 11:15 AM
here’s a nice european american and african american
film about equality
http://technorati.com/videos/youtube.com%2Fwatch%3Fv%3DMRtuxjHBmi4
Description:
Kunta Kinte (LeVar Burton) gets bullwhipped after running away. He is also forced to accept his new name, Toby
ROK // November 18, 2009 at 11:22 AM
@DJ
I see that you have a warped sense of this thing. If you agree that there is nowhere else on earth where there is the abundance of wealth to match Africa, then to talk about Asians and the Moors is moot. Who went into Africa first? Who started the idea of ownership which is central to capitalism?
You cannot deny that this focus on personal riches and wealth is a white thing… and that this quest for wealth has cause untold untold evils to be inflicted on humanity?
You remember there was a jet-ski culture on the West Coast? I saw it transferred to the ZR culture. Well let me tell you something, one man started all that and because of his greed, everybody started acting like him because he constantly did it. Crack cocaine was driving him.
For example, an operator would have some tourists who would say yes and while that operator is off getting his skiis, this man would move in on them and they would take the ski from him, thinking he was sent by the original operator and of course he took the money from the tourist for their rides, so by the time the other operator comes back, this man got all the money for all the rides for that group, leaving the man who sold the rides to them out of bread.
One man! And I was there to witness it with my 2 eyes. Today we complaining about the ZR culture still; the legacy of that culture that started on the beaches of the West Coast with one man; a paro.
kiki // November 18, 2009 at 11:22 AM
Kunta Kinte
http://555dubstreet.wordpress.com/2009/11/18/kunta-kinte/
http://555dubstreet.wordpress.com/2009/11/18/kunta-kinte-dub-91/
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 11:36 AM
ROK, I wont accept that my view is warped; different maybe. Having just spent the weekend in the Belizean jungle and listened again to accounts of Mayan history I will not let you give white European credit for notions of ownership that you say are central to capitalism. From what I heard, the Mayans had their value and ownership system that was very different and very sophisticated. My memory on Incan history is rusty, but I remember there were many similarities.
“You cannot deny that this focus on personal riches and wealth is a white thing… and that this quest for wealth has cause untold untold evils to be inflicted on humanity?” [Yes I can. See above. The Mayans and Incas had human sacrifices before they encountered any Europeans. Europeans tried to use and exploit what they found where ever they went. We know that Caribs and Arawaks did likewise way before any contact with Europeans. We know Egyptians accumulated wealth and possessions; so too did the Mayans/Incas, etc. We also know that such practices were evident in human societies in Africa and Asia before Europeans. So, why do you want to load all of the 'kudos' on Europeans?]
The jet ski/ZR discussion is just about greed and I remember reading about that in the Bible. Isn’t avarice a deadly sin?
ROK // November 18, 2009 at 11:37 AM
@DJ
“Africa was a stop along the route of exploiting…”
Nonsense. After 400 years and they have not moved on, it cannot be a mere stop along the route, like a harbour or an oasis or an overnight motel. They have grown roots right into the ground and sent it people asunder; all for riches. We are the only people to suffer this in this extreme.
You know what I want to tell you? the depth and totality of our suffering is directly proportional to the wealth they stealing from Africa; even as we speak. Our suffering will only end they day they think that Africa is totally plundered. Then it will be more mass murders, this time in the diaspora and done by the whitey authorities.
ROK // November 18, 2009 at 11:54 AM
@DJ
You commenting for comment sake? Man the concept of personal ownership came directly from Whitey. You mixing up things? I don’t believe it.
The Mayans never had a system of personal ownership. They had communities, zones, etc. and yes the notion of sovereignty which is far different, without any comparison whatsoever, to the notion of ownership.
If there were notions of ownership then there would also have been notions of market value. That a man could trade his land for profit. No such thing existed in the Mayan or Inca society. people took what they wanted and did not try the to own his neighbours land.
You have my belly feeling nauseated with that talk about sacrifice. That had to do with religion. Where did the So-called South American Indians plunder? There was a lot of synergy and communication between the Incas and the Mayans.
Furthermore, there is evidence that they used to trade with Africans long before the Europeans came. Where was the hostility except in the stories told by the white man himself to try to justify his crimes against humanity? If they were so hostile, do you think a handful of white men could have taken them like that? They would not even have been able to land foot on South America. Those stories do not match the evidence. It was the white man’s plagues and sickness that took out the Indians and when the Indians were too sick to fight and had dwindled in population, the white man finished licking the stuffings out of them, with monks bearing crosses.
ROK // November 18, 2009 at 12:07 PM
@DJ
“The jet ski/ZR discussion is just about greed and I remember reading about that in the Bible. Isn’t avarice a deadly sin?”
Yes please. The first bit of evidence to back up my point. Obviously, the white man either did not read that part or choose to ignore it.
Let me explain that the bible as you call it embodies all the principles of law and society that came out of Egypt. Therefore, if “avarice and greed” were against the law, it means that they were not allowed in the society.
This further means that such things as ownership and usury were unknown in those societies. Up to today, the US and Canada are still paying reparations to the Indians. This in itself is evidence and admission of “thiefery”. If the Indians practiced ownership, then there is no way that for a few crates of whiskey they could take over all the land of the peoples of the First Nation of the Americas and all like now there would be no need for reparations.
Wheel and come again. You like a lot of long talk.
kiki // November 18, 2009 at 12:14 PM
moderators are slow
http://555dubstreet.wordpress.com/2009/08/04/the-whip/
but they are not as bad as the government man
http://555dubstreet.wordpress.com/2009/11/18/government-man-3/
http://555dubstreet.wordpress.com/2009/11/18/government-man-dub/
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 12:25 PM
@ROK, you’re free to keep your view, and I am free to have mine.
“If there were notions of ownership then there would also have been notions of market value. That a man could trade his land for profit. No such thing existed in the Mayan or Inca society.” [Not so. Mayans used chocolate for currency. I can put you in touch with my Mayan descended guide if you like. He's the source.]
You say “You have my belly feeling nauseated with that talk about sacrifice. That had to do with religion. Where did the So-called South American Indians plunder?” [So, killing the best of your society for a set of religious beliefs that deemed that the living would then get a straight passage to heaven is ok, but plunder is not? Hmm.]
Disease and contact with Europeans did kill off some/many races, but was not the sole or main reason for their demise. They Mayans did what the Malagasy are doing now, which is to chop down their forests ( (70% deforestation in 2 decades, I recall, in Madagascar), and then end up with an eco system that could not produce food.
On your references to the Bible (not as I call it, mon frere). The fact that something was banned or deemed bad means that the society did not like it, not that it did not exist. As with charging interest in Islamic culture, it is not the same to forbid something as to deny its existence. Otherwise we could easily eradicate sin with edicts.
It’s a fabulous debate and maybe you can invite me onto BANGO TV and we can argue all day. I now move to other things, on this thread but am glad to take this up by e-mail (it’s on my blog) or over a civilized plate of non-European dishes and cactus wine.
I’m not sure if your saying that I like long talk is a complement or a criticism. Should we do a comparative word count?
ROK // November 18, 2009 at 12:36 PM
@DJ
“Mayans used chocolate for currency.”
I take it they used chocolate to buy land? Like how the Indians sold land for whiskey?
“So, killing the best of your society for a set of religious beliefs that deemed that the living would then get a straight passage to heaven is ok, but plunder is not? Hmm.”
I take it that you condone plundering.
Sorry, but I not going out of my way to discuss this with you. If you come on BANGO TV it would have to be with a Jamaican accent. I know many Jamaicans that less bright than you and Bajans does understand them.
Dennis Jones (aka Living in Barbados) // November 18, 2009 at 12:47 PM
@ROK, really my last word, so you and anyone else can have full reign after this.
I do not condone plunder but I do value human life above all other things.
The Mayans were using chocolate for exchanges before any Europeans arrived.
I have no problem speaking with a Jamaican accent (not sure what the brightness point is supposed to mean), if you think it will make for better TV. I’ll start practising now, but if I am misunderstood then I can blame someone else for asking me to comply with their wishes.
Let me know if you want to meet the Belizean guide (he’s certified so I take that to mean something). He can show you a lot of interesting Mayan stuff deep in the jungles and in the caves.
You may not see it the same way but your arguments about Europeans is putting them on a pedestal for having been so determinant in how our world works. I am not in that camp.
But as I said, no more discussion here. It’s crunch time for other tasks.
Have a wonderful day.
Hopi // November 18, 2009 at 1:19 PM
@LIBakaDJ………….Isn’t that what the IMF and World Bank do excellently…graph their words and observations to trick the unsuspecting and eventually pillage and rape nations…?
With all the words you’re throwing all over this this thread you still have not DISPROVED that the IMF and World Bank pillage unsuspecting nations.
So as usual you are blowing smoke!
BRAIN POWER (BP) // November 18, 2009 at 1:44 PM
ROK ! ROK ! ROK !
Whither thou ROK
I saw a vagrant in the SUNDAY SUN, it looked like you -was it you who was being shaved by that kind lady ??
kiki // November 18, 2009 at 1:56 PM
Cryptic Copacetic
Igbo Reading: Oma akwu-kwo iyi, ima-ri ihe iyi ma.
Literal Translation: “You who (claim to) know the vegetation of the riverside, do you have the river’s knowledge?”
Lesson: Literacy is not wisdom. A man’s knowledge cannot compare to that of the Eternal Being.
David // November 18, 2009 at 2:06 PM
One of the saddest aspects to the debate on Standard & Poors credit rating debate and attendant issues related to the economy is the high profile the Persaud’s and people based outside of Barbados are being given prominence within the media. Later in the week BU expects to provide an insight on this problem from an academic who is on the ground and understands the Barbados experience.
kiki // November 18, 2009 at 3:22 PM
Every sound of the drum you hear
Is an african beat
Very well
I’m leaving
http://555dubstreet.wordpress.com/2009/11/17/very-well/
kiki // November 18, 2009 at 3:41 PM
Detour
http://555dubstreet.wordpress.com/2009/11/17/detour/
wolves and leopards
http://555dubstreet.wordpress.com/2009/11/18/wolves-and-leopards/
Step On The Dragon
http://555dubstreet.wordpress.com/2009/11/17/step-on-the-dragon/
Hopi // November 18, 2009 at 3:47 PM
Bless you Kiki!
RJH Adams // November 18, 2009 at 4:54 PM
Hi David,
Thanks for emailing me. Interesting thread.
I’d respectfully suggest that Persaud and Marshall are not occupying positions that necessitate a one-or-the-other judgement (at least judging from what is in your piece).
Take the idea that you touch on of encouraging entrepreneurialship. If you have seen this:
http://www.vimeo.com/7056067
you might conclude that Persaud also supports the notion in concrete rather than rhetorical terms. To my ear he also says several things that are critical of BOTH past and current administrations. Politicise the man one may but it would be useful to separate his factual arguments from indulgence in the mischievous alchemy of the inference-to-certainty game.
More generally, Persaud’s criticism that the government has delayed and prayed when it comes to securing contingency funding hardly appears a political point at heart. Suppose, for example, that on top of the daily demands of running the people’s business during a devastating credit crunch that an enormous contingent liability, entered into on a discretionary basis and equal to, say, 3% or >$200m of GDP, comes catastrophically due. Does anyone imagine that this – or even some smaller fraction of it – can be readily covered? Is it mainly political to suggest that “hope for the best but plan for the worst” is superior policy to kicking the can down the road? Only when viewed exclusively through a partisan prism.
One commenter makes the point that if, as the previous government argued, the country’s debt is manageable because much of it is held locally then it must still be. That was an argument aimed at mitigating currency risk concerns and a nod to the large amounts held by the NIS. Surely fair comment though it is worth noting that not only has the debt continued to rise but at least one local mutual fund has unusually (and publicly last week) decided to stop holding Barbados paper. This is a very important change of context not taken account of nor widely noted so far as I can tell.
There’s also the suggestion that, contrary to what anti-government partisans say, Barbados is merely suffering the same pain as others and not some unique, self-inflicted form of economic purgatory. That is largely true. But if one considers the extend-and-pretend treatment afforded Clico Holdings (the contingent liability referred to obliquely above) and gives fair hearing to the Persaud argument that better “rainy day” funding terms should have been secured many months ago it is quite far from being completely true. Of course, that’s just a view not a fact. Perhaps it will all come good.
I do not know what else Persaud might have said to draw the ire of BU and others but fairness suggests articulating it in factual terms in order to dismiss it.
Regarding the comment on ratings agencies, to conclude that assessing countries and financial instruments is such a similar exercise that the failings of one must apply to the other does not bear much scrutiny. If you are able to point to a single disastrously wrong example of a S&P (or other major) country assessment (insofar as it is possible to separate the impact of the collapse of credit from these) please cite it. Further, and with the notable exception of Egan-Jones the major raters had serious conflicts of interest with product ratings arising out of their remuneration method – they got paid by the sellers of the instrument they rated. The rewards for country assessments pale into insignificance.
That said, there does exist a strong alternative case for downplaying the relevance of country assessments: they are too conservative and invariably behind the curve. When they do pronounce it is generally the case that they are merely stating the obvious. Is there truly anyone who was genuinely surprised by the negative watch announcement?
Finally, who could disagree with the sentiment of your concluding paragraph? But it does seem a little one-eyed to imply that the opposition enjoys a monopoly of “sucking political mileage” out of the current circumstances. Both sides seem to be doing a quite magnificent job on that front and the electorate will judge each accordingly come voting time.
[As a small aside and without, again, the benefit of the original sources of what was argued I’d also suggest that whilst having soldiers do police work has precedents these have regularly been difficult episodes. Different training, very different purposes – overlapping duties would require careful terms of reference.]
Adrian Hinds // November 18, 2009 at 5:26 PM
The Barbados labour Party told us that Thompy was taking his que from the IMF.
———–
The IMF “Directors encouraged the authorities to develop a credible medium-term fiscal adjustment plan and start with its implementation, as soon as possible. They were of the view that, if left unchecked, the large fiscal deficits, combined with an uncertain foreign financing outlook, could result in A DETERIORATION IN INVESTOR CONFIDENCE. A concerted adjustment effort was, therefore, crucial to countering such a risk, by reducing fiscal financing needs, supporting the balance of payments, and placing public debt on a firm downward path”.
————————————————
Thompson did not do this and hence the S&P downgrade.
The BLP said on September 18th….
The Barbados economy is so perilously placed at the moment that it is only one shock away from disaster. The indices like GDP and foreign reserves that should be up are down
————————————————
Lets look at some stats
Baseline: External debt for 2007 46.5%
Baseline: External debt for 2009 50.5%
Imports 2007 62.0%
Exports 2007 68.7%
Imports 2009 53.9%
Imports 2009 57.0%
Public sector debt 2007 103.3%
Public sector debt 2007 115.1%
International reserves, which declined by almost US$100 million in 2008, are likely to broadly stabilize during 2009, boosted by the recent placement abroad of a US$120 million government bond and by SDR allocations of around US$90 million.
The external current account deficit would narrow from 10½ percent of GDP in 2008 to 5¼ percent in 2009, and remain below 6 percent in 2010.
————————————————
Gross international reserves (in months of imports of G&S) 1 2007 4.0
Gross international reserves (in months of imports of G&S) 2009 4.2
David // November 18, 2009 at 5:36 PM
@Rawdon
Thanks as always for your input on matters of this nature even though some of your commentary rubbishes BU positions, we can handle it.
The last paragraph was made in the context the Prime Minister David Thompson making a public invite to former PM Arthur, Richie Haynes and Sir Erskine to join him at a breakfast meeting to discuss matters of state.
You obviously are not comfortable with the mouthings and subsequent actions of government regarding the management of the CLICO problem (feel free to get more granular given how the transaction as progressed since your last comment on the matter).
BU has nothing against Dr. Persaud and we are glad when a son of the soil represents the blue yellow at the lofty heights he obviously operates. It does not remove the obligation on our part to ask him to declare his relationship with leader of the opposition Mia Mottley.
Despite your dismissal of BU’s point which questions the decision making process of CAs regarding not only structured products but country ratings Internet searches are replete with examples of conflicting positions between the CAs when establishing country ratings, maybe it is gods mercy one or the other has not been proved wrong yet.
BU expects to post a commentary on the Barbados economy late Thursday night provided by one of our home grown academics.
Trained Economist // November 18, 2009 at 5:38 PM
The foreign exchange reserves are reported at 20.7 weeks of import cover. So the level of reserves can hardly be the concern of the rating agencies.
The foreign exchange reserves have been boosted by funds raised on the T&T capital market. Whether this could have been raised earlier at cheaper rates is debatable. Speed is not everything, getting it right is also quite important.
Trained Economist // November 18, 2009 at 5:55 PM
If Persaud did in fact comment that ” the government has delayed and prayed when it comes to securing contingency funding,” I would find that comment an unfair if not inaccurate one.
Persaud, as knowledgeable as he is, often manages to give the impression that everything can be done overnight.
As far as I am aware the funds raised on the TT market were in hand by June of this year. Surely one can appreciate that that there is a lag between a govt deciding on a bond issue, the actual process of placing the bond and receiving the funds.
Trained Economist // November 18, 2009 at 5:57 PM
When it comes to rating agencies and governments I suggest a read of the article found at this link.
http://www.people.hbs.edu/rabdelal/ToJudgeLeviathan.pdf
RJH Adams // November 18, 2009 at 6:43 PM
@David,
I would not want to “rubbish” anyone. Cordial debate is all.
Re Clico I am aware this is taboo area but you are right – I think it was an error not to underwrite the balance sheet of the company as preparation for a sale. Fixating on the policyholders may actually have hollowed out the commercial viability of the company (in terms of the signal it sent to the largest holders of Clico instruments) rather than shoring it up; and has laid a large contingent liability upon the shoulders of taxpayers at a fiscally inopportune moment. Just a view.
@TE, David: CAs on soveriegns is not a perfect relationship. I don’t suggest this. That link to the HBS paper (thanks) highlights some of the issues of economic dogma in hand with real politik (in broad terms) for sovereigns. This is quite distinct – and of a different financial scale too – from the corrupt and morally questionable interactions that occurred between the CAs and IBs.
@TE, timing point taken. It does, of course, matter which point is chosen as that at which the clock began ticking.
The “delay and pray” is poetic license but not an unfair characterisation of Persaud’s comments in that clip. But I accept that the subtext is up for debate.
David // November 18, 2009 at 6:48 PM
@Rawdon
The rubbish comment was made tongue and cheek, no offence taken at all.
Veritas // November 19, 2009 at 6:37 AM
Denis, what you think of any blogger is your business. Background information on people like you is important. You have access to certain information from the privileged position you hold.
And now you have background information about me. Or so you say. And who cares? Did you talk to the US security forces again? Or the diplomatic representatives of the mother country? Good.
You have a nasty strategy of making broad sweeping statements about Barbados and people who live here and then when questioned on your innacuracies, you smugly and dangerously start to pull back.
You also have a latent dislike of this country. You can’t conceal it. Your writings, your topic selection, your snide put-downs, your supercilious rantings. You are one unhappy person living in a great country.
Sad.
Barbadians should know that you make such statements from such a privileged IMF position! Simple. Amazing too.
Publicist? Did that disturb you? Why? Its your reputation. The only word I forgot was (self) publicist.
kiki // November 19, 2009 at 7:17 AM
Natty Dread Nah Run
http://555dubstreet.wordpress.com/2009/11/19/natty-dread-nah-run/
Warrior
http://555dubstreet.wordpress.com/2009/11/19/warrior-2/
Dennis Jones (aka Living in Barbados) // November 19, 2009 at 7:35 AM
@Veritas,
One thing that is not contestible is that people who do not reveal themselves clearly have something to hide. What? Why? What is the fear? We may never know, but hiding they are.
I do not need to check on an unknown person, but I can play the game of pretending I know something about someone and leave the impression that I have knowledge. It’s an empty exercise though.
What is clear is that I write about a wide range of topics but some you do not like or on which you have differing views. If you wished the world to know your views then you too could write and let those who share your views say “Yea” and the others say “Nay”. But that is the joy of democracies and I love being able to have my views out there for others to dissect.
As for privileged positions, I would gladly offer you a day of mine any time.
Read again what you wrote: “You have a nasty strategy of making broad sweeping statements about Barbados and people who live here”. Hang on. Isn’t that ‘nasty strategy’ what we read every day on this blog and in the papers–sweeping statements about Barbados and people who live here?
On inaccuracies, I notice a tendency of some who when asked to corroborate what they claim as errors have a veritable habit of going dreadfully silent. Hmm.
Odd choice of name, Veritas, coming as it does from the goddess of ‘Truth’ and the mother of ‘Virtue’. Would that we knew them well.
art // November 19, 2009 at 8:41 AM
I agree with LIB, and I as a Bajan personally feel that he is in a somewhat unique position to look at our country from a failry objective perspective. If you don’t like the truth and are in denial it is dangerous, as time is now of the essence.
DLP rode into power a couple of years ago ready to make sweeping changes in integrity, transparency, anti-corruption and so on. These would have made our country accoutable to itself. But all for nought as the background noise and blogsquabbling seems to eclipse the true needs of this once non-corrupt island. Do you hear me? I said “once non-corrupted”.
DLP appears to be merely tinkering, in a dangerous hands-off way, but when it comes to making new government contracts or doling out cash for bailouts moving ahead happily, playing what appears to be a duplicitous game with our tax finances, while we worry about how to make up a deficit.
That’s the way I see DLP, and I too am part of your mirror reflection today, Barbados.
DLP needs to get more seriously hands-on about our island’s financial safety and fulfill more of its given mandate, the mandate that was promised, the mandate of integrity, that we the voters exchanged for our vote.
Otherwise we’ll always have treasury leakage and corruption in office. Maybe if we the masses could know that our government contracts were made with integrity, and some accountability, then we would be more satisfied to deal with having a deficit to make up.
Make political milking of the treasury part of the past, DLP, and then you’ll have better support of the masses again. If you don’t you’ll see more people (like this) speaking out on the blogs and/or on the street.
Enjoy your time and diligently be mindful of what you promised.
Dennis Jones (aka Living in Barbados) // November 19, 2009 at 8:45 AM
@Veritas,
I’m very happy to be judged, and I hope you are too. To help your memory, let others see how good you are at dealing with inconvenient truths.
The thread below (from BU’s post “Walking on Thin Air” http://bajan.wordpress.com/2009/10/12/walking-on-thin-air/), on the UN Human Development Index is to me telling.
I had written on my blog that Barbados’ ranking had slipped. Another reader said that was not so. I cited the UN figures, which showed the fall. You still argued that there was no fall. Despite what you said, local politicians eventually got their teeth into this issue, see http://www.barbadosadvocate.com/newsitem.asp?more=politics&NewsID=7094. Senator Liz Thompson wanted to say the drop was due to the current DLP government. Former PM, Sir Lloyd Erskine Sandiford, pointed out that given the timing of the data in the report any decline should be seen as due to the former BLP administration. Under his administration he claimed the index reached its highest level.
So are you going to argue that the former DLP PM and BLP’s Senator Liz Thompson are all in some conspiracy with me to mislead Barbados?
++++++++++++++++++
Veritas // October 18, 2009 at 3:43 PM
DJ, my point is simple. Your glee was evident, if we had slipped. Pity. We didn’t so you were silent after your error was reveald. Simple.
#
Anonymous // October 18, 2009 at 3:54 PM
@Veritas, what I dislike about certain exchanges is a simple thing: cherry picking. I cited two reports by the UN which showed clearly that Barbados’ position has changed (I did not make up the numbers as you suggested; I gave the references. Did you look at them?). I give the references. You make no note of that (as if they do not exist). I did not produce the reports. A note in the latest UN report makes a point inconsistent with their own published works and you focus on that as fact to contradict. That’s not how one establishes a fact.
The fact that most of the piece does not even discuss Barbados is not of interest to you. I call that a bit blinkered. But, there you go.
If you have looked at the UN reports could you write a sentence that squares their internal contradictions?
#
Anonymous // October 18, 2009 at 3:55 PM
Anonymous // October 18, 2009 at 3:54 PM is Dennis Jones (aka Living in Barbados)…
#
Veritas // October 18, 2009 at 4:26 PM
DJ, you are jesting I am sure. Selective? Did you carry out the same analysis for Jamaica to see if there were contradictions? Or Bahamas? Or the United States? Was your analysis broad-based or are you just a publicity seeker?
Use your knowledge wisely, please.
#
Anonymous // October 18, 2009 at 4:44 PM
@Veritas, for me there was no contradiction as I was using the raw statistics of two reports, not relying on what one report told me had been the historical development. I did raise the question of the apparent inconsisteny with UNHDR via their website but as is common with large bureaucracies I am still awaiting a reply.
I don’t see the readership that my blog gets as giving much real publicity. As the piece had not generated more than my average 1-2 comments, I did not think it hit anybody especially more than other things I write.
#
Dennis Jones (aka Living in Barbados) // October 18, 2009 at 4:58 PM
@Veritas. What a quick check shows is a series of inconsistencies. I compared the raw 2009 report data against the raw 2007/8 report (first figure; and the bases for my commentary) and then what the 2009 report indicates was the change with the 2007/8 report (in a summary table that I did not use): US (-1/-1); Bahamas (-3/0); Antigua (+10/+1); Jamaica (-1/-8); Barbados (-6/+2).
Don’t ask me why the figures differ, but I will let you know if UNHDR reply.
++++++++
After that last point, your interest seemed to go cold. Why?
That’s me done.
Alex Fergusson // November 19, 2009 at 9:32 AM
The DLP did say all along that management of the economy was not important and that they will concentrate on social issues and leave the management of the economy to the public servants who were well trained.
It is not clear for all to see that the management of the economy is indeed critical and that the DLP does not know what it is doing.
Here is unemployment under DLP rule:
1987 17.9
1988 17.3 (average based on information provided)
1989 15.4 (average based on information provided)
1990 15.0
Elections: DLP re-elected. Unemployment began its climb under the DLP starting from 1990.
1991 20.3
1992 23.0
1992 25.0 (4th quarter)
1993 26.2 (2nd quarter)
1993 24.3
1994 21.1
1994 21.7 (3rd quarter)
The BLP inherited unemployment at
1995 19.6
The DLP is heading back there fast. What “Pathway to Progress?” Seems more like highway to poverty.
In 1994 Mr. Thompson held out “BUS FARE AND LUNCH MONEY AS HIS EMPLOYMENT MODEL. In 2009, he improves on that by telling university students that he cannot find jobs for any body. SHAME!!!.
Sorry if the number do not line up for ease of reading. But I will explain if required.
Dennis Jones (aka Living in Barbados) // November 19, 2009 at 10:30 AM
@RJH Adams
Rawdon,
Many of the comments on the thread reflect that people have not read or listened to most of what Prof. Persaud has said recently or over the past 12 months. His piece in this week’s Business Barbados, http://www.businessbarbados.com/wordpress/?p=271, gives a good summary of his proposals for what the government should be doing, as well as some issues about what some officials have been arguing. One section worth noting I reproduce below:
‘The bottom line is this. Barbados like all other Caricom nations is facing a significant loss of demand and it has no fiscal room for maneuver. This means we can only do five things. (1) We must improve the value for money for every dollar the Government does spend – there is no room for superfluous spending (2) The central bank must busy itself helping banks give forbearance to solvent companies in liquidity difficulties – especially those who commit to holding on to staff. The Bank’s idea of facilitating a loan repayment moratorium is a good one but needs to be better thought through than it has been. (3) We need to better make use of all of the resources from the multilateral agencies we have access to. If they want to lend us money to build a waste to energy plant and this reinforces our broad if not detailed strategy – what are we waiting for? (4) Government must prioritise big projects that have been stalled and ease obstacles without spending cash. (5) The government needs to soften the impact of unemployment on the most vulnerable and keep them engaged in working life.
The Government has announced steps in all of these directions. S&P is telling us we are running out of time and we need to up the pace and persistence. I hope we hear otherwise it is not us who will be having the last laugh.’
He also puts into good context some comments that suggest that Barbados’ reserves are at a comfortable level by some international norms. Like him, I think the danger is for people to think that 20 weeks of cover is adequate in current conditions.
I think there is a great misunderstanding about the role of the credit agencies and you highlight some. One of them for me is that without the ratings, investors would need to do more of their own due diligence and that would require a level of openness about government finances that is considerably more than now. The other point is that there are always lenders who are not concerned by a borrower’s credit worthiness. Amongst nations, the Republic of China comes to mind as a lender with very deep pockets who will be guided by its own socio-economic-political agenda when lending but it always has bilateral conditions of some sort, and these often relate to how the loan is collateralised (eg by minerals) or how the proceeds are used (eg using Chinese workers and materials). [China's activities in Africa are clear testimony to this.] Amongst private individuals and corporations we know that there are many ’shady’ financiers, some of whose funding comes from illicit sources and some of whom will give what turns out not to be real money but have gained real assets in exchange and then flown into thin air. The Caribbean has a few cases like that in the courts. But they too will want their conditions, often leverage, political access, and access to government contracts: we will see to what extent Allen Stanford was one of those.
I think the dealings over CLICO/CL Financial contain a potential time bomb of contingent liabilities that will limit the government’s room for maneouvre, and these are not yet reflected in any debt statistics.
Finally, on the ‘comfort’ that comes from having moved to more domestic debt financing. To me, the main advantage is that (like the US can), a country can print money to get out of a debt problem but there will ultimately be a price to pay for that. That should mean that the exchange rate should depreciate (as with the USD and the Pound currently) but with a fixed rate peg, the country will get stuck and the ‘pain’ will have to be borne elsewhere, often with unemployment. People need to understand that trade off.
Dennis Jones (aka Living in Barbados) // November 19, 2009 at 10:50 AM
@ Alex Fergusson // November 19, 2009 at 9:32 AM
“The DLP did say all along that management of the economy was not important and that they will concentrate on social issues and leave the management of the economy to the public servants who were well trained.” [Anyone who took that seriously really does not understand how the world works, which may sadly mean a lot of people.]
Take politics out of your analysis, unless you can show how the DLP itself ’caused’ unemployment. Look at the associated economic situation that went with those unemployment levels. I do not have figures to hand, but look for instance at what happened in say The Bahamas (more or less similar to Barbados in size and many aspects of economic structure and management), the US and UK for the same time periods. If the trend in Barbados was hugely divergent then you may be able to point the finger at the politicians. That approach also has its flaws but it also allows you to build or walk away from your case.
RJH Adams // November 20, 2009 at 4:23 AM
Hello Dennis,
Thank you for pointing to that link – I’ve never come across the site before.
Dennis Jones (aka Living in Barbados) // November 20, 2009 at 4:57 AM
@RJH Adams
Rawdon, you’re welcome. The site was launched this week; the PM had the honour of doing that.
Keep up the great analyses on Capital Chronicle.
David // November 20, 2009 at 9:55 AM
What is the matter Lowdown, the Nation editors barred you from citing you blog source? Woe to freedom of speech :-)
BTW a colun written in your own immitable style which features the Bio of the Barbados Broadcasting Athority would be hilarious:
CLENNELL BYNOE (chairman), George Pilgrim, John Haynes, Rev. Kim Welch, Mr Devonish (Telecoms Unit) and Mr Callender (G.I.S.)
Alex Fergusson // November 20, 2009 at 11:50 AM
The crisis in barbados is the DLP. Here is why:
Barbados has a debt to DGP ratio of some 8% and climbing out of control but which is neither being used for stimulus or stabilization.
This is therefore a new era in recklessness and irresponsibility by the DLP, even by its standards
What is the DLP doing to restore the balance between its entitlements programmes and enterprise creation?
What is the DLP doing to protect the financial position of Barbados’ key producing enterprises so that when the recession lifts and demand resurges, this country’s production systems are able to respond?
Alex Fergusson // November 25, 2009 at 12:39 PM
An issue of truth and judgment
+++++++++++++++
Locally, tourism receipts are down by $150 million but Prime Minister Thompson said recently that Barbados does not have a cashflow problem.
Barbados borrowed US$150 million from T&T recently – their Central Bank should know.
But here is what PM Manning in T&T told the world yersterday:
“And may I say that whereas most countries are experiencing a shortage of cash in the domestic financial system, we in Trinidad and Tobago are battling against a liquidity problem, with the Central Bank having to intervene to keep matters on an even keel.” He added: “Our doors are open and we are willing to partner with foreign investors as long as their policies are in accord with that of the Government and are in the best interest of the people of T&T.”