Mme Madeleine Lagarde is good for us


Friday, July 04, 2014

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THE week was Jamaica's. We got good global coverage, our FX bond was oversubscribed and our spirits lifted. Congrats to Peter Phillips and his boss, PM Simpson Miller.

This unsolicited, unexpected mark of approval by a global icon is unprecedented. It was Lagarde who said of our debt addict chums, "I have one message tonight about Greece, it is to call on the political opposition to support the party in power in the interest of national unity". Greeks listened; political interference, Audley Shaw?

The trend of the Jamaica Labour Party (JLP) to blame the People's National Party (PNP) for everything since the sinking of the Titanic is boring. Give praise where it is due. The International Monetary Fund (IMF) is a bank for screwed-up countries, and as debt addicts we screwed ourselves and need their money. Mme Lagarde is a taut package; a handsome lady, gracious but realistic, and she confirms the medicine is working.

What is our option without the IMF? We cut back to essential imports, ramp up production and exports, eat what we grow, buy local, have power cuts and pay down our debt by "the sweat of our brow". Are you up to it, Audley?

If we get criticism, they say critics have a hidden agenda. If we get praises, they say there is a serpent in the bouquets. Let us be normal; acknowledge criticism, accept praise and stay with the IMF programme this time.

MACRO IMPACTS: The indicators at the macro-economic levels are starting to look good. We are in rehab but we still want to continue imports, consume more, work less and live large. Things will get harder and the tonnes of Canada's salt fish, Argentina's corned beef, EU milk powder, USA rice, flour, red peas, chicken back; Australian wines, New Zealand butter and cheese will soon be unaffordable. We must produce and export to pay for imports.

I commend Opposition Leader Holness on his economic team, but is this an audition for Audley's job? The team is entrepreneurial, not one to manage an economy in crisis, and that's fine, as economists do not prosper a country; so it seems the JLP plans to be out until 2020, as by then Peter will have done the heavy lifting -- true?

Mr Holness' brief to them is crucial; what is his economic vision? The PNP is Socialist, but what informs the JLP's plans? Will they mobilise workers for a fierce assault on production, capital and technology in a business-led solution? What about farming? Was his devaluation letter to Mme Lagarde a schoolboy's prank or lack of understanding?

Sir, so long as imports exceed exports, our demand for US$ will cause our dollar to devalue -- Demand & Supply 101. Holness should eschew old boy points scoring and bring new, youthful gravitas to the job. Jamaica Inc needs an opposition leader we can be proud of.

MICRO IMPACTS: Things are not looking good "out a road"; the poor are struggling, pain is palpable. The poor always suffer -- it's not pretty. The JLP Government took IMF cash but not the medicine. Now the Simpson Miller/Phillips team has healed the deficit of trust. Mme Lagarde's arrival was an honour, and despite silk scarf and blithe aspect she had some hard sayings -- get used to devaluation and produce for export, save yourself!

Since we are in "the valley of the shadow of death", how can we make it work for us? We pass tests and are getting better but are still in intensive care. What can we do to exit faster, stronger and gear-up to build prosperity quicker? Here are some ideas.

Personnel is a prime area of state and corporate liposuction. More people are hired with more benefits in good times. We don't want lay-offs, so let's renegotiate terms, try job sharing, zero hours contracts, flexi-time and attrition by retirement. Let's merge jobs as income and production fall and warehouses fill up.

A job description is not Holy writ, and in good times we separate jobs to employ more -- for a clerk/typist we hire a typist and a clerk, so in bad times back to clerk/typist.

Motor vehicle and travel expenses can kill an entity. Is car pooling possible? Use Google scheduler to sync trips; voice or video conferencing instead of meetings. My monthly board meeting of a London firm is done virtually. Try paperless meetings; load all documents on a neutered tablet; come empty-handed to meetings, leave empty-handed and save; great for security.

Examine health insurance and remove adult kids, spouses who have their company scheme; use the hospitals, we pay for them. Leave was set in the "good old days", so review vacation leave and sabbatical (if a person can take a year off, you don't need him), study leave (try virtual learning), sick leave and casual leave.

Is it fair that people who choose not to have kids are penalised as they do not get the time off for school stuff as those who choose to have kids?

REORGANISE FOR SURVIVAL: It's a buyer's market, so renegotiate contracts. Computerise your systems, track money. Use technology to improve efficiency, productivity and usage. Try "Common Services" so if you have several subsidiaries or agencies, create a service bureau for each -- communications, legal, ICT, accounts, and appoint an account executive to serve a clutch of agencies or departments; don't pay four ICT sections. Merge them.

A reprographics centre with a bike and a van courier will save if you process more than five tonnes of paper and have 45 or more copiers, printers, scanners, small print jobs within an eight-mile radius. Seek innovation and pay staff for ideas which increase sales/income, reduce costs/expenses, optimise resources or eliminate waste. Consider all suggestions, as staff know where "the bodies are buried"!

Mme Madeleine Lagarde is not the tooth fairy, and the IMF is a bank, not God. We worship no one but must work to pay debts. She has many qualities of the French child film namesake Madeleine -- open and frank. We passed the IMF's economic GSAT after the Holness/Shaw team gave up on us as losers in 2011. We did not give up on ourselves; we know economic CSEC is ahead, then CAPE -- yes we can!

Mme Lagarde has confidence in us, let us be self-confident. Her comment to us to honour commitments had a small phrase which cut me to the quick: "It is also a matter of dignity". I am ashamed for us! We must never forget the men who took the IMF cash and threw our reputation "under the bus" in 2011. We are a great people; let us rise up, work hard and prove it "to de worl!" Selah!


I met Jim on my first return home and spent hours at his dining table as he probed my world and I his; he was always there, I was always hurrying past. He chided my impetuous spirit but opened the West to me. He was a strikingly handsome man with robust views on family, country and God. Jim has left the building. I extend condolences to Bishop Robert Thompson and the family. Stay conscious, my friend!

— Dr Franklin Johnston is a strategist, project manager and advises the minister of education.




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