PNP left JLP an improving economy
Prime Minister Andrew Holness is an imperfect man. As such, we expect him to err at times. He will stumble as he hits various bumps along the way, and he will be found wanting in certain spheres of leadership. Yet, there is nothing new or earth-shattering about those declaratory remarks; hence, no one should be surprised by them.
Truth is, like his immediate predecessor, Portia Simpson Miller, Holness is no miracle worker. He cannot turn water into wine. We are all human, with complexities that make us innately imperfect, even though we strive for greatness.
That notwithstanding, we should wish Holness well; not only in his capacity as prime minister of Jamaica, but also in his capacity as a father, husband, son, and fellow citizen. Personally, I am heartened to see someone of my post-Independence generation ascend to the upper echelon of Government and be prime minister. And, notwithstanding harsh criticisms of former Prime Minister Portia Simpson Miller, she too deserves accolades for steering the affairs of Jamaica as effectively and as successfully as she did during her tenure — Nah tek back nuh chat!
As someone who comfortably touts his Christian bona fides, Prime Minister Andrew Holness ought to be fully cognisant of the distance between Palm Sunday and Good Friday. He knows that the distance between the two extremes is indeed very short and can be quite tumultuous. According to biblical literature, Jesus Christ made a triumphal entry into Jerusalem, yet days later He was “nailed to the cross”. Prior to His death, Jesus rode into Jerusalem, where a multitude greeted Him enthusiastically. They waved palm branches, and covered his path with their clothing and the palm branches. They shouted: “Hosanna to the Son of David! Blessed is he who comes in the name of the Lord!”
Prime Minister Andrew Holness is no Jesus Christ. However, his own experiences inside the Jamaica Labour Party (JLP) should prepare him well for the challenges ahead. To begin with, the streams of accolades should not be misconstrued for blind support. Neither should the waves of encomia be mistaken for permanent or full-throated endorsement of all the elements inherent in Holness’s version of “Compassionate Conservatism”. Fairness and honesty demand that, in the same way we glorify his successes and prepare to celebrate his party’s accomplishments, we must remain equally steadfast in our vigilance, and scrupulous in our evaluation of his Administration.
We must not recoil from our position of fair-mindedness and probity. Instead, we must remain unwavering in our efforts to hold this Government to its commitments and to demand of it the highest levels of transparency and accountability, because Jamaica deserves no less.
Andrew Holness knows of the vicissitudinous nature of political leadership. He should know that leadership can be lonely, difficult, unpopular, taxing, and testing at times. It is within this context that I assess a portion of his inauguration speech and summarise some of the accomplishments of the previous Government on which this new JLP must build and not foolishly squander. The people have sacrificed too much to receive the reward of reckless spending.
First, there is no significant demur to the generally positive reactions to the letters and spirit of Holness’s inaugural address. The speech hit mostly all the right chords. However, he missed an excellent opportunity to temper expectations; the oversight could backfire.
In the run-up to the general election of February 25, 2016, the JLP made several promises, the mightiest of which was its personal income tax exemption for employees earning up to $1.5 million. By this, Holness himself metamorphosed into a Santa Claus of sorts, offering all kinds of largesse.
The JLP ran a brilliant and successful campaign in which it positioned itself as the populist party and promised almost everything. The many promises, though palatable to the electorate, now appear glaringly incongruous to the type of fiscal frugality Holness espoused during the speech.
Interestingly, of the imminent $1.5-million tax relief, Holness encouraged wise use of the additional disposable income and urged beneficiaries to buy Jamaican. Rhetorically speaking, his appeal was consistent with the multiplier effect theory they say windfall would have on domestic production. However, moral suasion is hardly a reliable strategy through which to cure historical and cultural affinities for foreign goods consumption.
There is more, given the multitudinous promises and pledges, to implement many of them within “the first 100 days in office”. The Holness-led JLP Government appears unmindful of the delicate economic premise on which the Administration may have to effectuate its “pay day” promise; hence, the missed opportunity for him to manage expectations from day one. It will not be long before the Holness-led Government realises that it will have to govern as a centrist. Centrism is all about pivoting, and pivoting from extreme positions to achieve reasonableness of centre. It is not about doing what is popular, it is about doing what is right; we expect Andrew to do no less.
Campaigning for power and attaining power are dissimilar. Yes, “all is fair in love and war”; meaning, people in love, or soldiers in war, are not bound by the rules of fair play. However, it is also incumbent upon a political party that rides to power on a wave of expectation to manage or dampen unrealistic expectations. PM Holness did no such thing during his inaugural address at King’s House. Instead, he audaciously upped the ante on populism. Maybe Andrew has found the proverbial “pan-o-jar” (treasure trove) and is mightily sure of the Government’s ability to fund the many promises without upending the current fiscal arrangements of which debt reduction is painfully “enshrined”.
Talking about reasonableness, as recently as last Sunday, this column stridently criticised the leadership of People’s National Party (PNP) and the Government it formed (2012-2016) for its failure to communicate, its refusal to mobilise the citizenry around the economic reform programme, as well as its ineffectiveness in marketing its accomplishments. However, it would be deadly irresponsible and intellectually dishonest to accuse the former Government of not accomplishing anything for, or on behalf of the people. The Portia Simpson Miller-led PNP Government, though lacking in many areas, did remarkably well in turning around the country’s economic fortunes, as well as in rebuilding and rebranding its tattered regional profile and international prestige, brought on by the ‘Dudus’ extradition fiasco of 2010.
Although significant economic progress was made during Portia’s tenure as prime minister, it was mostly concentrated at the macro level, and was slowly filtering through to the micro level. I challenge anyone, with a scintilla of honesty or an iota of reasonableness, to refute the fact that Jamaica’s economy is substantially better off today than it was in December 2011 when the PNP assumed power. To begin with, and though still unacceptably high, the JLP is the beneficiary of an environment where cumulatively, 1,300 fewer people died at the hands of criminals between 2012 and 2016 than during a similar period between 2007 and 2011, with the January 2016 crime statistics showing a 17 per cent decline in murders.
Without fear of contradiction, the JLP has now inherited an economy and country where, despite many lingering challenges, many things have advanced positively. Jamaica is now the second country in the English-speaking Caribbean to have an internationally accredited laboratory with the full capabilities to test for any type of disease that may pose a threat to public health. No more need to send samples to the Trinidad and Tobago-based Caribbean Public Health Agency for testing and confirmation. Jamaica, after many precipitous declines, moved up 16 places in the 2015 Corruption Perception Index. The improvement places Jamaica at 69 out of 168 countries. Interestingly, only 11 countries on the 2015 index improved rankings of 16 or more places.
Jamaica advanced from number 14 of 31 countries, in 2014, to number seven of 26 countries in 2015. Previously, Jamaica stalled in or near the bottom half of the ranking in the Americas. The new JLP Administration is at the wicket at a time when Jamaica surpassed the International Monetary Fund (IMF) primary surplus and net international reserve (NIR) targets for the October to December 2015 quarter, and is positioned to pass the 11th economic review test.
The JLP is taking over an economy where, during 2015, the Jamaica Stock Exchange Main Index increased by 97.4 per cent to an unprecedented level, where the value of stocks traded increased by 400 per cent to $64.6 billion, up from $12.8 billion — a signal of confidence. The JLP is inheriting an economy that the World Bank’s Doing Business Report 2016 ranks in the top 10 most improved economies worldwide.
Concomitantly, the JLP is taking over an economy in which Fitch Ratings Agency upgraded its long-term foreign and local currency issue bond ratings from ‘B-‘ to ‘B’ and from stable to positive. Investor confidence is at an all-time high, with investments such as Benchmark Renewable Energy $12 billion for construction of a large-scale bio-ethanol plant. The plant is to produce 500,000 gallons of aviation jet fuel per year and 60,000 gallons of desalinated water each day. The return of Red Stripe and investments in the tourism sector are significant. Local private sector lending and investments are up. According to the Bank of Jamaica, private sector credit increased by nearly 10 per cent in 2015, over 2014. These investments, along with improved current account balances, prove that, despite the painful devaluation, a competitively priced dollar is incentive for investments. Do not let ‘duppy fool you’, the JLP will not revert to a fixed-exchange rate regime; devaluation will continue, perhaps at a slower pace.
This JLP Government is taking over at a time when Jamaica just moved up five places on the Forbes ‘Best Countries for Business’ list. Jamaica moved up from 64 to 59, which equated to the top country in the Caribbean for business in 2015, and third in wider Latin America and the Caribbean. The JLP is heir to a Jamaica where the primary surp lus stood at $66 billion, exceeding the $60.7-billion target. It is taking power at time when the NIR stands at US$2.44 billion, approximately US$800 million above the figure targeted. A Jamaica where, though seriously high, the unemployment is decreasing; it now stands close to 13.4 per cent. Though significantly impacted by lower oil prices, the JLP is taking over when inflation is the lowest it has been in 48 years, and with the trade balance down US$500 million for January to October 2015, when compared to the corresponding period in 2014.
Readers can draw their own conclusions. Some may ask, “If everything was so rosy, why then did the PNP lose on February 25?” There are myriad reasons for the PNP to sort through. However, election results confirm that there are no guarantees in a democracy. Governments come and go, but the will of the people remains sacrosanct.
Now that the JLP has political power, it cannot behave like the dog that barks and chases a moving car, but when it catches up to it, all it does is to hoist its hind leg and urinate on the wheel.
Burnscg@aol.com