Minister Don Wehby's characterisation of what he calls "the Finsac experience" as being the "worst disaster" ever to have befallen Jamaica will resonate with many people, particularly opponents of the previous administration who either blame it for the meltdown of the financial sector of the mid-1990s, or are critical of its handling of that crisis.

We welcome Mr. Wehby's comment for two reasons. One is that its timing is important, coming as it does in the midst of the controversy over the so-calle investment schemes, which continue to be popular with many Jamaicans despite questions about their sustainability and their capacity for sustained delivery on their promise of extraordinarily high yields. Indeed, there are fears that many people who 'invested' in these schemes will lose their money and come calling on the Government for help.

Although the administration has said that such people will be on their own, there are those who insist that this is hardly the Government's last word on the matter given the political realities that it has to face.

We also feel Mr. Wehby's statement to be important because there is yet to be a serious, intellectual and unemotional debate of the events of the 1990s to determine, insofar as possible, the lessons to be learned from them. The conclusions may help to shape responses to anything untoward that may arise from today's 'alternatives'. The foregone notwithstanding, we must confess to uncertainty about what precisely Mr. Wehby meant to convey in his remarks.

There is a certain lack of clarity. For instance, we are not clear whether the minister is arguing that Finsac, as a vehicle, and the process it used for the $140 billion bailout of banks and insurance companies, was worse than the underlying problem it sought to address. Recall that in the crisis of a decade ago, financial institutions were heavily leveraged in long-term investment - much of it for their own accounts - for which they used short-term money.

However, there are those who argue that it was the banks' customers who first fell into trouble and then dragged the banks with them. They tend to blame the difficulties on the monetary policies pursued by the Government. Others, though, accuse most financial sector bosses of irrational behaviour, making the point that foreign-owned banks, supposedly with greater supervision and oversight, did not fall into the same difficulties.

The Government bailout, which guaranteed depositors in failed banks all their principal and interest - which we felt was wrong - pushed the national debt from 70 per cent of GDP to over 140 per cent. Capital dried up and there emerged, according to Mr. Wehby, "a psychological barrier" that undermined the "entrepreneurial spirit".

In some respects, there are parallels in the motivations that drove the depositors of the 1990s and who have invested in today' schemes. In some cases, there appear to be similarities in the behaviour of both sets of institutions. Perhaps now he has spoken, Minister Wehby may wish to facilitate the needed formal dialogue on an important episode in the history of the country that continues to impact on the economy.

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