Whatever happened to change?

Published: Sunday | October 4, 2009



Claude Clarke, Contributor

Ever since the Jamaica Labour Party (JLP) squeaked home ahead of the 18 and a half year-old People's National Party (PNP) administration in the elections of 2007 the country has waited with increasingly dimming hope for the change which many had expected to come, with a new pair of hands at the wheel.

Despite the PNP's election mantra of "not changing no course", because its own leader had been elected on a platform of change, it is clear that even the PNP itself was in a mood for change. The whole country wanted change, regardless of political preference.

Why then has the new JLP government so far failed to bring any change to the management of the country's economic affairs? It is puzzling that after 18 and a half years in Opposition, with time to assess, plan, organise and prepare for government, the JLP appears to have come to office with no idea as to what is wrong with our economy or what is needed to fix it and make it work. There can be no other explanation for the JLP's continuation of the PNP's debt management strategy, having witnessed the country sink deeper and deeper into a sea of debt under the PNP.

Great surprise

This acquiescence came as a great surprise to those, me included, who had supported the policy articulated by the JLP in Opposition, of replacing the country's expensive commercial debt with cheaper multilateral and bilateral funds. An even greater surprise was that the new government did not realise, immediately it came to office and was able to confirm the dire circumstances of our debt situation, that there was no way to achieve its stated objectives without an International Monetary Fund (IMF) programme to give it access to the volume of multilateral and bilateral funds it would need. Had it entered into an IMF agreement at the very beginning of its term, the JLP could have credibly blamed the need for the programme on the PNP and so avoided, at least in part, the political price associated with going to the Fund. How could the JLP have made such a serious strategic error when it had so much time to study, to plan and to prepare?

We are now awakening to the alarming truth - where the economy is concerned the JLP came to office in 2007 ill-prepared to govern and as befuddled as the proverbial dog that has finally caught the car it chased. Contrary to the conventional wisdom that the JLP had been preparing for government for all those years in Opposition, it appears that nearly all of that time was consumed in the struggle to wrest the leadership of the party from Edward Seaga and the effort to patch the open wounds left in the party after that mission was accomplished. What this virtual civil war in the JLP did was rob the country of the real value of a party in opposition - the thoughtful preparation of alternative policies to succeed where an incumbent government has failed.

Economic architects

The JLP did not have the benefit of a settled leadership under which an informed and coherent plan for government could have been developed. Nor did it have the usual team of economic architects of an incoming party's new plans to occupy the key positions of economic management in government to ensure successful implementation. This is what was expected from a new government elected on a platform of change following an administration whose stewardship had yielded persistent economic decline for the better part of two decades.

Instead of a new economic plan we were given the meaningless appointment of a member of the private sector, albeit highly capable, with strong accounting credentials, to the Cabinet to share the finance ministry with the portfolio minister. This suggests that the new government completely misunderstood the nature of Jamaica's economic problem, believing it to be more a matter of bad accounting practices and not the chronically dysfunctional macro-economic condition that it was.

Corrosive effect

The inexplicable ministerial arrangement in the Ministry of Finance did far more harm than any good it might have had the potential to do. While it might well have improved the ministry's financial management and accounting capabilities, the damage inflicted on the credibility, authority and respect for the minister of finance had a corrosive effect on the public's confidence in government's economic stewardship. This was particularly unfortunate during a period of unprecedented economic uncertainty. Further, these arrangements highlight the Government's failure to realise that the skill it really needed to create the change it had promised was macro-economic expertise and not accounting skills.

How could the new administration not have recognised the devastation of the entire productive and wealth-creating sectors of the country while they were in Opposition? Did they not try to understand what caused it? And did this government come to office with no idea as to what policy changes were needed to reverse the decline and restore the sectors to growth?

Better understanding

The Government has now presented two annual budgets, two supplementary budgets and two stimulus packages and we are yet to see any sign that it has a better understanding of the problem than it did when it came to office. The underlying structural economic weaknesses which guarantee the uncompetitiveness of Jamaica's productive output still remain. The horrendous cost burdens imposed on our factories, mines and farms by anti-production pro-imports economic policies which leave them hopelessly uncompetitive and incapable of providing employment opportunities for our people, remain unaddressed. As a result, the Government's promise of jobs has sunk like a stone down a watery hole.

After two years in office and eighteen and a half to observe the PNP take the economy into chronic uncompetitiveness, the JLP does not yet seem to grasp the simple fact that it cannot operate a successful economy without focussing completely on creating an environment in which the basic inputs into the productive activities in the country can be priced internationally competitively. The prime minister was recently reported as saying "part of the problem facing Jamaica's manufacturers is that the cost of inputs is too high". It is a view I have repeatedly expressed and am heartened to know that it is now acknowledged at the very top of the Government.

But the real challenge is not to recognise the problem; the challenge is to design, develop and apply the politically difficult policy measures needed to correct it. The policy changes required to create a competitive economic environment will test the fortitude of even the most popular political leader. They are decisions best made at the start of a political administration. But having wasted the first two years of its five-year term, the JLP government will need an act of extraordinary political valour to carry out the vital but painful economic reforms, with little time left in its term for the benefits to emerge. These policies would result in competitively priced capital, energy and local services. They would contract the cost of government to affordable levels. They would make our currency competitive and stable, and end the senseless policy of subsidising imports while penalising domestic production. But they would be very painful and would extract such a heavy political price that only a true patriot would be prepared to pay it.

Not yet ready

The prime minister's contribution to Tuesday's late night debate on the supplementary budget has now shown that he is not yet ready to be that patriot.

Outside of a vague promise to reduce the size of government, his much ballyhooed speech bore no sign of the long overdue change of economic course, or any hint of a development strategy for the country.

Of course the political fortunes of the JLP government will depend not only on its own performance, but will also be substantially influenced by the activities of the PNP in opposition. The passing of the ball of leadership from former leader PJ Patterson to the present leader Portia Simpson Miller has been, to use an American football jargon, 'incomplete'. It has been 'fumbled' by the failure to achieve the unity which can only occur when there is no doubt about a leader's authority. The pictures of unity which emerged from last month's annual conference were impressive. But until genuine acceptance of Mrs Simpson Miller's leadership penetrates the hard crust of resistance of those most viscerally opposed to her, the unity necessary for the party to go forward will remain elusive.

As the JLP demonstrated during its long and turbulent period in opposition, a party cannot properly prepare for government unless its leadership has the authority to attract, motivate and productively deploy its best talent and skills to the task. Until the PNP completely settles its leadership issue it runs the risk of repeating the JLP's shocking failure to prepare itself for government in 2007. It is now preparing a plan for governance referred to as the progressive agenda, but until the leadership question is no longer an issue, the selling of the agenda by the leader will be handicapped, and the party will not be able to properly prepare itself for government.

Jamaica cannot afford this type of vacuous governance again.

The JLP's failure to come to office with an economic plan in 2007 has placed a heavy burden on our people. Having witnessed this, the PNP has a duty to be more prepared for government, should it be called on to lead the country again.

The crisis facing us today demands a government with a workable plan, not a government that will have to put the people's business on hold while it stumbles around hoping to learn to govern on the job.

Claude is a former trade minister and manufacturer. Feedback may be sent to columns@gleanerjm.com

 
 
 
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