Election fever is upon us
By CFAL Economic view
Once again, election fever is upon us. With the report of the boundaries commission having been approved by Parliament, it is now open season for all aspiring politicians and political organizations. While the actual date of the next general election is not known, it is clear that the respective machineries of the political parties are gearing up to launch in early January.
We refer to this period leading up to the general election as the ‘silly season’. While this may to some seem unfair and even unpatriotic, we stand by our position, as normally very intelligent people take this opportunity (during the silly season) to publicly make irrational and unfortunate public utterances. The silly season brings out the best and the worst in our aspiring public officials. At the end of the day, 38 Members of Parliament will take their seats in the hallowed halls of Parliament. Constitutionally, the person commanding the support of the majority of members (at least 20) will ascend to the office of prime minister.
While we eagerly look forward to the publication of the official documents of the respective parties (manifesto, covenant or whatever), they only represent articulations of visions for the next five years. We would like to see the major political parties take this process to the next level by tackling long-term fundamental issues and committing resources to developing positions for the next 10-15 years. It is not until we start thinking beyond tomorrow that we can successfully position our country to compete effectively in the global arena.
The real purpose of this article is not to talk about who will win and who will not; but rather to focus on the various implications for the economy – both short-term and long-term. Our economy has been challenged, as has been most of the world, during these tough economic times. We have been down-graded recently and unless we put in place measures to mitigate our declining economic fortunes we will be downgraded again, which would have serious implications for us and our currency.
Many of us are experiencing a slowdown in business activity; some of us have already experienced reduced work weeks and/or layoffs; and finally, there are some employers just waiting for the passage of the Christmas season to drastically reduce costs. Politicians need to think ‘out of the box’ for the long-term benefit of the country.
We know that within the next six months we must have a general election. In a small country like The Bahamas, election spending can (and most likely will) provide a significant short–term infusion of money into our economy. There will be at least 100 constituency offices opened and staffed; there will be the employment of ‘generals’ in every constituency; there will be significant amounts spent on advertising, public rallies, signage, printed materials, clothing items such as T-shirts and caps, transportation and hand-outs. Add to this the normally scheduled ongoing public works programs. We could have a short-term injection of millions of dollars into the economy starting almost immediately. While it may seem that there is a lot of activity, and exciting projects waiting to break ground, we must not be deluded and remain focused on the big picture, which is the future of our economy.
If we had a wish list for the incoming administration, we would like to see in the financial sector specifically and otherwise:
• Good Governance – We call for the establishment and publication of a set of guidelines for the conduct of public officials (parliamentarians and senior government officials) governing their relationships with goods and services providers in order to improve transparency and to avoid charges of misconduct.
• A Council of Economic Advisors – The Council of Economic Advisers, an agency within the executive Office of the Prime Minister, is charged with offering the prime minister objective economic advice on the formulation of both domestic and international economic policy. The council bases its recommendations and analysis on economic research and empirical evidence, using the best data available to support the prime minister in setting our nation's economic policy.
• Accountability – We would like to see major policy decisions of a fundamental nature regarding issues such as the use of government land, the disposal of government assets, constitutional changes, economic policy, introduction of legislation impacting the conduct of business and immigration policies subject to open public debate, providing for full participation by the public.
• Privatization and outsourcing – It is imperative that we complete this process for the overall competitiveness of our economy – that is, BEC, Water and Sewerage, Bahamasair, ZNS, etc. Garbage collection, building maintenance, janitorial services, etc, could be outsourced.
• Consolidation of regulatory authority – It is possible that several regulators could regulate an institution concurrently. To make matters worse, these multiple regulators do not seem to communicate with each other. Wouldn’t it be wonderful if some of these regulators would cross-reference certain basic information?
• Level playing field – We still see inconsistencies in the application of some rules and regulations that make you question the system. Also, we as a nation must recognize that Bahamian professionals can be just as competent as their foreign counterparts, if given the opportunity.
• Pension fund legislation – We have called for the enactment of such legislation on numerous occasions.
• Public dialogue on tax reform – As a country we cannot continue to apply the 1960s taxation model to manage our economy. Once we attain full membership into the Free Trade Area of the Americas (FTAA) and the World Trade Organization (WTO) much will change. Our participation in these arrangements is advanced and we should not have to wake up one morning to face these changes and challenges unexpectedly.
• Public dialogue on catastrophe insurance
• Consumer protection legislation
There is a need to introduce legislation, particularly in financial services, that addresses truth in lending; increased transparency for trade and services contacts; and an office to settle disputes between small consumers and large service providers.
While there are numerous other equally pressing items that could be added to our list, we will stop here. We are convinced that placing attention on these items will go a long way towards positioning The Bahamas as a competitive player in this brave new global world that we are entering.
We are living in interesting times.
Dec 14, 2011