The agenda to derail the privatisation of Bahamas Telecommunications Company (BTC) for political gain and to protect vested interests

Propaganda and the pending BTC privatisation
By LARRY SMITH



AND now class, today we are going to talk about propaganda. Does anyone know what the word means?

It derives from the Latin for propagate, which means to multiply, reproduce or transmit. In this case, we are talking about spreading information.

What kind of information? Well, that is often hard to say. The key point to remember is that the information being presented will have an agenda. And in order to judge the value and quality of the information, you need to determine what that agenda is.

In a nutshell, propaganda uses loaded messages to produce an emotional response in support of an often hidden objective. And ever since the 1930s (when German and Soviet propaganda promoted state-sponsored genocide) the term has acquired a strong negative meaning - for good reason.

Journalists are supposed to be trained to give their audiences a reasonably accurate background and analysis of the subject at hand. Advertisers use an overt form of propaganda to persuade people to buy their products or services. Public relations lies somewhere in between, often presenting itself as journalism in support of a proprietary theme, which is not necessarily nefarious.

What sets propaganda apart more than anything else is that it seeks to influence public opinion through deception and confusion, rather than by encouraging genuine understanding.

According to Nazi Propaganda Minister Joseph Goebbels, "The most brilliant propagandist technique will yield no success unless one fundamental principle is borne in mind constantly - it must confine itself to a few points and repeat them over and over."

What points instantly spring to mind in the local context? No turning back (to white rule); stop, review and cancel (good economic initiatives); Hubert "the dictator" Ingraham; selling our birthright (to white foreigners), the plantation economy (enslaves blacks).

But it's not just about repetitive slander. As British wartime propagandist (and later cabinet minister) Richard Crossman said: "The art of propaganda is not telling lies, but rather selecting the truth you require and giving it mixed up with some truths the audience wants to hear."

This is what we are seeing today with the (currently) one-sided debate over the pending privatisation of BTC.

Let's look at the recent constructs of a massive conspiracy to corruptly engineer the sale of BTC against the interests and wishes of the Bahamian people. Evidence for this is said to rest on a series of conflicts of interest, and was recently given credence by retired Tribune journalist Nicky Kelly, who now writes a column for the Punch.

"One has to ask why the PM is so motivated to pursue a deal that is so suspect, and the machinations of its participants so obvious, that they exhaust credulity," Kelly wrote.

In this view, a small group of unrelated people began moving chess pieces years ago to achieve the present result - the sale of half of BTC to Cable & Wireless Communications, within a regulatory environment developed and controlled by former CWC employees.

The inference is that the plot was hatched by CWC, with the support of leading Bahamian politicians and technical advisors, to save its future Caribbean business prospects. Or maybe it was the other way round, and our top politicos and bureaucrats simply planned to enrich themselves from CWC. In either case, the full background to the story is largely ignored and a massive corrupt scheme is offered as the obvious reality. The clear agenda is to derail the privatisation of BTC, both for political gain and to protect vested interests.

The full background to the story includes the fact that there were no less than three public bodies responsible for decision-making - the cabinet, the privatisation advisory committee, and the privatisation working committee. There were also two sets of financial advisors - KPMG Bahamas and CITI, a major international bank - as well as two legal advisors - Charles Russell, a British firm specialising in communications law (which also advised the Christie administration on regulatory reform), and local law firm Higgs & Johnson.

In short, there were significant checks and balances. And with so many separate groups of advisors it would be very difficult for a specific conflict of interest to flow through to a final sale. It also has to be acknowledged that the goal of liberalising the communications sector and finding a major strategic partner for BTC has been the accepted policy of both major parties for years - even more so in the case of the FNM, which launched the process in 1998.

And what about those conflicts of interest that have been selectively ignored by the conspiracy theorists. Conflicts like the participation of some of the major antagonists in the current debate in the earlier sale that was agreed by the Christie administration with Bluewater Ventures - a foreign firm with uncertain ownership and no operating history.

It has been suggested that some of them were heavily involved when that deal went down - together with some of the leaders of the same unions that are now so critical of the current process. What chess pieces were these players moving?

The Christie administration cancelled the original privatisation process launched by the FNM after rejecting existing bids, and then proceeded to negotiate solely with Bluewater from 2005 until the general election in May 2007. How is this any different from the Ingraham administration rejecting bids received in the current process, and then talking to CWC?

And let's not forget to take into account the stark contrast between Bluewater, an unknown private equity firm, and CWC, a major international telecoms provider with a long and publicly reported background in the field.

In fact, almost all of the bidders for BTC throughout this long and complicated process were private financiers who saw an opportunity to make money. Digicell and CWC are the most obvious telecoms buyers in the region, but Digicell (which decided not to bid in the last auction) is purely a cellular operator. CWC is one of the few entities that does everything BTC does throughout the region and has a strategic reason to invest for the long-term. And since CWC has been interested in the Bahamas for the last 15 years, how can it suddenly be suspicious when they step up to the plate?

It is easy to research a large global business like Cable & Wireless, which may have problems in some areas but a very healthy balance sheet overall. In fact, CWC is a leader in all regional markets except Jamaica where they are second. It should also be noted that, although declining to participate in the most recent auction due to an internal reorganisation, CWC eventually went through the same entry process as all other bidders.

As for the terms of the CWC agreement, it is a fact that all the bidders required BTC's unfunded pension deficit to be covered by government - including Bluewater. How can this now be "repugnant" to the PLP, when they agreed to pay off the full deficit and close the pension plan entirely. I would suggest that there is no business in the world where employees make zero contributions to their own pensions while the employer pays 20 per cent of salaries into a fund. This obviously has a huge impact on BTC's value.

It is also true that all the bidders - including Bluewater - demanded a management fee in their plans, something which some commentators find egregious. The rationale for the fee that was eventually agreed is that CWC brings a lot of added value to BTC in terms of technology and intellectual property, which will significantly benefit the other shareholder. This is normal practice where a minority partner is involved, and industry benchmarks are used to set the fee scale.

Clearly, connecting the dots selectively amounts to spouting propaganda. It does nothing to help people reach a genuine understanding of the issues. This is known as pinpointing the enemy - simplifying a complex situation by presenting a specific group or person as the enemy in a clear-cut choice between right and wrong. And the better informed you are, the less susceptible you will be to this type of propaganda.

One of the worst allegations in this saga was made recently by PLP Chairman Bradley Roberts (who was the minister responsible for BTC in the Christie administration). He accused current BTC chairman Julian Francis of a corrupt conflict of interest in awarding to Providence Advisors (a financial services company which Francis also chairs) a lucrative contract to manage part of the BTC pension fund.

"As a result of this contract that Julian Francis awarded to himself, he positioned himself and Providence Advisors Ltd to be paid in excess of $400,000 per annum for the past 3 years," Roberts said. "The PLP calls for Julian Francis' immediate resignation and for the police to commence investigations..."

The facts are that efforts to place BTC pension funds with local investment managers began in 2006 under the Christie administration, when Greg Bethel was BTC chairman and also president of Fidelity Bank & Trust - one of the firms chasing the business. Providence, headed by Kenwood Kerr, was also invited to bid, and was eventually approved (along with Fidelity and CFAL) in a process guided by the accounting firm of Deloitte & Touche.

The actual contract was not executed until after the 2007 general election, and Francis (who is not a Providence shareholder) had nothing to do with choosing the investment managers. And Providence's fees over the past two and a half years were less than $350,000.

Statements from political operatives and unsupported extrapolations by sympathetic or thoughtless journalists are not the only forms of propaganda we must watch out for. There are also those entities which pose as legitimate news media. While party newspapers or radio broadcasts may be easily identified and their information taken with a grain of salt, some propaganda outlets try to disguise their true nature to fool an audience into believing they are presenting valid information.

The current prime example locally is the online propaganda outlet known as Bahamas Press, which refuses to even acknowledge that it is financed, owned and operated by real people, although it classifies itself as a "leading news website." An anonymous responder claimed the site is owned "by the people of the Bahamas."

As George Orwell wrote in his novel 1984, "the process (of mass-media deception) has to be conscious, or it would not be carried out with sufficient precision, but it also has to be unconscious, or it would bring with it a feeling of falsity and hence of guilt."

Of course, now that I have waded into the propaganda swamp, I must be part of the conspiracy, right? Well, now you can make the call.

What do you think?

Send comments to

larry@tribunemedia.net

Or visit www.bahamapundit.com

March 09, 2011

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