Response to analysis by Colin Daniel on Minister Estwick’s proposals

I write in response to an article carried in Barbados Today of Friday, February 27th. I am requesting that you publish the following, even as a guest Op-Ed if you are minded to.

Thank you for considering this request. May I take this opportunity to thank you for enabling me over the years to make intervention into the ideas marketplace of Barbados by publishing letters from me.

Dear Editor:

I am now confused re: the Estwick proposals. I recognize that the responses to it are fuelled by the interests those who respond have in the money that will come in from a sinking fund of the kind proposed for the Barbados economy by the UAE financiers. My interest is in what we perceive as the biggest problems of my economy and how we propose, in language I can understand as a fairly well educated and experienced citizen, to resolve those. But I am now confused by both the Swisse Fund Harrisonian as I said in an earlier letter to Barbados Today On-line was kind to print on Friday, 28th February, and now by Mr. Daniel.

I am now confused re: the Estwick proposals. I recognize that the responses to it are fuelled by the interests those who respond have in the money that will come in from a sinking fund of the kind proposed for the Barbados economy by the UAE financiers. My interest is in what we perceive as the biggest problems of my economy and how we propose, in language I can understand as a fairly well educated and experienced citizen, to resolve those. But I am now confused by both the Swisse Fund Harrisonian as I said in an earlier letter to Barbados Today On-line was kind to print on Friday, 28th February, and now by Mr. Daniel.

If the first problem is the size of the deficit that Barbados now carries, an increase in that deficit by between 60%-100% as offered by Dr. Colin Daniel in the full length treatment on one and a half pages is frightening to say the least. Problem of deficit will not be solved or resolved by his own assessment!

If the problem is the need for “restructuring of the public service“, a variable that remains clouded in all analyses so far that I see, is improvement in credit rating, which must surely imply ability and real further borrowing to support needs not going to be the outcome? Mr Daniel assures us that such improvement for an 18-24 month period will result from the Estwick plan. He also warns that inflation instability could result in the influx of such a large injection of monies into this economy. I’m confused?

(Re-restructuring, I do not see how laying off public workers constitutes restructuring, nor do I see how selling the family jewels in the form of more privatizing of money-making public enterprises is restructuring in the positive sense people are using it. We sold Barbados National Bank when it was the brightest star in the financial sector in Barbados. How has that helped us beyond the "few raw mout pennies" it produced as Barbadian/USA novelist Paule Marshall might say?)

(Re-restructuring, I do not see how laying off public workers constitutes restructuring, nor do I see how selling the family jewels in the form of more privatizing of money-making public enterprises is restructuring in the positive sense people are using it. We sold Barbados National Bank when it was the brightest star in the financial sector in Barbados. How has that helped us beyond the “few raw mout pennies” it produced as Barbadian/USA novelist Paule Marshall might say?)

If the problem is the need for NIS (National Insurance Scheme) to make viable investments and earn the foreign exchange,that can pay off its debt, then why make as a bottom line of attraction of the Estwick plan increase in direct foreign investment (DFI) in Barbados as Daniel proposes? It seems to me from Mr. Daniel’s assessment, and my understanding could be wrong and flawed, that Mr. Daniels sees that attraction of DFI as the key to growth and the most attractive aspect of the Estwick plan..

I had a personal problem of cash flow recently, the same case as the Government, and I was faced with either borrowing on my credit card, with its attendant horrific and usury interest rates, or using whatever cash and fine change I could scrape together to pay my financial obligations. Those obligations include a mortgage, payment for an old car, and helping to meet the education needs of a child. I decided to use my equivalent of the NIS (silver fine change I had been collecting over the years), rather than go to the credit card. That was the best investment in the growth of my household I could have made.

I was able to meet my obligations on my salary (EDITOR's NOTE: seated here next to Harclyde Walcott), including payment of land tax to the Government, and come up with more business ideas than I can use - I have been giving most of these ideas away. Ask people. I now have not much silver fine change- but it is building back up. I scrimped on buying new things for myself at Christmas, but I am fortunate to have great friends who constantly give me lovely clothes.

I was able to meet my obligations on my salary (EDITOR’s NOTE: seated here next to Harclyde Walcott), including payment of land tax to the Government, and come up with more business ideas than I can use – I have been giving most of these ideas away. Ask people. I now have not much silver fine change- but it is building back up. I scrimped on buying new things for myself at Christmas, but I am fortunate to have great friends who constantly give me lovely clothes.

My only difficulty is that I have been eating the capital that is my house by not doing timely repairs. But hold on, I have done the roof and the garden. My equity is immeasurably improved by those two actions. What I now have to do is repair the deck, repair the aesthetics of three areas of my ceiling and pave my drive-way. I suspect I am still ahead. Plus the little small business I had neglected has just been fuelled by two major foreign exchange earning ideas. And I am collaborating with a major institution in Barbados on one and I have to talk to another major institution on the other.

What is wrong with using Barbados NIS to invest in our Barbadian workers and Barbadian arising investment ideas? I really want to know.

Guidance,

  • Margaret D. Gill

6 Responses

Stay in touch with the conversation, subscribe to the RSS feed for comments on this post.

  1. Actually, I don’t feel comfortable being called a devil’s anything, far less “advocate”. I hope to be a Christ advocate if anything. But thanks for publishing and using such a lovely picture…

    On another matter, congratulations to Bajan Reporter for its move up. Good people always go up.

  2. I think Ms. Gill has missed several points that I am trying to make on the proposal. I will touch on a couple.

    The NIS manages several funds on behalf of the people of Barbados, the principal one being the contributory pensions and the second most important in my opinion is the health fund. At the moment, based on public information about 70% of the NIS funds are invested in government debt. Based on current thinking it is over exposed to the government of Barbados. Secondly, Barbados’s does not have a significant capital market, so its ability to invest in fairly liquid assets is limited. Hence, being able to in more foreign assets increases the diversity of its investment portfolio.

    The second issue is the need to restructure the public service. You are correct, layoffs alone is not restructuring. We cannot do this based on the current constraints the government has. There are departments and statutory companies which have to be eliminated or consolidated. They are people who have to be shifted around to the areas where their skills are best suited.

    The inflation issue is quite simple, if we increase the money supply in the economy too rapidly, it tends to have an inflationary effect.

    To give a sense of how much distress we are in. The projected liabilities at March 31, 2014 are $2.94 billion payable within 12 month of that date. The budgeted total expenditure for fiscal 2013/14 was $3.8 billion. This means that we have short term liabilities which equal 77% of total projected spending for fiscal 2013/14. We have dug ourselves a very deep hole.

    I am therefore open to suggestion as to how we can resolve this situation. All of us recognize that we cannot tax or cut our way out of this position.

  3. Hello Margaret – Devil’s Advocate is when someone other than Bajan Reporter is writing, if you are a true Christian, the nomenclature will just bounce off like the proverbial bullet off of Superman’s chest? It was originally done when contributors wished to retain their anonymity. When folk in an argument call me fat or stupid, I grin with glee as I know I won since this is all they can do to oppose my parry or riposte. We must all strive for such perspicacity, tell me how, I’ll bottle it and split the profits…

  4. Dear Colin:
    Like Ian, I am always wary when people respond to my comments or queries with responses directed at my person. But perhaps by “Ms. Gill has missed several points that I am trying to make in my proposals” you mean exactly that – I did not touch on them in my initial comment on your proposal.

    If you mean the latter, then you change the terms of the discussion I propose by not speaking to the critiques I make of your proposal, you add additional data which further confuses me as you propose two negative figures (a deficit and a liability) and ask me to accept that things are as bad as you offer with no indication of assets or any other positive resources. Colin, I am confused.

    I offer that I am a fairly well-educated Bajan, by this I mean I understand as much economics as I need to know to be a contributing and discerning member of my community. Trust me, I will understand you if you stand still and do the basics. I will get confused by manoeuvers that fail to address what I ask and attempt to show me lacking. But maybe I am just confused and miss all the important things you offer, because I still do not see how DFI, as diversifying as they may be (and note, I do not reject DFIs. Is our economy not predominantly made up presently of DFI’s if we take banking and hotels as two sectors?) are preferable over foreign exchange earning Barbadian capital? I am sorry, I do not understand when you say “Barbados does not have a significant capital market, so its ability to invest in liquid assets is fairly limited.” That actually sounds to me like an excuse for not getting more local Barbadians perhaps Black but not only- involved in fincing beyond paying deposits. I could be wrong and you will tell me how.

    I am sorry Colin, (I hope I may call you that for ease), you do not want suggestions to our problems. What you want is a confirmation that your quite closed positions are correct. I cannot give solutions or comfort. I am a poet and an economist anthropologist. I can only give questions.

    Then too, I am a Christian (I hope despite Ian’s trying to unseat me by seating me in the devil’s place). The latter means that I have a quite unreasonable hope in my hope in Barbadian ingenuity and refusal to be contained in econometric boxes. I am actually not cursing here. I am describing what I hear from the economists who are only that and being given great space to speak – and so to influence the outturn of the economy, which as we know from our training is based in self-full-filling prophecy. Margaret D. Gill

  5. Dear Margaret;

    Being utterly frank, I am an Agnostic although a confirmed Baha’i (not a very good one either) – I would like to think God is out there but have my doubts (not saying this to open conversion channels, just making observation) and if (allegedly) Jesus spent 40 days and nights with the Devil then you can withstand my classifications, hope I won’t hear it again? If you want to stop contributing that is your right, but since you are Educated as am I, I thought not only is your skin thicker but you would not necessarily allow the opiate of the masses to cloud your otherwise acute perception.

    Having said that, at no point did Colin refute you at a personal level, having gone to school to with him and well aware of his anal quirks as a Prefect to my then and even now rebellious self, in all honesty he does not seek to rebut at such a level. So please review calmly and if someone calls you a Janissary? Just laugh, it’s taken a while for me to learn, and I still slip, but the plain reality is there are more sphincters and gonads between ears and behind wheels than at keypads or telephones, grin & bear it…

  6. Nope, Nope. I shall not be calm, if that is what you are taking me to not be (I thought I was, but hey…).

    Why be calm when we are discussing things that involve the loss of jobs and therefore human joys and such? Why be calm when the oldest rum-producing entity in Barbados (owned by a Trinidadian) has folded- as such? Why be calm when I still have not gotten a response from Colin, Clyde Mascoll who I also asked with no answer yet, nor Michael Howard another body I also ask and no answer? The question was, what is wrong with using our NIS fine change to invest in Barbadian ideas for business?

    I asked these men because they seem to know and I am a perpetual student, Ian.

    On another matter, while I am possessed of a sphincter, I have no gonads. And on the God thing? I have nothing to say but my prayers – as my grandmother use-ed to say.
    Guidance,
    margaret

Comments

add a comment

Some HTML is OK

or, reply to this post via trackback.