A TIME TO PRESERVE, STRENGTHEN AND EXPAND THE FOUNDATIONS OF A SUSTAINABLE ANGUILLIAN ECONOMY

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By admin October 7, 2011 09:39

A TIME TO PRESERVE, STRENGTHEN AND EXPAND THE FOUNDATIONS OF A SUSTAINABLE ANGUILLIAN ECONOMY

I was exposed to a number of inspirational and visionary ideas by my Economics lecturers drawn from the Caribbean, as a student at the University of the West Indies, Jamaica, many years ago. A few of the ideas have stayed with me and have positively impacted my thinking and work. They will continue to do so in the future. The ideas remain extremely relevant today, in this time of economic turmoil that is hurting Anguilla’s economy and most economies globally.
One such idea concerns an essential ingredient for the development of modern, innovative and sustainable economies in Caribbean countries. Such economies must be managed and operated in the interest of and for the benefit of Caribbean people. The essential ingredient is the possession by the people of a major share of power and control over economic decisions.

This power and control is economic. It is distinct from the political power and control that our representative governments exercise, as national economic managers, making and implementing policies and strategies of the political economy of the Caribbean. It is based on and derives from the growth of a new group of entrepreneurs whose roots are among the people of the Caribbean and whose loyalties are to Caribbean people. It holds that Caribbean people should be at the steering wheels, as it were, of their economies. It should not be left solely to those from outside of the Caribbean to dominate the private sector and control the steering wheels of the economies.

The idea of shifting economic power substantially from almost total private sector domination by foreign entrepreneurs and business owners, to include a rising and significant group or category of local entrepreneurs, is in strong contrast to what transpired in the colonial economies of our countries before we achieved a high degree of political self determination and independence. The nationalism and regionalism of the economists who taught me, led them to examine the distribution of ownership and control over production and trade in Caribbean countries as they progressed to full internal self government followed, after a number of years, by political and constitutional independence.

My Economics teachers found that the advances in the political realm were not matched by similar advances within the economic systems of our countries. This moved them to put forward the proposition that in order for the people of Caribbean countries to develop national economies, and to integrate them regionally, it was essential that control and decision making over the “commanding heights of Caribbean economies” be in the hands of Caribbean entrepreneurs, large and small, and of Caribbean people represented by the trade union movement. This was a radical idea at the time, one which caused those who benefitted from the exploitative colonial economic arrangements to become disturbed and to accuse my teachers of being communists and socialists.

But I loved the proposition and bought fully into it. My study of economics and the economic history of the Caribbean confirmed for me the logic of this position and its implications. This meant that political and constitutional independence by itself would not result in the people of Anguilla and the Caribbean achieving economic prosperity and the eradication of poverty. It would be essential to avoid using political independence merely as an opportunity to go cap in hand begging for grants and concessionary loans from countries, all over the world. It would be essential to avoid using independence to also enrich the political elites, corrupt the governance process as a consequence, and create long term, chronic dislocation in the economy, social instability, corruption and persistent poverty.

It would be essential to use political advancement, along the path of self determination and eventual independence, to address the economic imbalances and the lack of sustainable development in Anguilla and the Caribbean. It would be critical that carefully thought out strategies be devised. It would be essential that talented and committed innovators, technocrats and entrepreneurs, from the public and private sectors, establish strategic connections fortified with sound education and relevant experience. It would be absolutely vital that, at the political level, visionary and selfless politicians should be mandated by the people to make the political decisions about the development of the economies consistent with the vision of creating national economies, in which the people of the countries would participate quite substantially in owning and controlling the “commanding heights of the economies” and in moving and shaping the economies, to achieve prosperity and sustainability.

It was often said that all this was “highfalutin” theory to be left behind when one re-entered the real world from the “false” world of college and university. But maybe it does have a bearing on what has gone on, and what will go on, in the economies of Anguilla and the other Caribbean countries. I say it has an extremely significant bearing.

Let us take a look at Anguilla and see whether we can discern the working out of the idea of Anguillians individually, and especially collectively, owning and controlling substantial parts of the “commanding heights of the economy”. Let us see if that ownership and control has been applied mainly to facilitate the economic empowerment of the people of Anguilla. We will look in particular at the present AUM Government of the Hon. Hubert Hughes. We will consider its attitude and policies, as can be gleaned from its statements and actions, and also the actions themselves towards major institutions critical to the long term achievement of a national economy in Anguilla that responds to the needs and interests of the people of Anguilla.

Anguilla’s severe economic woes have sparked a fire of heated, confused and confusing public and private debate for the past three years. A central focus has been on the best strategies to erase the Anguilla Government’s budget deficit, increase employment and turn the economy around from decline to growth.

Chief Minister Hubert Hughes and his AUM Government rode into office a year and a half ago. They were successful in convincing Anguilla’s electorate that their predecessor in office, the AUF Government of Chief Minister Osbourne Fleming, had grossly mismanaged the economy. They accused the AUF Government of squandering the “people’s money”, leaving the Treasury empty and the Government broke.

Some individuals, in their enthusiasm to weigh in on the political issues, quite irresponsibly declared Anguilla to be a “failed state”. How is that for their patriotism and love of Anguilla? What was the motivation to seek to inflict a severe political wound on Anguilla, to make a grossly false claim that served only to drag Anguilla’s name into the mud for no good reason?

The ‘Four Horsemen’ of the AUM rode into office having presented themselves to the people as the ones with the “invisible” but real plan to clean up the mess left by Chief Minister Osbourne Fleming and his AUF Government. People believed Mr. Hughes. People believed the elections propaganda, that the AUM unleashed against the Hon. Victor Banks, that it was essential to “get rid of Victor” – that he had to go.

The AUM had shouted and screamed from the political podium that the AUF Government, especially Hon. Osbourne Fleming and Hon. Victor Banks, had sold out Anguilla to the foreign investors. They had given away huge amounts of tax revenue to investors in tax concessions, and had wasted the revenues earned by the Treasury during the boom years from 2004 to 2007. They had perpetrated massive corruption in office. The Four Horsemen of the AUM would ride into the Secretariat in The Valley and would clean house. Candidate Hubert Hughes promised that, as Chief Minister, he would turn Anguilla’s economy around in six weeks. As Mr. Clean, Uncorrupted and incorruptible, he would bring the corrupt AUF gang, especially Hon. Victor Banks, to justice and make them answer for the deplorable corruption that they committed while in office. As the Protector of the Revenues and Wealth of the people of Anguilla, Hon. Hubert Hughes would give his son a special mandate to recover the many millions given away, by Victor, Osbourne and the others, to investors.

Yes. Chief Minister Hughes and his three other horsemen would shake up things for the better when they took over the Government. They would set things right that were wrong. Indeed the Four Horsemen of the AUM Government have really shaken up things. Regrettably, their shaking has not been for the better. It has not brought smiles and happiness to those who bought into their promises. The shaking has been more like an earthquake causing fear and trembling, confusion, doubt and pessimism.

Their attempts to set things right, that they judged were and are wrong, have destabilized the operations of the Government and have destabilized critical institutions in Anguilla that are vital to the development of a sustainable Anguillian community and nation.

The last year and a half has been marked by the blunders of an AUM Government drunk with power, believing that their power gained via the ballot box, trumps the rule of law and the principles and practices of good governance. And so they unleashed on Anguilla a series of attacks against the bedrock institutions that form the core of the foundations on which the people of Anguilla have begun to build, and will continue to build, a sustainable, self-reliant and self-determined national economy – an economy integrated and interdependent with the rest of the Caribbean and indeed the world.

The flush of political victory, and the assumption of control of the Government, made the AUM politicians and their leading operatives drunk with power. They could now do as they please and settle old scores and get even with imagined enemies, especially AUF members and associates. In the process Chief Minister Hubert Hughes, his Ministers, their principal operatives and power brokers have attacked and weakened the very institutions that have made it possible for the people of Anguilla to capitalize on opportunities to build themselves economically. These institutions have, to a great extent, made it possible for the emerging entrepreneurial class in Anguilla to participate not just on the fringes of the modern Anguillian economy. They have enabled them directly and indirectly to participate in a major way in key sectors of the economy – to own and control significant parts of the “commanding heights” of the Anguillian economy.

The foundational institutions for the growth of a national Anguillian economy, to which I refer, are the Anguilla Social Security Board (ASSB), our two indigenous Banks – the Caribbean Commercial Bank (CCB) and the National Bank of Anguilla (NBA) – and Anglec.

Three recent events set me thinking about these four institutions together, and about the roles they play in the economy and society, as well as the attitude, policy and actions of the AUM Government in seeking to deal with these institutions over the past year and a half.

Take the Anguilla Social Security Board first. When the ASSB was established and began operating in 1982, many people were skeptical, but few refused to participate. One of the few was the Hon. Hubert Hughes. This is the politician who has presented himself as a champion of labour and working people. Yet he downright refused to register his business and his workers with the ASSB. On the other hand, the creation of the ASSB was made possible as a result of the visionary leadership of the Hon. James Ronald Webster and the dedicated and committed management and implementation work led and coordinated by Hon. Victor Banks, Timothy Hodge, Colville Petty and Marcel Fahie.

The ASSB in those early years took only two employers to court. The Hon. Hubert Hughes was one of them. How is that for the Champion of the working people of Anguilla?

Today the AUM Government of the Hon. Hubert Hughes has put the ASSB at risk. They have callously politicized the social security system and have exercised extremely poor governance in attempting to leverage the Social Security Fund on a highly imprudent financing scheme – the famous US$200 million loan that the Chairman of the Social Security Board tried to raise, without going through due process and proper due diligence. The Chair has sought to throw around his weight, to bully or attempt to bully his way in dealings with critical institutions on Anguilla – institutions that are critical for the development of a national economy that empowers the people of Anguilla. His actions further destabilized the economic system of Anguilla in the wake of the fallout from the Great Recession. He has not been called to account by our Chief Minister.

The ASSB is fundamental to a sustainable Angullian economy that responds to the needs of the people of Anguilla. It should not be politicized and made into a tool of political warfare and the personal vendettas that those drunk with power seek to unleash against upstanding Anguillians and critical Anguillian institutions.

Thanks to the Caribbean Commercial Bank and the National Bank of Anguilla the emerging group of Anguillian entrepreneurs from all over the country, and all political persuasions, were facilitated and enabled to share in the boom and develop their businesses, making sure that the foreign investment did not all flow back out of Anguilla as soon as it flowed in, during the period 2004 – 2007. NBA and CCB are institutions of the people of Anguilla. Whatever happens to them will greatly impact the Anguillian community. When they are successful and prospering the people of Anguilla do the same and vice versa. When the people of Anguilla are encountering hardship they are affected. They represent the people of Anguilla exercising quite substantial ownership and control in the banking and financial system of Anguilla.

What has the Government of the Hon. Hubert Hughes done to preserve, strengthen and ultimately expand the vital indigenous segment of Anguilla’s banking and financial industry? The people of Anguilla need to know. At a time when countries everywhere are doing all they can to strengthen their banking and other financial institutions, what has the AUM Government been doing to CCB and NBA? As a Government for all of Anguilla, it is highly questionable whether they have been acting with the best interest of the people of Anguilla at heart. It appears that they have been driven by personal and subjective political considerations, and have taken decisions and actions that history may very well show were not in the best interest of advancing the participation and leading position of the people of Anguilla in the banking and financial system of Anguilla, through the NBA and CCB.

Now to Anglec. The AUM’s mission after the 2010 elections was the wholesale takeover of Anglec without due regard for the rules and procedures of the law and good governance. Thanks to the fearless defense of concerned shareholders and patriotic Anguillians, who understand the critical role of a modern, efficient and financially sound electricity utility, the undemocratic and high handed attempt of the Chairman of Social Security and the Minister of Utilities to take over Anglec was prevented from taking place in the manner that they conceived it. The Government and the Social Security Board were forced to abide by the law.

Now there is talk of meddling improperly with the system of tariffs under which Anglec operates, following the election of three additional Government nominees to the Anglec Board of Directors. It is enough to state that good governance must prevail, and if it does not the minority shareholders have the right to seek redress through the courts on any matter which they consider harmful to Anglec, or to them, and to be contrary to good governance.

Anglec is one of the best operating utilities in the Caribbean on many fronts, and we should be extremely proud of it. We should not seek to tear down what the utility has achieved in the last 20 years by dint of careful and visionary planning and hard work.

This is no time to tear down. The Government must not by its words and actions threaten to, or actually, tear down the ASSB, or CCB, or NBA or Anglec. Instead the Government of the Hon. Hubert Hughes should do all in its power to preserve, strengthen and expand these institutions which constitute a major part of the foundation for a sustainable national economy in Anguilla.

Marcel Fahie

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By admin October 7, 2011 09:39

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