“Neither a borrower nor a lender be, for loan oft loses both itself and friend.” Those words spoken to Laertes by his father Polonius might have very well been the creed by which we lived at one time or another, but given the times in which we now live, they may very well mean something entirely different today. I can recall being admonished by Teacher Arthwin in a similar fashion as Laertes, in the old East End School. We were taught to be thrifty, not to hang our hat higher than our heads could reach, buy it when you can afford to, however, in a world of high finance, you’re only as good as your FICO score, a somewhat biased formula that determines your credit worthiness. So borrowing today has become the rule, not the exception, a long way from the way we were brought up, and isn’t it ironic?
Anyone paying attention to the battle in the United States between the tea party Republicans in the Congress and the President, over the shutting down of the government and the possibility of defaulting on its debt, knows that Polonius’ admonition of Leartes rings hollow today, since good faith and credit is the yardstick by which all of us, country, corporation and individual alike are measured when it comes to borrowing money.
For sixteen days in September, the world watched aghast as the Republican controlled House of Representatives threatened to wreck the US Government and, with it, the economy of the world, for as America goes, so goes the world. That’s quite a cross to bear, and for what – just to settle a score with the first overwhelmingly elected two-term African American President, Barak Obama? Not only did they not see the forest for the trees, but the cavalier attitude with which they tried to pull off this escapade, their so-called moment in the sun, highlighted the fact that they were more than willing to destroy this country and all for which it stands, is bordering on insanity, and the likelihood of them visiting the same venue again in February is still possible.
Across the Atlantic some twenty-three hundred miles away, sits the most northerly of the Leeward Isles, the tiny British Overseas Territory of Anguilla. This tourist paradise has seen better times, but with the advent of a global downturn in its economy coupled, with a change of government, little has been done to enhance the lives of Anguillians. The outlook for prosperity has been further muddied by the recent release of Anguilla’s credit rating by the CariCRIS agency. While our credit has taken a hit, the question that one has to ask is why were we downgraded from an AA to a BBB+? A quick glance at the facts and one might be quick to rightfully place the blame on the shoulders of the previous government. Toward the end of 2009, the telltale signs of a downward spiral of the economy started to appear on the horizon. Some may contend that the change of government might have been a contributing factor and that assertion is not without merit. The previous government was not without its faults, and there’s more than enough blame to go around. The underlying fact is that we put all of our eggs in one basket, the very same thing that our forefathers admonished us not to do.
The installation of a new administration with lofty ideals for going forward, the promise of good governance, transparency and a platform for getting the country back on track seemed, at first glance, to be just what Anguilla needed. The future looked promising. However, upon closer observation, when all that was promised did not materialize, the country felt betrayed. Instead, of making good on their so-called mandate, the re-set button was hit, and the administration went off on a tangent with a series of charges against the outgoing AUF government, who, with all of the charges leveled against them, to their credit did manage an exemplary period of stability and growth, that is, until the global economy collapsed. The incoming AUM, instead of doing what they were elected to do, did nothing but blame the AUF, Governor Harrison and the British Government which brings us to where we presently are, acts that may have inadvertently contributed to our downgrade. I will come back to our rating.
Credit worthiness is defined as one’s ability to have the wherewithal to borrow money and then be able to pay it back as agreed. However, in our case, our creditworthiness took several hits, some self inflicted, and others, a part of doing business. CariCRIS, the Caribbean credit rating agency downgraded us from an AA to a BBB+ and one can ask why triple B+? Well, in their report they show a pattern dating back to September 2007 when we had an AA. Since that year up to the present we have steadily declined. They list several factors, which I will go into, but the main one appears to be a 25 Million (US) notional debt. The rating drivers, to use their own vocabulary, are broken down into three parts: our strengths, weaknesses and rating sensitivity factors.
Our strengths are that we supposedly are supported by the British Government as an Overseas Territory. We have a political environment with a history of broad political stability and very low, but increasing levels of crime. A good financial infrastructure exists, but we have limited monetary policy flexibility.
Our weaknesses range from a poor and deteriorating loan portfolio quality, a limited fiscal flexibility and an external sector that’s characterized by significant deficits on the current account.
The rating sensitivity factors also range from sharp changes in the macroeconomic environment, substantial changes in debt, successful implementation of revenue increasing measures and a possible change of the island’s status as a British Overseas Territory.
So there you have it. The factors that caused our credit downgrade and that’s not half of it. Our CM has as much to do with this or more than anyone else. According to CariCRIS, “The relations between the CM and the UK Government have become increasingly strained with several public exchanges of correspondence taking place over the last three years.” For every time that he got into a fight with the Brits and the Governor, he has taken to the media and made it all public. There are many other issues that factored in the rating, but the real harm was self inflicted whether inadvertent or intentional. The end result does not help us. Though the CM’s mouth has done us much harm, CariCRIS asserts that our continued relationship with the UK continues to serve us well and that it is our status as a British Overseas Territory. The billowing of the Union Jack in the wind provides additional confidence for investors, creditors and tourists alike. Conversely, CariCRIS asserts that should the political arrangement between Anguilla and the U.K. change, that is if we were to follow Hubert with his self-determination scheme, they expect that this will have a significant negative impact on the credit ratings of the Government of Anguilla. Given all that has happened, it appears that the CM still has not learned anything from this. A few weeks ago he took to the media once again bemoaning the fact that things did not look good for the budget. Three and a half years ago, the people believed that the AUM was the answer. Now they’re having buyer’s remorse. The government does not appear to have a plan to move the island forward. They were going to be transparent, but they wound up doing the very same things that they accused the previous government of doing. They became that which they despised.
Government is supposed to do for its citizens what they cannot do for themselves. Dr. Paul Webster, a staunch Hughes supporter in the last election, put it succinctly last Saturday on the Mayor Show on KOOL FM when he said, “It’s the government’s job to make sure that its people are fed, clothed and properly educated, and it’s very sad when that doesn’t happen.” That the CM is now saying that the government is being run by civil servants is a little troubling. Everyone who works for the government is a civil servant, so in a sense the CM is correct, but just what did he mean by that? Does it mean that he’s been reduced to being a bystander in his own government? I hope not. Maybe this is a harbinger of things to come. The Mayor Show on KOOL FM 103 last Saturday (Nov. 2nd) discussed the House of Assembly’s action (on Friday 25th October), and while each side argues its point, the fact remains that legal experts think that the bills should not go forward for, in so doing, it sets a dangerous precedent – and if the legislation is allowed to stand, what will the quorum-less House do next? Granted the Deputy Speaker on the ex-officio members should have stood up and objected rather than walk out.
The Honorable member from District number two, Mr. Jerome Roberts, when asked by Mayor Show Panelist Mr. Conrad Rogers why when he saw that there wasn’t a quorum, did he not say something. He said, and rightfully so, that he is a member of the government and it wasn’t in his best interest to object. A caller to the show raised a very interesting point in that what was done was illegal and shouldn’t be allowed to stand – and if it is allowed to stand, what will they do next. The bill does become law after three readings. Was it properly vetted? These are things that no one seems to know what’s going on. The Hughes Administration operates in secret and, one day, that sort of thing is going to come back and haunt us like never before. We have to be diligent in monitoring our government.
As we like to say: Where do we go from here. Three and one half years later and nothing to show for it. Anguilla has ground to a screeching halt and no one seems to know what to do in a given situation. We’ve been taxed to the hilt in every way from property taxes to the so-called stabilization levy, a levy that was supposed to be a temporary fix, but nevertheless is still in existence – and now serious consideration is being given to a new tax-VAT. When will it end?
For the last several weeks, the Mayor Show on KOOL FM has been discussing Anguilla 44, a plan to boost our tourism numbers. In Anguilla, we have an outstanding product and this is borne out by a recent Conde Nast survey in which we had three properties in the top 25, the first time that this has ever happened. So what then is the problem? Is it lack of effort? Are we doing all that we can? Are we hitting the right venues? What is it? Those are some of the questions that Anguilla 44 is trying to answer. Not only is it asking the questions that no one seems to want to ask, but it is also offering solutions on how to get it done. Last July while I was visiting St. Thomas, I happened to see the new port terminal at Red Hook. It was a state of the art facility and I said that is what we need in Blowing Point. A state of the art port facility. After all that is where the majority of our visitors enter. On Saturday’s Mayor Show, Ms Webster was asked to offer a plan to increase visitor numbers. She suggested that she would build a visitors center that would not only welcome visitors to the island but provide them with valuable information one of the many suggestions of Anguilla 44.
When tourism is our bread and butter, we can’t afford to treat it lightly. Some of us can’t abuse it while others are fighting to keep it afloat. It’s everybody’s business. If the tourists don’t come, then we have nothing to fall back on. That is a path that we chosen to follow. Let’s be respectful to our visitors. When they bring a couple bottles of wine through customs, let’s not nickel and dime the people. Get them through – give them a nice smile and wish them happy holidays.
Before I go, let me say this: Everywhere you go and everyone you speak to has come to the same conclusion. We are stuck in the mud with no way, in the foreseeable future, of getting out. The CM appears, by some of the statements that he has made, to have accepted Anguilla’s plight as a fait accompli. He has said that civil servants are running the government and I would surely hope so. If it was being run by fisherman I would be concerned. No slight of our fishermen. I’ll get to you in a moment. The CM campaigned for this gig and whether he chooses to rap, croon or simply just rock – he should get up on stage and give it all he has got. Mr. Hughes your legacy is at risk. Is this the way you want to be remembered? For someone who has been so concerned about his posterity, you sure have brought your pigs to fine market.
On a more positive side, it was nice to see the father of the nation come out in support of the inclusion of women in the political spectrum. Though he did not specifically endorse a particular candidate, it was gratifying to finally see our first CM come back with emeritus status. Now if he would finally acknowledge, by name, the brave foot soldiers that stood side by side with him, it would go, in my opinion, a long way to silence the majority of those critics who seemed to think his ultimate recognition should not have happened. Let us finally recognize people like Walter Hodge, Atlin Harrigan, Wallace Rey, Jerry Gumbs, Collins Hodge, John Webster, Peter Adams and Bob Rogers. It is high time that you give credit where credit is due. I know, sir, that you will be the first to say, “I didn’t do this by myself,” but if you don’t come out and acknowledge, by name, the foot soldiers who went into battle with you, then everything you say will be self-serving. I hope that you in your own special way will do the right thing. Thank you for all that you have done, and may God Bless you.
It is hard to see and hear what has happened to our lovely paradise. We are getting kudos worldwide, but yet we can’t seem to kick start our economy. We need a leader who is willing to make the hard choices. The time has come to either fish or cut bait. Which will it be? Speaking of fishing, let us give the fishermen a break on fuel. Let us start to clean up the island. Cut down the brush that crowds our highways – let us fix our roads. Repair our crumbling schools. These are things that can be done to put our people back to work. Let’s take pride in our lovely island. If you are not ready for prime time, then perhaps it’s time to bring the curtain down and call for new elections. I think it’s as simple as that and, to use the words of John Fitzgerald Kennedy: “If not us, then who? If not now, when?” In Proverbs 29:18 it is said that, “Where there in no vision, the people perish.” What is your vision for us?
And so, my fellow Anguillians, we can choose the status quo and do nothing – or remain silent and be carried with the tide, for Martin Luther King Jr. has said that: “Our lives begin to end the day we become silent about things that matter.” But perhaps the quote that’s most appropriate at this time is that “We will remember not the words of our enemies, but the silence of our friends,” When A. Philip Randolph made several demands for economic and social justice for Black people, President Franklin Delano Roosevelt, responded, “I want to do it, now go out and make me do it.” Well, the time has come for us to make them do it. The time has come for all of us to get on board. Let those in power know that we’re mad as hell and we’re not going to take it anymore. Let us change our leadership if we have to. Dwight D. Eisenhower said, “The supreme quality of leadership is integrity.” Is there no one among us who will stand up and make the call? Do the right thing. Until then, may God bless us all and may God bless Anguilla.
Tyrone Hodge
