Saturday, June 2, 2012

The Austerity, Inflationary, No Growth, Bitter Medicine, Debt Reducing IMF Budget

As far as I am concerned this “Austerity, Inflationary, No Growth, Bitter Medicine” Budget is a rubbish budget but whichever party was in power I feel would have to deliver this “Austerity, Inflationary, No Growth, Bitter Medicine” Budget which was written in Washington by the IMF and represents a clear sign of their frustration with our inability to live within our means, the world financial organizations are now doubtful that we will be able to repay our loans, plus interest. It is clear also that our political class lacks the ability, innovation and imagination to stimulate real economic and social development. They went to Washington thinking they were going to get a better deal from the IMF than the last set of equally clueless, political class members but came away with the same deal as our previous administration, I can just imagine them around the negotiation table thinking their smooth talk and good looks was enough to soothe the savage beast but instead realising that the world no longer finds us amusing or good looking for that matter, you owe me pay me, which reminds me of that scene from the movie Goodfellas:

Our current economic situation is not sustainable and I am afraid that we may have reached the end of our rope coupled with the fact that the rest of the world is dealing with their own financial turmoil and simply have no time, patience or the means to throw money at us.The UK economy is in a double dip recession and the US economy is going south as they say with anaemic job growth and a stalled economy recovery they are too busy trying to stay above water and really have no time for people who wants to live free at other people’s expense. Our National debt of J$1.7 trillion, is about "One Hundred and Thirty Percent" (130%) of GDP and our budget which is J$612.4 billion, as per Dr. Philips every new Jamaican born would owe J$600,000. Half the countries on the planet are lining up for financial bailouts and we do not have priority, we are at the back of the queue, there are countries that the world considers more important and they must be serviced first because if the Jamaican stock market crashes it would not cause so much as a ripple in the worlds financial market. Faced with this reality of our position on the totem pole it is then left up the Jamaican people to solve Jamaica’s problems by making the right common sense decisions, do what is best for our country and people but I doubt that will ever happen, we do not do right or common sense.

Go to the Back of the Line Jamaica!
The budget provides no incentives to private companies to grow much less survive through the hard times ahead, the government is literally saying, the loan sharks are not going to lend us any more money unless we pay some more on the over J$1.7 trillion we owe them. I agree that some level of increased taxation is required, we must pay the piper since our humongous debt needs servicing, the people carelessly ran up the debt and the people must shut the hell up and pay for it, I have no sympathy in that department, buying an imported luxury SUV that is bigger and value 4 times the house you live in with every expensive luxury electronic devices attached to your belt while kicking and screaming about the price of chicken back is laughable. I am only upset that a special entertainment tax, “The Merriment Tax” was not implemented because nothing will stand in the way of Jamaicans need for entertainment and merriment, cost is not a factor in this department and as a matter of fact the more expensive the event the more people will turn out to show that they belong in a certain “Big and Large” sector of society, not to mention the chance of being in one of the Observer’s Page 2 pictures.

However I would have liked to see more incentives given to various sectors including farming, manufacturing and export type companies from the budget. The resultant price increases on locally manufactured products and agricultural produces will cause companies in the retail and wholesale industry to seek cheaper alternatives from foreign sources, this budget could result in a massive increase in imports and further devaluation of the dollar. I agree with the tourism tax although they will belly ache and carry on because it affects their profit margin but they have been having it too easy for too long now, tourism is not an infant industry, it is a mature industry being treated like it was newborn.

We Jamaicans are a people who demand so much while contributing so little to our own development, everything must be given for free but accountability is a must, we must pay the piper sometime, it is not if but when the shit will hit the fan and the world will turn a blind eye, they are tired of throwing good money into our money sucking Black Hole. We the Jamaican people dig this grave, we cannot lay the blame on anybody else but ourselves, we cannot just a ga-long-so, living for the next merriment and imports on borrowed money, we must start making common sense decisions or else we will fail.

"Jamaica's trade deficit swelled to more than 3 Point 2 Billion U.S dollars (US$3.2 Billion) over the January to August of 2011 period while the import bill which reached over whopping US$4.3 billion dollars, exports earnings was only US$1.1 Billion dollars."

I see nothing proposed by this Government that will change our situation, a situation has have been getting progressively worst regardless of which party is in power. Our economic indicators have been marginal and mediocre in some areas and deteriorating in most others. Our social indicators have also deteriorated, we have become a selfish and greedy society and it shows, the level of violence within our society is as a result of this. Anything else other than the improvement of these indicators is idle chatter and a waste of time. Our national debt does not grow marginal and mediocre but by Quantum Leaps. Dr. Philips hinted that with these changes, there could be a balanced budget by 2016, when the Jamaican national debt could decline from the current 130 percent of GDP to 100 percent, but I say at what cost, then again I am not sure we have a choice, who in their right mind is going to lend knowing that we are skint, broke, penniless, sucking fumes. We are the Wimpys of the world, J. Wellington Wimpy, "I'll gladly pay you Tuesday for a hamburger today". This is the only positive thing about this budget, it was engineered to pay down our massive debt and because we ignored it for so long we are out of options, even if we changed government tomorrow the world position will be the same .... F*K you, pay me!!..

It seems the sole purpose and role of the Opposition is to become the Government:

"A scorched earth policy is a military strategy or operational method which involves destroying anything that might be useful to the enemy while advancing through or withdrawing from an area. It is a military strategy where all of the assets that are used or can be used by the enemy are targeted, such as food sources, transportation, communications, industrial resources, and even the people in the area"

The opposition is performing typical opposition duties, that of oppose and run interference, it is classic opposition, this is what every opposition party around the world and across time is doing and have done and ours is no exception. The life of an opposition is a life of luxury, you turn up in parliament and heckle the Government, you stand before the media and heckle the government, you make them rethink every strategy and second guess themselves every step of the way. It seems the main job of the opposition is to keep the people in a continuous state of discontent until they are able to regain power. The opposition does not have to make a decision base on policy or principle, they monitor public sentiments and feelings and what ever the public is against then they are also against, classic litmus test opposition, taking the popular position, as they say in America “armchair quarterbacks” and both the JLP and PNP are professionals at it.

The current Government rejected the Private Sector Working Group GCT proposal and as a result the opposition is for the proposal, if the government had accepted and implemented the proposal then the opposition would have been against it. The opposition ran an election pushing the deliverance of bitter medicines as the only way to forward, that and increase unemployment and when they lost the election they cursed poor people that they voted with their bellies not their heads. But now the opposition is totally against Bitter Medicine and cry for the poor people of Jamaica every chance they get. Now because Mr. Holness have never provided the details of the Bitter Medicine the JLP had promised when they were in Government and fighting an election battle, means he is now free to redefine it's meaning base on public sentiment, popular feelings and outrage. Just for the record I am for the Private Sector Working Group GCT proposal it makes sense to me and I hope it will be implemented one day soon, lower the rate to 12.5% and tax everything and everyone, no exception/exemptions.

“Daryl Vaz, who served as Minister of Public Sector Efficiency in Holness administration sounded off on a campaign platform that if the JLP was returned to office, it would "dig out" public sector workers who were blocking the work of the government. “ This is Classic Vaz who may have "single handedly" cost his party the election.

Even when our oppositions have done the same thing in the past, made the same decisions, carry out the same act while in Government they can turn around and criticise the government for doing the exact same thing and make it look like the worst thing in the world. This current opposition have delivered late budgets and have delivered several supplement budgets over the years but now use it as a dirty word against the current government, amazing!

Opposition also like to make promises while in opposition, they can pull them out of their hats on demand. The PNP like the JLP while in opposition made promises after promises and decades would go by and still they make the same promise and still nothing, they copy and paste these promises from one manifesto to the next, heck I think it’s the same manifesto with a date and title change…

While in opposition the PNP also played the same classical hypocritical opposition game, case in point: In 2009 the then JLP Government proposed a new IMF Tax package which was set to take effect on January 1, 2010. The PNP waited for public response and seeing that the public was against it also jumped on the band wagon. Portia Simpson Miller immediately became the defender of the poor and promised the JLP Government a wave of island wide protests if the tax was implemented and called on the Government to roll back the taxes which they did. So the PNP while in opposition forced the JLP Government to roll back taxes but then implemented those same taxes when they became the Government of Jamaica, you cannot make this stuff up!

Whenever a Government becomes the opposition they automatically become experts, magicians and healers. The PNP was in Power for donkey years and nothing but as soon as they became the opposition they can fix the world.

When the JLP was in opposition they had a gift from the Gods, they were experts, magicians and healers and as soon as they became the Government nothing but more debt and more imports. Now in opposition they are again Experts, Magicians and Healers sent by the Gods to fix the world, kinda like Thor.

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