Jamaica's economy playing out as expected

Written by Dennis Chung
Dennis Chung is the author of "Charting Jamaica's Economic and Social Development - A much needed paradigm shift" and a founder of www.mindyuhbusiness.com. His blog is dcjottings.blogspot.com

When I listened to some of the reactions of surprise to the PIOJ's report January to March 2009 economic performance, I wonder if we are really serious. As far as I am concerned the economy is playing out as expected. Whenever I am asked about the 2.8 per cent downturn in the economy, during that period, as if it is unexpected, I refer to the article I wrote on July 18, 2009 titled "A perfect economic storm". At the time I started saying that "The next six to nine months will be one of, if not the most challenging, in the economic history of independent Jamaica".

For me it was obvious that if things continued the way they did and if leadership did not come together, we would be experiencing all we are today. In fact, it is worse than I expected, as the Lehman collapse made things much worse but the trend I expected is playing out. The extent to which we are feeling it today could have been avoided but too much time was spent in political diatribe and side arguments that distracted us from what we needed to do as a country.

Identifying the fundamental challenge

The consequence of the country not adequately projecting and preparing for the economic downturn has landed us in a situation that I believe will be hard to avoid now. I never expected such a sharp decline in the first quarter, which is going to be better than the second quarter in my estimation. What is happening also is that the economy is already like a runaway car, which is harder to stop once it gets going, and would have been easier to slow down prior to it starting to pick up speed. It is now going to take much more effort, and financial resources, to slow down the decline.

With all of this said, though, it is still possible to lessen the effects on the country, and I had written in my book about the real cause of the problem and gave an example of a five-year plan that could place us on the path to economic development. Some will not take what I say seriously, though, as I am just an accountant trying to talk about economic matters, but I will continue to be comforted by my own voice.

In order to determine how we can deal with the challenges we face, and which are worsening, we must first understand what the underlying problem is. This again I outlined in my book, which in summary is the fact that the country spends more foreign exchange than it earns. Unless this equation is changed we will always be caught in the downward spiral of economic stagnation/decline and debt. If we accept that this is the fundamental problem then it makes no sense addressing symptoms, which we have always been doing. Because of where we are today the measures to address the problem get more and more difficult the longer we wait.

The Age of People and Nations

Written by Milton Maragh

The age of a person or country is generally associated in our minds with growth, development and progress.
Progress is measured by relative success or failure. The recent challenge by Dr Peter Phillips to Jamaican opposition leader Portia Simpson-Miller's leadership of the People's National party (PNP) brought the issue of age and national development to the fore.
The 59 year-old Phillips, from a strong political science background was pitted against 63 year-old Simpson-Miller, seen by many of her critics as a populist who was not exposed enough to academia. Both had supporters spread across youth and experience but the youth seemed to be more in the wings.
But if the 70 year-old party typifies more of the spirit of Jamaica for the number of years it has held government compared to the incumbent Jamaica Labour Party that led the island at independence from Britain in 1962, should not its vision embody and embolden youth or at least a younger leadership, many are asking.
Against this background, we looked at recent and contemporary leaders for any relationship between their age and their impact. There may be pattern when we look at the correlation between the age of our most powerful leaders and the time they either formed new organisations or assumed leadership of others already in existence.
Let's enumerate starting with - Marcus Garvey who was born in 1887 and formed the People's Progressive Party in 1929 at age 43;
• Norman Manley born 1893 and one of the founders of the PNP in 1938 at age 45;
• Alexander Bustamante (Clarke) born 1884 and formed JLP in 1943 at age 59;
• Hugh Shearer born 1923 and assumed JLP presidency and PM in 1967 at age of 44, on the sudden death of Donald Sangster, aged 56, after two months as prime minister;
• Michael Manley, born 1924 and became PNP president in 1969 at age of 45 and PM in 1972;
• Edward Seaga, born 1930 and successfully challenged Shearer for JLP leadership at age 44 in 1974, becoming PM in 1980;
• P.J. Patterson born 1933 succeeded Michale Manley as PNP leader and prime minister in 1992 at age 59 (with Simpson-Miller the loser at age 47);
• Simpson-Miller born 1945 won PNP presidency and became PM at age 61 in 2006;
• Bruce Golding, born 1947, left the JLP in 1994 at age 47 to form the National Democratic Movement (NDM) and returned at 58 to lead JLP in 2005 and became PM in 2007 at 60.
Phillips, who was born in 1949, lost in his first attempt to unseat Simpson-Miller in 2006 at age 57 and repeated his failure in 2008.
From the forgoing it would appear that those leaders in their 40s tend to have the fire in their bellies to fight for leadership. We can propose that leaders who came to power at about age 45 had roughly 20 years to provide strong and inspiring leadership; but those taking it on in their late 50s and 60s would have lost the fire and are not necessarily the best to lead countries like Jamaica as they tend to be nostalgic and too focused on the past rather than the future opportunities.
Bustamante first came to power in the first general election under universal adult suffrage in 1944, but lost to his cousin Norman Manley in 1955 and '59 before winning an election to lead into independence in 1962 and and held onto to power until 1967 at age 83, although because of Bustamante's incapacitation, Sangster acted as prime minister from 1964 until 1967 when he won his own mandate. Sangster did not fight for the leadership but inherited it from an enfeebled Bustamante.
It makes it easy to conclude that he Sangster was not a fighting leader at age 53 in 1964 when he began acting for Busta. If Bustamante had good leadership development skills he might have handed the reins of the JLP to Sangster in 1955 after the party was beaten by the PNP in that election. That would have given Sangster a clear 12 years to lead the JLP through his best years of his life.
This pattern of failed leadership development continued through both political parties as seen with Michael Manley who should have handed over to Patterson in 1980 after the loss to Seaga so he could have had a chance to stamp his image on the PNP and to yield to a younger leader in 2000/2002. The PNP should now be led by someone in their late 40s/early 50s and not early 60s. But since Patterson did challenge Manley in 1980 as Seaga did Shearer in 1974, that says something also about his desire to lead.
On the JLP side, Seaga held onto leadership far too long and killed the fire in Golding back in 1994. Now Golding is likely to repeat the same mistake because when he became PM at age 61 in 2007 he should have appointed a deputy PM in his/her 40s. Instead he selected Dr Ken Baugh at an age that seems elusive but cannot be younger than 60 years.
Golding should make the move to appoint an early 40s deputy PM to prepare the path for that person to assume leadership before 50 and Golding should walk away in 2012 regardless of the outcome of the polls due then. Simpson also needs deputy leaders in their 30s and 40s while using her grassroots popularity to lead the PNP into the next election (local or national) and step aside win or lose.
Leadership development is weak in every aspect of Jamaican society. It is this widespread failure in leadership that is causing widespread failures socially, economically and politically. And how does this age analysis relate to Jamaica's national development? We can delineate three successive stages of development. The first is cultural followed by political and then economic development. The ultimate goal of a nation is to become a prosperous, powerful people and first we have to become a united people in a similar manner to the United States' evolution from a people born out of many immigrants from Europe and elsewhere who have melded into an American culture.
While many see the period between the political and labor upheavals in the 1930s and independence in 1962 as a period of political advance, it may be seen as a period of cultural development that began with Marcus Garvey and culminated in 1992 with Patterson becoming PNP president and PM

Garvey and Michael Manley like Marley and Miss Lou may really be more cultural than political leaders. Over two generations they helped to shape the national identity and self confidence of Jamaicans as a people exemplified by an athlete like Usain Bolt, at 22 being so confident and proud on the track and media stage. We can now say we are a PEOPLE and now we need to become powerful before we can become prosperous.
In this analysis, Jamaica will continue to bear the pains of political development to maturity by the 2020s, where hopefully we will reach beyond the US$5000 per capita GDP mark when we will start to see rapid economic growth through to the 2050s and the stage of economic development, property and security.

The State Citizen and Morality

Written by Carol Lawton

www.FinditJamaica.com

Ethics and Morals are debatable but at what point does it become objective. Each person has their own ethical and moral standards but is it defined by the State they live in as to what is acceptable. This tirade is based upon a conversation that I had in a shoe repair shop with a teacher today. It started out with a comment about a long time girl friend and who she ended up with vs who she used to date. My answer was that it’s life then I comment that our community was regressing and going backward from the original design. This is where the conversation took various turns.

My points for the regression of the community were as follows:

1. Sewage going straight into the sea. (We pay a sewage progress bill every month to NWC)

2. The top soil, garbage and sewage that comes out of the regularized (Operation Pride settle) in heavy flood waters off the hill to dig up the roads.

3. The smooth well built roads are down to the marl rocks which form the foundation of the roads.

4. The house are not numbered

5. Neighbors don’t know each other

6. Idlers and beggars on the corners

7. No more green spaces

I would list more but this is a shorten version. Long and short of it is this teacher said that the community was not regressing but that I was using a definition of development that does not fit Jamaica and that it was my type of thinking that reinforce the colonial model of development. All this statement is bull to me because if a well laid out community is forced to live alongside squatter who care little for the community they affect. A police force that does not follow the noise law or loitering laws, a government that care little for the environment and citizens who care for nothing but a roof over their heads and some food (money) then we must be a bunch of animals just living together because we a stuck on a rock. I remember the mongrel statement but this is just a tirade nothing personal.

He then went on to state that we are tropical people and throughout the topics this is how most countries are because of the customs of the people. Bull again. One thing that he did go on to talk about was values which I had to agree with him. The gist of the conversation on values boils down to at what point does the state step in when the family the basic structure of the state fails? Is it the laws of the state which have failed hence the control systems placed upon the citizens have regress to the chaos we have now where morals are bad and immorality is good. Where the good guy finish last and money and brute power are the key determinations of success and right? Are there multiple laws or one law for all in Jamaica for citizens, the rich, the poor and the civil servants? It is almost cave man like to think but he was right on the mark. The family is failing hence the state is failing as the family is the building block of the state. In AIDS torn countries, AIDS is the fear for state as it moves to destabilize entire families, villages and towns. In Jamaica, AIDS is a problem but more important are values, morals and ethics. Our population is very young and there is a disconnect with the last generation for some reason

The prime example is the music on the buses. An old lady commented that this was not the type of music to play while young people are on the bus to a conductor. The conductor said in a joking manner, it’s Irie Fm and laugh it off to the delight of the whole bus. Do we not have laws for this or is it that it’s everyone doing as they please. Is it that the State and the Teacher are of the same view that to enforce the law is to reinforce the standard of our past colonial history and let tropical people be tropical people and do as they please. Right around now I am very sarcastic because when I asked the teacher so where are they headed morally then since that is where the bankruptcy is? He drew a question sign in the air and says God knows!

Personally I think it is time the State apply the laws on the books. This application just as PC Lewin stated should go after the small things but it must be applied to the government as well. “Police wants insurance from public; their cars should meet the same standard”. If the State begins to act morally and ethical as it deals with the affairs of State the mirror effect will be the citizens will comply especially since the State is not just saying it they are doing it. The hard dry no feelings enforcement of the laws for all. When laws are not enforce then justice will cease and chaos will reign. Jamaica is at the brink of a failed state not by economics but moral and ethical failures and its toothless justice system.

THE FACTS OF HISTORY DOES NOT SUPPORT THE CLAIMS OF THE JAMAICAN ECONOMISTS

Written by John Anthony

The fearmongering has led economists on radio in Jamaica and elsewhere to postulate that the recession in the US is the worst since the Great Depression. But these economists must know of the facts that anyone can read in any history text book or research on the internet and they must know that the facts undermine their claims. So what gives? Well what gives is most listenners are not digilent enough to do the research themselves and unfortunately so too is the Prime Minister who on no evidence whatsoever allowed the fearmongers to influence him. Here are the facts.

THE ECONOMIC DECEPTION EXPOSED!
Let us compare the present recession in the USA to the one in the 80s and see what were the remedies applied then. What a major difference Ronnie and Ralston? This is not a partisan chart too; it is from the FDIC!!


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The Jobless Rate Gap Comparing now to the 80s Recession
We've still got a long way to go Ronnie and Ralston.
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Jobless Claims As Percent of Payrolls Comparing 1980 to 2009

Mr. Prime Minister believe your eyes; not your ears. This is all US govt. data and charts.
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Who was the president that caused the recession in the 80s? Let us see:



________________________________________
39th President of the United States

January 20, 1977 – January 20,1981


Who succeeded Jimmy Carter and caused that dramatic fall in unemployment for 8 years? Let us see:




________________________________________
40th President of the United States


January 20, 1981 – January 20, 1989
What were the solutions Reagan used to stimulate the economy??
His supply-side economic policies, dubbed "Reaganomics,"
1. included deregulation and
2. substantial tax cuts implemented in 1981. No stimulus package was used; none whatsoever in what was according to the facts, not real business radio show, a far worse economy.

MORE CHARTS TELLING A DIFFERENT STORY THAN WHAT ONE HEARS ON REAL BUSINESS RADIO SHOW!

President Barack Obama has turned fearmongering into an art form. This fearmongering may be good politics, but it is bad history and bad economics. It is bad history because our current economic woes don't come close to those of the 1930s. Mr. Obama's analogies to the Great Depression are not only historically inaccurate, they're also dangerous.

At worst, a comparison to the 1981-82 recession might be appropriate. Consider the job losses that Mr. Obama always cites. In the last year, the U.S. economy shed 3.4 million jobs. That's a grim statistic for sure, but represents just 2.2% of the labor force. From November 1981 to October 1982, 2.4 million jobs were lost -- fewer in number than today, but the labor force was smaller. So 1981-82 job losses totaled 2.2% of the labor force, the same as now.

Job losses in the Great Depression were of an entirely different magnitude. In 1930, the economy shed 4.8% of the labor force. In 1931, 6.5%. And then in 1932, another 7.1%. Jobs were being lost at double or triple the rate of 2008-09 or 1981-82 (see chart above).

~Economist Bradley Schiller in yesterday's WSJ
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By now, it's clear to everyone that we have inherited an economic crisis as deep and dire as any since the days of the Great Depression.
~President Barack Obama in today's Washington Post
MP: The chart above shows annual real GDP growth during the Great Depression I (1930-1932) and the 2007-2009 period, using the WSJ consensus forecast of -.30% for 2009 growth.

So then what is really going on?? How come all this fuss over what is not a serious crisis as in the 80s? Why the deception??

Tirade on the legalization of corruption

Written by Carol Lawton

Let legalize corruption! Why? It makes complete sense! My first point is that its already institutionalizes in Jamaica . The second is the lack of respect for time. The third is poor customer service. It just makes sense and will be less stressful to do business.

Taxes will be gathered better because there is someone to cook the books and stamp it approved just like the government accounting. The formal economy will be equal to the informal economy in that it’s a free for all and the restriction of government is gone and information and connections in a lethargic civil service will prove of great value which the private sector can now move to without the microscope of government.

The government can then add a corruption fee to grease the wheel of this useless civil service. I speak of it this way because it is not here for the public but to ensure that they exist so let them hustle for it and the better hustler in the system win. They will set the price for doing business with the government for the service based on time. Each setting their own prices for moving things fast through the red tape. Out of each hustle the government will get a commission and will not have to pay their salaries as the hustle will be more than their take home.

The civil service will be based upon production pay. No work No production no pay! Cant deliver a document faster than another civil servant you lose the money to the other. Rude and indifferent to the public, you lose to the people person type who is able to build their network faster. Just think how much the few tax payer will save if they don’t have to pay the civil service. Essential service could be outsource to foreign companies who would always be on edge for the next bidding so they would provide a good service and know that if the don’t lay down in bed with corruption a next person may just get it. The citizen will get to decided who they want for a fire service, a security company as a police force, import doctors and nurses for medical, imported farm workers to replace what we have, This will free up Jamaican to be full time hustlers.

The government could do away with all the departments that monitor corruption as it will be an obstacle to a pure system of liaise faire capitalism which many think they can play. But take away the rules and lets play is what the private sector would like to say to the government and underground economy. Hustling could be a university degree as who really needs to spend time and money gathering knowledge and skill. We will then have a society of full tertiary educated people. Math skills would go out the roof as Montego Bay will become the financial capital of Jamaica due to the sophisticated hustling schools and operations. There will not need to be a dependent on tourism just a digital track to their bank account.

Contracts could be cleared easily and the work finish which could push the country faster to their first world status. The Ministry of foreign affairs can make it clear as well as the Ministry of commerce that we are really ready to use our full pool of well trained hustlers and the wheel are ready for greasing. We can revert back to the good old days of dog eat dog cut throat competition with no barrier to trade. No visas, no work permits just a global cesspool of the best corrupt people the world can offer now imagine the outsourcing that could go on with even that guy with that $50 billion Ponzi scheme. Even 10% of that if we had given him support could do the country well.

Why should we not think about it now that corruption can be a good thing since it is already there. It cost too much to get rid of. We already have a world rating for it. Lets be the best at it. It’s a thought for the coming 2009. A country whose GDP is based purely on the informal sector, non performing civil service and corruption vs the minuscule production of a dying private sector while improving the function of the public sector. Imagine full employment! Well have anyone ver propose it? Lets think about it. LOL

INSIDE THE MIND OF PRIME MINISTER GOLDING! NEVER BEFORE REVEALED SECRETS!

Written by John Anthony

What kind of man is Prime Minister Bruce Golding? What drives him? What are his strengths and weaknesses? Here we reveal information never before read anywhere in annals of Jamaican history and politics.

SPEAK SOFTLY PRIME MINISTER

Bruce Golding is a honest and straightforward man. This straightforwardness gets him in trouble often especially when he gets emotional and strays from his written speeches. This man should rehearse and rehearse answers to potential questions or his straightforwardness will continue to get him in trouble. He needs a speech writer yesterday and should refrain from the temptation to stray from his written speeches. His straightforwardness makes him unwilling to acknowledge mistakes and change course even after it seems obvious that he is alone . Sometimes others care not so much about being correct as they care about being acknowledged. Negotiators with this man need to be aware of this trait and never tell him bluntly that he is wrong. When he speaks without anger or resentment his words compel attention and reformation and are extremely powerful.

He is apt to jump to conclusions without considering all the relevant factors and full consequences and difficulties.. This is a blunt and outspoken man often unwilling to wait for the proper times and seasons and desire to rush through every piece of work as soon as it presents itself. An unfinished task is almost like a disease to him and he often rushes ahead too quickly as in the case of the EPA agreement. He is right overall on the EPA in that we must learn to compete but he is wrong on not examining the fine details. The way to out-manoeuver this man in negotiations is to steers him away from his own insights to analysis and to get him to become emotional. The other strategy is to include ultra-fine details and clauses in contracts and agreements. When he becomes emotional he often makes wrong choices.

A PROPHET IN JAMAICA HOUSE?

Here is one of the greatest secrets of the Prime Minister. He has visions and hear things he is afraid of telling normal humans about. His mind reaches out far beyond the present and he has the ability to see the future by his understanding of current events. Of course, since he has never been trained in the art and science of divination he feels like a round man in a square hole!

The powers of intuition that lie latent within this man are enormous rivalling that of even so-called psychics.Intuition (knowledge) - understanding without apparent effort, quick and ready insight seemingly independent of previous experiences or empirical knowledge.

If he relied more on this great gift instead of on partisan emotions, and the influence of charitable endeavours,he would shock the nation with his uncanny gift at being correct. Frankly, his radio show is an attempt, unknowingly, to bring some of this much needed insight to the common man. Callers to this show should ask him what he feels, not what he knows!

He rarely makes mistakes when he follows his own inspirations but is sure to be led astray when he seeks the advice of yes men. This gift shockingly seems at odds with his outbursts and unscripted statements but these come not from inspiration but from angry partisan instincts. He is quick to foresee events and is sure he is correct. If he can differentiate between his inspirations and emotions he will make accurate decisions and changes never before made in the history of Jamaica. Great prophets learn to differentiate between their inspirations and their emotions.

A LUCKY SPIRITUAL GOOD MAN

To say that Golding is filled with energy is an understatement. He is a source of energy, outgoing and loves to be on the move. Actually he would much rather be hiking outdoors rather than sitting in the parliament. His carefree adventuresome nature can be refreshing. This is a man who loves to travel and l-ov-e-s to be on the move. For one who loves freedom so much, it seems odd that he would want to detain innocent persons, called crime suspects, for 60 days but his inability to bear to see others suffer will cause him to propose unwise actions. He should never make decisions under such duress. This man should watch his generosity and goodness as others will quickly take advantage of him. Emergencies bring out the best in him and he can become timid and afraid when there is no need for action or quick thought. He is a money generator too!

ONLY GOD HAS NO FAULTS

Bruce has the tendency to fly to pieces over even small matters, is quick to anger, combative and determined to have his own way. He can be unreasonable in his desire to help those he loves, zealous and over-sanguine in whatever he underrtakes. He also should watch the temptation to sacrifice health and good nature in his determination to finish what he initiates. The bluntless of this man is the cause of much unnecessary suffering to others and the truth of his words must not be used as an excuse to domineer others. He should learn to be gentle in speech and to give out the truth with discrimination. He should teach himself to forgive and forget. Bruce can expect too much of others, quick to observe, to plan and to do and make small allowance for those less gifted.

He should cultivate calmness and purpose and think well and in silence, drawing on his inspirational giftings before making important decisions. Golding is not concerned with details and should not lead negotiations especially where contracts are involved. This makes him especially unsuited for the EPA negotiations and he will never understand the details therein.

GOD IS ON HIS SIDE

Call it luck if you want; but the universe is on the side of this man. The beneficient universe loves to send him help which often appears at the 11th hour and luck will even help him at winning games of chance and lotteries. especially when he is close to his last dollar.

A LONER HE MUST BE

Prime Minister Golding must have set times alone where he processes his intense feelings. He needs a space at home for himself to maintain his sense of self-control and must not be disturbed. His close circle of friends must be selected carefully; he has too many.

Tirade on the Market and Downtown Kingston and Street Wisdom

Written by Carol Lawton from www.FinditJamaica.com

In the street you learn the streets, its alleys, its lanes, its corners and each person who travel through it. The market is a dynamic factor that when politician and administrators make a decision they do not see the ripple effects. An orderly downtown market is needed before any invest will flow into the area by outside. The city needs to look at creative finance and collection which I think is being looked at and not the central government.

The money that moves in that small area is crazy as good are exchanged and redistribute across the island. Even a simple decision as remove the ugly stall carries a ripple effect. Lets me show you how 2 garbage wood pallets are worth $36K per year. A wooden stall is rented for $100 per day hence $3K per month hence $36K per year. Now imagine when one man owns 100 of these stalls, 20 push carts (rent as well to cart men) to move them and goods around .The underground economy is huge just for him as when you see him you will have pity thinking he is not making money. The chaos ensures him making money. I could pull numerous works in downtown that are high paying but would be silly as we all know them. (Assumption on my part)

Hence to remove him would affect the haggler from country, the follow of goods across the market, and efficiency of the market. But a man like this making over $3M does not even have a high school diploma. When these people are making that amount of money how can we tell the young around them that education will make them money vs. hustling. The hustling is business so no pity for these people who make as much as the PM. I had though the present JLP would move rapidly to pull these people into the fold by changing the tool called the TRN from a money collection tool to a system development tool to close the informal economy which does not give it full share to the government and erodes the formal economy.

Frankly the city can afford to fix it now that it has made its collections more efficient at 70 percent up from 30 percent. Lets be frank as usual, the KSAC councilors have no excuse for the bull that they are pulling off about their party is not in power, the MP is not giving anything, the central government is not helping. Its all bull. If revenue is at $15billion that means the city now has almost US$200 million to invest into the city which can be expand further by grabbing the other 30%. This is recurring money since these fees and city taxes are due every year.

The collection of taxes from the citizens by the KSAC could even by government paper and be a part of the city portfolio. The sale of government paper would be sold to the KSAC as Samari bonds at rates that are variable and equal to the inflation rate of a hard currency on which the bonds could be pegged hence no 14% and higher rates but 2-3%. If it’s the welfare, you politicians are about these are the ideas that are out there. But a poor man’s wisdom is lost up high and the fool is praised for his/her inaction. Jamaica not land of wood and water but land of talk and talk. Stop the hustling of the people. Stop the informal economy as its not all drugs but its untaxable business activity that we all know.

Lets stop the garbage and put the taxpayer money to work on rebuilding the city vs. hiding behind falsity of inaction. The generation that is looking at you is very much analyzing the system making rational decision as to if the system is for them. The formal economy pays taxes but get no service, the informal pays nothing and gets no service. Yet the revenue is there to create an efficient system which is equitable to all. But hi this is just what this poor man learns from walking the street and listening to the corner talk.

PS: They are not all idlers and criminals on those corners