By Garfield Higgins From Jamaica Observer

If people cannot trust their government to do the job for which it exists, to protect them, and promote their common welfare, all else is lost. — Barack Obama (2006)

The most critical ingredients/indicators of economic, social and political buoyancy/developments are public and private institutions that operate on principles of integrity and efficiency. Institutions must facilitate and engender public good. For public good to be achieved, institutions must be rooted in the rule of law and buttressed by strong traditions of accountability and even stronger direct and indirect societal involvement in the machinations of State apparatuses.

Any dispassionate look at this Administration’s management of our affairs should leave us in absolutely no doubt that they do not understand the above paradigm. The People’s’National Party has failed to appreciate and remedy the institutional problems that bedevil us. They have formed the government for 22 of the last 26 years, so theirs is the lion’s share of blame for the state of affairs. This Administration urgently needs adult supervision otherwise we might all end up in reformatory school.

Global Competitiveness
A look at the recently published Global Competitiveness Report and the findings in relation to Jamaica must concern all self-respecting citizens of this country.

What is the Global Competitiveness Report? “The Global Competitiveness Report assesses the competitiveness landscape of 144 economies, providing insight into the drivers of their productivity and prosperity. The report remains the most comprehensive assessment of national competitiveness worldwide, providing a platform for dialogue between government, business and civil society about the actions required to improve economic prosperity. Competitiveness is defined as the set of institutions, policies and factors that determine the level of productivity of a country.

The level of productivity, in turn, sets the level of prosperity that can be earned by an economy. The different aspects of competitiveness are captured in 12 pillars, which compose the Global Competitiveness Index.” — GCR website

The pillars are:

1. Institutions

2. Infrastructure

3. Macroeconomic environment

4. Health and primary education

5. Higher education and training

6. Labour market efficiency

7. Goods market efficiency

8. Financial market development

9. Technological readiness

10. Market size

11. Business sophistication

12. Innovation

The GCR notes, inter alia, “The role of institutions goes beyond the legal framework. Government attitudes towards markets and freedoms and the efficiency of its operations are also very important: excessive bureaucracy and red tape, overregulation, corruption, dishonesty in dealing with public contracts, lack of transparency and trustworthiness, inability to provide appropriate services for the business sector, and political dependence on the judicial systems impose significant economic costs to businesses and the slow process of economic development.”

How are Jamaica’s institutions ranked vis-à-vis 144 economies of the GCI?
Property rights, 52; Intellectual property protection, 62; Diversion of public funds, 86; Public trust of politicians, 95; Irregular payments of bribes, 75; Judicial independence, 42; Favouritism in decisions of government spending, 94; Wastefulness of government spending, 125; Burden of government regulations, 126; Efficiency of legal framework in settling disputes, 88; Transparency of government policymaking, 109; Business costs of crime and violence, 143; Business costs of terrorism, 57; Organised crime, 138; Reliability of police services, 105; Ethical behaviour of firms, 74; Strength of auditing and reporting standards, 35; Efficiency of corporate boards, 50; Protection of minority shareholders’ interests, 41; Strength of investor protection, 68.

After more than 50 years of Independence this is the sad global measurement of our key institutions. Has Prime Minister Portia Simpson Miller read this report? If yes, has she digested it? Or is it that Simpson Miller and her Administration are so caught up in their fixation on mediocrity that the latest findings of the GCR are not important.

This Administration urgently needs adult supervision otherwise we might all end up in reformatory school.

In a similar manner, did the Government even send any commiserations to the people of Singapore on the passing of one of the greatest political leaders of this century? — maybe the greatest, except for Nelson Mandela. Why? Simply because Lee Kuan Yew (LKY) used the word ‘quixotic’ to describe former prime minister — soon to be national hero — Michael Manley in 1975, 40 years ago, when he visited Jamaica for the Commonwealth Conference.

“At Kingston, Jamaica, in April 1975, Prime Minister Michael Manley, a light-skinned West Indian, presided with panache and spoke with great eloquence. But I found his views quixotic [exceedingly idealistic; unrealistic and impractical]. He advocated a ‘redistribution of the world’s wealth’. His country was a well-endowed island of 2,000 square miles, with several mountains in the centre, where coffee and other sub-tropical crops are grown. They had beautiful holiday resorts built by Americans as winter homes… One Sunday afternoon, when Choo and I walked out of the barbed-wired enclosure around the hotels used for the conference to see the city on foot, a passing car came to a halt with the driver shouting: ‘Mr Lee, Mr Lee, wait for me!’

“A Chinese-Jamaican, speaking Caribbean English, came up. ‘You mustn’t forget us. We are having a very difficult time.’ He gave me his card. He was a real estate agent. Many professionals and business people had left for America and Canada and had given him their homes and offices to sell. He had seen me on Jamaican television and was anxious to speak to me. Chinese, Indians and even black Jamaican professionals felt there was no future under the left-wing socialist government of Michael Manley. The policies of the Government were ruinous…Thereafter, I read the news of Jamaica with greater understanding.” — From Third World to First: The Singapore Story: 1965-2000, Lee Kuan Yew, page 364

Well, LKY was right. Outside of Hurricane Gilbert, I believe Michael Manley is the biggest disaster to have hit this country since Independence. Its decades after and we are still paying for his economic mistakes.

Are the GCI’s findings important to our pockets?

Do they have any connection with our ability or inability to buy fish back, chicken back fat, oxtail, and or pink salmon? Do these findings have any relationship to the absence of appreciable economic growth in the economy over the last 26 years? Are they related to the inability of this Administration to offer little more than a five per cent increase [at least up to now] on basic salary after six years of public sector wage freeze?

The overwhelming answer is yes, yes and yes! Our institutions, private and public, are very weak and in many instances extremely weak. When Phillip Paulwell said some years ago that Jamaica does not have an investor-friendly environment he was right. Sadly, however, he ranks among the people who have contributed to the worsening investor climate.

While Prime Minister Portia Simpson Miller and her wrecking ball team goes around boasting that Forbes magazine has situated Jamaica as the best place to do business in the Caribbean, investors — except for the Chinese — are not lining-up to capture ‘investment opportunities’. Instead, companies like Scotiabank, Nestle and J Wray & Nephew, three of our largest employers, are shedding workers. Just last December Pan Caribbean [the Chinese firm which, in 2011, took control of Jamaica’s main sugar factories at Frome, Monymusk and Bernard Lodge Estates] made redundant 217 posts, inclusive of clerical, maintenance and field hands.

Nestle identified last December the following reasons for its decision to stop manufacturing Milo, Jamaica’s favourite food drink, locally and instead import the product from Malaysia: “High unsustainable maintenance and production costs, along with limited growth potential and declining export possibilities have led to the decision to reduce the scope of Milo operations in Bybrook. This will result in an import and repackaging operation in an effort to continue employment for as many employees as possible.” As a consequence 30 posts were made redundant.

Jamaica’s economy is the sick man of the Caribbean. The PNP, after 22 of the last 26 years in power, are primarily if not totally responsible for its illness. Additionally, the PNP seems not to grasp this reality. This Administration urgently needs adult supervision otherwise we might all end up in reformatory school.

“Jamaica’s high energy costs and poor infrastructure ranked the island 97th globally, or worse than civil war-torn Syria, according to the Global Energy Architecture Performance Index Report published last December by the World Economic Forum in collaboration with Accenture Strategy.”

Does the Prime Minister understand these realities? And, if she does, what has she and her Administration done about it? Does the PNP understand that it is the massive increase of small and medium-sized local companies which grow economies of countries? This Administration urgently needs adult supervision otherwise we might all end up reformatory school.

Successive PNP administrations have shown that they are skilled at destroying local business potential. The PNP’s unique skills are in winning elections, not management of State resources and good governance.

The demise [a few migrated] of the following abbreviated list of major companies that employed close to 15,000 workers just two decades ago is testimony to the inability of the PNP to take Jamaica beyond borrowing and borrowing to repay borrowings, plus merciless taxation of a pauperised majority. Such is the vision of the PNP. It is simple.

Mutual Life [a company that operated locally for over 100 years], GoodYear Tyre Company, West Indies Glass, Homelectrix, Workers’ Bank, Raymars Furniture, Charley’s Windsor House, Thermo Plastics, Berec Batteries, Century National Bank, Crown Eagle Insurance, Crown Eagle Insurance Commercial Bank, Island Life Insurance Company, American Life Insurance Company, Eagle Merchant Bank, Time Store [a company that operated locally for over 100 years], Things Jamaican [the brainchild of former Prime Minister Edward Seaga was closed down and turned in a prison/detention centre], and Ecotrends.

Add to these another 45,000 small- and medium-sized businesses that folded during the PNP Administration’s prolonged scorched-earth economic epoch and little more evidence is needed to conclude that the PNP and economic growth are antithetical. Members of the PNP government now don Wall Street garb, but they are the same socialists from 40 years ago. This Administration urgently needs adult supervision otherwise we might all end up in reformatory school.

What of our friends?
Grenada, our sister island, is achieving appreciable economic growth, which is having more that a ‘numbers on a page effect’ — a phrase coined by President Obama. Grenadians, by majority, are feeling the growth in their pockets, seeing the evidence in their supermarket/market baskets and on their dinner tables. Grenada has been ranked one of the 10 best places in the world to do business by London’s Daily Telegraph. But it is not just the ranking, it’s the quality of their institutions.

Rwanda, a country with a population of 10.6 million, was ravaged by genocide occasioned by Tutsi and Hutu violence in 1994. During the approximate 100-day period, from April 7, 1994 to mid-July, an estimated 500,000 to a million Rwandans were killed; constituting as much as 20 per cent of the country’s total population and 70 per cent of the Tutsis. The genocide was planned by members of the core political elite known as the akazu, many of whom occupied positions at top levels of the national government. Perpetrators came from the ranks of the Rwandan army, the National Police (gendarmerie), Government-backed militias including the Interahamwe and Impuzamugambi, and the Hutu civilian population.

Jamaica had no physical/population event comparable to the Rwandan genocide. Rwanda is now one of the fastest-growing economies in Africa. Why? They have a visionary president, Paul Kagame, who has seen to the building and strengthening of institutions. Kagame is not using the fact that seeds [Willie Lynch Formula] of discord [the primary cause of the genocide] were planted by their former Belgian/German colonials as an excuse not to achieve. Rwandans, like the phoenix, have risen from the ashes of their immediate past and are forging ahead.

How are Rwandan institutions ranked vis-à-vis 144 economies of the GCI? Property rights, 28; Intellectual property protection, 32; Diversion of public funds, 19; Public trust of politicians, 10; Irregular payments of bribes, 27; Judicial independence, 34; Favouritism in decisions of government spending, 16; Wastefulness of government spending, 4; Burden of government regulations, 6; Efficiency of legal framework in settling disputes, 16; Efficiency of legal framework in challenging regulations, 24; Transparency of government policymaking, 8; Business costs of crime and violence, 6; Business costs of terrorism, 37; Organised crime, 9; Reliability of police services, 21; Ethical behaviour of firms, 22; Strength of auditing and reporting standards, 63; Efficiency of corporate boards, 35; Protection of minority shareholders’ interests, 34; Strength of investor protection, 22.

How are Singaporean institutions ranked vis-à-vis 144 economies of the GCI? Thirty years ago this country was far behind us with respect to institution building and consequent economic growth and development. Singapore has a population of 5.4 million and is the size of St James in terms of area, with a per capita income of US$55,776.

Property rights, 2; Intellectual property protection, 2; Diversion of public funds, 6; Public trust of politicians, 1; Irregular payments of bribes, 3; Judicial independence, 20; Favouritism in decisions of government spending, 3; Wastefulness of government spending, 3; Burden of government regulations, 2; Efficiency of legal framework in settling disputes, 1; Efficiency of legal framework in challenging regulations, 21; Transparency of government policymaking, 1; Business costs of crime and violence, 4; Business costs of terrorism, 50; Organised crime, 4; Reliability of police services, 8; Ethical behaviour of firms, 3; Strength of auditing and reporting standards, 5; Efficiency of corporate boards, 5; Protection of minority shareholders’ interests, 10; Strength of investor protection, 2.

You do not need a degree in mathematics to see the connections here between growth in the Rwandan economy and the strength of key institutions. The reality of Singapore achieving First-World status in fewer than 40 years is a result of, among other things, the strength and credibility of its institutions, built by visionary, honest and disciplined leadership.

In Jamaica, we are preoccupied with majoring in minors; defending a culture of inefficiency that is long irrelevant. Near one billion dollars cannot be properly accounted for at the NSWMA, nepotism is rife in some parish councils, costing us millions. Ministers of government, like Dr Fenton Ferguson, Phillip Paulwell, and Anthony Hylton continue to cost us millions in lost investments but they continue to occupy pride of place. And we have a prime minister who seemingly does not understand the word accountability. It’s time for the PNP to pack their bags and go.

That is the true genius of America, a faith in the simple dreams of its people, the insistence on small miracles. That we can say what we think, write what we think, without hearing a sudden knock on the door. That we can have an idea and start our own business without paying a bribe or hiring somebody’s son. That we can participate in the political process without fear of retribution, and that our votes will be counted — or at least, most of the time. — Barack Obama, speech at 2004 Democratic Convention

Garfield Higgins in an educator and journalist. Comments to [email protected]

IMAGE: The recent Global Competitiveness Report
For more on this story go to: http://www.jamaicaobserver.com/columns/PNP-Administration-urgently-needs-adult-supervision_18685574