Manley and the PNP's dilemma

Ian Boyne, Contributor

Ralston Hyman is hopping mad with the Government. Nothing sensational about that statement. Except this is 2012 and it's the People's National Party (PNP) Government we are talking about. Some were stunned, in reading The Gleaner on Ash Wednesday, a day of penance, as Ralston was unrepentant in his criticism of Finance Minister Peter Phillips, who scorched the Budget by a whopping $21.6 billion for this fiscal year.

"Budget cuts in a recession are going to have a negative impact on the economy because the economy is already functioning below capacity, and the Government is a major player in the economy," Hyman told The Gleaner. His Ash Wednesday jeremiad continued: "The level of poverty, unemployment and frustration will also increase ... . It is a very bad move and it is going to have political consequences." I commend Ralston's courage and consistency, which suffer even greater scarcity in media these days.

But even as I was lauding 'Teacher' Ralston for shocking some persons who thought he was quicker to join Phillips' staff than to criticise him (you naughty cynics, I know what you are thinking!), I could not help but think how Michael Manley was way ahead of his time. Michael Manley, more than any other political leader in this country, had a profound, acute and textured understanding of the limits of domestic political action if the global economic architecture remained inhospitable to development. Wednesday, February 29 will be the 40th anniversary of Michael Manley's first electoral victory. It is not an occasion which should pass without notice.

While many have a jaundiced view of the 1970s, and some even in the PNP seem ashamed of that period, the 1970s represented perhaps the most significant period in Jamaica's political project. It was the period in which the highest ideals of politics were articulated and one in which the challenges and dilemmas of Third-World development were most clearly and incisively delineated.

on same page

Back to Ralston's lament. Ralston and I are on the same page. Both of us favour Keynesian policies and are strong advocates of counter-cyclical economic measures in a time of recession. I am proud that Ralston has not, like some others, changed his tune now that the PNP is in power, with the party clearly following some of the key policies of the Jamaica Labour Party (JLP). Which, as I pointed out on many occasions before the last election, are really the mandatory policies of the International Monetary Fund (IMF). I kept saying that whatever the PNP sycophants were chanting about the "wickedness" of JLP policies, the PNP had no choice but to toe the same line if they came to power.

I kept saying that it was more important what decisions were taken in Washington, Brussels, Berlin, Geneva, Beijing and Tokyo than those made at Jamaica House or Gordon House. Economic sovereignty is largely out of our hands. The main difference between the PNP and the JLP is that the JLP is more complicit and is in ideological affinity with the bankrupt neoliberal policies, while the PNP will try to find some wiggle room for state activism and social protection.

Michael Manley, out of his sheer intellectual brilliance and sophisticated grasp of international affairs, saw that unless there were significant reforms of multilateral institutions like the World Bank and the IMF, and that unless the developing world had a greater say in influencing decisions which impact on them, local economic initiatives would be severely limited.

The same way that the Marxist theoretician and political activist, Leon Trotsky, taught, in contradiction to the Bolsheviks, that you could not build "socialism in one country", but needed global revolution, so Manley understood that the aspirations of the masses for a decent way of life hinged on a New International Economic Order.

There were many in the 1970s, in their myopia, who felt that Manley was 'wasting time' attending to all these international issues, being so active in the Non-Aligned Movement and 'fasting in other people's business', while neglecting domestic matters.

No, Manley understood in a deep way that if he did not lobby for significant changes to the global economic and political structures, that unless he fought for international economic justice, there could be no sustainable local justice. He failed at that globalist project, without which he could never succeed locally, certainly not at the height of the Cold War.

unfairly criticised

Ralston, it is not because Peter Phillips, who is highly intellectually competent, does not want to stimulate the economy. He does not want to contract and depress demand. Nor did Audley Shaw or Bruce Golding, for that matter. Bruce and Audley were unfairly and foolishly criticised for carrying out policies which were unpalatable but necessary in the circumstances.

What Ralston would have to tell us is how Peter Phillips could avoid slashing the Budget and how he can avoid making more drastic cuts in next year's Budget if he is not going to raise taxes and borrow more - which most would recoil from. But, more important, Ralston, if Phillips thinks he is his own man and goes ahead and constructs a budget that suits him and us as progressives, what imprimatur will he get from the IMF to draw down on life-sustaining funds from the World Bank and the European Union?

Phillips either follows Hyman's prescriptions and waves 'ta-ta' to the IMF or he bites the bullet and does what he has done. Globalists like me know that what is needed is for institutions like the IMF and the World Bank to be restructured to reflect the interests of the developing world; what is needed is a debt-cancellation programme for distressed middle-income countries like Jamaica with high debt-to-GDP ratios.

A lot of our debt is commercial, which means that resources of the IMF must be dedicated to helping countries in our situation release ourselves from the debt trap so we can channel those resources into development. Nobody wants to deal with that elephant in the room. Everybody simply accepts the 'common sense', the givenness of our present international economic order. Michael Manley did not. And 40 years after he began to take this nation on a course of transformation, we are still futilely grappling with the same issues he grappled with, but in his case with far greater insight, acuity and intellectual boldness. Now we gave resigned ourselves to debt peonage and neoliberal theology.

Michael Manley, to his eternal credit, saw the absolute connection between the domestic and the international. He worked with progressive developed-country leaders like Willy Brandt and Third-World leaders like Julius Nyerere to effect crucial changes in trade and economic management at the global level.

The PNP, like the JLP before it, is trying to put a square peg in a round hole economically. Now don't get me wrong: Peter-John Gordon and Damien King don't have to remind me that some of the key things the IMF is demanding are things we must do for ourselves, whether we had an IMF agreement or not. Fiscal recklessness, waste, and mismanagement of resources are always counterproductive. My point is that macroeconomic stability and fiscal prudence are necessary but not sufficient instruments of growth.

We need greater resources and greater flexibility from institutions like the IMF and the World Bank so that we can stimulate the economy and carry out polices which, historically, are the only ones which have helped to spur growth all over the world.

Currently, the global economic and financial architecture is not designed to assist countries like ours. When the global economic crisis erupted in 2008, the IMF and the G-20 countries came together and coordinated policies to stimulate the world economy. Billions were pumped into the IMF and the IMF experienced a resurgence. That's how the world has been managing to cope with the global recession. Joint, coordinated action was taken. The same must be done for developing countries, and not just those heavily indebted low-income countries.

Manley's vision of a New International Economic Order is needed now more than when he campaigned for it nearly 40 years ago.

social justice

Manley also brought to the forefront the issue of equity and social justice. In the 1960s, there was significant economic and industrial growth, but it was not trickling down.

Professor Patrick Bryan, in his sympathetic, nearly 400-page biography of Edward Seaga, titled Edward Saga and the Challenges of Modern Jamaica (2009), admits: "Jamaica's spectacular economic growth between the 1950s and early 1970s had not come anywhere near mitigating the contrast between the haves as opposed to the haves-not."

Seaga himself, in his own autobiography Edward Seaga: My Life and Leadership, concedes: "Of all the programmes instituted by Manley in the 1970s, it was the agenda of social legislation that was most successful. These new enactments affected many aspects of the society - women, employment and children, among others."

He then lists a whole slew of them and then made this remarkable statement: "The social reforms, notwithstanding limited results in tangible performance, were of lasting value in raising the social consciousness of the people. It was the rhetoric of Michael Manley that raised the bar of self-esteem and racial pride among people of African origin, in continuation of Garvey's mission." Yes, Seaga wrote that! (Ah, the virtue of reading.)

Manley centre-staged egalitarianism as an ideal and infused politics with transcendental meaning, moving it beyond gamesmanship. I would live to see the World Bank, no less, put out its 309-page authoritative World Development Report in 2005 titled Equity and Development, which would say: "The main message is that equity is complementary in some fundamental respects to the pursuit of prosperity ... . The evidence is that inequality of opportunity ... is wasteful and inimical to sustainable development and poverty reduction."

Manley had spent the latter half of the 1970s trying to convince the World Bank of that. Michael Manley was one of the most visionary political leaders the world has ever seen. His political strategy and tactics were inept, clumsy and proved costly to his transformational project. He badly underestimated the virulence of the response of the local and international ruling classes and paid dearly for it. But no Jamaican political leader has ever exceeded him in vision, intellect and breadth.

Ian Boyne, a veteran journalist, is the winner of the 2010-2011 Morris Cargill Award for Opinion Journalism. Email feedback to columns@ gleanerjm.com and ianboyne1@yahoo.com.