Time to broaden debate

Ian Boyne, Contributor

Sometimes I am inclined to think we suffer hopelessly from either-or, binary thinking. It's either black or white. We hold ideas in opposition, rather than in healthy tension. So it's either our economic problems are due to corrupt, incompetent, muddled, myopic politicians and/or bureaucrats, or they are driven by outside factors, totally beyond our control.

I reject such thinking. It is not that our problems are simply imposed from outside, with our policy responses making no difference and having no impact. I am a globalist who believes that exogenous economic and political factors weigh heavily on domestic economic matters, but I hold passionately to the view that corruption, mismanagement, partisanship and a host of other factors do retard domestic economic development.

You compare Jamaica with other countries which face the same harsh and inhospitable global environment and you see that the outcomes are different. The hard, empirical facts do not support any notion of our total and abject powerlessness. Our responses and policy actions do make a difference. They can either exacerbate or ameliorate exogenous factors.

In Jamaica, our politicians have taken decisions which have been short-sighted, special interest group driven, tribalistic and, in some cases, downright corrupt. They have done things which are inexcusable - and some even so egregious that their most deluded apologists can recognise as such when they step away from the echo chamber.

BEYOND BAD-MOUTHING

Some of our politicians have made horribly bad economic decisions and have taken policy actions which have contributed to our underdevelopment and debt trap. But that is not to gloss over the equally undeniable fact that the external economy and external economic and political factors constrain our economic development. Why can't some of our commentators understand that? Throwing words about who benefits from the trough, who is afraid to disturb the status quo for personal interest, and who is singing for his supper is not to engage in serious intellectual discourse. As it is said, not because you are paranoid it means they are not really out to get you!

My motives could be quite corrupt and yet I could hold a position which coincides with the truth. Examine my arguments on their merit, rather than cast aspersions or engage in psychoanalysis -which should really be left to the professionals, and even they have to exercise epistemic humility. The Observer last week continued its refreshingly balanced critique of International Monetary Fund (IMF) dogma. The cynics can say that now that its chairman faces the prospects of losing waivers and incentives for his hotel industry because of the IMF's insistence that such lollipops must go, the paper has a sudden burst of enlightenment.

As it's hard to accurately decipher motives, let's look at the arguments offered. In an editorial last Wednesday, "The IMF will not grow our economy for us', the Observer lashes the IMF because it "practises a brand of economic fundamentalism which is theological in its inflexibility. It has a standard set of policy prescriptions ..."

It then charges: "The IMF has at times been insensitive to political and social limits of adjustment, even while knowing that its performance tests and policy measures undercut the political support of governments, e.g., the Michael Manley administration in 1979-80 and the Golding administration in 2011." Now for students of political science and keen political observers here, this is a significant and far-reaching editorial.

It is quite unusual to find an Establishment newspaper offering this kind of critique of the IMF, which is often made by liberals and progressives. Note the language of the editorial: "The high priests of the IMF may even derive a certain perverse but self-righteous pleasure as the next government would be more supine."

The editorial goes on to note: "IMF programmes do not necessarily produce economic growth, because of their deflationary stabilisation measures which are antithesis to growth. Stabilisation of the macroeconomic fundamentals is a necessary step, but that does not, by itself, generate growth. If economic growth occurs during an IMF agreement, it is probably because of some fortuitous event such as favourable export prices, a surge in tourist arrivals, and the like."

The Observer has just broadened the economic discourse in this country. And for The Observer to do so is significant, as Establishment newspapers generally don't offer this kind of critique of international capitalist institutions like the IMF. I am not suggesting The Observer has gone Red or even progressive. But they have an editorial writer who is doing some thinking. It is delightful to see this kind of critique creeping into editorials.

We must, indeed, broaden the debate in Jamaica and move away from the usual dialogue of the deaf. Yes, continue to cuss politicians and bash them. They deserve much of it. But in all of that, can we give some consideration for some wider issues? I am not calling for a moratorium on politician bashing. I am simply calling for a broadening of the discourse.

IMF MISGUIDED

I am asking that we ask ourselves whether perhaps - just perhaps - the IMF, by some stroke or mathematical odds, may be wrong or misguided in its own recommendations and policy mix.

In its well-argued editorial, The Observer reminds, "No Government of Jamaica has completed the full duration of an IMF agreement. This is a depressing record which the IMF blames on poor implementation because of lack of political will and technical incompetence." And then The Observer editorial writer engages in an all-too-uncommon practice of nuanced reasoning by stating, "These are factors, but the truth is that the IMF targets were unrealistic, the policy measures inappropriate, and the programme underfunded."

In our political and economic commentary in Jamaica, we rarely go on to acknowledge that the picture of political mismanagement, corruption and misguided policy action along with bureaucratic incompetence is not complete; that there could possibly be something else. It's entirely our fault.

The Observer is not foolishly saying we just reject the IMF programme. That is not realistic, and the so-called non-IMF paths lead to blind alleys and a precipice. The IMF path right now is the worst of all paths on offer - except all the others. This is no contradiction of what I have been arguing, as Paul Ward and Lloyd D'Aguilar would rush to argue in their binary thinking. Economics is the art of the possible. Lloyd, as a good and faithful Trotskyite, must remember that you can't have revolution in one country. You need world revolution to achieve domestic liberation.

In Jamaica, we are not even raising these issues. The Observer has to be heavily commended for raising the bar of public discourse. Ralston Hyman, in the February issue of Jamaica Business ('Primary surplus target unrealistic') says the only way the Government can achieve the 7.5 per cent annual fiscal surplus target is if it "brings the country to a screeching halt. This would have severe implications for social stability, investments and economic growth in an environment which is already extremely volatile and tense because of high levels of unemployment, underemployment and social instability."

TAKE IT OR LEAVE IT

But the 7.5 per cent primary surplus target is an IMF imposition. It is not something which, from what I can gather from Minister Phillips' public statements, the Jamaican team recommended. It's a take-it-or-leave-it position of the IMF. And, quite frankly, we can't afford to leave. It's a case of, as Sizzla would put it, "Can't ask you to go, can't ask you to stay." Yet Christine Lagarde, the IMF managing director, gave an excellent speech last Wednesday at the Economic Club of New York showing how global policy actions are important for international stability and why a growth paradigm must focus on jobs and equity.

She said: "All countries need to emphasise more growth, jobs -and more equity. In other words, more attention to the issues which really matter to people." And hear this: "Equity matters, because as tough times continue, we see signs of adjustment fatigue and rising social tensions ... Most urgently we must protect people most affected by the crisis and make sure adjustment is as fair as possible."

The IMF has, indeed, become more sensitive to the most vulnerable and has come to accept, after much political pressure, demonstrations in the streets and intellectual challenge to its neoliberal orthodoxy - as well as chastening by the Great Recession - that social services must be protected. This has come as a result of struggle.

If people simply took what was dished out as unquestionable dogma, the IMF would not have made adjustments and made provisions in its latest programmes for the most vulnerable. But the fact is the IMF needs to realise that it is not just "the most vulnerable" who will be threatened by its insistence on this 7.5 per cent fiscal surplus and other harsh adjustment measures. The middle class is going to be severely affected, and you can't develop this society without its middle class and professionals. That's a recipe for disaster.

Says Ralston Hyman in his Jamaica Business article: "If Dr Phillips and his technical team are imprudent enough to attempt to meet this target, the economy will shrink some more and more people will lose their jobs and the Government will miss the target while increasing the possibility of social unrest." The truth is that what or who has brought us to this position is not immediately relevant. What we know is that the medicine is too strong.

My neoliberal friend in Europe asked me whether I had read Emerging Africa: How 17 Countries Are Leading the Way. I ask him to reread chapter five and note this statement: "Only through the Heavily Indebted Poor Country (HIPC) Initiative and the Multilateral Debt Relief Initiative (MDRI) were most low-income countries finally able to come out from under the debt burden, in most cases only beginning in 1999 or later." It was international action which brought this about.

We fool ourselves -and mislead the Jamaican people -sif we propagate the view that we don't need to fight any external challenge.

Ian Boyne is a veteran journalist. Email feedback to columns@gleanerjm.com and ianboyne1@yahoo.com.