I'll skip Dr King's class - History is a better teacher

Orville Taylor, Contributor

I suspect that the editor might have playfully used the title 'Step into my class, Dr Taylor' to head my friend Damien King's article last Sunday! because he wanted to generate interest in a column that doesn't otherwise, by its content, grab the reader.

Truthfully, I hate wasting time in what appears to be 'competitive' reasoning with my colleagues. There is no trophy or cup to be won here, and it is not my intention to play one-upmanship while the nation is waiting to get intellectual leadership regarding how we overcome this crisis.

Social scientists have a particular role. We have to identify social problems and offer solutions. In a small Third World country like ours, we need truth. When we have concepts, we must be reasonably sure that they are accurate; and when we have theories, they have to match reality - and we must not find excuses as to why they don't work. In this regard, I don't give a hoot for King's ego, although I carry no 'belly' for King himself.

So, for example, if we as sociologists theorise that the declining labour standards in the 1990s and early 2000s would have led to declining productivity, we had better be cocksure that our data stand up to scrutiny and not give some flaccid excuse that extraneous variables are at work. It is not about who can mouth off. The proof of the pudding is in the eating.

Whatever might be the economic theory that drives the recommendation of devaluation of a local currency, there are three facts.

Fact one: Jamaican exports don't seem to increase.

Fact two: The demand for imports doesn't decrease; if anything, it increases.

Fact three: Given facts one and two, the trade deficit widens.

Now, maybe I didn't take enough undergraduate courses in economics, but when my brother and sister were teaching me arithmetic, and Messrs Rupley and Whittick struggled to put me on the path to GCE O'Level success in mathematics, I learned that addition meant more and subtraction meant less. If there is a new type of math, I'm gonna 'skull' school again.

Furthermore, the fundamentals of English and use of English classes that we did at the University of the West Indies, reinforced the unambiguous meaning of increase and decrease. I learned my English in language class, not math or economics.

In several columns, I expressed grave trepidation when the prospect of devaluation loomed, because history, not economics or political science, told me horror stories. From the data, what is obvious, is that the outcomes of increased exports and decreased imports do not take place. However, economic theories, such as that which my economist colleagues teach us as gospel, hold on to devaluation prescriptions like an escapees' shirt.

US trade relationship

Ivy's bwoy can't bother with the ego trips, therefore, let us examine the accompanying chart, which shows trade relationships with the United States (US) since 2000.

Between 2000 and 2012, the Jamaican dollar fell from US$1:J$43.08 to US$1:J$88.99. It was a constant and relentless slide, with the exception of years 2010 and 2011, when it appreciated from J$88.49 to J$87.38 and J$86.08.

The logic behind devaluation is that it will reduce the price of Jamaican goods and make the foreigners gobble up things labelled 'Made in Jamaica,' like a crackhead who suddenly finds that the price of the stone ball has fallen.

Well, step into the class and read the chart, which was designed in history class; not economics. Exports to America were US$648.1 million in 2000, when the Jamaican currency had twice the value it had in 2012. By 2012, when the Jamaican dollar was slipping, like the credibility of those who advocate devaluation, and getting ready to crash through the $100 mark, exports to Uncle Sam were down to US$507.6 million.

Speak all the theory you want, the cheaper Jamaican dollar did not lead to more exports going to our main trading partner.

On the other hand, imports from the US were US$1.38 billion in 2000. When last year ended, US$1.99 billion worth of American commodities made their trek to Jamaica. For 12 of the 13 years, the figure increased almost in a straight line, and only in year 2009, after the global crisis, did imports fall off.

Indeed, the explanation is perhaps more suited to migration theory, which might suggest that Jamaican goods need visas, while Americans' don't.

The pattern for exports is not as linear as with imports. Exports did increase between 2005 and 2008, but that was after major declines after 2004, when exports fell to the decade-low US$319 million. In fact, the only years when there was an absolute increase in imports over 2000 were 2007 and 2008, when the figure surpassed US$700 million.

Nevertheless, after falling to US$328 million in 2010, when there was a slight revaluation, the export data made a mockery of the economists' theory in 2011, when there was both a revaluation of the Bustamante dollar to $86.08 and an impressive jump in exports to US$566 million. Furthermore, apparently, not having done introductory courses in economics, both the dollar value and exports obeyed the laws of gravity, but not the laws of supply and demand, in 2012.

Nature of reality

None of these data are cooked, and as inconvenient as they might be, they are strictly fact. I don't care what the pattern should have been, or what was predicted by economic model or theory.

This is the nature of reality, and that is why we sociologists have been teaching our students to do social research for the past decades, when the economists did not make their graduate students learn research methods.

The struggle of bright people to be bright and right all the time, despite the empirical data to the contrary, always makes the lives of us behavioural scientists interesting, because there is always so much of human behaviour to explain.

So, let the data speak for themselves. My intention is to educate, not to compete with or embarrass my peers. Facts are just facts. I write not for praise or medals, and I certainly am not writing for cups.

Dr Orville Taylor is senior lecturer in sociology at the UWI and a radio talk-show host. Email feedback to columns@gleanerjm.com and tayloronblackline@hotmail.com.