Norris McDonald | Debt management, money hunger and GOJ’s trust deficit

On May 1, 2023, Finance Minister Dr Nigel Clark registered a US$1 billion debt instrument with the American Securities and Exchange Commission. There was no apparent major public announcement of the Jamaican Government’s decision to borrow more money.

If things are going fine, and Jamaica is going to get the fantastic economic prosperity promised by Dr Clarke and the International Monetary Fund (IMF), why this drastic hunger to borrow more money?

This new US$1 billion solicitation to borrow more money adds to the US$968 million borrowed from the IMF in March 2023.

Clearstream International SA and Euroclear are European money hustling firms who will manage this debt solicitation for a fee of US$110,200.

Why this money hunger, desperate dash, mad dash for more cash by Dr Clarke and the government?

POOR DEBT MANAGEMENT

If all the money borrowed so far from the international bankers have not made life better for the Jamaican people, why would the government keep borrowing more and more money if things are getting better?

Didn’t Dr Clarke say his Budget was going to produced economic growth?

Where is the evidence of this?

Where is the sound debt management and promised economic miracle?

Indeed, Dr Clarke has been promising economic growth from one ‘fenke-fenke’ Budget to another, and yet, on the face of the evidence, this debt crisis just keeps getting worse.

Increased borrowing by government certainly is not the solution people expected when they placed their faith in government to manage public affairs.

And given no rapid expansion in national production, things are likely, in my opinion, to get worse.

In fact, that is what the World Bank has been telling us. According to the World Bank, more and more Jamaicans have fallen deeper into poverty.

Poverty rates in Jamaica increased from 19 per cent in 2018 and 2019 to 23 per cent in 2020.

One could blame the impact of COVID-19 and drastic lockdowns for making things harder for people. But, if the government had practised prudent debt management and had a serious, practical economic plan, clearly people’s lives could have got better over time.

This is not what we have seen so far, as the World Bank attests.

The rise in poverty in Jamaica has been a general trend and tendency in international capitalism. And it is as if the government just doesn’t get it; they keep painting an unrealistic vision of the future while the national debt gets worse.

Jamaica might appear to be a small speck in the global debt crisis with the national debt estimated to be roughly US$14 billion for 2023. But without a sound economic plan, this debt crisis will keep getting worse.

My friends, if we are to divide up Jamaica’s national debt burden, and share it up among the people, each person would owe roughly US$6,000.

The impact of the debt crisis has been felt by the worsening living standard for ordinary Jamaican people.

We are truly in desperate times. Instead of people being able to escape poverty and economic hardships, things have been steadily getting worse.

Where is the hope for the future that the government keeps promising?

This debt crisis cannot be solved with the same fenke-fenke approach to the Jamaican Government’s debt management.

Isn’t this a downright shame? What do you think?

TRUST DEFICIT

Prime Minister Andrew Holness and his economic team, led by Finance Minister Dr Clarke, got a mandate to make life better for poor people and the middle class.

People expected that they and their families would enjoy a better quality of life.

But so far, they clearly have not delivered on their promises. What we have gotten instead, in my opinion, is trust deficiency and poor management over public affairs.

Good governance requires – in fact, demands – that people can trust their government to do the right thing on their behalf.

Just as important, in a democracy, the government must truthfully tell the people their plans, why they are doing it and seek public support to such policies.

Isn’t democracy supposed to be based on government seeking the trust and support of the people even as they properly manage a country’s finance affairs?

Also, the rise in public corruption and the increase in the debt burden rob the country and the people of the chance to get economic prosperity.

Poor management of taxpayers’ money is a true disservice to them since it is they who, at the end of the day, pay for financial scandals, mismanagement, waste, and fraud.

We have seen scandal on top of scandal – whether it be at Petrojam, the Ministry of Education’s disappearing money and, other alleged public scandals such as poor supervision of Stocks and Securities Ltd. – which appear as breach of trust.

Trust deficit is the lack of openness from government. And if government is going to keep borrowing money, without a public announcement to the Jamaican people, this may be one more example of this trust deficiency.

What do you think?

Do you really believe that it is right for the government to borrow more and more money and, by so doing, add to the debt burden?

If that is what you truly believe, don’t be ashamed or afraid to say so?

My dear friends, the Jamaican people want better to come but, after 50 years under this IMF road to nowhere, there are still no clear signs that, in this political economic scenario, this can be achieved.

People expect and demand good government. They do not expect a perpetual increase in the national debt burden.

It appears to me, though, that the government is following a dark, debt-driven, money hungry road to nowhere.

They do not even have a bottle of ‘Peenie Wallie’ to help them see better on how to manage the country’s financial affairs.

That is just ‘the bitta truth’!

Norris McDonald is a respiratory therapist, social researcher, and political analyst. Email feedback columns@gleanerjm.com and miaminorris@yahoo.com.