The Tribune

ALTHOUGH last week Moody’s cut Slovenia’s rating by two notches to “junk”, this proud central European nation —one of the EU’s most recent members – is determined not to become the fifth eurozone country to ask for financial aid.

Slovenia has decided to do its own belt tightening to avoid joining the beggars of Europe — Greece, Ireland, Portugal, Spain and Cyprus – which have been bailed out by the international community with hefty emergency loans. This Alpine town of two million, where 250,000 years ago Neanderthal man roamed, became an independent state in 1991, after the collapse of the Yugoslav federation.

Last week, Slovenia’s government announced an austerity plan to raise 540 million euros ($707 million) in new taxes to balance its budget and avoid a bailout. The plan — to partially privatise 15 state-run companies — is yet to be approved by Slovenia’s parliament. Of course, to raise this sum, there will be other taxes.

Among the companies to be privatised are Slovenia’s second largest bank, the national airline and the telecommunications company.

Can one imagine the financial turnaround the Bahamas could realise if it had the courage to offload Bahamasair, BEC, Water & Sewerage and the Bahamas Broadcasting Corporation and stop its futile posturing by trying to claw BTC back into the fold? Also, it has to face the fact that it is incapable of managing such simple operations as the frequently burning public dump, which is adversely affecting the health of so many Bahamians. This public scandal should also be turned over to private enterprise.

Unless, and until, government realises that there is no room for misplaced nationalism in these financially-draining emotional symbols, the country has little hope of recovery.

In downgrading the Bahamas’ credit rating, Moody’s has revised its outlook of the Bahamas’ economic future from stable to negative.

“We expect the government to find it difficult to rationalise spending and achieve the fiscal consolidation necessary to stabilize the debt and place it on a sustainable trajectory in the near term,” said Moody’s. “While the pace of increase in government debt ratios is likely to slow in the coming years, a failure to reverse the recent trend of rising debt will place downward pressure on the Bahamas’ rating. In addition, the crystallization of contingent liabilities from debt held by public sector corporations such as the loss-making Bahamas Electricity Corporation could adversely affect the rating.”

Instead of taking the belt-tightening advice, Prime Minister Christie on coming to power last year showed the direction of his thoughts. He set the pace by appointing the largest Cabinet in the history of the Bahamas. As perplexed Bahamians scratched their heads, he was quick to explain that the extraordinary challenges facing the country required the extra hands that he had appointed to “simultaneously tackle these challenges on the broadest possible front”.

Since then, there has been mounting confusion. Obviously, Mr Christie’s mother did not teach him that often “too many cooks spoil the broth”.

Anxious to deliver on impossible promises made during the election campaign within the 100-day deadline he set himself, he launched a costly referendum on gambling that has ended in confusion and is now tied up in the courts.

Today, Bahamians find themselves in a position where, in biblical terms, the last days are worse than the first.

So far, nothing has been delivered. But costs are mounting — the most recent being the NIB forensic audit for which we are yet to see a statement. This audit seems to have raised more questions than it has answered.

Contrary to Moody’s advice, instead of government spending continuing to slow, it continues to rise. This is where the Opposition should start asking questions. For example, Bahamians have a right to know the cost of renovating the Bahamas’ various oversees diplomatic properties. The Bahamas’ residence in London, for example, should be examined. We understand a high rental was paid to house the high commissioner while his Mayfair residence was being refurbished. If the cost is found to be excessive, an explanation should be given — never forgetting, of course, that these are taxpayers’ funds for which there should be an accounting without any excuses or foot dragging.

Foreign Affairs Minister Fred Mitchell has also announced that government is considering opening a resident honorary consulate in Chicago to help enhance the relationship between the Bahamas and the people of that city. Will the trade and commercial opportunities dreamed of warrant these extra expenses at this time? There has to be something more than enhancing relationships to justify this extra cost to government. Or is a pitch being made to prepare the country to become a Republic with its own president replacing the Queen as suggested by former MP George Smith (PLP-Exuma) over the weekend?

Mr Smith is suggesting jettisoning the Senate, which would be no loss. However, a Republic usually has a parliament with an upper and lower chamber. In Trinidad, for example, the lower house — like our House of Assembly – is elected, while the upper House — like our Senate – is appointed. Sixteen Senators are appointed on the advice of the prime minister, six senators on the advice of the Opposition and one, ostensibly an independent, appointed by the President. The President in turn is elected for a five-year term by an electoral college made up of members from both houses of parliament.

Instead of planning to open more consulates, a country as small as the Bahamas should try to partner with larger embassies to help shoulder some of our diplomatic duties. Larger countries have done it, why not the Bahamas or is this a case of misplaced pride?

Privatisation seems the way to go to strengthen the Treasury, pay off the national debt and free the Bahamian people from the fear of rising taxes.