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Business Bites: Us Government Shutdown – A Trumpian Catastrophe For Everyone

US President Donald Trump. (AP)

US President Donald Trump. (AP)

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Richard Coulson

By RICHARD COULSON

The present shutdown of a large part of US Government operations is no minor blip in how the country is run. With 800,000 civil servants abruptly without pay for a period entering its third week, it is a self-imposed disaster previously unknown in the nation’s history. Bahamians should not kid themselves into believing we will be exempt from this catastrophe in the world’s largest economy, our neighbour and main source of our tourism and commerce.

Nor can we ignore that this calamity must be blamed strictly on President Donald Trump and his obsession with building “The Wall”, a sop to his ego with no function in solving immigration problems or defending national security. There is no need to list here the many policy mistakes he has committed ever since his inauguration, or the racial and anti-feminist prejudices he has displayed from far earlier. They have been amply documented for public consumption. Some Bahamians preferred him to Hillary Clinton. That may have been a rational choice at election time, but his record to date must be giving his local believers serious doubts.

His latest threat to declare a “national emergency” to obtain funds for the Wall without Congressional approval will create an unprecedented dispute over basic principles of the US Constitution. In the history of American presidents, Trump is not just different, but unique – a true outlier from all the previous 44 men who have led the nation, well or poorly, to survive for 243 years. Although I have no professional training in human psychology, Christian ethics, marital relations or sexual priapism, I cannot accept that public performance as a statesman is totally divorced from private behaviour, particularly when it no longer remains “private”. They must be related.

Consider the hard facts of his personal life:

Aside from Ronald Reagan, he is the only president who has been divorced (twice), and Reagan’s one re-marriage was a firm romance that lasted to his death.

Only two presidents were chronic “womanisers”, Jack Kennedy and Bill Clinton, neither of whom advertised the habit, while Trump has been blatant about his affairs and his cavalier attitude towards the female sex.

All the presidents chose mates from solid American background, several of whom were remarkable women who provided strong support or became intellectual or charitable leaders in their own right, such as the wives of FDR, LBJ, Ford and Carter while Laura Bush is a professional librarian who saved her husband from alcoholism.

Which of Mr Trump’s three “ladies” whom he chose to marry can even approach these qualities?

Mr Trump’s personal style and approach to the presidency is so eccentric and impulsive that one could take odds that he will serve only one term, if that:

• He could simply get fed up with the effort and resign.

• He could suffer a fatal stroke.

• He could be declared unfit under the 25th Amendment and removed.

• He could be impeached.

• He could lose support of his base and the Republican presidential nomination.

• He could be defeated in the 2020 general election.

• He could be assassinated by a crazed fanatic.

The final alternative would be a dark day, bringing unpredictable political turmoil to the US , but the other six possibilities would simply mark the welcome end of a bizarre interlude that could lead to a brighter national future.

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Finance Minister K Peter Turnquest.

Our financial services – change, not crisis

We have recently seen alarming and conflicting press reports about the health of our financial sector. On the one hand we read about the $200 billion decline in banking assets over the last six years, and the end of IBCs (International Business Companies) linked with new legislation imposed by the EU and OECD. Former Central Bank Governor James Smith mentions a “death knell”, backed up by financial executive Paul Moss. On the other hand, Minister of Finance Peter Turnquest reassures us there’s still plenty of business for traditional IBCs, as long as they remain “passive”.

Let’s separate apples from oranges. “Banking assets” are only relevant for the age-old commercial banking business of lending against deposits. They have been shrinking for many reasons, but we can be well served with just three foreign-owned (Canadian) and two locally owned banks, surely adequate for a population of 400,000, without the useless addition of Bank of Bahamas, whose struggling business and staff should be sold to a stronger operative. There’s no evidence for the stated fear that foreign banks will squeeze out local ones – it has not happened to date. What’s needed is more efficiency by the whole commercial banking sector, whose bureaucratic and dilatory ways infuriate its customers.

Commercial banking is only one segment of our total financial services sector, which includes private banking and related trust administration; securities dealing; investment management and counselling; direct and captive insurance; mutual fund administration; corporate services and special transactions; accountancy, computer and IT services; even ship and aircraft registration and (maybe someday) international arbitration.

We maintain a good grip on private banking, trusts and investment management, with many smaller firms, both bank and non-bank, both local and foreign owned, active in this field with the growth of “family offices”. The Central Bank’s recent sensible decision to permit multi-currency business by any financial institution will not drive away this business and may in fact enhance it and add to local employment.

Unfortunately, we have dropped the ball on other financial services. Many years ago the PLP government took steps that closed our captive insurance companies, causing their move to Bermuda and becoming its second largest industry with highly profitable international links that can never be recaptured for The Bahamas.

Over many years, the blind obduracy of our legal community (with a few honourable exceptions) has made us a back-water in international business.. By imposing a “closed shop” against foreign lawyers setting up practice here, they have encouraged multi-partner legal factories in Cayman, Bermuda, BVI and elsewhere that attract lucrative fee-earning services for cross-border deals, hedge fund management and financial holding companies for major clients. While our Bar Council and Association focus on the bewhigged ceremonial of English traditions, our economy loses million dollar fees to practitioners in the fly-speck of Road Town, Tortola.

The future of IBCs is a side issue. While many thousands were incorporated, they were always ingenious legal fictions that bought little tangible wealth or employment to The Bahamas. We can see that thousands have already been liquidated, a process that will continue as their utility becomes doubtful. Even if a “passive” IBC is non- taxable, why go to the trouble of registering for a business licence and preparing financial statements when its affairs can be conducted by a domestic company with a local office and dedicated personnel and no threat of retaliatory measures?

The future of the Bahamian economy lies with businesses, including lawyers, accountants and financial advisers who have firm “boots on the ground” here while serving both local and foreign markets. A good example is Cloud Carib, a Bahamian IT communications company with its active base at Sandyport and a growing network of international branches —a template for hi-tech start-ups based in Grand Bahama.

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The recent news that Netherlands (alone) will place us on a blacklist simply because we do not levy an income tax of at least 9 percent, must be forcefully opposed, as an unacceptable violation of our sovereignty. Fortunately, we don’t do much business with that little country, who seems to defy broader EU policy.

Comments

TheMadHatter 3 months, 1 week ago

Mr. Coulson, the marital stuff and other stuff you mention are really not that important on the big picture. Nice article, however, Trump is President today because we (his supporters) expect him to continue to stand up to China. As the AG candidate said today, China is a much bigger threat than Russia.

This is evident here as they own our most pristine beach property where they have placed Baha Mar. Also they own the large hotel at the center of town, the former British Colonial. They also have their soldiers placed in nearly every "convenience" store in Nassau - how convenient for them.

China is at war with the world. Look at their activities in the Pacific and in Africa. They are buying up every piece of real estate in the USA and Canada. They own our container port in Freeport.

This is a new war. No tanks rolling down the streets. Their weapons are money leveraged against the ignorance of the populations of countries they invade.

China's supporters (traitors, sell-outs) are among those you see every day bashing Donald Trump. If someone actually colluded with Russia to steal an American election you don't think the FBI or NSA would have sufficient evidence after two years to arrest that person? Notice how the FBI never for one minute obtained possession of Clinton's server. If you or i had a business and were suspected of merely evading taxes, our computers would be confiscated.

China will win because they bribe whoever they want - and nobody is a patriot anymore. Look at us. A shiney new sports stadium, now functioning as a road traffic office. We can't even put license plates on cars in our capital city.

China will win because most people will believe that Trump and his supporters are crazy, until the 47th President is named Chang. Then they will believe what we are saying. But it will be too late. Game over.

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SP 3 months, 1 week ago

Well said TheMadHatter. Mr. Coulson is obviously caught up in the grouping of individuals who's misguided attention is focused on Trump the individual instead of Trump the President of the United States Of America!

No question Trump is unique and even untruthful the majority of the time, however, Trump's position on the wall, WTO, and pushing back on China is in the best interest of the USA. The wall will not stop illegal migrants and is not intended to do so. The wall makes the border less porous, more manageable and adds much better opportunities at implementing more badly needed control strategies.

I refused to travel to the US long before Trump due experiences with the rude border agents right here and certainly will not expose my family to the heightened racial tension caused by Trump. But none of that has anything to do with Trump's policy on the wall, WTO, or China!

If the Bahamas had leaders like Trump, we wouldn't have a Haitian problem, there would be no unemployment and we would be the only country in the world with enough sense to abstain from the WTO based on what we see have happened in other countries.

I am no fan of Trump the individual, however, I am 110% with Trump the President!

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Well_mudda_take_sic 3 months, 1 week ago

Whatever Coulson may have written above about Trump is undoubtedly driven by his most severe case of TDS - Trump Derangement Syndrome. LMAO

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sucteeth 3 months, 1 week ago

Coulson is another leftist democrat. Trump has done more for the US than ANY other president and this is a fact. Economy booming, unemployment at all time low, people off food stamps, dealing with Russia and busting China's ecomony, stock market at highs and the list could go on and on. Who gives a dam if he has had a few wives. Clinton had over 20 affairs that have been documented and payed off most of them. Obama destroyed the US and created the racial divide.

I believe Coulson should stop spewing his BS on us with no evidence to back it up..

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Sickened 3 months, 1 week ago

LOL! You need to listen to the real news instead of listening to Trump. Economy booming was soooo beginning of last year. We're in 2019 now buddy!

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sucteeth 3 months, 1 week ago

Look at the facts they speak for themselves..

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