The Tribune

EDITOR, The Tribune.

Having seen excerpts from the Prime Minister’s speech at Lyford Cay last week, I am left with the hope that we may finally have a government that understands the basic interests of The Bahamas and Bahamians for the first time since that of Lynden Pindling.

Moreover, the nature of the criticisms leveled against Mr. Davis’ speech (being mostly veiled, yet unconvincing defenses of Hubert Ingraham’s policies) serve only to reinforce such hope.

Mr. Davis is especially to be commended for having identified what is clearly the most pressing priority facing this country today: an unsustainable socio-economic imbalance, which is these days being misidentified by both media and politicians as a “cost of living crisis”.

The real problem is not about inflation. This has always been a high cost country compared to the adjacent mainland. Goods, services, electricity and fuel are all more expensive here than in North America. But the two costs that most affect the livelihood of the majority of Bahamians (wages and revenues) are both lower.

The resulting formula means that US dollars earned from abroad are redistributed disproportionately in favour of merchants and professionals (who sell goods and services) and disproportionately against wage earners (who sell labour and rely on state services). That is the problem.

To pretend that the problem is merely inflation is to pretend that external price fluctuations affect us all equally, which they most manifestly do not.

Yet instead of fixing this formula by raising wages relative to profits and other prices, a generation of Bahamian politicians has instead relied on the ‘expertise’ of economists representing the very interests that benefit from the old, broken formula. The result is a delusional expectation that ever more foreign investment will somehow, someday fix the problem. Unsurprisingly, it never does.

Whenever you hear a politician express the notion that they would like to raise the minimum wage but now is not the time, or that the economy is too fragile to do it now, that politician is not only demonstrating a fundamental ignorance of The Bahamian economy and how it works, but is parroting the talking points of these vested interests.

Far from safeguarding momentum in the domestic economy, undercompensated labour is actually the principal obstruction to such momentum, both in the short and the long term. In other words, the surest way to boost growth (at any time) in the domestic Bahamian economy is to lift wages at the bottom, at the expense of profits at the top. The historical record is clear beyond contradiction.

If, as he indicates, the Prime Minister intends to address these inequities by finally moving to introduce a livable wage, then this could represent the best news for the Bahamian economy and society since the advent of Bahamianization.

Equally encouraging is the Prime Minister’s correct assessment of the failures of privatization in the Bahamian context.

The Nassau Guardian’s editorial of the 4th January, which criticizes Mr. Davis’ speech and defends Hubert Ingraham’s supposed successes in making us a “shareholding society” illustrates the tenacity of one of the most destructive political gimmicks of the 1980’s and 90’s.

Bahamians don’t need a government that turns them into “shareholders” any more than they need one that turns them into union members. Both these are private choices. What Bahamians need is a government that defends and responds to their needs as citizens. That’s all.

The notion that some politician has a right to take an institution built over centuries on the taxes of Bahamians (and therefore belonging to them ab initio), unilaterally transfer it into private control and then offer the original owners “shares” is as absurd as it sounds, forty years after Thatcher and Reagan (the destroyers, respectively, of the British and American middle class) tried to normalize it in a political gamble that has now spectacularly backfired on both sides of the Atlantic.

In the local context, the absurdity approaches criminality when you consider that the ultimate effect of the so-called “shareholder society” has been to exacerbate the dichotomy between haves and have-nots while offering substandard service and reduced accountability.

That the Guardian would, in its defense of Ingraham’s policies, cite the case of the Arawak Port Development (a privatized monopoly now making huge profits while the cost of imported foods has helped to price Bahamian wage-earners out of the “success” of their own economy) demonstrates how out of touch our elites have become in these matters.

I suspect it will also help, rather than hinder, the resonance of the Prime Minister’s basic point with most Bahamians.

Overall, Mr. Davis is to be commended for having told it like it is. Now, having identified them, he should endeavour to begin undoing those foolish policies that have so harmed this country and its people.

ANDREW ALLEN

Nassau,

January 2, 2024