Saturday, January 20, 2018

The private sector can't dance


Donstan Bonn

This year, let's start calling everybody to account. None must be spared; the times demand it. We have blasted the politicians and must continue to do so. But there is a group allowed to escape from their responsibility to the society from which they have fed more than most. I refer to the business class; not the struggling small and medium operations, but those big enough to have together parked billions in the bank, profits not possible without this country's resources and people, unrealisable in any other similarly small economy.

For the past few years, most of our business elite have been sitting on their resources, marking time but still accumulating; only a few venturing to take some measured risk to stimulate the economy; most waiting, as always, for the treasury to provide new feeding. And they continue to absurdly shout to the government "diversify, diversify'', as if they had no responsibility in this critical national need.

This class benefitted most from those years between 1995 and 2008, when the government spent with increasing wildness. Natural gas had kept the treasury replenished from LNG export earnings and fuelled our petrochemical and iron and steel industries as well as our light manufacturing, all helped by an artificially buoyant international economy. In that 13-year fete, with the band playing "sweet T and T'', everybody danced, but it was business that boogied to the bank

Then came the global financial crisis which produced the great recession from which the world is yet to recover. Markets have shrunk and countries, like Trinidad and Tobago, that never developed sustainable competitiveness, will run aground. Already we see budget deficits and debts increasing, as the government borrows to sustain our lifestyle, to keep us dancing even as the music fades.

This year we will continue drifting downhill and could eventually crash into the ditch. For there have been critical changes. One is the global glut in natural gas that will keep prices low. The US now has reserves for over 100 years at current consumption rates. New competition could push us to the periphery of the LNG market. Worse still, Point Lisas could become a graveyard within the next decade. It is attracting no new investments and those already there must be thinking of migrating to America for cheaper gas and larger profits. Our best hope is for a huge oil find to increase production. After 50 years of independence, we must still keep our fingers crossed that some multinational is lucky with our resources. Shameful!

Our economy is an illusion. Without LNG, the engine stalls, the mask falls, we see the shell. The music stops. What will we now sell to put food on the table? Whose responsibility was it to diversify the economy? The government, yes, with policy and incentives; and it failed miserably with agriculture and the creative industries. But didn't the state facilitate private business expansion with market access, physical infrastructure, modern telecommunications, social stability, cheap energy, low corporation tax and other fiscal incentives, paid for by the people? So where has the private sector been in the need to diversify? Missing in action! Calling on the government! Rubbish! Don't they have minds as well? Aren't they supposed to be entrepreneurs? Didn't they once style themselves "tigers of the Caribbean''? They were tigers when fed by LNG money; but now just ordinary fat cats, sitting on their pile of dough, not knowing how to bestir themselves. When last has our private sector come up with a new idea for the economy of Trinidad and Tobago? They seem dead in the head, adept at the ordinary, when today it is only true creativity that will save us.

Though with some outstanding individuals, our business class as a whole is spoilt. Forever tied to the state's apron strings, they do not have the daring to take up the slack when the government must reduce spending. Whilst they create some wealth, they absorb so much of it in the process. In the final analysis, they constitute a huge sponge, sucking vitality out of the system, pouring back insufficient and accentuating the divide between rich and poor. Sure they provide employment for the survival of thousands of families. So did the European nobility for the serfs in the middle ages. Our business class, like the feudal landed gentry and business people everywhere, always cream off most for themselves. They are fundamentally uncaring of the common herd on whom they depend, lavishing on themselves and their own, living in a separate gilded world and always ready to jet away at the first sign of trouble here, untroubled by their own role in any instability. Let the present economic slide become irreversible and you will see them fly. What does Trinidad and Tobago mean to such people?

Not many are driven by more than materialism. There is little social conscience or patriotic passion here; not much genuine talent either; certainly no Henry Ford or Bill Gates in this company. Our private sector is more glitter than gold. Therefore see them today, with boring billions in the bank, all dressed up with nowhere to go. They are parked at the gate of the state in Benzes and BMW's, calling on the government to "run the money'', spend for them to absorb more; waiting for handouts they don't need; far worse than the poor they criticise for "dependency''. Most feel no strong inner compulsion for self-propulsion. They too are products of a crippling culture that produces the deformity of dependence. So that after the13-year LNG fete, for all their flash, our private sector can't dance. Shackled, they can't move. They hear no inner drum.

Ralph Maraj is a former

government minister.