Even as statistics from his own office show steady economic contraction, Central Bank governor Ewart Williams has asserted that Trinidad and Tobago is not in a recession. Instead, the governor has preferred to describe the country as experiencing a ’deep slowdown’’ and even gone so far to say that the internationally accepted definition of a recession-two consecutive quarters of falling GDP-may not be applicable to the T&T economy.

This position is not untenable, but there are two problems with Mr Williams making such a case now. The first difficulty is that he waited until the country reached a recessionary stage to claim that the economy should be measured by other methods. Since this contraction has been expected for over a year now, the governor, as a key director of national policy, should have put his econometric ducks in a row rather than simply making an after-the-fact assertion out of thin air.

In doing so, he raises suspicions that his claim is more political than analytical. This can be justifiable to the extent that Mr Williams is attempting to maintain economic confidence, since financial cycles are often determined by herd psychology. But that brings us to our second problem.

It isn’t only that the economy has for the last quarter of 2008 and the first quarter of 2009 contracted by 1.1 per cent and 3.3 per cent respectively, but unemployment is also up, manufacturing down, and the energy sector contracting.

In such a scenario, we are hard put to think what indicators the governor might have in mind that would transform a recession into a mere slowdown. There comes a point where financial optimism bumps into hard reality, and these figures, plus the fiscal caution being exhibited in the private sector, indicate that we are at that juncture.

Here, the more effective strategy for economic recovery cannot lie in talking about blips and loosened belts. Wishing does not make it so. Instead, it is necessary to prepare the populace for lean years. Indeed, it is instructive that the people of T&T, as indicated by reduced consumer sales, have already decided this on their own. Such an apparently responsible attitude from a supposedly spendthrift populace bodes well for the economy’s long-term prospects.

What the Government should now be doing is re-ordering its priorities to ensure that, rather than spending money on fripperies like overpass openings, it injects funds into areas that will ease the coming burden on the less well-off in the country.

Unfortunately, there is little sign that the Manning regime has reached this conclusion. And that, far more than a lack of confidence, is the greatest present danger to the country’s economic future.