“WHAT GOES AROUND COMES AROUND!”

The last two weeks have been fraught with examples of the incompetence of this Government and its supporters in dealing with the normal issues in the management of its affairs. One gets the distinct impression that, to put it colloquially, “dey don’t know wah dey doin.” For example, in my last column I spoke at length about the Parliamentary Secretary’s “boo-boo” in trying to make politics out of an issue that required non-partisan support as well as an understanding of proper protocol; last week the national holiday to celebrate the “father of the nation” was also undermined by a blatant disregard for protocol and this week the House of Assembly has been postponed supposedly to have public consultations on the implementation of the “interim” Stabilization Levy. A levy that is critical to the passing of the budget and is intended to be implemented in little over three weeks.

While I applaud the Ministry of Finance for the latter initiative --- I seriously doubt that any serious consultations can take place at this eleventh hour. As I recall the Leader of the Opposition raised a number of important questions on this matter during the budget debates not the least among which were the questions: a) How will this revenue be utilized? b) Will it be placed in the Consolidated Fund to be spent in any manner the Government wishes or will it be used for special purposes? c) Will this levy eventually become the National Health Fund Levy? d) How “interim” is “interim”, that is, how long will this levy be in place in its proposed form? e) How will it be implemented and collected equitably in cases where persons are self-employed? It is my understanding that during the presentation of the budget proposal agreement reached between Government and the FCO consultants a few weeks ago --- a few brief comments and questions of similar content were raised by some of the participants. However, in the real sense of the process of consultations, most of these queries were not adequately addressed. My question therefore is will this meeting on Tuesday, March 8th, 2011 suffice to clarify these concerns?

Discerning readers of my column would have noticed that I have deliberately avoided going into detail about the tax measures imposed by the present AUM government over the past twelve months. First of all, this is a Government that during the recent election campaign spouted considerable rhetoric about taxation and borrowing and placed all blame for Anguilla’s financial and economic plight on the “willful errors” of the past Government with the complicity of the British Government. I use the term “willful” because during the same campaign the “serial liars” of the AUM party “fabricated” a number of conspiracy theories in an effort to win the election. In fact, the Parliamentary Secretary from his infamous “black book” in “mock” investigatory style revealed what he claimed to be “already agreed taxation measures” set to be implemented immediately in the event that the Anguilla United Front should win the election. He also mentioned that there was a British Frigate in Sandy Ground waiting to ensure that such measures took place. It is little wonder then that a number of Anguillians out of genuine concern for the future took these “serial liars” at their word and voted to prevent the realization of their fearsome predictions.

Even after the AUM won the election they continued to spread this conspiracy to consolidate and legitimize their victory. On March 31, 2010, the Chief Minister in an address to the nation on his return from his talks in London said: “The Memoranda of Agreement in particular which the AUF signed in secret with the full knowledge of the Governor in Executive Council, has squandered Anguilla’s prime tourism beach resources to foreign land speculators, who among other things are allowed to invest in real estate, while giving away the taxes that were needed to propel the economy, meet the cost of financing social services, the cost of paying your civil servants and of maintaining Law and Order.” It is both ironic and unfortunate that even the beach resources that the Chief Minister spoke about and which the past Government sought to secure for the enjoyment of Anguillians at the Cap Juluca were given away in the naïve negotiations with officials of his own Government. In fact, if one were to consider the benefits that the people of Anguilla have lost in terms of the local management and the size and of the National Park; the exploitation of near-shore beach resources; the restrictions on areas for built-development, and; the options for local ownership in Cap Juluca --- one would tend to agree with Mr. Ashton Bradley’s conclusion that rather than changing the Cap Juluca Agreement from an MOA to an MOU they have in fact negotiated an IOU (I[sland] Owe You) rather than an MOU.

Members of the various constituencies in my mind have nothing to be ashamed of because they have been mislead by persons who they considered as trustworthy individuals. The truth is that on the very AUM campaign platform one of their regular speakers was a “man of the cloth” who declared with what appeared to be a “divinely inspired passion” that: “anyone who voted for the Anguilla United Front was in direct confrontation with God and would be punished!” And even now I have also reached the conclusion that a number of the elected officials of the AUM Government including the Elected Member for East End seem to blindly accept many of the lies perpetrated by the main “serial liars” of the AUM party as fact. For example, the APP Elected Member for East End proudly explained the difference between an MOU and an MOA in the House of Assembly as if he was quoting from a legal lexicon compiled by one, “Hubert Hughes, Professor-at-law”. And last evening in the absence of the Chief Minister and his Minister of Home Affairs, I was informed that the Elected Member for Valley South in a “stage managed” interview on an AUM talk show claimed that he learned from Ms. Dorothea Hodge, a political advisor to a former FCO Minister that the past Government and in particular the former Minister of Finance refused aid which was readily available from the British Government to do roads in certain villages in Anguilla. This statement being in concert with a number of lies told on the AUM campaign platform regarding information supposedly received from the same Ms. Dorothea Hodge.

My point is that if the inexperienced AUM elected officials can be misled by the “serial liars” of their own party --- it is quite conceivable that the wider electorate can also be fooled. In the case of the Elected Member for Valley South, it would be most unfortunate if he does not know that since March 2003, the Anguillian Government has not received any capital aid from the British Government. The terminology used is that we have graduated out of the capital aid program. On the other hand, if as he contends he was so informed by Ms. Hodge he either misunderstood what she said or Ms. Hodge may have misspoken on that issue. In either case it proves that it is very easy to find oneself trusting statements made by persons whom we have no reason to mistrust or who are deliberately trying to exploit that trust by deliberately trying to mislead us. Unfortunately, the dilemma of many persons during the last election campaign falls in either one or both of these categories.

I made the statement very often during the election campaign, having had the premonition that the AUM “serial liars” were exploiting the frustrations of the electorate sufficiently and could conceivably steal the election, that “ the AUM can fly an election campaign but cannot land a Government!” My statement was based on the unrealistic promises and outright lies that were being employed to achieve their objectives. Mr. Patrick Hanley, popularly known as “Sheriff” in a short posting on his “Facebook page” on June 17, 2010 made the following comment: “the past government operated on a policy of putting more money in the economy than it takes out by taxation, with the expectation that increased business activity will bring enough additional revenue to cover the shortfall, this policy has now proven to have failed, as we are now seeing record deficits with no short term resolution”.

The ongoing talk by the Chief Minister about “deficit financing” was a terminology that he (the CM) used as a flawed description of normal budgetary arrangements in all the Overseas Territories. As past Minister of Finance, I have never taken an unbalanced recurrent estimates budget to the House of Assembly. The first unbalanced budgets brought to the House of Assembly since 1983 were the budgets that this present Chief Minister and Minister of Finance brought to the House in April 2010, June 2010 and December 2010. Having said that, the impact of the global financial recession on our economy determined that such a solution was necessary but it also required negotiations with our partners in the private sector and the FCO in an atmosphere of mutual respect and cooperation. In fact, Mr. Hanley’s final admonition in his closing sentences rings true: “parties must lay aside their differences and work for the common good. More can be done and done more quickly, if everyone is on the same page instead of posturing for party advantage.”

But the point I wish to make about Mr. Hanley’s statement is that it is based on a false premise established by misinformation constantly being promulgated by the Chief Minister. Never in any of my presentations, neither formally nor informally, have I used the term “deficit financing”. To further substantiate this misinformation the Parliamentary Secretary, in a comment on the same posting made wrote: “the former Minister of Finance has long preached the values of deficit financing”. In the Ministries of Finance under my stewardship various components of capital expenditure were financed either by grants or borrowing. However, in the case of borrowing for capital development the repayment was always included in the recurrent estimates as part of recurrent expenditure. These arrangements do not fit the textbook definition of “deficit financing” from which Mr. Hanley quotes in response to a direct question from Mr. Fritz Smith on the same posting. Nor does it describe what has been happening in Anguilla over the past ten years. Estimates are what they are --- estimates! Given the vulnerability of the Anguillan economy to natural and external shocks such estimates are even less scientific and therefore allows any “pundit of economics” to come up with some theoretical framework to fit his/her arguments. These are the kinds of statements by the AUM party that take root and are spread about as factual by unwitting supporters and very often become the launching point for even more dangerous inaccuracies and lies.

All of the foregoing brings us to a very important point. Last week in my column I referred to the entire budgetary saga as “much ado about nothing!” But in truth and in fact the whole process has resulted in considerable costs. In my estimation the only presenter on the Government side of the House who seems to have any real understanding or more accurately, who is unwilling to participate in the conspiracy theories associated with the passage of the budget and the causes of our plight is the Elected Member for Road South, the Hon. Edison Baird. His views are quite unlike Mr. Hanley and others who have been persuaded by the Chief Minister’s lies about “deficit financing”. The nature of the Anguillian economy given the tax regime in place at this time; the paucity of our natural resources and the “openness” of our economy generally, Anguilla can only prosper by growing the economy and maintaining it at an optimal level in a favourable global environment. It is true that we must manage and control our spending and maximize our revenue collection but this cannot succeed without paying due attention to economic development.

The false sense of complacency that the Chief Minister and his colleagues are spreading, by the prior sanction of the budget proposal by FCO, can be dangerous if the electorate believes that we have arrived. First of all, the costs to our economy have increased because we have waited so long bickering about the inevitable, namely, mutual and respectful negotiations with the British Government who must in the end “bail us out” if things get even worse. Secondly, the taxes that they are now imposing far exceed those that the Parliamentary Secretary quoted from his “infamous black book” as representing what the AUF and the FCO were plotting to implement. Thirdly, the Stabilization Levy; the gasoline tax, and the increased customs surcharge will seriously impact the investment sector and jobs. And finally, nothing will happen in this economy if Anguilla continues to be on the “red flag” listing of major private international financial agencies and institutions that have been “scared off” by the thoughtless and damaging rhetoric of the Chief Minister on worldwide media.

Already the Flag Temenos Project negotiations have foundered; the pace of the Solaire Project is not as represented by government; the Cap Juluca Expansion Project is in a holding pattern; there are rumours of political posturing on the proposal for a new project in the Blowing Point area, and; no new investments are appearing at this time in this particular “window of interest” for Anguilla. We are beset by an ever-increasing number of broken promises and incidences of bad governance in this government’s record. And to “top it all off”, supporters of this Government are now fighting among themselves. It was heartrending to hear one of the most vocal callers of the AUM talk show circuit complain that he was driven to tears and his heart ached last Saturday when he heard the position taken by one of their usually supportive talk show personalities. Which only goes to confirm the truth in the saying that: “What goes around [most certainly] comes around!”

Victor F. Banks
Sachasses Estate
March 8th, 2011