Counting the cost
“…You can see how many people want to nurse the government and by the time all of this is finished our nipples are bound to be very sore, but we will do our best in the interests of the people of Barbados. It’s an obligation from which we cannot escape” – Prime Minister Freundel Stuart speaking at a town hall meeting for Barbadians in the Washington DC area on April 22, 2012.
How much longer can government continue to be all things to all people?
This question came to mind on hearing the above statement from the country’s leader five months ago and its one we feel obligated to return to following two unrelated events yesterday, both of which made headlines in this publication.
On one hand we had Opposition Leader Owen Arthur addressing the island’s business leaders at a Barbados Chamber of Commerce and Industry luncheon at Hilton Barbados.
A central part of the former prime minister’s speech was that government’s direct involvement in the local economy was worrying, and there was a need to change the level of dependency on state intervention and funding.
Arthur said it was “clear that major adjustments have to be made to the scope and nature of govenrment’s direct involvement in the economy and society”.
He called for an adjustment programme to put the brakes on public expenditure, but said any adjustment programme would have to be structured to ensure the poor and vulnerable were not placed at a further disadvantage.
Education and health care were two of the areas the economist said government needed to reduce its direct involvement.
Not long after Arthur uttered his last word at the business luncheon, came the news that Barbados’ 18 dairy farmers, having not been paid by the Pine Hill Dairy in the midst of a milk glut, had turned to Government for a $1 million “bail out”.
On the heels of the financial difficulties of REDjet, closure of Almond Beach Village, and calls for relief from the tourism and sugar industries, any stranger to Barbados would wonder if there was suddenly some kind of corporate dependence syndrome in Barbados.
The truth is, though, that both the individual and corporate citizen have long depended on state support, especially when times are tough for them.
What has seemingly made the issue so glaring in recent times is the fact that the government on which increasing demands for assistance are being made is itself finding it hard to makes ends meet.
So realistically the elbow room an administration might have in good times practically vanishes in times when economic growth has also disappeared and balancing the books are as easy as walking on water.
Giving a poor citizen a welfare cheque or helping pay their expensive electricity bill can itself become unsustainable if the number of people needing such help escalates and there is no commensurate increase in revenues.
But short of finding jobs for these Barbadians, or cutting them off and leaving them to suffer, government has few choices but to assist them.
Can the country really afford, however, to adopt a too big, or too important to fail policy in relation to every business, group, or industry that comes begging for assistance.
Our view is that there should be some measure of flexibility, carried out on a case by case basis, to determine just how far the state should go in helping companies and enterprises when they find themselves in a tight spot.
Otherwise the Prime Minister’s words will become an increasing reality.