The elusive right formula
When prescribing medicine to treat an ill patient, the main challenge which a doctor initially faces is determining, with a reasonable degree of accuracy, what constitutes the correct dose.
It is never an easy task. Over-prescribing sometimes can trigger nasty side effects that can cause the patient to feel worse than when he or she first sought treatment.
Under-prescribing, on the other hand, may alleviate some of the symptoms which can make the patient feel he or she is getting better when the problem actually may be getting worse because the dosage is not strong enough to attack the problem at the source.
Finding the right balance to avoid both scenarios is therefore critical to beating the illness and restoring the patient to wellness. However, as is quite evident, it often involves a case of hit or miss. Furthermore, every patient is different and the amount of medicine which may be effective with one person may not be in the case of another.
The duty of the doctor is to keep trying, maintain regular consultation with the patient to get vital feedback, until either the right dosage is found or type of medicine which proves most effective. Meantime, a good doctor seeks, within reasonable and realistic limits, based on available scientific knowledge, to encourage the patient as much as possible to remain confident and in good spirits.
The same approach applies to treating an ailing economy which is what we in Barbados have been grappling with for the past seven years. Listening to Government economists and other policymakers speak sometimes about economic issues, one easily gets the impression that the economy somehow is an abstract phenomenon divorced from the day-to-day experience of the average citizen.
It certainly is not! While economics is couched in highfalutin language which generally speaks to theoretical concepts and statistics which make the subject rather confusing to the average citizen, the reality is that the people have always been the heartbeat of an economy. Indeed, economies are created by people to satisfy their various needs.
Government policy has significant influence on economic performance which is determined, to a large extent, by a crucial factor known as “confidence”. Once there is confidence, the key players who drive economic activity, will be upbeat about the future which creates a conducive environment for growth to occur.
As a result, they invest in projects which expand productive capacity. With expansion of what is called the Gross Domestic Product (GDP), the main measurement of growth, comes increased opportunities for wealth creation, employment, higher consumption of goods and services, opportunities to earn more foreign exchange through exports and, of course, more tax revenue for Government.
Against this backdrop, promoting a high level of confidence should naturally be an overriding objective of Government economic policy because of the positive spin-offs. Based on the evidence, it is fair to say that insufficient confidence in Government’s economic prescription may have served to undermine the pace of recovery because pessimism existed where there should have been optimism.
Government communication in general but specifically on the economy has been deficient. In some cases where there was an attempt at communication, it only led to confusion because of an absence of clarity on some issues as a result of one official saying one thing and another something completely different.
Earlier this year, Barbadians were told words to the effect that the ailing economy had turned the curve. Weighed down by the prolonged economic downturn, this news naturally would have raised hope that better finally was coming. However, a recent statement by the Central Bank Governor, which took the country by surprise, immediately dampened such hopes and would have rekindled doubts.
Reviewing the economy’s second quarter performance, the Governor announced that “foreign exchange outflows will be tightened by the measures to be announced in the forthcoming Budget” to halt a slide in the foreign reserves. There was immediate anxiety and speculation, especially within the business community, as to what this exactly meant.
Given the alarm caused by the statement, Minister of Finance Chris Sinckler had to engage the public in an effort to offer clarity. However, the damage was already done. What will it take for this Government to realize that it will never be able to function effectively in the absence of a clearly defined communication strategy?
Such a strategy is necessary to impose message discipline within Government and ensure clarity and consistency in the information provided to the public, especially in relation to the economy. Without effective communication, Government will find that confidence in the economy will never be what it should be and that doubts will persist as to whether it has found the right economic medicine at the right dosage or if it even knows what is doing.