Chris should go, suggests Straughn

Economist Ryan Straughn believes that Central Bank Governor Dr DeLisle Worrell is not the only one who deserves to lose his head for poor management of this country’s monetary and fiscal policy over the past seven years.

Speaking on radio here Monday morning in the wake of reports that Minister of Finance Chris Sinckler was demanding the Governor’s immediate resignation, the Opposition Barbados Labour Party (BLP) spokesman suggested that Sinckler should also be forced to step down given that the Governor is a creature of the Minister of Finance who is ultimately responsible for the current instability of the Barbados dollar.

“I believe the Governor has embarrassed himself professionally and as a result of that he is now being embarrassed personally,” said Straughn, a former Central Bank employee.

However, he highlighted Sections 47,48 and 49 of the Central Bank Act to show that “anytime any Governor believes that both the monetary policy and the fiscal policy run contrary to maintaining the fixed exchanged rate in Barbados, he has the responsibility to write the Minister of Finance and state specifically why he has come to such a conclusion and what are the remedies that need to be taken to rectify the situation”.

He was therefore adamant that the current threat of currency devaluation could not be pinned on Worrell alone, since Sinckler was a much as fault as the Governor for the recent money-printing binge.

“What you are seeing manifested right now between Bay Street [the seat of Government] and Spry Street [the Central Bank] is just a symptom.

“I believe it is an attempt basically to hang the Governor out to dry [and] he would get no sympathy from me on that from a professional standpoint [since] I think he has done the country a disservice, because the Central Bank’s job is not to support Government, [it] is to protect the mandate of the fixed exchange rate. [But] it has been a willing participant in supporting the policies of the Government, which have led us to this position”, Straughn said.

He also suggested that Prime Minister Freundel Stuart must also share in the economic blame, while contending that the country lost $219 million in the last three months of 2016.

“I think part of what Barbadians have to ask themselves is, ‘at what point are we the people going to decide that enough is enough’, because the reality is that for six or seven years at least, we were told that the policies being pursued by the Government would take us to safety whereas, not just the Opposition, but persons in the country who know better have been saying that the policies being pursued were misguided. But I think we are in a place right now where Barbadians have to decide what they want to do,” the Opposition’s candidate for Christ Church East Central said, while calling on citizens to get up and make their presence felt “either at Bay Street or in Parliament yard to make sure that the Government understands that they cannot continue with the policies they are pursuing which put our lives in danger”.

Straughn’s comments came on the heels of a series of legal and other manoeuvres by the Governor and his advisors to block attempts by Sinckler, under direction from the Central Bank board, to remove Worrell from office.

In an unusual move, the High Court met under the cover of darkness Sunday night to approve a temporary injunction, assuring the Governor of a temporary stay of his execution until next week Wednesday.

Also responding to the Central Bank developments, economist Avinesh Persaud said that from his reading of the Governor‘s statements in recent weeks the Government’s chief advisor on monetary policy had made it very clear that the current approach was not only unsustainable, it was endangering the stability of the Barbados dollar.

However Persaud said it was a clear case of the Government not listening.

“Historically when we need to borrow money and we issue debt, it is purchased by the banks and the life insurance companies [but] in recent months they have basically gone on a buyer’s strike. They are not buying any and it’s a result of that buyer’s strike, an unwillingness of anyone in the private sector to buy new debt, an increasing unwillingness to own our debt, own the name of Barbados as a credit,” he said, adding that this would explain the recent heavy reliance on the Central Bank to print money, which has led to the current pressure on the Barbados dollar.

Persaud also cautioned that there was no painless way out for the economy.

“Our deficits have been in the order of $400 million to $700 million every year for the past seven to eight years and we have piled on the debt, so I think even if we were to reverse course at this minute it would not be enough to reverse the problem we are in. So there are no easy options,” the economist said, adding
that everybody would have to share in the burden.

He also touted privatization as a possible solution, while suggesting that over $300 million in revenue could be raised through changing the domestic ownership structure.

However, the former spokesman for the failed Four Seasons project cautioned that such would only be realized “if we do the sale correctly, not if we flung off assets to our friends or anyone who is prepared to give us a deal today.

“That is a sure way that we are selling the family silver at discounted prices,” he said.

Straughn agreed, while suggesting that job cuts were not the only way for Government to achieve the fiscal space it needs.

In fact, he suggested a complete re-ordering of the state’s priorities, with health and education as the two main areas that need to be protected.

Straughn also highlighted the planned sale of the Barbados National Oil Terminal Limited to Sol as a missed opportunity for ordinary Barbadians to acquire shares, amid the urgent need for restructuring.

8 Responses to Chris should go, suggests Straughn

  1. Hal Austin February 14, 2017 at 4:15 am

    This is a good call, it is not only the governor in the dog house, but also the minister and the prime minister. The only quick answer is to call a general election.
    On the other hand, I have been saying for years in my Notes From a Native Son, that we need a new Central Bank Act.
    A mandate protecting a peg is nonsense; we need a new Act mandating the Bank to maintain economic stability, target inflation, and keep a watchful eye in employment. There is nothing new about this, in fact almost every major central bank in the world have these tasks.
    Persaud is also right about privatisation. Selling off state assets to the Williams brothers or Simpson is not privatisation; it can be described in other ways.
    There are two other ways of privatising state assets: first, selling shares to the public, and a good way of doing this is the way Margaret Thatcher privatised British Gas; and second, by marketing the sale to global players and seeing who comes in.
    Look at BHL, they were on the market and a global player came in and bought them.
    In privatisation the government has an obligation to get the best price for shareholders ie taxpayers.
    By the way, a much better written story although I am not keen on editors writing the major stories. There is a perverse incentive to keep the best stories for yourself. An editor’s job is to bring on young writers. That is a better metric of a good editor than byelines.

    Reply
  2. antoinette sealy February 14, 2017 at 10:51 am

    I haven’t read any two Bajan economic gurus agreeing on how the economy should be turned around. A whole lot of garbage morning noon and night is being published by people who have swallowed text books and have no experience as practicing economists. Not one can tell you how to get 100 fish cakes from 1/4 pound of saltfish . Mr. Grenville Phillps, if you are reading this column, please ignore the media and get your party ready to contest the next election. Use the internet to get your messages across to the voting public. You have instagram, twitter, facebook, whatsapp, messaging and whatever is possible at your disposal. If economic text book gurus were the answer to ailing economies, the Greek economy would surging instead of contracting . According to the BBC news earlier today, the Greek economy contracted over the last quarter of 2016. As long as welfarism continues to be practiced by the BBBBBB and DDDDD, our economy will remain in shambles. Ignore Straughn and company.

    Reply
  3. Helicopter(8P) February 14, 2017 at 12:23 pm

    Stay on top of every day expenditure, let not one day go by with out balancing the equation. Always look down the road to the future and future generation for their good heritage. This era is a time of gut politic and there is no time now to be wasted on people with hot air policies guiding the country further into doom. Wake up to this call all nationals and ask; ” Are we grabbing the bull by the horn or by its’ tail? Individualism is good but unity is even better. Everyone of us cannot be in the same economic bracket but at least we are all Barbadian. Until all Barbadians acknowledge this, there will be a fragmented society built off of cravings and consumptions.

    Reply
  4. Sunshine Sunny Shine February 14, 2017 at 3:59 pm

    The Central Bank Governor should be ashamed for letting his expertise be influenced by the likes of minister Sinckler. This minister is really a work in wickedness.

    Reply
  5. David Hall February 14, 2017 at 4:37 pm

    Right on Straughn! The MOF needed to be gone even before he took office. He seems absolutely clueless on managing anything relative to economics.

    Reply
    • Sherlock Holmes. February 14, 2017 at 8:30 pm

      OK preacher,here you go again.

      Reply
  6. Troy February 14, 2017 at 8:36 pm

    All the lies the MOF and the CBG are now being realized. They lied to the public year after year. Now the manure hit the fan….no one wants to accept responsibility. Chris stop pointing fingers….let him who is without sin cast the first Stone. Wunna get fat off the tax payers sweat and tears and this is what we get in return. We work too hard for this bunch of imbeciles to run our country down. This is not what our founding fathers predicted or envisioned for our country. The Bees and DEMS must take responsibility for this mess. More transparency and accountability

    Reply
  7. antoinette sealy February 15, 2017 at 9:42 am

    Mr. Straughn has to tell the nation how he will get the money to pay monthly salaries to an overweight Public Service before he must be seriously considered as an alternative MOF. He must also ask his current boss , which former Minister of Education employed two and three security guards at every school in Barbados. Yes this was a good idea but it had consequences from which we are now suffering. We are now paying salaries which we can’t afford , to people who sleep on the job when children are in the classroom. For sure other Ministers had to get a piece of the pie so they employed security guards at every department which fell under their Ministry. During that time the private sector was laying off staff and the Public sector was absorbing them left right and center. As a little girl my grandmother always warned me that ‘Wuh sweeten goat mout diz bun he tail” . That is true true true . Straughn is not the answer. The bookworm economists who spout theories from Marx, Friedman and Keynes just to impress Bajans that they have the answers to the current problem are all jokers. As I said before , not one of them can tell you how to get 100 fish cakes from 1/4 pound of saltfish because they are not practicing economists running their own businesses. Once again Mr. Grenville Phillips, I am calling on you to put together your team of business people who can get us out of this mess.

    Reply

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