Financial desperation and the NHT raid


Thursday, February 28, 2013

Print this page Email A Friend!

In the late 1800s when the engineering genius Karl Benz had patented the modern motor car, powered by an internal combustion engine (known then as the horseless carriage), the political leader of Germany, who was an ardent lover of horses, labelled Benz as unpatriotic.

With even the church at the time calling the horseless carriage the work of the devil, it is quite possible that in the minds of the secular and religious authorities in Germany in the 1880s, the inventor/forerunner of the Mercedes Benz was as an enemy of the state.

Today, hard times are upon us and it appears that, in the short term, it will get worse. Selling the voters of this country in its election campaign of 2011, a two-week resolution of the IMF agreement which had seemingly come to a standstill under the then governing JLP administration, the PNP also promised the voters that nice times would return.

The JLP told us the truth and lost. The PNP was pathologically mendacious in its campaign promises and was rewarded handsomely by its base of low information voters and those who had become disillusioned with the JLP administration's handling of the Dudus matter from 2010 onwards.

Faced with harsh IMF pre-conditions for a new Standby Agreement and fully immersed in the tough times which then JLP Prime Minister Andrew Holness had promised would arrive by now, the PNP administration had no choice but to accede to the IMF. In the process, it raided the NHT ($44 billion over four years), said the removal of funds was legal (while attempting to amend the NHT Act in Parliament) and pretty much said to the people of this country, we had no other choice but to do what we did.

I sympathise with the government because its problem is simply the real representation of our's. We are paying the price for years of consuming what we have never produced while living in a flat and oftentimes, declining economy. Add to that, systemic governmental corruption and the very fact that, just previous to this, the PNP held governmental power for 18 1/2 years and it tells you that we are not likely to crawl out of this hole anytime soon.

Just recently I had a telephone conversation with my friend, Hugh Wildman, attorney-at-law, the person who had won the pyrrhic victory in the CURE vs JPS matter and lead attorney for CAPI (what does that mean again?) in taking the government to court over the NHT raid.

I saw the illegality in the snatching of funds from NHT even before Wildman pointed it out to me. A bright 10th grader could see illegality.

What is there to stop them from raiding the NIS funds? I asked him.

"You have the same concerns as I do," he said.

It was my view that the government should have borrowed the funds from NHT at a ridiculously low rate with even a 10-year moratorium on repayments.

Former Prime Minister Bruce Golding has put forward some practical alternatives in an article written in the Jamaica Observer, headlined 'That $44 billion NHTcontribution'.

He has correctly rubbished the argument put forward by NHT head, Easton Douglas that the $44 billion withdrawal will not interfere with the delivery of housing solutions to contributors. Again, even a 10th grader could see that Mr Douglas was selling us an un-saleable fairytale. Even subtly blaming a shortage of medium-sized contractors for the non-delivery of housing solutions to contributors, was a dead giveaway that the government knew the move was illegal.

According to Mr Golding, there is much government land that the NHT could have purchased for $44 billion. In other words, use the NHT's $44 billion over four years to purchase lands which would be showed on the NHT's books. In the fiscal emergency that is upon us now, even though the NHT would be devoid of $44 billion cash, it would have in its position land worth $44 billion.

The NHT takes in about $31 billion each year. With the government extracting $11 billion over the next financial year that leaves $20 billion, plus land available for providing housing solutions. Mr Golding's idea is a most sensible one and the model for it is the JDF's new barracks construction.

One assumes that the PNP administration has no intention of taking Golding's advice. The fact is, the PNP has never really been a party of fiscal discipline or indeed, economic performance. Too much of its credo is tied into 'redistribution' and the fact that people like Finance Minister Peter Phillips and Transport Minister Omar Davies were grounded in old, academic socialism theories.

The Prime Minister herself was immersed in and gained her initial power from her involvement in the politics of the state providing housing when her mentor, Tony Spaulding the late firebrand Housing Minister in the PNP of the 1970s was showing us how to build out PNP garrisons.

When $5 billion was snatched from the NHT to build out inner city housing in 2006, it was under the leadership of Portia Simpson Miller. Very few of those who gained housing solutions in those projects were NHT contributors. That they have failed to pay back anything, only satisfies the implied belief in the PNP that distribution of state benefits is a shorter line and an easier route than building an economy and creating wealth.

Therein lies my greatest fear. That this PNP administration like all since the 1970s, is driven by those in top leadership who are short on vision for an economic future that does not involve a disproportionate concentration on redistributing state benefits.

There are times when we cannot afford to bleat over what took place in the past but, if the past is an indication of what we are likely to do now and in the near future then we must consider our past. To that extent, I believe that there is space for the co-existence of CAPI taking the government to court over the NHT matter and, the argument by the government that it had no choice but to raid the NHT coffers.

To label CAPI as an 'enemy of the state' as I have seen on some crazy Facebook posts, is quite foolish. While I believe that CAPI has JLP blood in its vitals, it must be stated that the PNP is quite skilled at waging the 'patriotic' banner around and labelling those who think differently as enemies of the state.

That stance, like the PNP's democratic socialism was perfected in the 1970s. It seems that too many of those in the top leadership of the PNP, devoid as they are of any new political thought or economic lessons, are now reprising a part of the 1970s.





1. We welcome reader comments on the top stories of the day. Some comments may be republished on the website or in the newspaper � email addresses will not be published.

2. Please understand that comments are moderated and it is not always possible to publish all that have been submitted. We will, however, try to publish comments that are representative of all received.

3. We ask that comments are civil and free of libellous or hateful material. Also please stick to the topic under discussion.

4. Please do not write in block capitals since this makes your comment hard to read.

5. Please don't use the comments to advertise. However, our advertising department can be more than accommodating if emailed:

6. If readers wish to report offensive comments, suggest a correction or share a story then please email:

7. Lastly, read our Terms and Conditions and Privacy Policy

comments powered by Disqus



Today's Cartoon

Click image to view full size editorial cartoon