February 2012 Archives

I think the Royal Gazette's Budget headline of "Premier favours growth over austerity with $1.08b Budget" misses the mark.

Bermuda has been in economic contraction for a number of years, and there was nothing in this budget that was a break from the past which would stimulate growth. Other than growth in debt that is.

A more accurate headline would have been "Premier favours status quo over austerity".

The core problem that Bermuda faces under the PLP is that their core philosophy is anti-growth, because, as Denis Pitcher over at 21Square has demonstrated, the core challenge facing Bermuda is a loss of people on the island which is hitting Bermudians directly both in unemployment and in lower incomes.

Land licenses were designed to depress the real estate market, term limits were designed to depress international business. And they worked. The result has been a massive increase in Bermudian unemployment, a massive loss of both Bermudian and non-Bermudian jobs, but most materially, a structural shift in the Bermuda economy which the government still stubbornly attributes to global economics despite mountains of evidence to the contrary.

Bermuda it seems to me is separating into two camps, the denialists and the realists.

The realists know that the answer is to reverse the PLP's signature policies which have directly undermined Bermudians job creation and wealth creation. The denialists say "it's the global recession, we need less foreigners and more government debt to solve our problems", when the genesis of our problems was less foreign workers and investment preceded by a massive ramp up of Government debt.

As the George Orwell quote goes: "To see what is in front of one's nose needs a constant struggle".

I think what drives me the most crazy is the PLP's insistence on saying things they know not to be true.

To borrow a quote from Bill Maher:

"This is what I hate about the Republicans. They know that what they're saying is BS, but they say it anyway because they know that the people who aren't paying as much attention won't know it. That, to me, is the ultimate definition of cynicism."

That's why I found the PLP's recent patriotism attack on realists particularly cynical, and hypocritical. Especially because just a week ago their shrill website claimed that "If you believe in the right wing values of the Republicans and the Tories, the OBA is the party for you."

The PLP are Bermuda's modern Republicans, particularly in their campaigning which borrows heavily from their highly antagonistic, reality be damned approach to communcations. Philosophically they are isolationist, anti-immigrant, and responsible for racking up massive amounts of debt.

Calling their opponents unpatriotic is election gimmick number 1 of the US Republicans, and one they invoked regularly against President Obama. Of course it's racial code for all sorts of things: that he isn't really an American, that he's a Muslim, And that's what the PLP are up to with this patriotism BS. It's a classic diversion, the kind politicians invoke when faced with tough to rebut criticism, not to mention similar code that the Opposition are somehow not authentic Bermudians, are pro-foreigner, anti-Bermudian etc..

But what we've seen is that nothing has been more anti-Bermudian than the PLP's economic and ensuing social policy. The economic policy has turned surpluses and a thriving economy into perpetual debt and a contracting economy with ensuing job losses in every segment except cruise arrivals which have little economic value - but lots of headline value.

What strikes me as unpatriotic is implementing policies designed to drive your key jobs to your overseas competitors, and even worse - refusing to end them when it's obvious that they are a threat to Bermudian jobs and wealth creation.

That economic contraction has made the long term survival of many Government services completely un-viable. Everyone knows it. The PLP know it. They just can't admit it with an election looming as it is an admission that their philosophy is completely incompatible with a growing economy and inwards investment.

So what we get is a budget perhaps most characterised by an import duty change that in a few months has been completely schizophrenic, culminating in a Budget proposal that isn't even directionally consistent with a measure put in place before Christmas.

We've gone from 35% duty at the airport and $100 duty free per household to 25% duty and $200 each family member.

It's indicative of a leadership that has no guiding philosophy other than what works for a headline in the here and now. There is no strategy just tactics, there is no plan just gimmicks, there is no growth just spin.

I keep returning to the simple idea that there is no way for Bermuda to make the structural changes without a change in political leadership. Paula Cox and her colleagues are legacy protecting first and foremost.

They can't totally reverse discriminatory land licenses because they were their idea. They can't end job and investment killing term limits because they were Paula Cox's idea. They can't admit that our debt is out of control because it was single-handedly put on the books entirely under Paula Cox's tenure.

This budget was simply an attempt to buy time and hope for some external factor to turn things around. But Bermuda can't afford to wait for outside forces, nor will they be enough.

Bermuda's recovery will begin when Bermuda fixes Bermuda's self-inflicted problems. And the best way to signal that Bermuda is making a clean break is to make a clean break and bring in new leadership.

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Interesting and typically reality based analysis of political corruption by Kevin Comeau in today's Gazette.

Unfortunately the Gazette really buries guest Op-Eds to well down the page of the comment section of their website.

That would not be such a big deal if political corruption were a rare occurrence in Bermuda. But it appears that "Defamationgate" may be only the tip of the iceberg.

Numerous Government capital projects over the last ten years (e.g., Berkeley Institute, Port Royal Golf Course, Heritage Wharf, the new Courthouse, TCD) have collectively resulted in cost overruns of hundreds of millions of dollars. Generally, only two things can cause large cost overruns: Managerial incompetence and financial corruption.

When you consider that the cost overruns on some of these projects exceeded 100 percent of the initial cost estimates and that Government had at its disposal civil servants with collectively more than 100 years of architectural, engineering and construction expertise, it is hard to conclude that only incompetence was at play. Someone had to be doing something unscrupulous. Individually and collectively, these and other large Government contracts simply don't pass the smell test.

Not only were tendering rules violated and the recommendations of civil servants ignored in the granting of some of these and other large Government contracts, but inordinately large change orders were frequently made.

When you add to this the multiple damning reports of two Auditors-General, we are left with strong circumstantial evidence suggesting something untoward.

I find it interesting that PLP partisans' position is that an absence of prosecution demonstrates a lack of corruption. However those same people would argue that the administrations that proceeded them were horrendously corrupt, yet I can recall no prosecutions from those eras either which by their own definition means they were corruption free.

What we're seeing is situational ethics in full effect.

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"Patriotism is the last refuge of a scoundrel." Samuel Johnson. http://t.co/oX0WIKTh

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Government reverses yet another policy which had nothing to do with BDA's economic downturn. Nothing whatsoever. http://t.co/eMBRzKpc

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It will be interesting to see whether the OBA's position on MP pay cuts is too complicated - although grounded in financial reality - to be fully understood by the public.

It's a bit nuanced and the PLP excel at demagoguing reality based positions such as this.

The PLP are obviously overjoyed that they think they can pin their own year long resistance on pay cuts on the Opposition who had no role whatsoever in wrecking the Government's financial stability.

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It's impossible to buy Bermuda when so many businesses won't return your calls.

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Mmmmmm. Bermuda bluefin tuna with soy sauce and wasabi. http://t.co/s6BAJLmc

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