Sunday, September 27, 2009

How to make a Budget

How to make a Budget
Kevin Baldeosingh
Trinidad Express

Friday, September 11th 2009

Over the past week, all serious commentators have analysed the Budget, but now I am going to do so. In order to understand the 2009-2010 Budget, and all Budgets for the past eight years, you have to understand the principles, perspectives, and PNMs that inform the various measures. Without this, you may fall into the trap of looking for economic ideas, policy measures, or common sense.

For example, given the world-wide slump and the drop in government revenues, you might have expected a Budget which emphasised austerity and which tried to avoid a deficit that may well worsen the country's fiscal situation in the near future. But, if that's what you were thinking, you are clearly unaware of the first rule of Budget-making in Trinidad and Tobago, which is:

If You Doh Spend, Yuh Cyar Tief

This is why in the second paragraph of the Budget, Finance Minister Karen Nunez-Tesheira read, "My profound appreciation is also extended to the Honourable Prime Minister and my Cabinet colleagues who share with me collective responsibility for the integrity of this Budget." This, you would recall, was the same reasoning Nunez-Tesheira used to claim there was no conflict of interest in her overseeing the bailout of CL Financial while she was a shareholder in CL Financial. However, since this Cabinet is headed by a Prime Minister who falsely alleged that $10 million were missing from the Cleaver Heights project, who has had four court decisions go against him in six years, and who needs $3 million drapes, Nunez-Tesheira's statement is not persuasive. But she feels free to make such absurd assertions because of Rule#2:

Those Who Fail To Learn From The Past Are Condemned To Vote PNM

Everybody with sense, and even some radio talkshow hosts, warned the Manning administration that it was repeating the policy mistakes of the first energy boom of 1973. Back then, the oil dollars were also wasted on grandiose projects rather than sustainable development and inflation reached double digits. And, now that the second boom is bust, the same strategy which failed in 1983 is being pursued again. When the bottom dropped out of the oil barrel in 1982, the Government did not reduce expenditure. Instead, it increased its wage bill by $1.4 billion. By 1983, unemployment began creeping upward, by 1986 the Treasury was pretty much emptied, in 1988 the NAR administration had to go to the IMF, and by 1989 unemployment was 22 per cent. Which brings us to Rule#3:

You Can Fool All People Some Of The Time, And PNM Supporters All Of The Time

"As we have clearly illustrated, our current economic performance is creditable by any standard," Nunez-Tesheira told T&T last Monday. Well, apparently not by the standards of the Global Competitiveness Report. Although T&T's ranking in 2009 improved for the first time in five years to 86th out of 133 countries, it seems the Government's standards for measuring economic performance are not the Report's, which cites inefficient bureaucracy, corruption, and crime as undermining business in this country. The Report also ranks us 122nd in the prevalence of organised crime. Which reveals Rule#4:

Budgets Are For PNM-Till-Ah-Deads, Even When They Deading "We will not waiver from our zero-tolerance posture towards criminal activity," read Nunez-Tesheira, with nary a blush. "From the traffic violator to the kidnapper, from the white-collar criminal to the drug trafficker, the message to the criminals is simple: you will be found and brought to justice and you will feel the full brunt of the law. The Government will act to eliminate criminal activity at all levels, especially gang related activity."

Yet the Unemployment Relief Programme has still been allocated $429 million, which should fund a good bit of gang-related activity. Last year, the murder rate among URP workers alone was 50 per 100,000 (compared to a national rate of 40 per 100,000). The Government has spent billions more dollars on blimps, crime plans, boats, radar, helicopters, even as murders reached 540 last year and are already past 350 with four months still left in 2009. So why would a Government which claims to be serious about crime refuse to revamp the URP? Because of the final rule of Budget making:

Do So Doh Like So

"Our vision is for a nation where there is respect for the rule of law and human rights and the promotion of the principles of democracy," Nunez-Tesheira read in the conclusion to the Budget, while all around the country even PNMs snickered. After all, her dear leader has spent the past fiscal year defending Calder Hart, shafting the Draft Gender Policy, invading a radio station, and giving public lectures to explain why he should be Executive President, Benevolent Dictator, and Cutest Christian in the Caribbean.

One of the best commentaries of the 2010 budget so far.

Bravo Mr. Baldeosingh! Give this man a standing ovation.

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