$2-trillion dilemma: Where did all the borrowed money go?
Aubyn Hill, Financial Gleaner COLUMNIST
Jamaica's national debt is in the vicinity of $2 trillion. Despite the substantial depreciation of the Jamaican dollar for a very long time, and at a much faster rate in 2013, that $2-trillion figure is a huge amount of money except, possibly, in Zimbabwean currency.
It may sound distant when it is called 'Jamaica's debt', so let us personalise it and call it what it is - our debt.
That money should have been spent for our, the citizens of Jamaica, benefit but that outcome is somewhere between unclear and doubtful. What is transparently clear is that it is us, Jamaicans, who will have to pay back this mountain of debt racked up by different politicians over the last three or four decades.
First of all, our politicians need to be castigated for borrowing so much that we are quite simply unable to repay in any reasonable time frame. Leaders in other sectors of our economy need to share that blame. I am suggesting that the financial sector - the one in which I made my career, albeit almost exclusively overseas - is the biggest local enabler of the governments' profligacy.
The financial sector gorged itself on endless amounts of government paper, which carried attractive and corpulent interest rates. Some of that paper the sector imbibed by government fiat, but large portions were by choice.
Similarly by choice, and by government encouragement through high interest rates, banks and other financial firms moved their lending away from the manufacturing and productive sectors into non-productive government debt financing activity.
But maybe the most insidious position of the banks is the fact that they never chose to publicly caution, not to mention criticise, any of the government leaders who sank the country and us under this huge debt albatross.
The financial institutions profited relentlessly from this government largesse.
CALL MINISTERS TO ACCOUNT
Just as we are calling the NHT board to account for its questionable-to-faulty judgement in taking Jamaican citizens' taxes to buy the perennially loss-making Outameni property (or business?), so, too, we now need to call to account all the living prime ministers and their finance ministers to give a detailed account of the amount of money they borrowed each year and how the funds were spent.
Let us see the progressive amounts which were spent on debt service, education, government travel, civil service pay - analyse the growth or otherwise in these expense lines, and the spend on cars for monsters and senior civil servants compared to the spend on police cars and fire vehicles.
Who received those contracts for imported police cars, fire vehicles and JUTC buses, or passports?
How much fuelled corruption - sadly a disease on whose international index Jamaica is still falling.
How have our nurses, teachers, government doctors, police officers and soldiers fared from these now obnoxious amounts of borrowed money? Were they paid well or even on time?
INFRASTRUCTURE IS BUCKLING
Many Jamaicans have voiced the concern that a great deal of our infrastructure is falling apart. Probably the most prominent radio personality who carries that message openly and often is Ralston Hyman, the economic and business expert on Power 106 FM's 'Real Business' programme.
His voice is important because he is a member of the government-appointed Economic Programme Oversight Committee (EPOC).
It is my assessment that his view is fair and balanced. His insight is right that investors will avoid Jamaica if our roads are bad; health services are weak, stretched and creaky; our police force is ill-equipped with insufficient and poorly serviced vehicles and other resources; and our schools continue to underperform because of lack of sufficient investment and weak measurement tools - even as we deny every social need to meet the IMF's 7.5 per cent primary surplus target.
The burdensome money-sucking 7.5 per cent primary target is an IMF requirement that is unique in its severity. It is a Jamaican exclusive from the IMF to match the vastness of the debt placed on the backs of citizens by politicians who were elected to govern well and lead the country to economic prosperity. What a farce and pain it has been to many poor Jamaicans.
In the same manner that we are asking our Government to account for its poor judgement over the purchase of the Outameni property (or entire business), we should really push hard to get our elected officials - the current ones and those who have retired - to tell us where all that borrowed money went.
Clearly, not enough was put in our failing and even decrepit infrastructure, nor used to educate the majority of Jamaicans to international standards so that they could build a better Jamaica by working here to foster fast economic growth, or overseas to garner knowledge, experience and capital and return home as investors and business managers who could enhance economic growth.
Until we getter better particulars on how the money was spent, it looks like a lot was wasted and a bunch disappeared down the sinkhole of corruption.
Aubyn Hill is CEO of Corporate Strategies Ltd and chairman of the opposition leader's Economic Advisory Council. Email: firstname.lastname@example.org. Twitter: @hillaubyn Facebook: facebook.com/corporate.strategies.