Wed | Aug 5, 2020

Garnett Roper | Jamaica a collapsed state

Published:Sunday | January 12, 2020 | 12:00 AM

I am using as my point of departure two articles published recently in The Gleaner. One was an editorial titled ‘Resurgent Financial Conglomerates, But …’ and the other written by Ronald Thwaites, ‘Chang’s Dilemma’.

I am making the assertion that the Jamaican society has become a failed experiment. To be clear, neither article makes that point.

The editorial points to the post-FINSAC resurgence of financial conglomerates. It cites NCB Financial Group’s acquisition of 62 per cent of Guardian Holding and the U$225 million purchase by JMMB of 22.5 per cent of Sagicorp, and then it calls upon the ministry of finance and the Bank of Jamaica to ensure that the regulatory environment is in place to ensure that Jamaica does not return to the debacle that led to the FINSAC interventions.

Thwaites comes closer to my assertion of a failed state when he says, inter alia … that “the rot of social destruction, the disordered elements of the culture, idleness and unrequited anger, mixed with weed, liquor, and the cheap prevalence of guns, make for a toxic stew which the pity-me-little social programmes can only divert or abate for a while but cannot attack systemically.” He was describing what he calls the impossible social situation and the Green Bay mentality of the present Administration.

I have come to my conclusion of a failed Jamaican experiment for many reasons.

Most recently, I had cause to drive to Negril, travelling east to west on the north coast. It struck me as never before that there is an obvious demarcation in the philosophy of development that we pursue.

All the lands on the right hand side of the road were developed with a variety of resort developments and related activities. The lands on the left side of the road were relatively undeveloped – bush. The trouble is that the people who work on the right side of the road live on the left-hand side of the road. That is where they access services and their children go to school, and that is where their communities are.

The money earned by investors on the right side of the road stays out at sea (or overseas) and never appears to make the social investment where the people live, in housing, transportation infrastructure, or in education and healthcare. There is no proportionality between the extent of the development on the right side of the road and the extent of social investment on the left side of the road.

TWO REALITIES

On the one hand, there is the dramatic rise in the incidence of criminal violence in three of the parishes in which the dramatic bifurcation in the development choices and priorities pursued by Jamaica’s ruling elite has made it self-evident that there is a relationship between criminality and social and economic inequality. This is something to which there are blind spots for too many analysts and pundits.

There have been at least 1,326 murders committed in Jamaica in 2019. This is the largest number of murders committed in any single year since 2010 when a state of emergency was declared in order to capture and extradite Christopher Dudus Coke to the USA to stand trial on racketeering.

The 1,326 murders committed in 2019 is even more stark because this is despite the fact that states of public emergency have been imposed across various parishes in the island, including in three parishes in the tourism belt.

Where criminal violence is concerned, the statistical indications are that we are proceeding in the wrong direction in the policies we are pursuing in Jamaica. The police made 360 fewer arrests in 2019. There are 400 fewer law enforcement officers in the Jamaica Constabulary Force (JCF) than in 2011. There were only 103 firearms recovered in 2019 and at the same time that there was a total of 3,417 serious and violent crimes, which is 96 more than 2018.

On the other hand, there is an invitation to celebrate the rebirth of financial conglomerates that is a recovery from a period during which investments came from Trinidad and Barbados and were used to acquire, and, no doubt, to rescue Jamaican financial institutions two decades ago.

This may be cause for celebration except if one stops to ponder, what major industries or investments or development in Jamaica over the last two decades can be attributed to the Jamaican financial conglomerates?

The fact that I cannot think of any does not mean that there is none. There may well be. God knows there are some stellar real estate developments and some very luxurious motor vehicles on our roads that should be properly attributed to Jamaica’s burgeoning financial sector.

What is undeniable, however, when compared to the FINSAC years, is the carte blanche now being enjoyed by financial institutions in the fees charged to customers and depositors.

The financial institutions in Jamaica have enjoyed a field day and are laughing all the way to the bank at the expense of their customer.

I do not believe, by the way, that the solution to the usurious fees being charged at their customers’ expense by commercial banks is greater government regulation: I believe that what is needed is greater competition. The BOJ needs to license more commercial banking institution or to expand the range of services that near banks are authorised to provide.

GO TO GUYANA

However, my point is that the economic models being pursued have been, on the one hand, those that do not promote social investment (or reinvestment in the communities around the resort developments); and, on the other hand, ones that are pursued at the expense of the people who use the services.

There also appears to be a glass ceiling on wages being paid in many places, including the new BPO sector and, generally, in other sectors.

Many new entrants soon find that they cannot cope with these salaries. You might say that the salaries being paid, that flatter to deceive, are not livable wages. Companies earn U$10 per hour from their clients and pay their employees less than U$4 per hour for the same work.

The net effect of these policies is to render fewer and fewer options for economic and social mobility in Jamaica for the Jamaican people. Fixed-wage earners cannot survive if that is their only income in Jamaica; wages in the public and private sector are too low. On top of all of this, crime is too high and too random, and the security forces are too ineffective.

I watched policemen chasing vendors in Half-Way-Tree until the vicinity of the Half-Way-Tree Transport Centre and Mandela Park were pristine leading up to the Christmas holidays.

Then I wondered what happened to the vendors that had been chased away. How would they earn, and where would they sell during the peak commerce season of the year, the Christmas holidays?

I am sure that the vendors found some place– they always do – but would it be enough? Would they make enough?

If anyone asks me for a bit of advice, I would tell them to go to Canada, find a job there, but if you can’t get a visa, go to Guyana. Exxon Mobile just found six billion barrels of oil (and climbing) 170 miles off shore of Guyana. They started producing the week before Christmas, and they found more oil fields.

That society is about to take off. They will need our help with workers and technicians. They only have 750,000 people living in Guyana on a land area 20 times the size of Jamaica, 83,000 square miles. It stands to be the nearest thing to the gold rush.

For the time being, Jamaica is seeking to leave its citizens behind or just to leave them at the mercy of gunmen, and there is no big idea anywhere.

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