Like most peo­ple, I had been look­ing at the re­cent­ly con­clud­ed PSA dis­pute which was fi­nal­ly set­tled last Fri­day with a mix­ture of sym­pa­thy for the pub­lic ser­vants and a strong de­sire for more in­for­ma­tion. I have been (and re­main) very crit­i­cal of the Min­is­ter of Fi­nance for not giv­ing us, the gen­er­al pub­lic, the facts and fig­ures to jus­ti­fy his case for the five per cent. For make no mis­take, the onus is on the Gov­ern­ment side to jus­ti­fy the hold­ing to the line of the five per cent, and in my view it is yet to do so. What the min­is­ter has ba­si­cal­ly done is to tell the unions and the rest of the pop­u­la­tion "that's it! We are hold­ing the line at five per cent, and those who don't like it can lump it!"

It is an at­ti­tude that is un­for­tu­nate, to say the least, and one which no 21st cen­tu­ry man or woman can con­done or agree with. And, like most peo­ple, I am of the view that if we could af­ford to pay the pub­lic ser­vants more then we should have done so. How­ev­er, we ought not to let our­selves get bogged down in crit­i­cism of the Min­is­ter of Fi­nance (no mat­ter how jus­ti­fied that crit­i­cism might be), but should, as re­spon­si­ble mem­bers of so­ci­ety, try to fig­ure out and un­der­stand why the Gov­ern­ment is hew­ing to such a tough line. Sir Arthur Co­nan Doyle put the fol­low­ing words in the mouth of his fa­mous de­tec­tive, Sher­lock Holmes: "How of­ten have I said to you that when you have elim­i­nat­ed the im­pos­si­ble, what­ev­er re­mains, how­ev­er im­prob­a­ble, must be the truth."

If you take the sense of those words you could say much the same thing when it comes to the be­hav­iour of gov­ern­ments in gen­er­al, and of this Gov­ern­ment in par­tic­u­lar, ie, that when you ac­cept that the Gov­ern­ment is not made up of mad or crazy peo­ple there must be a very good rea­son why it is hold­ing so rigid­ly to the five per cent line. The on­ly an­swer that seems to make sense is that the Gov­ern­ment is not very op­ti­mistic about T&T's fu­ture and is quite con­cerned about our fu­ture eco­nom­ic well be­ing. Let's look at some facts:

1) Oil pro­duc­tion is de­clin­ing at a time when oil prices are ris­ing, thus pre­vent­ing us from tak­ing ad­van­tage of what would nor­mal­ly have been a very nice wind­fall. Our oil pro­duc­tion is now less than 100,000 bar­rels a day.

2) We are now a gas-based econ­o­my. But there are sev­er­al prob­lems:

• Amer­i­ca can now pro­duce gas for less than we can.

• Gas prices are not ris­ing in tan­dem with oil prices.

• Our re­serves are dwin­dling and what re­mains is deep down and dif­fi­cult to ex­ploit.

• When we called for ex­plo­ration bids last year on­ly one bid was re­ceived. Then we put out what might be termed "a sweet­heart" call for bids and end­ed up with none at all. It is clear that the for­eign­ers are say­ing to us "you keep your gas, it is too ex­pen­sive!"

So, the very se­ri­ous ques­tions arise: How much time do we have? What are we go­ing to do?

The Gov­ern­ment ap­pears to recog­nise the prob­lem. Right now it is mak­ing se­ri­ous ef­forts to try and re­vive the man­u­fac­tur­ing sec­tor, and the na­tion's num­ber one sales­man (ac­tu­al­ly, that should be sales­woman), the Prime Min­is­ter, is get­ting off of her chair and is go­ing out in­to the world at large to try and bring busi­ness to our shores. So far the Gov­ern­ment's suc­cess in this en­deav­our has been lim­it­ed, to say the least. It is clear to any in­ter­est­ed and well in­formed ob­serv­er that we are in dire straits -and the Gov­ern­ment is noth­ing if not in­ter­est­ed and well in­formed.

Clear­ly, the Gov­ern­ment's think­ing is that the coun­try can­not af­ford to take on fu­ture com­mit­ments that it may not be able to hold on to. We have on­ly to look over to Eu­rope and ob­serve what is hap­pen­ing to Por­tu­gal, Ire­land, Greece and Spain (the "PIGS"). All of these coun­tries let their spend­ing get out of con­trol with the re­sult that their re­spec­tive pop­u­la­tions are be­ing vis­it­ed with great eco­nom­ic pain and not lit­tle hu­mil­i­a­tion. The time has come at last to pay the piper. Por­tu­gal is now in the process of go­ing cap in hand to the Eu­ro­pean Union for a bailout. If it doesn't come then the trou­ble that they will face will make their cur­rent prob­lems look like a pic­nic.

Ba­si­cal­ly, the prob­lem with all of the PIGS is that they let their ex­pen­di­ture get big­ger than their in­come. Put an­oth­er way, they "bet the farm" on be­ing able to pay their debts "some­time" in the fu­ture. The fu­ture is now here! Eng­land too has not been spared. The new (al­most one-year-old) coali­tion Gov­ern­ment has been forced to make rad­i­cal and dras­tic spend­ing cuts in or­der to avoid go­ing the way of the PIGS. Some half a mil­lion jobs have been cut. Can you imag­ine that?! Five hun­dred thou­sand peo­ple are be­ing thrown on the bread­line.

On­ly Ger­many has man­aged to sur­vive. The Ger­mans look at their Eu­ro­pean coun­ter­parts with scorn and de­ri­sion, say­ing in ef­fect, "You fools liv­ing in a fool's par­adise." They held the line and re­fused to let their spend­ing get out of con­trol even when it was politic to do so. But to­day they are the on­ly Eu­ro­pean coun­try that is pros­per­ing. And just in case we for­get ... re­mem­ber that lend­ing coun­tries and in­sti­tu­tions (like the in­fa­mous IMF) tend to im­pose very strict and/or se­ri­ous con­di­tions on loans that they make to bail out a coun­try. Ask the peo­ple of Greece. Ask the peo­ple of Ire­land. I could go on, but you get the point.

It looks as if we are where the PIGS and Eng­land were a few years ago. With oil pro­duc­tion drop­ping and gas not as po­ten­tial­ly prof­itable as it used to be, the Gov­ern­ment would be very fool­ish to go easy now.

The al­ter­na­tives would be one or more of the fol­low­ing:

• Lay off a lot of peo­ple now.

• De­val­ue the cur­ren­cy (a tem­po­rary panacea).

• Move in­to more debt ... but then what?

We can­not let go. No! As I said, I am very crit­i­cal of the neo-colo­nial­ist at­ti­tude of the Min­is­ter of Fi­nance who ob­vi­ous­ly does not be­lieve ei­ther in trans­paren­cy or in open gov­ern­ment. But it is clear that his think­ing is that we have to hold the line. And on that score I agree with him com­plete­ly and give him full marks ... a hun­dred per cent.

Un­for­tu­nate­ly, we have been com­plete­ly prof­li­gate with our good for­tune in the past ... too prof­li­gate, spend­ing as if there were no to­mor­row. We need to take a page out of the Ger­man ap­proach and hold the line. If you think that what is hap­pen­ing now is painful, trust me, you ain't seen noth­ing like the pain we will en­dure if we don't.

Robin Mon­tano

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