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Colm Imbert’s Shoes

Thursday, April 14, 2016

No matter what some politicians say, nobody really wants to be in Colm Imbert’s shoes at this moment. This is not 1981 under George Chambers or 1986 with ANR Robinson or even Basdeo Panday’s turn at the crease in 1995. These are all men who led administrations that faced and confronted very serious challenges that had the potential to permanently change the social and economic landscape of the country. 

I know this may amount to an over-simplification of the issue, but in each instance cited here, the prospects for relatively timely economic recovery, resulting from a turnaround in oil prices, could have been anticipated if only because many objective global fundamentals were at a level of general stability. Nothing epochal had taken place.

Yes, the Saudis flooded the market with cheap oil in 1981. We also recall the convulsions within OPEC at the end of 1985 that led to a virtual glut and we are constantly reminded of the fact that Panday was faced with a $9 oil price back in 1998 when the Saudis acted up again.

However, the external circumstances driving the current downturn are now characterised by a realignment of international forces and unprecedented geo-political dynamics—much of which account directly for the prices of crude oil and natural gas. There had been no 9/11, no “Arab Spring,” no upsurge in international terrorism, no recovery from an economic crisis not witnessed since the Second World War.

Though there are longstanding antecedents, it might be safe to say that the convergence of historical forces has never been the same.

Internally, missed opportunities to expand the base for non-energy driven economic growth have persisted and, in some senses, gone into reverse gear even as a succession of spendthrift administrations has come and gone—the last two for certain.

I remember a conversation with a former energy adviser to one administration who contended that there was no need for panic over the oil industry because for as long as the planet is viable, there will be oil and natural gas there for the taking.

Accordingly, state policy on domestic consumption never fundamentally contemplated days of scarcity and of precipitous, enduring price reductions. The rate of growth was being boastfully measured in terms of kilowatt hours of energy expended and renewable energy sources were never seriously pursued by anyone.

Playing fields were, quite correctly, lit to extend the hours of outdoor recreation activities in communities throughout the country but the lights still stay on long after everyone has gone home. In private homes, Xmas lights are measured in the thousand and proudly make the front page of the newspapers.

Economic diversification came to mean expanded opportunities mainly within the sector comprising energy-sucking plants at preferential rates. The country has been on a roll.

With such recklessness in the face of readily evident perils, Trinidadians and Tobagonians have, with state support, become less and less inclined to prepare for change. In the process, we have grown fat (readable as metaphor and as fact), ill, spoilt and patently unprepared for any worst-case economic scenario.

This is not a critique of the paternalistic state. In my view, the state needs to be the tireless parent of the poor, the uneducated, the ill and the dispossessed. But not all favoured children ought to become spoilt brats.

Journalists who have been around awhile could have written the post mid-year review responses in advance of hearing a word from the minister. The coded ethnic references, blind uncritical support and our infamous penchant for “taking advantage” of each other.

For certain, price increases in a wide variety of sectors will not be proportionate with the adjustments announced in the mid-year review. Do the mathematics for yourself in the coming days.

Within recent memory are inexplicable increases in prices for products to which a reduced Value Added Tax (VAT) had been announced. Such a travesty should be punishable under criminal law, I believe.

There will no doubt be an impact of increase fuel prices that cuts through a wide variety of goods and services. But consumers need to be conscious of the proportionality of the relationship between the measures and the new costs. Former energy minister Kevin Ramnarine has done such a calculation relative to the increased price for super gasoline itself and found that perhaps we are being over-charged to start with—which, I contend, still positions us favourably among countries of the wider region.

But, let’s now extend the calculations to the increases we will see arise.

There is also the increase in customs duty and motor vehicle tax for vehicles 1999cc and up—or the most part vehicles that are better known for fashion than for utility. There are also increases in the prices for tobacco and alcohol for the poor and underprivileged. Someday, somebody is going to argue that governments who touch these commodities are denying means of comfort for suffering souls.

Try surviving on 30 per cent of what you earned a year ago and do some arithmetic to calculate what you have to earn through alternative means and what costs you have to cut. Now, forget about the dry humour, dull delivery and the patriotism nonsense and just try—if you are so unfortunately minded—to fit into Mr Imbert’s shoes.


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