It is time we move to adopt alternative economic policies

Aug 21, 2008 Letters

DEAR EDITOR,
I refer to a letter in the SN dated Friday 1, 2008 and captioned “Private sector disappointed at lack of real discourse” and recognise that a letter writer had written criticising the Government with regards the way the activity was organised and suggested ways of improving such activities.

I feel that the writer was reasonably objective with regards the criticisms but I would like to look at the activity as reported in another way.

In looking at the caption one gets the impression that it was the Government that was at fault but after reading one understands that the private sector itself contributed immensely and the banking sector among others “made no attempt to make any real inputs.

Maybe the Caption should have been Private Sector Commission disappointed at lack of contribution by its members.

It could have continued by saying that the failure of business sector to address issues indicates possibly that they are not ready or do not understand their role as the “Engine of Growth”.

Why would the banks want to ask questions? First, most of the social capital resides in banks that are owned and controlled by foreign share holders. They are making reasonable profits.

Their concern is primarily for the share holders and while nothing is wrong with that at least one would expect some level of concern for the people and the country.

The Government’s sterilization policy is easing the way for them. Why run risk and lend more when we have treasury bills to purchase?

Of course some would point out that they are not buying these bills but overall the purchases do ease the competition and so they can go on not taking much risk and still continue to rake in the profits.

They have been criticized by so many persons and agencies as being over conservative with regards to lending policies and practices.

Some of them have indicated to me that it is the Government’s policy that forces them to behave the way they do.

I am not a banker or an economist and so I cannot discuss with them and so I am hoping that someone would write and shed some light on these issues.

What seems to be common knowledge though is that the banks are sitting on over $30 billion of social capital. This section of the private sector holds this money and seems not to be facilitating its employment to facilitate growth and development.

Does this have any implications for development? Why is it that the spread between savings and loan interests are so wide? Can people really borrow to invest in productive enterprise at such high rates?

When they do decide to run the risk and borrow at these rip off rates the stress obviously would be great and the possibility of being unable to make payments is greater.

If this country has adopted the policy of having the private sector be the engine of growth and this is the attitude of the private banking system then heaven help us.

There can be no light at the end of the tunnel. If we continue with the policy that the private sector is the engine of growth and it does not invest in areas because of too much risk or because the profit rate is not high enough and the Government does not invest then who is going to employ our people in those areas.

Who is going to provide the necessary employment for our youths? How can they be the future if they have no future?

It is becoming quite obvious that the private sector is the engine of the growth of the owners and this does not reflect in real and necessary development; the trickle down just does not work.

If they control private capital and they place it in foreign banks it’s their right. A system that says the individuals would take care of themselves and automatically it would result in social development does not reflect the real world.

I am hoping the private sector commission would examine the private sector realistically and tell us how it is that this sector would facilitate the growth of the working people and the unemployed.

We look at our neighbour Venezuela and we see and understand that prior to Chavez the profits from the industries and the banking system simply went into the hands of a few and 80 percent of the population were marginalised.

This is what prompted the government to nationalize so that the people can benefit from some of the wealth socially generated.

Cheddi Jagan understood this. I must say that he also understood the role of the private sector and acted to defend them. I have been taught by Dr Jagan and so I am saying to the workers of Guyana that your class interests are more important than your race or ethnicity.

I am saying to you that the policy of the private sector being the engine of growth has succeeded in benefiting the private sector and has not effectively led to development.

It is time we move to adopt alternative economic policies as adumbrated by Dr Cheddi Jagan.

I remember the days gone by when NACCIE, WPA, the PPP and others would hold symposiums to educate the masses, to discuss policies that would serve the working people. We were regarded as one of the more politically educated people in the Caribbean, if not the world. Today especially our youth know nothing about these issues.

I am hoping that we can revive the national debate with regards the way forward and bring back the ideas of Dr. Jagan and Dr. Rodney.

Let the workers, the Government and the private sector be the engine of growth. It can never be the private sector alone.

According to Dr. Jagan and many progressive writers and economist the dependence of the private sector and the market alone can only generate the circumstances for the perpetuation of dependent capitalism and the impoverishment of the working class.

I sincerely hope that Mr. Jerry Gouveia as the President of the Private Sector Commission and as such represents the interest of the private sector would also recognise that this sector needs to act meaningfully not only to act to bring about personal growth but that they have the responsibility as “the engine of growth” to facilitate the growth and development of the people of Guyana and Guyana as a whole.

Maybe they can have discussion not only with the Government but also with the banking sector.

If they do not take their responsibility seriously and especially if the banks retain their conservative approach and only look at Guyana with dollar signs printed on their eyes like Donald Duck then this country would not ever achieve its potentials.
Rajendra Nauth Bisessar