Raising the debt ceiling

Jan 30, 2021 Editorial

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Kaieteur News – Of course, this was always in the works and budgetary matters had to come down to this. That is, raising the debt ceiling. In view of the many billions that were and are now so casually spoken of, and engaged in, it should be clear to any right thinking and concerned citizen – all Guyanese citizens – that this spells serious trouble for today and tomorrow. And we at this paper say this, because it should be more and more obvious that the nation’s debt ceiling does not have a limitation, that what is already high is going to break through restraints, because under the current administration, there is no such care or concern.
In the almost six months that the PPP/C government has been in office, there has been one abiding characteristic that has surged to close to the top. It has been borrow and borrow, and then borrow some more. It is no longer even in the millions, but billions of dollars, with the count still going on in the usual carefree manner. This government is behaving like a drunken sailor on an extended shore rampage, splurging and spending at will, and for anything and everything, that attracts human fancy. We remember the miners (pork-knockers) of old, who having made a strike engaged in a free for all celebration, an endless round of such.
It has been borrowing to address COVID-19 pandemic needs, which is certainly an area with which there can be no quarrel, no complaint, and especially when clear and clean accountability accompanies such borrowings and related spending. As to be expected, part of the massive borrowing requirement has been placed squarely at the feet of the previous coalition government, which was involved in numerous costly excesses that have since come to light. That was safe and sure to be found appealing, though somewhat timeworn and overdone at this stage. But it is a target that cannot be ignored, or a well aimed shot not to be passed by, when it cannot be robustly defended.
In all of this, there has been interest, and some concern, about where the funding was going to be sourced from relative to the mini-budget measures announced by His Excellency last year. Again, it cannot be contested that some of the relief measures put in place were most timely, and made a difference in the lives of many Guyanese, particularly those on the lower end of the economic and social ladders. But there was some alarm then, which is intensified even more so now, as to how all of the spending programmes were going to be funded. Running a huge deficit or taking full advantage of many readily available and enthusiastic lenders was among the options believed to be on the table.
Well, the flurry of borrowings in the last several months did provide an indication of what was the mindset of government leaders. So, that has been put to rest, but it is a restless state, now compounded by astonishing budgetary moves. The problem is that now the senior minister responsible for the nation’s finances has moved to the National Assembly to table two orders seeking clearance to increase this country’s debt ceiling. It is not just that he is the point man signalling where the PPP/C is heading (and taking us willingly or unwillingly with it), but of the staggering amounts that are involved.
The orders speak of increasing domestic debt by a whopping 233 percent and external debt by 65 percent. Those are not chickenfeed numbers, and when translated into dollars, the heaviness of the burdens intended to be heaped on present and future generations are stupefying. On the domestic front, the increase proposed is by $350 billion from $150 to $500 billion. There is nothing incremental about such numbers, but the equivalent of mortgaging the house several times over, with liens all over the place. They are going to come due at some time, and no matter how generous and ‘soft’ those borrowings are, they can come back to haunt. It is our belief that a more gradual vision and approach would get some mouthwatering projects done, while not saddling us to the albatross of weighty debts and debtors hanging around the nation’s neck. It does not have to be every expensive thing under the sun and all at once.
And it is so, because when that 65% (another $250 billion) increase sought for foreign debt is contemplated, there is little left by the way of optimism. Running up enormous debt (over a half trillion dollars in one swoop), and gambling recklessly, but hopefully, against future oil revenue streams, has been the failed way of other Third World countries, as piloted by their corrupt leaders, who dug huge debt holes for their societies, while lavishly helping themselves to many of those billions in borrowings, and then leaving the already poor people poorer than before.
This is the disastrous fate at which Guyanese stare, and mostly uncaringly. Our citizens are so partisan, so unthinking, so far gone, that they ignore (or submit passively to) the yokes that are wrapped around them. These immense budget increases spell danger, they speak to hard troubles down the road.

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