Analyzing a budget

Mar 04, 2021 Letters

Dear Editor,

Overall, people I conversed with said it was a good budget with an excellent timely theme: “A Path to Recovery, Economic Dynamism and Resilience,” although there are some issues with some items and some numbers. The Senior Minister, Singh, and Vice President, Jagdeo, are applauded for focusing on measurers to lift the economy out of the ‘pandemic recession.’ But the public is upset with the tone of the presentations (certainly on February 22). That was not a debate, and the analysis by many MPs of the budget was poor.
In my studies in comparative politics and political economy, the government side presents a budget and an opposition shadow person (very often the opposition leader) gets an equal amount of time to respond to it. Then other MPs from both sides get their turn to give their input on the budget. Parliamentary comments are usually related directly to the budget, not extraneous remarks.
For instructive lessons, the MPs should look at the budget presentation by the Chancellor of the Conservative government in UK and the follow up debates. The British MPs would get a chance to quiz the Chancellor and the Prime Minister. Guyanese MPs should tune in to understand how a response is given by the opposition and other MPs.
The US would start its budget preparation soon. The US has a completely different system of budget presentation and debate. The Budget Director or Secretary of the Treasury don’t make an oral presentation of the budget. Rather, the President and his team prepare the budget and sends it to Congress. The Congress discusses it and suggest changes. The President always agree to the changes in order to get the budget passed by both Houses. There is a give and take. The Members of Congress don’t bring in extraneous discussion or debate unrelated to the budget. They may request funding for items in their constituency. The President’s team normally give in to the demands in order to win their support for passage of the budget.
Noted Guyanese scholar, Dr. Ramesh Gampat, did an extensive analysis of the February 12 budget. He is an outstanding economist who has worked with the World Bank and the UN to assist countries with their development models and budgeting. I urge Guyanese MPs to access it to learn how to analyze and debate a budget.
Dr. Gampat proffered a model of analyzing a budget — one can see scholarship here of some who are well read in Economics. He proceeds to analyze the budget through the lens of this framework. It is very professorial. This is what we learn in college studies and in seminars in graduate school on the way to a PhD. Only scholars who are masters in their subject can undertake such a task and with such distinction. It is the kind of study that not even my Economics professors had taught when I was doing doctoral studies. It is a great, impressive, painstaking piece of work, very comprehensive and professionally done. It would have taken over a week of full time studies and commentaries. It is scientific and objective. It is the work of a real scholar. This model should be available to all college students majoring in economics on how to undertake an analysis of an issue.
Gampat’s analysis tells the situation as is — the real value of the budget item. It cannot be compared with sycophancy or singing for supper comments that appear in the mass media in Guyana. This is a real economic analysis, not journalistic jingoism. I have never read a Guyanese economist proffering such an analysis — how it should be done and how to analyze it. The government of Guyana and the opposition should take a look at it; there is so much to learn from it. Those engaged in sycophancy should take a page from Dr. Gampat’s work, if they are serious about being an analyst. Those who are not trained as economists should get a better handle of the budgetary process.
One disagreement I have with Dr. Gampat – he claims a budget is supposed to be an economic tool and it is indeed so in “developed” countries although one can’t separate politics from economics. But Guyana and most third world countries are so far removed to being like “developed” countries; professionalism is lacking. In Guyana and third world countries, a budget is primarily a political tool on how to retain political support and build on it. By definition, a budget is not a purely political instrument and by practice it is not a purely economic instrument; it is both but still lacks the nuances of a “political economy” instrument.
Yours truly,
Dr. Vishnu Bisram

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