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Inside Politics – Job Creation Is Wealth Creation

Economic stimulusAntigua St John's - It was heartening to hear that the new chairman of the Antigua & Barbuda Investment Authority (ABIA) has returned from Trinidad & Tobago after a successful conference there.

If all that comes out of that gathering is that Antigua and Barbuda gets investments that lead to new jobs, then for me, it will have been a very successful trip.

Job creation has been a problem for the United Progressive Party. Last week, when Prime Minister Baldwin Spencer listed the accomplishments of the UPP Administration after eight years in office, job creation was not among them.



Truth be told, job creation has never been part of the philosophy of the UPP. This is evidenced when one glances back even to the 2009 UPP Election Manifesto, where job creation was noticeably absent from its list of priorities.

Captioned “Defending the Nation”, the manifesto speaks of defending Antigua & Barbuda from threats the party saw as real or imagined. Economic development and job creation received little attention, as the focus was placed on defending the nation from other threats.

There are a number of reasons for the absence of any focus on job creation. For years, the UPP’s primary focus has been to root out the seemingly intractable Antigua Labour Party. Such was its concentration on that single task that it seems to have sapped the party’s energies for anything else. After assuming office, the UPP became captive to its radical element - who kept shouting, “Lock-up!” - forgetting that ‘lock-up’ does not create jobs, nor does it put food on the table.

Over the past eighteen months, I have had an on again-off again discussion with the government’s chief economic adviser, Kevin Silston (now on secondment in Washington) on what in my view is a mistake in the alignment of the ministries in the UPP Administration over the past eight years. When it first took office in 2004, it created a Ministry of Finance and the Economy, a first for Antigua and Barbuda. In my humble opinion, therein lies the problem.

I am of the view that this alignment is like a marriage of convenience that is not working. I have pointed out to Kevin (and even to UPP stalwart and economist Ernest Benjamin) that this particular alignment of the Ministry of Finance with the Ministry Economic Development cannot work as it features an inherent conflict. Kevin and I have argued the point on several occasions, and while he will not admit it, he has supported my argument in one of his responses.

I suggested to him that the Ministry of Finance is by its nature conservative and it will be watching every penny that is spent and would oversee the other ministries to ensure that they adhere to their budgetary allocations, as they should.

On the other hand the Ministry of Economic Development is primarily concerned with attracting investment by granting would-be investors a host of concessions and tax reliefs. My view is that the Finance Ministry’s imperative: meeting the government’s financial obligations, naturally discourages it from engaging in this course of action.

Irrespective of their best intentions, the two UPP Ministers of Finance, Dr. Errol Cort and now Harold Lovell, found themselves so bogged down by the exigencies of the demands of the Finance aspect of their portfolio that it became their primary and quite often only concern. Economic development is seen as a distant cousin.

In one of his retorts, Kevin asked me, “So you want me to give up taxes now (from the potential investor) when I have salaries to pay at the end of the month?”

To support my contention, I recall that back in August 2010 Finance and Economy Minister Harold Lovell convened a press conference to announce his successful discussions with the members of the Paris Club. While he was gloating about the accomplishments in Paris, I questioned him about his plans to stimulate the economy. His answer was that in two months he would call another press conference to announce a stimulus package.

It was not until the middle of 2011 that the press conference was called to announce the Construct Antigua and Barbuda Initiative. This was the government’s ‘economic trump card’: a proposal conceived by Secretary of the Contractors Association, Nicholas Hadeed, and one that Hadeed admitted took the government about a year to take seriously.

In eight years, the government has not articulated one credible economic stimulus measure of its own, and its failure to do so is partly responsible for the economic morass in which the country finds itself.

I don’t pretend to be an expert on psychoanalysis, but using my own experiences, I know that a job gives a person a sense of self-worth and accomplishment. It also gives a sense of independence. This is especially true for a young person entering the job market for the first time earning his/her own money to spend however he or she wants.

There are too many young men on the street corners during what ought to be working hours: listless, without hope, without a future, without a sense of belonging.



Many have turned to criminal activity; but the real crime is that society has failed them. It’s time to end the cycle. It is time to provide jobs, meaningful jobs to our young people.

There are other reasons for the UPP’s difficulty with job creation. Years ago, Antigua and Barbuda could boast of being a relatively tax-free jurisdiction. Now there are a host of taxes on everything. Investors by nature are seeking to maximise on their investments. Taxing income, allowances, and every conceivable earnings of both native and investors will serve as a deterrent.

There’s a saying; ‘you can’t have your cake and eat it too’. One of the fundamental principles of economics is the Law of Diminishing Returns; perhaps as a nation we have reached that point with our maze of taxes.

Creating opportunities for job creation is creating opportunities for wealth creation.

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14 Comments In This Article   

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Excellent Article

#14 Kevin Watkins » 2012-06-04 20:04

One of the best articles Everton Barnes has ever written. Keep up the good work Mr Barnes. I am going to save this article.
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Kevin Watkins

DONT BE FOOLISH

#13 THE GODFATHER » 2012-06-04 11:00

Everton, you are wrong, wrong, there is more to this reasoning other than taxes, stop selling your employer campaign plan. Do not let others use you for their own selfish motives. You are a clever guy, so don't be foolish, stop selling yourself short, and have some self-worth.
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THE GODFATHER

JOB CREATION

#12 GARRAT » 2012-06-03 23:23

Everton, to sit and wait for a foreign investor to arrive with a suitcase of money to invest is not just going to happen. We must first work with what we have. We should not have gone and bought part of the Epicurean Shopping Centre, nor the Bencorp Building, nor try building a car park unsuccessfully, but use the waited money and rebuild the Half-moon Bay Hotel into a five star hotel. Our tax money was spent covering up drains in St.John's to the tune of over $100,000 million then taken up and thrown away, and nobody care about it. The manufacturing sector,agricultural sector need revival and only the ALP has a plan for their revival. THE PEOPLE GET THE GOVERNMENT THEY DESERVE .
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GARRAT

Don't fully support Everton>

#11 C. Matthew » 2012-06-03 17:53

We keep blaming the wrong people in Govt for the economic failures and not the Chief Servant who commands the Nation. Truth is neither Errol or Harold never attacked any investor or blocked any investment. Chief Servant blocked 400 application for foreign land holding development over the last 8 years!!! Who killed the Guaina Island project that could have created 1000's of jobs . Who took away half moon bay and can't pay for it ,?? This scared away most foreign investment .Compound the problems by sending your Army againt the largest local investor ,simply for bringing generators which you are now depend on. Over 1 billion $ was wasted on foolish car parks, pork barrel fences'', rusted out old chinese generators,larvish stays at the Woldoff for cronies and playmates, buying up old building,ect ect... Yet 1 hotel was never built to give work to your people!!! We now have to Defend the Nation from you !!!!
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C. Matthew

Timely article #4

#10 Smart One » 2012-06-03 17:19

I don’t believe we can replay these debts. The interest alone will keep us busy. So we better make up our mind now to tell them they better start thinking of write-offs or I suggest we ensure these politicians never die. Let them find a way to pay for it and only when paid they can go to their resting place. As Derrick says he is worried that his grandchildren will be saddled with all this debt burden and nothing to show for it. We will be in debt for centuries to come to the Venezuelans and Chinese. No end in sight.
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Smart One

Timely article #3

#9 Smart One » 2012-06-03 16:54

The bank would be glad, but when the newspaper state the cause of death of your child I don’t think they would be happy. Check out what is playing out in Europe, people are coming out against austerity measures. They simply will not put debt payment above letting the nation starve. But we have freely chosen to do so and our politicians have told us that is how it supposed to be and the diehard followers have swallow this. Again watch the European development. And the debt that they are talking about, ours is like peanuts to theirs. Not even ours are just crumbs. And they say they are not going to pay back anything in a rush. We should have been bold enough to say I.O.U. period. What is becoming a bigger problem is our ability to pay back the much bigger debt we now have to Chavez and China.
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Smart One

Timely article #2

#8 Smart One » 2012-06-03 16:53

They can’t be creative and think outside the box. And then they are now guided by expert from the IMF with a total different agenda. So no hope there. The Construct Antigua initiative came much too late. And I for one truly have a completely different view of taxes. We cannot be compared to large Islands that have the numbers for collecting taxes. We need a different tax system. And don’t tell me we have to pay taxes, cause I never said we should not pay. But the manner in which is important. The aim should always be to stimulate the economy, which means that people should have enough disposable income in their hand, so they can spend it and shops and other businesses can thrive. It is not the society that has let the young people down it is the politicians. What is the sense of paying taxes and the government meets their financial need but the rest of us struggle to get by. It’s like paying your mortgage and your children die from hunger at home.
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Smart One

Timely article #1

#7 Smart One » 2012-06-03 16:52

Everton many of Caribarena bloggers and commentators have tried to stress this problem without trying to be political. However each time you bring something up contra the UPP it dies. Dr. Cort and Lovell are deaf to the ideas of others. So are Mr. Silston and some other members in the ministry that are guiding the minister and of course the IMF behind the scene.
The priority from the UPP was to put as they saw it the fiscal house in order. But as you call it the economic house came tumbling down as well. And like an entrepreneur has to look for ways to expand his business and in time of economic depression he would have to spend more instead of less, it is therefore the accountant who has to maneuver how to pay the bill. The job of the accountant is very easy when money is coming in as water, but when things are tough he has to be very creative. So to with the people in the Finance Department. Weston called them lazy at one time.
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Smart One

RE: Inside Politics – Job Creation Is Wealth Creation

#6 Audrey » 2012-06-03 13:01

Tarl everton a you that? Sounds good. U need to hold a class with magic he keeps spouting the nonsense from zdk. A well written article.
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Audrey

“Antigua & Barbuda is NOT open for business”

#5 Dig It » 2012-06-03 12:57

Everton, "job-creation" should always be on top our "list-of-priorities" in this country! It is just "sad" that it has been put on the "back-burner" for the last eight years, while the country's economic conditions get "gloomy" as the days and months go by! Contrary, to what the ABIA Chairman is saying, it is evident that Quote:
“Antigua & Barbuda is NOT open for business.”
So when the Chairman said Quote:
“We were able to engage many businesses, presenting the incentives offered by the Antigua & Barbuda Investment Authority, and we also held solid discussions about specific sectors,”
He is actual telling the "straving" local skilled workers and those yet to be "discovered" that "nothing" is on the horizon for them! We are not only a nation-of-beggars but also a nation-of-great-desp air! http://www.antiguaobserver.com/?p=75888
It is one thing to "engage" investors but another to "lure" them to our shores to create employment opportunies! Besides, corruption, nepotism, cronysm, job-creation also undermines the "social order."
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Dig It

RE: Inside Politics – Job Creation Is Wealth Creation

#4 Rubbin alcohol » 2012-06-03 12:57

Yep. Good job.
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Rubbin alcohol

"back up truck" style economics

#3 tenman » 2012-06-03 09:31

Quote:
In one of his retorts, Kevin asked me, “So you want me to give up taxes now (from the potential investor) when I have salaries to pay at the end of the month?”
Everton, move to the head of the class, you have hit the nail on its proverbial head. Silton's and the ministry record was one of waste while they dug deeper into tax payers pocket. There were no real programs to wisely spend tax payers moneys. The current government prior to 2004 stated that the public service was bloated. However on gaining office, salaries and wages ballooned from around 250 million in 2004 to $384,632,844 in 2009, even after the Vol. Sev program. Job shifts occurred during those years with central government work (eg. Security & Cleaning) being outsourced to companies who were effectively owned by UPP parliamentarians and their friends. No real economic program, to benefit the people of this country, was put in place to ensure we thought long term. However, some politicians ensured their financial future was set by ensuring government contracts came their company's way

..
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tenman

I speak the truth

#2 Hya » 2012-06-03 09:21

It is quite alarming that UPP has lots of pensioners paying them hefty salaries doubled with allowances and their salaries can pay 3 young qualified persons to each of their cronies salaries. It is a shame that the youths are the backbone of any nation, so when the backbone is broken what do we expect....crippling of the body, in this regard crippling of the Nation of Antigua & Barbuda.. God help us ALL.
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Hya

SPOT ON!

#1 Bush Doctor » 2012-06-03 09:19

THIS IS THE BEST ARTICLE WRITTEN ON CARIB ARENA EVER! CONGRATS EVERTON!
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Bush Doctor

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