Monday, 1 October 2012
A failing government void of values and economic credibility
The inescapable story of today has been the news that Jersey remains in recession with negative economic growth of 1%. That's a 14% contraction in 3 years.
Whilst in the UK there is huge controversy when economic growth is at -0.5% and the fact that the UK has gone in, then out, then back into recession again, in Jersey there seems to be mainstream complacency from the public about the fact that our economic decline has been consistent without even a brief period of recovery like the UK.
In the UK there are threats of a general strike and a strong political opposition that attempts to argue against the failing governments economic plans. Yet in Jersey, the only ones seemingly ready to stand up and do something about it are the trade unions, who are dismissed by the media and right wing commentators and only make up a small part of the population anyway.
All the more important, this news comes at a time when we find out that in Guernsey their economy actually grew by 1%. We have two islands right next door to each other. Jersey is in recession, Guernsey is not. Jersey has high unemployment, Guernsey does not. Jersey has had to increase GST, Guernsey didn't even have to introduce one. This shows that it isn't just about a world wide downturn, but that government policy is capable on influencing it.
We really need to ask ourselves where Jersey is going wrong and what needs to change to fix things as soon as possible.
We had the astounding spin from Senator Ozouf that a 1% contraction in the economy was somehow "an encouraging sign", but when you dig deeper to see what the governments actual policies are in this tough economic time, it is anything but encouraging.
When the economy is in crisis you'd expect to see mainstream arguments (as they have in the UK) between what the appropriate way to fix it with public spending and tax initiatives is. In Jersey we don't really have this debate on any meaningful level. We just hear a few bits and bobs from a government that doesn't overtly seem to have any guiding principles or values leading to why it is doing what it is doing, and then the arguments about how each particular policy is in line with their vision.
The Treasury Minister has made the rather irresponsible promise that there will be no further tax rises for 3 years. They say a week is a long time in politics, so 3 years is a very long time indeed and, especially when the economy is in the shape it is, it is irresponsible to say that the government will absolutely not consider tax rises for such a period of time.
When you make promises like that, you are destined to break them, which leads to unhealthy cynicism in politics. Remember Senator Ozoufs promise that he would actively resist any attempt to raise GST and then he was the one who actively proposed it?
What he should be saying is that if the economy worsens, the government will have to re-examine it's strategy. Having no "Plan B", as it were, could be catastrophic. Okay, that means a degree of long term uncertainty for both business and the public, but the alternative is far worse.
But the government can make some promises.
The government can't and shouldn't be making a blanket promise of no tax rises. But what they can promise is that whatever their fiscal policy is, it will be compatible with certain values and principles. Namely that it will be those most well off amongst us that should bare the brunt of the tax rises and that cuts to public spending will be targeted at things that will not make life harder for vulnerable people that rely on those public services. By implication, that means things like no increase in GST, maybe having a Capital Gains Tax introduced instead etc.
That is a promise that they can make, but they aren't. Time and time again, Jersey ends up with a government that (aside from the accurate generalisations that they are conservative and work as a block) is undefinable in the sense of pinning a specific clear line of policy (a "manifesto"), a clear set of values and working method. Our political system doesn't let these values become the centre of what we are trying to decide at election time. Instead it's just a personality contest.
The 5 point plan
In my 5 point plan (outlined in a previous blog post), I said that Jersey needs to focus its cuts in spending on waste and unproductive government activities. I can immediately identify two topical things that are a waste. Firstly, we have talk at the moment that the States may buy up the old Pontins site at Plemont for £8m (which by the way, the owner says is not enough), and then sell it on the Jersey National Trust for £2m so they can return it to nature. Personally, the idea of returning something to nature seems absurd to me. That site has had buildings on it for well over 150 years. Any nature that one day occupies it will be "artificial nature". Instead we have developers wanting to build housing on it and they don't even have to destroy any more nature to do so. Yet the government is intent on wasting £6m for no apparent benefit.
Secondly there has also been talk about the Williamson report looking into a terms of reference for a committee of inquiry into the child abuse scandal in Jersey. This, despite the fact that the government had already spent £60k on the Verita report into a terms of reference for an inquiry. Having two reports was a total waste of money, especially when the first one had nothing wrong with it. They just need to get on with it and have a full and comprehensive committee of inquiry to get justice for the victims and lay a foundation for framework to make sure this can never happen again to vulnerable children in Jersey. That would be money well spent, not like the thousands they have needlessly wasted trying to cover it all up.
The fact that the government will waste money on things like this whilst telling ordinary working people that they have to face cuts to public spending shows contempt for the ordinary people of Jersey.
All of the money that can be saved should be spent on projects for job creation and helping small businesses. GST should be cut (if only temporarily) and alternative tax methods should be looked at that focus on extracting more from the islands wealthiest.
The problem is that the personal politics of it is coming before the economics. The individuals that are fighting for these things aren't able to do so on a wider platform. So nobody ends up with what they want out of the government.
As I have made clear in my previous posts on electoral reform, Jersey's political system is not fit for purpose. It is neither democratic, nor capable of producing an effective and cohesive government.
In my essay The Economic Dictatorship I argue that the most profound benefit of a full and working democracy is that it is inevitably going to create a better economy. It provides for the utilisation of all talents, it allows the incorporation and consideration of criticism and provides for the benefits of wealth creation to be equitably spread around.
Instead we have a States Assembly with many talents excluded from government, valid criticism is often silenced, and Jersey is becoming more unequal every day. We need a dramatic change in the political culture of this island otherwise we are doomed to decades more of the same, running this beautiful island into the ground.
A seemingly absurd comparison
The more I think about it, the more I am drawn to make an historical comparison that may on the face of it seem absurd, but hear me out.
Karl Marx believed (and I agree with him wholeheartedly) that revolutions are an inevitability in systems that allow the the material base to become so far detached from a mass of people who are becoming more and more intellectually and philosophically aware. He predicted that this would be the case with capitalism (and he has yet to be vindicated), but it's a principle that clearly works in other situations.
Take for example the Soviet Union. In the 1980s, the people of the USSR began to realise that their economic and political model was unsustainable and had to go, but that it was best for everyone to avoid a revolution because (as the early anti-Trotskyites realised) a revolution is chaotic and does not necessarily lead to democracy.
This was realised and spearheaded by the reformer Mikhail Gorbachev (in my opinion a great man), who wanted an organised transition from a Communist dictatorship into a social democracy. But the hard line Communists (who had vested interests) attempted to subvert the process, which caused chaos, which was exploited by Boris Yeltsin (in my opinion a terrible man) who was able to take power, get independence for Russia, break apart the Soviet Union (despite the only democratic referendum in Soviet history showing a huge majority supported keeping the union), and plunge the country into economic downturn. Now the former nations of the Soviet Union have bad relations, there has been war, and Russia is run by the oligarchs. Now the world is left with one superpower, the United States of America, which has been a profound force for evil internationally and has not had another superpower to balance it out (do you think America could have invaded Iraq if a democratic Soviet superpower had opposed it?).
Now compare this to Jersey. We also have a political system that is not fit for purpose, that the public are growing increasingly discontent with. We had our great reformer, Daniel Wimberley, set out the framework to fix Jerseys political system. But those with vested interests sought to subvert it, and Senator Bailhache was able to usurp it. If the people of Jersey remain complacent, Senator Bailhache will be our very own Boris Yeltsin.
(Yes, I did just compare the Jersey Establishment to the Soviet hard line Communists! That was the part of the comparison that might have sounded absurd)
The point that I am trying to make is that culturally, Jersey is completely in the wrong place to fix our problems. We need more political engagement and active debates on the economy as a whole and what values we want behind the policies to ensure that the island resembles what we want it to. But Jersey must be able to reform itself and put aside the vested interests.
Those that have been in power in Jersey for decades have run the island for the interests of only themselves and a small minority of the islands population (the rich) on the basis of an ideology that is not only morally bankrupt, but also ignorant of the economic realities that have been adduced since the 1920s.
Jersey needs to build a popular movement of ordinary people from all walks of life that can fight and argue for an administration that runs by full democratic principles and actively seeks out to create a fairer society based on the values that we all hold. Jersey needs a democratic socialist political party in whom we can place our trust and help to win control of Jersey so that it can be run by the people, for the people.
Having full employment is not impossible. Having decent pensions for our old folks is not impossible. Having a society in which we all have our fair place and contribute a fair amount to the community is not impossible. We just need to accept these realities and work together to cast aside the vested interests and make this island as good as it can be.
We're working on it!
P.S. Deputy Pitman has started video blogs talking about topical events and giving a spin on it that you won't hear in the mainstream media. Check it out - http://thebaldtruthjersey.blogspot.co.uk/2012/10/the-bald-truth-review-political-week-in.html
Also, since I mentioned the Williamson report, here is the reaction from the JCLA - http://voiceforchildren.blogspot.co.uk/2012/10/guest-posting-from-abuse-survivor-and.html