Friday, April 28, 2017

Invest in the infrastructure to drive growth

Last Easter Sunday seven of us decided that we would do the 111-mile cycle ride to Montego Bay.Of course I had to eat at Peppa's as soon as I got there, which I think is one of the best kept secrets in Montego Bay, and then stayed at my friend, Terrence Jarret's Altamont West, located right on the Hip Strip, which I haven't visited in a while.

After showering and resting for a while, I ventured out to meet a friend of mine who was visiting from overseas, to have a quick chat and then head back to the room for a good sleep.

I deliberately stayed on the Hip Strip because I could just walk from the hotel to meet up with my friend. Everything had gone well so far: We had a great ride to MoBay, ate good food, the room was good, and after the meeting I thought I'd just walk back to my hotel.

Everything was good until I started walking along the Hip Strip. This immediately struck me as urban decay in action.

The pan chicken and other vendors had all taken up residence along the side of the street and even under the bus stops, allowing little room for any pedestrian traffic.

The sidewalks had obviously not been repaired in many years, and one could see the concrete breaking up. The roads had been cleaned but were badly stained from the vending activities that take place there night after night. And the traffic was horrendous, with taxis stopping wherever they pleased.

I thought to myself: “This is a prime example of why we find it so difficult to develop the country.” Tourism, as we know, is the number one foreign exchange earner (apart from remittances which are not based on productive activity, and Trump may soon reverse that).

Additionally, Montego Bay is the tourist capital of Jamaica, and the main area of attraction has always been touted as the Hip Strip. So in effect this strip could be referred to as the proverbial “goose that lays the golden egg”. But it seems as if we are trying to strangle that goose.

I cannot understand why we do not have a grand vision for the Hip Strip. If we do, why has it not been implemented? I can picture the Hip Strip as a well-kept road, where only pedestrian traffic is allowed, or specially designated shuttles, operated by the Tourist Board, paid for by advertisements displayed by tourism interests. The sidewalks and streets are well maintained.
No vending is allowed, and the type of business activity is well regulated. Against this backdrop thousands of tourists are traversing the Hip Strip 24 hours a day, and because of this experience the cost of a room is double what it is now, which means soaring real estate values.

In essence, the Hip Strip would become a global tourist attraction. However, once I wake up from that dream I come to the realisation that the Hip Strip is being allowed to go the route of downtown Montego Bay, which is dirty and absolutely chaotic.

Urban decay has been allowed to creep into residential communities because zoning laws have not been implemented; inadequate planning and the support of the “disturb my neighbour mentality” prevail as loud music is the norm across the country, with no regard for the citizens who want to enjoy the peace and quiet of their homes.
This is another assault on the market value of real estate across the country, as if we are not satisfied with the decay we have brought to the garrison communities in defiance of the euphoria and vision that Jamaicans had in 1962.

But let's not stop there, because we have allowed this same type of decay to beset downtown Kingston, which we are now trying to redevelop, while at the same time allowing the decay and indiscipline to creep into New Kingston.

New Kingston is now a place where many people say they dread going to because the sidewalk infrastructure is decaying; homeless people loiter on the streets all day - some establishing car wash businesses on the streets, in addition to the begging; the parking restrictions are ignored and whenever you go there, a line of illegally parked vehicles can be seen (even though there is a police post); and then there is the traffic which is blended in with the reckless driving.

For too long (for fiscal and other reasons) we have ignored the infrastructure and have been underspending, and it is important to reverse that trend. Think of it like a balloon.
A balloon can hold a certain amount of air in it, depending on the size. If you put more air than it can hold, then it will burst, and this is an undesirable outcome as you will lose both the air and the balloon. Similarly, economic growth is like the air in the balloon, and the capital infrastructure is the balloon.

In order to expand your economic and social development, infrastructure is important. So if we think about the tourism product, it is not going to be possible to increase the tourism value added if we do not improve the tourism product. And the tourism product cannot be improved unless we put the necessary infrastructure in place to support the improvement.

So the all-inclusives, such as Sandals, and similar hotels which have done a fantastic job with a fragile environment, cannot grow geometrically if we do not provide the environmental infrastructure to grow. Even on a micro level, can you imagine the growth in tourism we would see if we could improve the infrastructure and environment around the Hip Strip - even without developing beyond that, though that too is necessary.

Or can you imagine the growth in business and real estate values if we were to halt the decay in New Kingston and solve the traffic problems?

As far as I am concerned, this is a sound argument for the use of funds like the TEF and NHT. We shouldn't only be talking about using these funds for fiscal support.

We must think outside the box and start envisioning what is possible if we properly utilise these funds to provide this environmental support, and find the will to instill the discipline and order that we need.

What I am certain of is that investing in our infrastructure will increase our capacity for growth, and allow us to see the geometric expansion we need, rather than the incremental growth we have become accustomed to.

Monday, April 10, 2017

Jamaica's opportunity to shine

A few years ago someone asked me what I was passionate about. I mentioned that one of the things I really am passionate about is Jamaica and Jamaicans. It is that passion for Jamaica and to see Jamaicans in a better place that often drives me to write and make comments, as I think this is the best way I can contribute.

I really believe in the potential of Jamaica, and when I speak at any event overseas I always try to portray that. Recently I was at a regional conference and spoke to what Jamaica has done since 2012 in transforming our economic fortunes, and what I discovered was that many people are aware of our progress and have a lot of respect for what we have done. We need to understand that this was no easy task, and people overseas understand this much more than we seem to.

Where we are today is undoubtedly one of the best opportunities we have to shine, and I can’t remember in my lifetime such an opportunity. Speaking to people who are older than I am, I get the feeling that we are feeling somewhat like we did in 1962 — the year we achieved independence.

At that time, I am told, there was a feeling of invincibility - a feeling that we could achieve anything we wanted. History has shown us that those responsible for charting that course have messed up badly, and they have to live with that. Today, however, I think we have a chance to once again realise that dream, and if we do not do so now, then I am not sure we will be able to do so any time soon. So we must ensure that we grab the opportunity and “run with it”.

In order to do so, it will take extraordinary leadership. Note carefully I said leadership, not management. Because it won’t be about just checking some boxes and saying that we have completed a set of tasks or initiatives. What it will require is leadership that will mobilise and motivate the people to be the best that they can be. This is the resolve that the Government will have to find to lead this country on a path to real prosperity and development, which means allowing people to reach their full potential and success by their own efforts - and not through handouts as we have come to think development means.

At the present time I think that both political parties have two leaders who are capable of delivering on such a vision. Andrew Holness and Peter Phillips — both of whom I have a lot of respect for — have the ability to lead that change via different paths. Based on my interactions, I believe they are both committed to seeing a better Jamaica. But commitment alone never got anyone anywhere, because in the end it is how one leads and manages to mobilise his/her team that will make the difference.
Team in this case means all Jamaicans, not just the ones who vote for either side. This distinction is very important, as too often we act as if there are two Jamaicas, and one can survive without the other.

One of my greatest fears is that I will become mentally disabled and unable to think properly — an affliction that overcomes many coherent people from time to time. As far as I am concerned, anyone who defends a party position irrespective of the illogic behind it suffers from some form of mental disability and lack of independent thought.

In the past I have voted for both parties based on the agenda that they placed in front of me during the election campaign, because I think that success is not based on the colour of the party flag, but rather on ideas and the ability to lead. As a matter of fact, if one is blinded politically by “party colour”, how can one criticise a racist who is blinded by “race colour”? I am not saying that one should not have political ideals, but just remember that John McCain — a Republican — criticises any perceived wrong move by Donald Trump.

This is the real challenge that the “chosen leader” will have to face. In order for us to move forward as a country, we must unite around common goals and not ostracise someone else just because they hold a different opinion. Sadly, I see this happening all too frequently on social media.

The leadership we need must not only be able to see beyond “party colours” and unite the nation around a common goal, but must also ensure that there is consultation with the people. This does not mean that one must talk to everyone about everything, but a good leader can always feel the pulse of his people. Think about Bustamante and Michael Manley.

This is what I take away from the “Call to Action” report done by the Economic Growth Council when it says that citizen security should be at the heart of our development. This could not be better stated. What we must remember is that nations are not successful because they have fiscal surpluses, stable exchange rates, and highways. Countries are successful because they have successful citizens who live in an environment they feel comfortable in. This is what created the nostalgic feeling in 1962, and it is what we need to focus on if we are to be a truly successful country.

Of course, this means creating an orderly and disciplined society where people feel it is “the place of choice to live, raise families, work, and do business”. Show me someone who goes home and sleeps with his bank account every night and feels satisfied. Show me someone who feels good knowing that he has amassed a lot of wealth but needs to have constant security around him 24/7, or else face possible criminal attacks.

To be a successful country also means not just creating an orderly and disciplined society. We must also create EQUAL opportunities for everyone to be the best that they can be. The circumstances of our birth shouldn’t matter; we should all have the ability to excel based on our own efforts. This means removing the obstacles that prevent people from moving forward - like excessive bureaucracy, taxes, corruption, and crime.

In addition, we must protect our children so that they don’t grow up abused and angry, and we must create an efficient system of justice, where if someone is accused of a crime they don’t spend years waiting to get a verdict.

Like others looking on from overseas, I believe that Jamaica and Jamaicans have accomplished a lot over the past four years, and we have an opportunity to shine. This will require the type of leadership to unite and put every citizen at the centre of all policy decisions.

Tuesday, March 28, 2017

Develop our intellectual capacity for growth

Last week I made the point that the most important asset that Jamaica has is its three million residents, and that it is the underutilisation of this asset that has caused us to attain average growth of a mere 0.8 per cent per annum for the past 40 years. The fact is that our three million residents are also our most neglected, abused, and underutilised asset.

One does not have to be a rocket scientist to understand that if you minimise the use of what can give you the greatest value, then obviously your value creation will be minimal.

This can be extended in economic terms to say that an economy that does not focus on its areas of comparative advantage cannot be competitive and cannot optimise its development.
Jamaica, for example, has a comparative advantage in tourism, sports, music, niche agricultural products, and more recently the BPO sector - which is primarily our human resources and geographic location. We have, however, done everything to restrict the development of these by not addressing crime, inadequate resources and planning, by tolerating praedial larceny, and year after year by seeking to “kill” any industry that does well through the imposition of draconian taxes. We therefore create policies to discourage industries from doing well, and then we wonder why we can't have sustainably high growth levels.

This is the same thing we do with our human resources, as we encourage urban decay by creating disorderly communities; we ignore the productivity of people by allowing uncontrolled noise when people need to sleep; by not respecting the rights of people; by restricting the potential of people through the creation of labour laws that stymie their capacity; and by not insisting on the protection and schooling of children.

The result of this is that Jamaica scores very poorly with respect to innovation, as shown in the

Global Competitiveness Report, when it is well known that economies develop fastest when innovation is encouraged.

A secret that many of our policy makers have never understood over the years - but which our private sector understands very well - is that the best way to build your business is to improve the intellectual capacity of the people who work there.

The most progressive CEOs I know understand this; for example Don Wehby tells me that he is always on the lookout for good talent, even if there is no vacancy, as they will always add more value than their cost. And if he cannot place them within the company, then he puts them on boards. It is therefore no surprise that under his leadership, GraceKennedy has become a much larger global brand and is always improving its profitability.

This importance of intellectual capacity is something our policy makers have never understood. So even while they always seem amazed at the development of a country like Singapore, they don't understand that one of the things that has led to Singapore's success is the focus on building human capacity through education and creating an environment for the population to be productive.

The creation of this environment is necessary for improved productivity and human capacity. If we continue to support an environment of disorder, such as road indiscipline and night noise, discourage productivity and improved compensation, through archaic labour laws and mechanisms such as collective bargaining, and discourage investment and value creation with taxes, then we cannot be surprised to see our labour and total productivity factor falling since the 1970s.

Can we further be surprised, as I mentioned last week, that little Antigua has GDP per capita at US$18,300 per annum, while we are just over US$4,000 per annum? Can we be surprised when we have approximately 20 per cent of our people living below the poverty line, unemployment at 13 per cent, and more than 300,000 peopler on welfare (PATH), with another 200,000 in need of welfare?

The only way for us to achieve Vision 2030, and experience real development, is to improve the intellectual capacity of our people.

This means creating an environment that encourages learning and disciplined living. It means educating our people and preparing them for higher value jobs, as it is not just about the quantity of jobs (such as low-paying factory or BPO jobs) but the quality of jobs. The fact also is that industry, such as BPO, is restricted by the intellectual capacity of the human resources available; therefore the BPO sector cannot move readily to high value jobs, such as programming, because we don't have the skills necessary.

The first step, of course, is that our policy makers need to fully appreciate the need to develop our human resources if we want to see true development.

The EGC's Call to Action has understood this by focusing firstly on “Citizen Security” as the foundation for growth. The next step, however, is for it to be intertwined with the fabric of our fiscal and other government policies.

This to me is still not evident, as our discussions are still focused around the mathematics of the budget, and who did what when they were in office since independence.
So essentially, our conversations are focused on immediate needs and the distant past. There is very little discussion about the future. If we are to get to Vision 2030 we must change this way of thinking, and we must start to lay out and discuss plans for the future.

We also need to understand that the future of any country depends mainly on the children and those yet unborn. Therefore we need to ensure that focus is placed on improving our education system in terms of access and quality. This does not mean building a school at every corner, but using innovative ways such as distance learning.
The future of our country depends on creating exceptional human resources. This means that our focus must be on creating an environment for our people to realise their full potential. This must not be confused with the politics we have practised over the years, which consists of giving people handouts. That approach simply brings everyone down to a lower standard instead of helping them to be the best they can be.

This is going to require visionary leadership, which chooses to take action for developing the potential of our people. In other words, leadership must take steps similar to those taken by Jesus when he fed 5,000 people from a basket of fish and loaves, instead of trying to share up the single basket among the 5,000 people.

Friday, March 17, 2017

Create a culture of development

Every time we come around to this time of the year — when we debate the budget, I swear that the arguments for and against are the same. The same arguments may not come from the same people every year, as it depends on which party is in power at the time. But no matter which party it is, the arguments made by their supporters are always similar to the ones made by the party that was in power the last time.
The problem I have with the discussions that take place is that they never really centre on moving the country forward. They tend to develop into shouting matches where both sides put forward arguments that are usually incorrect and myopic. The advent of social media has only served to escalate the divisive and myopic views in many respects.

At the end of the day, of course, we have all wasted a lot of energy arguing points that really do not elevate the discussion about how we can develop Jamaica.

Last week I visited Antigua for the first time, and I was struck by the fact that the 100,000 or so residents of this small island enjoyed a far better quality of life and seemed more organised than Jamaicans. They have a GDP per capita income of more than US$18,300 and their main industry is tourism, which I was told supports around 70 per cent of the population.

Contrast that to Jamaica, which earns significantly more from tourism, bauxite, and agriculture. Yet with a population of three million, we have a GDP per capita of around US$4,000 — a far cry from Antigua.
Jamaica is also much closer to the largest global market and has far more air and sea connections. So the question is: Why have we not been able to come close to a small island like Antigua, although we have so many more natural advantages?

And even more important, we have 30 times the number of people, which means that we should have the capacity to be 30 times more innovative than Antigua, and when coupled with our significant resource advantages we really should be looking at GDP per capita of more than US$30,000, at a minimum.

Instead, we are scraping the bottom of the barrel at just over US$4,000 GDP per capita.

As I pondered these things, and as I listened to the Antiguans describe their culture, I began to understand. And anyone who runs an organisation knows that leadership and culture are the two most defining elements of organisational success. Everything else is secondary.

I learnt that in Antigua everyone understands the importance of tourism, therefore everyone is in the business of ensuring that the tourists have a great experience.
As an example, the group I was with went to visit an old English fort. Another tour guide leading a separate group there came over and offered us some water and drinks from his van, saying that he needed to ensure that he took care of all visitors.

In Jamaica, tourist harassment is so pervasive that Sandals had to push forward with a very successful product called all-inclusive hotels. Thank heavens for Butch Stewart.
I also noticed that, even though Antigua doesn’t have the infrastructural development that Jamaica does, the streets were spotless. I actually saw a plastic bag on the side of the road and it stood out like a sore thumb because everywhere else was so clean.

In our case, when the NSWMA requests $5.5 billion to keep the streets clean and we get $3.6 billion, we are criticised by the same people who cut the budget for not keeping the country clean.
Driving on the roads in Antigua is a pleasant experience, as people actually stop at stop signs and stop lights; no one is speeding, and I didn’t see any reckless driving by the taxi drivers there. Contrast that with what goes on here, and we see the vast difference.

I also noticed that the environment was quiet, and there was no noise from dances or churches. By contrast, Jamaicans are forced to listen to the dissonant sounds emanating from sound systems and raucous pastors, despite the Noise Abatement Act.

Our visit was topped off by the discussions we had at a well-organised symposium put on by the Caribbean Centre for Development Administration (now headed by Devon Rowe, a former financial secretary of Jamaica) on developing a charter for public sector improvement in the Caribbean. We had ministers of government present from nearly every other Caribbean island except Jamaica, of course.
Based on the progressive nature of the discussions, I was only too happy not to be in Jamaica and surrounded by the type of discussions we normally have around budget time.

So what has caused this marked difference between a small island that depends on tourism, and Jamaica — a country blessed with relatively abundant natural and human resources?

It struck me that what Antigua has done, which we have failed to do, is to create a culture of progress and development. Their people and their environment are geared towards moving the country forward for the betterment of everyone.

I am not saying that they do not have their challenges, but certainly the cultural atmosphere that has been drilled into the minds of their people (as evidenced by my interaction) is that they recognise the need to protect their tourism business and create an environment where everyone feels comfortable and can prosper. Hence, their US$18,500 GDP per capita compared to our approximately US$4,000.
At the end of the day, therefore, if we are going to reach “5 in 4”, then we must understand that this responsibility — or the ability to do so — does not lie in the hands of a few committees. It can only happen if through our leadership we get the whole country behind the plan.

As an example, Vision 2030 must move beyond a concept in a book and in meetings, and be owned by all three million Jamaicans.

To do this we must also recognise that the most valuable resource we have as a country is our population of three million residents, and not the natural beauty, music, or sports. Unless we are able to make that transition in our thinking, and our leadership begins to understand the importance of creating that culture, then next year this time we will be having the same discussions we have had for the last 40 years.

Friday, February 17, 2017

The budget’s alternative facts

It’s that time of year again when businesses and people get edgy, and in some cases hold off on plans until the minister of finance speaks and reveals the tax package.

The fact is that tax policy has a direct bearing on economic growth and development, which is something our governments have failed to understand, as tax policy over the years is devised through political statements on platforms rather than through consultation with the technocrats.

So the politician gets on the stage and gives an impossible directive such as ‘ye shall fly’, and then says to the technocrat that they need to make them fly, even while it is not possible.

The consequence of this type of approach is that we have a tax framework that doesn’t encourage production and development, but rather takes pride of place in the 2016-17 Global Competitiveness Report as the third most problematic factor to doing business in Jamaica. And in fact it has consistently been in the top five most problematic factors over the years.

Obviously this means that politicians do not read this report, because if they did we would have done something about it years ago.

This is why when the Matalon report came out in 2007, and the Private Sector Working Group on Tax came out with their 2012 report, the Government just cherry-picked what they wanted from it and ignored the statement that the measures would only be effective if implemented as a whole. The fact is that the expediency of funding the budget was more important than long-term development.

Today, because of this naïve view of our policymakers, we still grapple with the same fiscal challenges we had 10 or even 20 years ago. So today we are faced with a budget deficit of close to $20 billion, and an expected tax package in the billions of dollars. And as usual, tax policy is merely a mathematical and allocation exercise, rather than one geared at driving growth.

One of the major challenges facing the Government over the years is that of low tax compliance. This is evident in the fact that even though the employed working force is estimated at 1.15 million people, just over 320,000 (around 27 per cent) are registered for payroll taxes.

But last year, instead of going after compliance, it was easier to impose a higher tax rate on people above the $6-million level. The promise, though, was that the move would be temporary — as the minister committed last year that in the upcoming year these people would enjoy the full $1.5-million threshold and the rate would not be increased. This is expected to be so as the minister is someone who sticks to his commitments, as evidenced by the $1.5-million threshold implementation.

What this would mean is that the additional $19-billion income tax increases on individuals should come from compliance measures, given the low percentage of people working who are registered for PAYE.
When I do some analysis on the revenue estimates for 2017/18, however, it again betrays the intended policy to move towards indirect tax, as the 2016/17 direct tax as a percentage of total revenues is 27.8 per cent, while the 2017/18 estimate is 29.8 per cent — suggesting a move in the opposite direction. This of course needs explanation.

This math exercise every year, in my view, speaks to the lack of innovative ideas and vision of our leaders over the years. Any society that is concerned about development and growth does not look only
short term at revenue collection and expenditure management, but addresses its mind to what needs to be done to encourage growth.

This is where I think our governors continue to fail us.

It is not all bad news, however, as since the economic reform programme started in 2013, we have admittedly seen legislative and fiscal changes to encourage growth and stability. But in my view it is not fast enough to cause the paradigm shift we need. And unless we start doing what’s necessary to cause this paradigm shift, we will remain behind our competitors in terms of development, which we must understand is relative.

Every year we continue to play a wait-and-see game to find out which sector is going to be called upon to finance the budget, but the truth is that our time is not being efficiently spent doing so.
The debates and analysis will continue in the media about what taxes will be raised and which ones will decline (mainly because of political announcements). But there is not enough talk in the media about the need to use tax policy to drive growth.

We have seen examples of the Employer Tax Credit resulting in Corporate Income Taxes increasing, and the tax incentive on the Junior Stock Exchange resulting in significantly more employment, payroll taxes, and consumption taxes. But yet still we have not embraced the fact that if we were to make the tax environment more competitive, primarily with lower rates, then we may actually see more economic activity. Again, just look at the Global Competitiveness Report.

The conversation we therefore need to have each year is not one about wondering if the minister is going to ‘hit me’ this year, but rather what tax policy should be introduced to spur development.
In Panama, for example, the law protects investors on the same terms as the investment was made. In the US tax rates are set out three to five years in advance. Therefore, investors and people can plan their business and have confidence that the decision they make today will not be altered by any political decision for the next five years.

This is the “alternative fact” of what budgets and debates should be about. For this to happen though we need to change how we think. In other words, we need to have a vision for development.

We need to not continuously seek to place one group against the other. And we need to understand that encouraging capital to make as much money as possible is to the benefit of the whole society.

The question therefore is: is it possible for us to make this paradigm shift in our thinking and reveal the “alternative facts”?

Friday, February 10, 2017

Solve crime by dealing with the root causes

On February 23, 2007, in my piece called “No public law and order”, I wrote:

“Any effort to permanently deal with…criminality in this country,must not only be addressed at hardened criminals, but must of necessity include an assault on the breakdown of law and order generally. We need to put a stop to the manufacture of criminals by discontinuing the corruption in the public sector and enforcing discipline in the society…Unless we can address these issues we will not be able to maintain discipline in the society. And if we cannot have basic discipline, then these same undisciplined people will grow up to be hardened criminals. What happens is that people will continue to buck the system as much as possible to see what more they can get away with.”

So far we have not managed to address the problem of indiscipline, which has in fact worsened, and like night follows day, we also continue to reap violent crimes with greater intensity. It is therefore no surprise to me that crime is at higher levels today. And, additionally, we see more violent crimes.

A recently released study by the IDB also shows that crime costs Jamaica four per cent of GDP every year, which approximates to $60 billion annually.
At the same time that we are losing $60 billion annually from crime, we are trying to find $16 billion in the fiscal accounts to deliver on the promise for an increase of the income tax threshold to $1.5 million per annum.

The solution to finding this additional $16 billion is that we may have to raid the funds from public sector bodies like the NHT and increase other consumption taxes.
It is therefore obvious to me that the reason for having to squeeze the hapless taxpayers, instead of being able to reduce taxes is the result of very poor governance/public policy over the decades.
This responsibility does not lie with any one administration, as the crime that we are reaping today is the result of poor public policy for more than 40 years. I would go further to say that the responsibility for this is not just with the politicians in Parliament, but also the public sector bureaucracy that has been charged with executing public policy.
In an interview with Minister Bobby Montague, on my TV programme

On Point, he made the very telling statement that we must ensure that we take the time to craft a correct strategy to tame this crime monster once and for all. Because, in my view, crime-fighting policies and initiatives over the years have been woefully ineffective.

For decades we have had several anti-crime police squads with various acronyms. We have imposed numerous states of emergency and pieces of legislation, which in most cases have only served to cause increased strain between the Jamaica Constabulary Force and the citizens.

Over the years, Jamaican citizens have also contributed to the crime problem by seeking to support the politicisation of crime. So when one party is in power they seek to criticise the ruling party — not because any careful analysis is done, but because they are not supporters. As citizens we also support indiscipline. As one person on social media said to me, why do we want to further oppress the transport operator by imposing increased fines for littering or traffic offences? The answer is that if you don’t want to pay the fine, then don’t break the law.

Recently, for example, the Minister announced the acquisition of two boats and an aircraft to monitor the borders. There was immediate outcry from some people, who if they really thought about it would understand that unless we secure our borders, with 145 illegal points of entry, then taking guns off the street will be meaningless, as they can be easily replaced.

But while we continue to announce initiatives to solve crime by deploying more security forces, having a zero tolerance approach (which we should always have had anyway), and putting more resources into crime, I still think that we have failed to address the root causes of crime. And so our efforts will be like treating the symptoms of an illness without finding out what is causing the illness.

As I pointed out in February 2007, the nourishment for crime is the lack of law and order in our environment. This is what, as a country, throughout all our crime strategies, we have failed to address. So while we roll out multiple crime plans, we have never in any serious way addressed the matter of road indiscipline, squatting, night noise, or child abuse for that matter.

The evidence is clear. We have failed to address the deficiencies in the Road Traffic Act and Child Care and Protection Act with any urgency, or in the same manner we pass legislation for retroactive taxes. We have failed to ensure that there is peace and quiet in communities, thus ensuring greater productivity.

And even though we are now talking about child abuse, because it is the current topic, we have not discussed the need for parents to be held accountable for the abuse of children, such as putting them on the roads to sell various items when they should be in school or at home studying. We have not discussed holding parents accountable for children not attending school regularly.

Like any other problem, one can only solve it in a sustainable way by identifying the root cause and taking steps to fix that root problem, while at the same time dealing with the symptoms.

So here are questions to ponder: Is it possible to solve crime without addressing the matter of accountability of parents for their children? Is it possible to solve crime without ensuring that we have a very orderly society, such as the way people drive on the road and ensuring proper zoning and noise levels? Is it possible to solve crime without a properly functioning and efficient justice system? Is it possible to solve crime without ensuring that the people asked to uphold the law (the police) enjoy acceptable working conditions?

The February 2007 article was written 10 years ago, and is as relevant today as it was then. The crime problem has not been solved, and during those 10 years we have spent a lot of resources and had many crime plans.

Still, crime worsens.

In my view, we have failed to address the social issues and law and order challenges, which are the root causes of crime. And, I should add, the main reason for our perpetual fiscal budget challenges.

Friday, January 27, 2017

The impact of policy on development

Page 3 of the Wednesday, January 25th, Jamaica Observer, had two very disturbing reports.

The first referred to a 15-year-old who is unable to read and write, because his mother had no money to send him to school, and his father had basically abandoned him. In addition, the mother, who is not working, has several children and his older siblings are in a similar position.

The second story is about a Pentecostal pastor who was convicted of having sex with a minor.

These stories follow the revelation of the sexual misconduct allegations against three Moravian Church pastors, in all cases involving minors. In this case, it also features a mother who has 11 children, who is also not able to take proper care of them, and no mention of the father, or fathers.

Around the same time, a news report revealed that both the OCR and CDA, were playing “bureaucracy tag team”, while a seven-year-old girl was allegedly suffering abuse at the hands of a predator. After seven months, they had not located the child despite having the contact details for the person who had made the report - and within one night of the news item the child was found.

The authorities have launched an investigation into the case of the seven-year-old, and the Government has also promised to assist the mother of the girl involved in what is now known as the Moravian Church Scandal.

Both responses I think have fallen short of what they should be, as in the former case there was no urgency in the form of a timeline given to completing the investigations, or even any suspension from “front line duties”, as done with police, even though the abuse of a child is one of the worst crimes.

In the second case, I would have wanted to know what was the investigation into the neglect by the mother. But this is a day in Jamaica.

And after all of this, the question being asked is, has the church failed us? With much debate about the inadequacies of the church, as if it is the church that is the responsible gatekeeper for law and order in the country.

The fact is that all these cases have more to do with a lawlessness society, and lack of order, than any teachings of the church.

What we must not continue to do is divert the responsibility of governance from where it should reside, which is the Government and Parliament, as these are the institutions with the power and authority to effect law and order, and hence create values in a society.

The church like any other institution is nothing more than a microcosm of the society. This also applies to a school. So, that when up to a few years ago, 70 per cent of our children were leaving high school, without one subject, the ultimate blame is not the school, but rather the system that has caused the school to produce that output.

Until we understand this fundamental point, we will be forever chasing our tails, and eventually end up repeating the cycle of the past 40 years.

The fact is that the cases above have more to do with the policies pursued by Government over the past 40 years than the failing of any church or school, as the same leadership in the church and school was created by the policies (or lack thereof). So a teacher or pastor, who has underperformed, was not isolated from the environment before.

In fact, one could also argue that if the church and school were absent then the situation may be much worse than it is today. Just as a senior policeman said to me - even though people may say that the JCF is dysfunctional, what would happen if we did not have the “dysfunctional) JCF in place?

Therefore, in order to solve the problems of murders, child abuse, road indiscipline, and disorder generally we must, in my view, go back to the problem of Government policy.

So even though we create a police force, OCG, Public Defender, OCA, and other such institutions, if the Parliament each year refuses to provide adequate resources then how do these institutions function effectively?

And even if we go further and provide the resources to all these institutions and they do their job effectively and carry persons to the court, but because of inadequate resources and action, the justice system is unable to deliver judgements for at least two years -then once again the result is disorder.

And even if we assume that the resources are made available, and the justice system works efficiently, another challenge we have is that we do not proactively put legislation in place. Effectively taking years to debate and have legislation passed.

Also, when we look at the economy, even when we make all the sacrifices under the Economic Reform Programme, if we fail to put the legislation in place to deregulate capital or achieve public sector efficiency, then there will be no sustainable growth and development.

In the end everything that happens in a society comes down to policy developed by Government, and functionaries, and importantly also how Parliament governs and debates when they meet every week.

We only need to look as far as the United States and see what effect the policies espoused by a President, or the House of Representatives, have on markets and whether capital stays in the country or not. Or what effect laws passed - such as on abortion, or the mere appointment of a Supreme Court judge - have on the behavior and values in the society.

In the end it all comes down to policy, as this is what affects long term behavior and what a society turns out to be.
Unless we realise and address this issue then a focus on church or the JCF will only be a superficial solution.