50 years in dependence

The two head honchos of the Government's banking and planning institutions held separate press conferences last week to tell us how badly the economy had been performing, as though bad news delivered once was not good enough.

Planning Institute of Jamaica (PIOJ) director general, Dr Gladstone Hutchinson, was the first messenger to tell us that economic performance for the April-June quarter was "relatively flat. The out-turn reflects a general weakening of the economy ... ". There were "larger-than-expected contractions in value-added" for "some key industries," Dr Hutchinson told us.

And, troublingly, he informed that that "the employed labour force continued to decline", and that the increase in the unemployment level to 179,900 persons was the highest recorded in 12 years, while the 14.3 per cent unemployment rate was the highest in 10 years. Business confidence had tumbled by 31.9 percentage points relative to the January-March quarter of this year, and reached its lowest levels since the July-September 2009 period. Consumer confidence was also down.

What might have missed many financial analysts and editorial writers under the fog of what Professor Joseph Stiglitz would call the "cognitive capture" of neoliberalism was that, to quote Hutchinson's own words, "This (flat) GDP out-turn occurred against the background of a relatively stable macroeconomic environment, mainly reflected in better-than-expected fiscal deficit and continued moderation in inflation."

It probably has not occurred to any of the neoliberals that this significant empirical fact shows that one can achieve the desired neoliberal outcomes without the concomitant positive growth; pointing to the fallacy of a monetarist approach. (But neoliberals are faith-based people. They will continue waiting for results!)

logic must prevail

In his episode of the bad news, Bank of Jamaica Governor Brian Wynter was now free to refer to "the IMF standby agreement going awry" (under the former Government, of course) as one of the domestic policy uncertainties. He rejoiced that "with agreements on wage restraint for the 2010-2012 periods, the fiscal risk represented by unconstrained public expenditure on wages was significantly eroded". That was before he heard about Clayton screaming a decisive "No!" to wage restraint and pension reform down the halls (no pun intended) of the Jamaica Teachers' Association.

So we were again reminded of our economic challenges and crisis last week, and our minister of finance at a Gleaner Editors' Forum last Wednesday announced that 3,000 public-sector posts would be slashed from the Establishment. He warned that "the logic is either wage restraint or job cuts". If you have been following the economic news in Jamaica for the last 40 years, you would have to ask what is new about the bad news?

And all of last week at The Jamaica Pegasus hotel, some of the finest scholars and intellectuals of the Caribbean gathered to discuss precisely Jamaica's and the Caribbean's experience with Independence at the Sir Arthur Lewis Institute of Social and Economic Studies (SALISES) 50-50 conference - looking at the past 50 years and projecting to the next 50.

I could not miss three of my favourite Caribbean intellectuals: Havelock Brewster, Norman Girvan and Obika Gray, and tried, unsuccessfully, to catch Kari Levitt. Finance Minister Peter Phillips had given the keynote address to open the conference on Monday. He seemed to have been prophetic when he said, "Simply identifying the challenges, however, will not guarantee our success in surmounting them."

more heat than light

But one does not have to be particularly prescient to wager that academic conferences usually excel more in analysis and diagnosis than in concrete prescriptions. There were too many panels running concurrently for me to make a full assessment of this conference, even if I attended full-time, so I can't be definitive. But the sessions I attended did not pay enough attention to solutions or the way forward.

My hunch is that that was the same for most, if not all, the sessions. (It also struck me that more time should be allowed for presentations and interactions. Fewer panels, more substantial presentations and give-and-take.)

I am not making light of analysis. We need to reinforce our analysis, diagnosis and reflections on our problems so that we are not seduced by quick fixes, wishful thinking and illusions. Proper analysis is profoundly important, and at this SALISES gathering, there were many gems worth storing.

Obika Gray's analysis of the failure of our intellectuals to influence the intelligentsia and popular discourse was poignantly on target, provoking an impassioned set of plaintive questions from conference organiser and SALISES head, Professor Brian Meeks. Brewster's paper on economic development and happiness in Jamaica deserves a whole column by itself. (Brewster is now frail in body but still powerful and agile in mind.)

Norman Girvan was excellent in his major presentation on Wednesday evening. All my stars performed and I discovered some new talent, too.

If scholars and intellectuals are to overcome the deeply anti-intellectual prejudice of many in the society, particularly among the economic elite and the pragmatic middle class, they must demonstrate that they can interact with the real, concrete problems of society and that their reflections have answers to our policy dilemmas.

First, the academy must be rigorous in critiquing the received wisdom and common sense of bourgeois society, and must deconstruct what Marx called the "false consciousness" it produces. It must do so with shattering brilliance. It must lay bare the nakedness of right-wing thought and in economics must challenge prevailing neoliberal notions. So the analysis is important.

But, important, too, it must wrestle with the dilemmas and complexities of really existing capitalism.

One of the things which always disappoint me is when a thinker critiques an opponent without considering or anticipating that opponent's best counter-arguments or premises. Perhaps it is my grounding in philosophy which makes me acutely aware of counter-arguments and alternative positions and which prompts incessant self-interrogation and cross-examination. Too little of that is done, especially in economic and political discourse.

bashing of multilaterals

At the SALISES conference, for example, there was a lot of bashing (justifiably) of the international financial institutions (IFIs) like the International Monetary Fund (IMF). Especially in the context of discussing 50 years of independence for Jamaica and Trinidad, it was inevitable that the irony of IMF dictates over national economic policies would be drawn.

You know that Norman Girvan, a pioneer of the Dependency School of Economics, could not resist the temptation: "For 35 years of the 50-year independence experience, the Jamaican economic policy has been under the direct supervision of Washington-based international financial institutions; or carried out within a framework that they approve of and is aimed at maintaining the confidence of donors and investors."

So, Norman continued, "One consequence of this is that successive Jamaican governments have surrendered many, if not most, of the policy tools for shaping economic development which the State had acquired in the late colonial and early post-colonial period."

As Norman said to a roar of appropriate laughter, if a study was done, it might find that Jamaica has less policy autonomy under the IMF than we had under British Crown Colony Government! And we talk about independence. In fact, what we should say is that we are 'in-dependence'.

Said Norman in his paper 50 Years of In-Dependence: Reflections: "The last IMF agreement made in 2010 is a clear demonstration of the extent to which the Government of Jamaica has lost its ability to independently determine its own policies." Norman referred to the abolition of state import trading agencies, removal of import controls, elimination of tariff protection, removal of price controls, financial libera-lisation, etc. - all tools of neolibe-ralism. But what Norman failed to interact with are the implications of the fact that in a World Trade Organisation-governed world, developing countries are forced to follow that path. In other words, certain options available up to even the 1980s are just no longer available because of the power of the Bretton Woods institutions.

policy inequity

As scholars like Ha-Joon Chang have shown in 'Kicking Away the Ladder' and 'Bad Samaritans', the very policies which developed and the newly industrialising countries utilised to grow rapidly are being denied to developing countries today. The work of Dani Rodrik and Erik Reinert has demonstrated that, too. So when Norman complained at the SALISES conference that, "I believe that the abandonment of such policy instruments went too far," while acknowledging that state officials "were forced to do it by the international financial institutions," without showing a way out of the dilemma, he is missing an opportunity to make a meaningful point.

Peter Phillips once had the luxury of intellectual reflections without responsibility for state action. I was there in the mid-1970s when he and Aggrey Brown launched their radical 'Essays on Power and Change in Jamaica'. I heard his presentation then. I knew when the special edition of Development Dialogue came out with that damning critique of the IMF - written by Norman Girvan, Richard Bernal and, believe it or not, Phillips' Financial Secretary, Dr Wesley Hughes, who both now have to negotiate with that same IMF.

There are two fundamental issues which progressives like Norman and others who spoke at SALISES last week must face squarely: The fact that the economic lifeblood of Jamaica is now totally in the hands of IMF surgeons, and whatever we think, if we don't please them, they won't ink an agreement with us for us to get money from other multilaterals and the private capital markets. Our life is in their hands, while intellectuals like Norman enjoy the luxury of reflections.

You could analyse till you blue, you could cuss them till you change from red. Keep your analysis and they keep their money. What practically must Jamaica do in light of this, Norman? Mikey Witter has abandoned any notion of his simplistic thesis in 'Small Garden, Bitter Weed'. There is no viable Emergency Production Plan, as Norman himself learned from the 1970s.

Plus, there are some necessary and painful adjustment measures which Jamaica must take, with or without the IMF. In other words, we are so critical that only radical surgery will do. It is the failure to address these crucial practical dilemmas which reduced the effectiveness of that SALISES confab.

Ian Boyne is a veteran journalist. Email feedback to columns@gleanerjm.com and ianboyne1@yahoo.com.