|FNM policies made recession worse|
Published: Jul 03, 2012
From his letter to the editor that appeared in the media on Monday July 2, 2012, Dr. Hubert Minnis is either suffering from selective amnesia or he is deliberately deceptive in his account of national events.
Firstly, the Progressive Liberal Party (PLP) always acknowledged the global recession. The party, however, criticized the Free National Movement’s (FNM) stop, review and cancel policy that accelerated the country’s economic decline and descent into a recession prematurely. We stood by that position then and stand by the same now.
The press reported in 2007 that according to the head of the contractor’s association, 70 percent of contractors were either unemployed or under-employed. This was not due to the global recession brought on by the financial melt down – this was the direct result of the bad policies of the FNM where it sought to (ostensibly) “spite” the PLP government.
Standard and Poor’s reported that the stop, review and cancel policy of the FNM government contributed to the “stalling” of the economy.
The PLP accused the FNM government of tax hikes at a time when governments around the world were lowering taxes and offering incentives to stimulate the private sector and save jobs.
Editor, I will go further. The tax hikes on hotel rooms and departure tax increases were bad for the Bahamian economy and hurt the tourism industry. While stopover visitor numbers and tourism expenditure were increasing in competing destinations, stopover visitors and expenditures were declining at home.
The FNM government deliberately allowed the legislation that waived the stamp tax for first-time homebuyers to expire on the December 31, 2007 because it was a PLP policy and the former prime minister had the audacity to try to blame the PLP for the expiration of this bill. Clearly this was a bad policy decision by the FNM government that hurt the local construction industry and the national economy.
Further, the FNM increased the stamp taxes on real estate transactions and removed the flat real property tax rate on high-end properties and assessed a higher rate. This policy decision crippled the real estate and construction industries, as confidence was lost.
The FNM government intentionally stopped and delayed important projects left in place by the PLP for purely political reasons. These projects could have created much-needed jobs for Bahamians but the FNM was too busy playing politics instead of looking after the interests of Bahamians.
They also told an untruth to the Bahamian people about the severity of the local economic crisis. The leadership of the FNM had to know that the 2011/2012 budget deficit was more than the projected $314 million, but they held on to that figure until their defeat at the polls. Bahamians outside the government were pegging this figure at around $500 million, but the FNM vehemently denied this to the bitter end.
Of the most egregious acts by that heartless FNM government were the tax hikes and subvention cuts in the 2010/2011 budget. The FNM had the unmitigated gall and gumption to raise taxes on the backs of Bahamians after collecting almost $500 million in one-offs in previous years.
They collected hundreds of millions more in stamp taxes from the sale of Vopak (former BORCO), the sale of South Riding Point Ltd. (former Burma Oil) and the sale of Baha Mar involving the Chinese.
After collecting almost $500 million in one-offs, the FNM still wanted to raise an additional $100 million in revenue to narrow the budgetary deficit. The PLP could not support this level of economic mismanagement and cold, callous and heartless attack on struggling and suffering Bahamians, so it walked out of Parliament in protest.
At the end of that fiscal year, the country suffered economic elasticity so their tax policy was a dismal failure.
The botched roadwork was a jobs killer and caused many businesses to close their doors. This decision was particularly egregious because the FNM cancelled many of the road improvement contracts it met in place that employed most of the major road builders in The Bahamas. They opted for a foreign contractor that got in bed with Bahamas Hot Mix while qualified Bahamians stood on the sidelines.
It is clear that the policies of the FNM government made the recession worse. This was always the argument advanced by the PLP. The party’s leader and current Prime Minister Perry G. Christie made this case up to May 5, 2012 at Clifford Park, a mere two days before the general election.
The FNM in its fixation on and lust to destroy and reverse any and everything PLP made poor policy decisions that hurt literally thousands of Bahamians. Now in opposition, Dr. Minnis seeks to wash his party’s hands much like Pontius Pilate did, blame everything on the recession, and point the finger at the PLP.
Editor, I would be remiss if I allowed Dr. Minnis and the FNM to get away with this. Dr. Minnis and his FNM cohorts helped to create this mess and the PLP government is working assiduously to clean it up.
Finally Editor, I wish to comment on this non-sense about the PLP benefiting from the accomplishments of the FNM.
Firstly, the FNM government projected a $25 million budgetary surplus in 2007 based purely on what it inherited from the PLP’s prudent stewardship of the Bahamian economy.
Secondly, the FNM benefited from projects like the new Lynden Pindling International Airport project, Baha Mar, the national stadium and the I-Group in Mayaguana, etc. Each major project the FNM sought credit for was the brainchild and work of the PLP government.
Thirdly, the FNM failed to attract one single significant foreign investment during 2007 to 2012.
Bahamians know that governments are continuous and all governments benefit from the work of their predecessors. It is also true that a succeeding government is burdened by the missteps, policy errors and general ineptitude of its predecessor.
Dr. Minnis wants it both ways so he comes across as disingenuous and petty and his comments come across as sour grapes. I am satisfied, however, that the Bahamian people are smarter than he gives them credit for.
– Bradley B. Roberts