EDITOR, The Tribune.
The reasons for the upcoming snap election (the first in Bahamian history) are as clear as daylight. The unprecedented fiscal challenges posed by a year of lost economic activity have the government facing a dilemma long in the making.
Any attempt to borrow money (the favoured tactic of this administration), will be met with demands from would-be creditors to either dramatically cut spending or to reform taxes (either by increasing present ones, or shifting to new sources).
The former choice will outrage a population already abused by years of irresponsible austerity, while the latter will force the FNM to face up to the stark reality of an egregiously regressive tax system that spares the rich and squeezes the poor.
While the FNM knows it will face civil disorder if it follows its instincts and slams the poor with another VAT increase, it simply cannot bring itself to follow the entire civilized world and make wealthier residents contribute their fair share of taxes. That just isn’t in its DNA. Besides, its greedy and short-sighted paymasters would never tolerate it.
So instead they choose an election that they are certain to lose.
The Bahamian electorate has tossed out every incumbent since 2002. While most voters have probably never articulated the underlying reasons (fixating instead on short term media-driven narratives), they should be clear to any thoughtful observer.
Since the end of the Pindling era, the basic policy thrust of this country has been toward a neo-liberal model, favouring a trickle-down economic agenda and assuming (against all of the evidence and experience of the last 30 years) that simply concentrating wealth at the top and taxes at the bottom will magically bring growth.
Hence our taxes (always regressive) have become dramatically more so with the introduction and increase of VAT, while vast tax cuts are given even to controversial investors (like Disney) and ministers promise rich Bahamians and foreign home-owners respectively that there’ll be no progressive taxes on high incomes or luxury properties.
Meanwhile, average wages have been outstripped by a cost of living that increases with each new tax, fee, charge, (Bahamasair) fare-increase and parcel of Bahamian land that a wealthy realtor sells to a wealthy foreigner.
While the FNM is the proud champion of these insanely stupid policies, the PLP is guilty of following or at least not reversing them. For its part, the media either tacitly approves or is itself distracted from the real issues through genuine ignorance.
And it is these increasingly bipartisan policies that have created the conditions that give the electorate a well-founded sense of diminishing living standards and individual prospects, which in turn manifests as anger at incumbents every five years.
Mr Davis and company will only have one short-lived opportunity to break this cycle by reversing the underlying causes of a rightly disaffected population. To do this they must drastically restructure the tax system by rebalancing it in favour of taxes on wealth, property and income and eliminating or reducing consumption taxes. They must also raise minimum wage, bring spending in line with international norms and introduce real universal healthcare.
If they do these things, the boost to consumption will bring about the kind of economic growth not seen in generations and will permit the middle class to grow again.
If they do not, in five years they will lose an election and the cycle will begin all over again.
17 February 2021.