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Discussing Issues Affecting CARICOM and the CSME

The Evolution of Neo-liberalism- The Opening up of Policy Space for the Small Island Developing States of CARICOM?

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Courtney Lindsay- MPhil Candidate

Institute of International Relations, University of the West Indies, Trinidad and Tobago

Conference on Trade Policy, Innovation, Governance and Small States Competitiveness

June 11-13, 2012

 

Introduction

Policy space broadly refers to the level of autonomy available to a country’s government to formulate and implement strategic policies which supports economic development. As it relates to a developing state context, and for the purposes of this paper, the definition used will be formulated from documentation of the United Nations Conference on Trade and Development (UNCTAD) Sao Paulo conference in 2004 where the concept first came into official use, as this is more instructive. The concept speaks to the autonomy available to governments to design and implement domestic policies geared toward the diversification, expansion and enhancement of their industrial, technological and productive capacities in the face of “international disciplines, commitments and global market considerations” (pg 3: p 8.).   This paper will examine this concept by applying it to two related factors: that of the neo-liberal economic paradigm, as well as its accompanying multilateral policies as enshrined in the World Trade Organization (WTO), the World Bank (WB) and the International Monetary Fund (IMF). The two are inseparable. Neo-liberal regulations entrenched in these multilateral institutions were created to further the aims of the former, which are open markets and the free reign of capital (Evans, 2005). The context of the paper will be situated in developing countries, with emphasis on the small island developing states of CARICOM. The paper will distinguish between policy space constraints as brought on by legal regulations of such multi-lateral organizations as the WTO and the IMF as well as bilateral free trade agreements, and policy space relating to more general conditions such as the international trading regime which is perceived as being an unleveled playing field against developing states. The paper will address both.

The paper will first assess the criticisms leveled at the neo-liberal policy prescriptions of the Washington Consensus, which has been perceived to have reduced policy space in developing states; it will then examine the current state of the neo-liberal economic model, under which there is a supposed opening up in policy space in favour of developing countries. The paper will then seek to explore the weight of the arguments of the proponents of the theory that neo-liberal economic policies, as well as its vehicles (IMF, WB, WTO, bilateral FTAs) do in fact hinder the creation of industrial policies in developing states. It will further examine the arguments of scholars examining the recent global financial crisis of 2008, to determine the extent to which policy space is said to be shifting in favour of developing states in the global political economy. The paper will conclude by outlining the need for further theorizing and conceptualizing of the concept of policy space as it relates to especially Small Island Developing States (SIDS). It will then suggest a method of investigation geared toward creating a model capable of measuring the amount of state intervention necessary within an economy, sector or sub-sector, and to predict, ex-ante, the effectiveness and outcomes of such intervention. This is toward the assumption that should CARICOM states quantitatively demonstrate the benefits of intervention toward growth, diversification and industrial expansion within their economies, and are able to numerically and near accurately predict their outcomes, they can make a more convincing case for policy autonomy in future multi-and bilateral negotiations. Additionally, they may be able to exert a greater influence on the changes within an evolving neo-liberal trading regime.

 

CARICOM States and Policy Space

It is perceived that CARICOM states have been experiencing a progressive loss of policy autonomy over the last 30 years with the adoption of the neo-liberal economic model via World Bank and International Monetary Fund (IMF) structural adjustment policies. Multilateral trade agreements via the world trade organization (WTO), as well as bilateral trade agreements, and, in general, globalization in a neo-liberal form has, since the 1990s also contributed to their loss of policy autonomy. Concurrently, over this time period, CARICOM states have for the most part been stuck in a developmental quagmire, with the condition of some economies such as that of Jamaica growing increasingly precarious (Levitt, 2005; Girvan, 2011). The promises of the benefits of incorporating into their national economies the neo-liberal economic policies of deregulated and open markets have fell flat, having done little by way of encouraging vibrant growth and economic development.

Recently, heterodox thinkers on the problems of developing states have postulated that many, if not most of the neo-liberal policy prescriptions are in large measure to be blamed for the lack of growth in not only CARICOM states, but developing regions of Latin America, Africa and Eastern Europe, which also accepted neo-liberal economic policies via the Washington Consensus (Stiglitz 2005, 2009; Lall 2005; Wade 2005, 2009, 2010; Chang 2002, 2004; Reinert 2009, including several others). The fact that states such as those of East Asia, as well as China and Chile which took an independent, or largely independent course from the Washington Consensus have flourished adds weight to their argument, as well as their conviction that the neo-liberal economic policies enshrined in the Washington Consensus are inimical to growth in developing economies. They postulate that the neo-liberal prescriptions adopted by the latter, and the multilateral regulations and obligations they are now subjected to have served to increase their vulnerability, leaving them open to exploitation by multinational corporations (MNCs) and other powerful capitalist interests of developed economies. They further note a progressive stripping away of developing state governments’ ability to engage in industrial policies such as export subsidies and credit support, which would enable them to diversify their national economies, increase their product value-added, and in general, strategically develop the competitiveness of their own private sectors. Heterodox thinkers are unanimously opposed to the market obsession held by the IMF, the WB and the WTO, and their ‘one-size-fits-all’ best practice policy prescriptions. They encourage strategic state intervention and the creating of the right supporting state institutions to facilitate macroeconomic stability through the creation of productive capacity.

In general, proponents of this view argue that neo-liberal globalization constraints the policy space of developing states by virtue of them being integrated into the global economy, what Mayer (2009) refer to as ‘de facto  constraint’. This affects policy space in such areas as domestic interest rate where a state must seek to modify its interest rate based on the relative difference between itself and other states. In this sense, then, all states, both developed and developing are faced with de facto constraints to policy space. Therefore, the main target of attack for thinkers such as Lall (2002, 2005), Wade (2005, 2010), Akyuz (2009) and others are the legal rulings of the WTO, as well as structural adjustment policies of IFIs, which poses “de jure” policy constraints on developing states. They have accused these organizations and the powerful economies such as the United States which seeks to set the normative rules of their agendas of proscribing developing economies from formulating policies and offering protection to infant industries. These constraints are being viewed as being mainly responsible for prohibiting developing states from acquiring a level of development experienced in developed states.

These de jure constraints are embodied in such legally binding regulations as the trade related aspects of intellectual property rights (TRIPS), trade related investment measures (TRIMS) and the general agreement on trade in services (GATS).  TRIPS is believed to raise the cost of technology transfer to prohibitive levels, restricting research and development, and ultimately inhibiting technological and thus economic development in developing states. The state has also been forbidden to place performance restrictions on foreign investors through the trade related investment measures (TRIMS). Performance requirements related to local content, trade balancing, export requirements and requirements on foreign investors to procure goods from local suppliers have been banned. This supposedly severely restricts the ability of developing economies to create policies which ensure that the national economy receive maximum benefit from the domestic presence of foreign direct investment (FDI).   With regards to the general agreement on trade in services (GATS), it is now, according to Wade (2005:88) “next to impossible for developing country governments to protect their own services industries from competition from well-established foreign firms, in a way that virtually all the successful developers have done in the past”. The criticism doesn’t stop there: heterodox thinkers further argue that where developed states have been unable to cement the greatest level of market access from developing economies via multilateral, legally binding arrangements, they are pursuing through a series of bilateral FTAs. The ultimate goal, they argue, is to further deepen existing regulations, as well as to gain other concessions of the so-called “Singaporean Issues” involving government procurement, trade and investment and competition policy.  These, they forebode, will further restrict industrial policy space in developing economies, hence implying that developing states, while they should negotiate for more development space at the multi-lateral level, should steer clear of bilateral free trade agreements, especially with powerful economies.

However, this warning is indeed late. One study worthy of mention is that of Gallagher (2005) whose research highlights the proliferation of regional and bilateral free trade agreements between Latin America and the Caribbean (LAC) “where 33 out of 39 countries belong to at least one RBTA” (Gallagher 2005:37). He seemed bewildered that LAC countries continue to pursue bilateral and regional free trade agreements, especially with more economically powerful states, and using computable general equilibrium models, sought to demonstrate that LACs gain significantly less from bilateral agreements with the United States, yet they pay a very high cost in trade diversion and the loss of policy space. The author argues that a standalone study of the CARICOM region is necessitated, as being grouped in with Latin America in such as study may not provide a specific picture for a CARICOM context. No two bilateral and regional free trade agreements are the same, and Latin American states, by his own study, appears to be more intertwined with the United States in bilateral arrangements than are CARICOM states. However, his research is instructive in demonstrating that CARICOM states, like their counterparts in Latin American do of late, spend the lion’s share of their foreign policy energies in bilateral and regional free trade agreement formulations.

To take advantage of these bilateral and regional free trade agreements, and to compensate for the reduced capacity for intervention, developing state governments to large extents are using quasi-independent state agencies in an effort to diversify, expand and increase their exports, as well as to compete with imports (Knorringa and Meyer-Stamer 2008). This strategy is termed localized economic development (LED), and, in the case of CARICOM, is being perpetrated through the encouragement of bilateral partners, and use of donor funding. The LED strategy involves the creating and mandating of agencies, government ministries and private sector support organizations with the task of diversify the economy by building and expanding entrepreneurship, as well as developing private sector export competitiveness and capacity through business facilitation, research and development facilities, business incubation, among others, all in an effort to get their economies competitive and export ready. They also engage in value-chain promotion in an attempt to connect local goods and services providers to the markets of their free trade partners by hosting or facilitating business forums, trade missions, stake-holder workshops, etc. Knorringa and Meyer-Stamer (2008) went on to highlight that these kinds of sub-national, public sector services geared toward private sector development however have thus far proven ineffective in addressing issues of industrial development in developing economies. They join other heterodox thinkers in arguing that the most important element in the industrialization, diversification process is lacking: that of traditional, strategic government intervention which plays a major role in providing industry support. Without this, development strategies such as LED and Value Chain promotion inevitably come to naught.

This clearly has implications for the ways in which CARICOM states approach industrial development and private sector growth, in that, it questions CARICOM states developmental priorities. The question that development thinkers in CARICOM should seek to answer is no longer what else can CARICOM states do in their attempt to build a viable, sustainable, diversified economy. The question should be whether such an economy can be built using their current economic model of regulatory type neo-liberalism. This variety of capitalism has been advocated by the Washington and Post Washington Consensus, and injected into CARICOM states through structural adjustment policies. It involves the state creating quasi-state regulatory institutions to maintain market competitiveness, but otherwise maintaining an arm’s length distance from the market. The failure of this model to spur economic growth brings squarely back into the equation the question of the role of the state in the economy. More importantly, it begs the questions regarding the level of state intervention, as well as the types of interventions necessary to change the current direction, and to conceptualize and implement more effective industrialization and trade policies and practices.

 

 

 

How Neo-liberalism came to influence developing states national economic policies

Economic liberalism/neo-liberalism emerged and gained rapid ascendancy during the 1970s.The paradigm came about as a prescriptive policy mechanism to solve the economic problems that plagued both developed and developing countries as a result of a series of economic recessions during the period of 1970-1980. This period was marked by stagnant economies yet rising government expenditure on social services, resulting in massive deficit spending by many governments. For developing countries the recession of the 1970s was exacerbated by the third world debt crisis resulting from the 1973 Arab Oil Embargo imposed by the oil producing countries of the Organization of Arab Petroleum Exporting Countries (OAPEC). This created severe indebtedness in developing countries of Africa, Latin America and the Caribbean, which had previously borrowed from international commercial banks to finance infrastructural development, and in the case of Jamaica, to maintain the high standard of living experienced during the boom period of the 1960s, as well as to support social services in the 1970s (Levitt 2005). These countries which were already feeling the effects of a fall in commodity prices of their primary exports on the world market had no other option but to turn to the Washington-Based multilateral International Financial Institutions (IFIs) for financial assistance. Anglo-American type neo-liberal principles were mandated upon governments of these countries through their interaction with the World Bank (WB), the World Trade Organization (WTO), and the International Monetary Fund (IMF). These institutions spread the neo-liberal paradigm across the debt-ridden, developing world via the Washington Consensus structural adjustment policies as conditions for loans[1].

 

The Washington Consensus and the Role of the State

The Washington Consensus emerged out of investigative work conducted by John Williamson (1990) which sought to list the economic reforms which Washington thought were necessary for, and was hence urging upon Latin American countries. This ten point reforms which he observed and codified underpins the neo-liberal economic model.  They speak to a free market economic system based on the abstract concepts of tight fiscal discipline, expenditure redirection (toward such services as primary education and healthcare) open markets, elimination of trade barriers, tax reforms to broaden the tax base, privatization of national industries, financial liberalization to create market determined interest rate, competition through deregulation, protection of private property and minimal government intervention in the market (Williams 1993). All these can be summed up into three concepts: (1) prudent macroeconomic policies, (2) outward orientation, and (3) free-market capitalism.

The role of the state under the regulatory neo-liberal paradigm was relegated to creating institutions to apply and implement these concepts, as well as to create and enforce the rule of law to protect and enhance them. The state should provide judicial, military and police services to protect private property and property rights, as well as regulatory agencies and institutions to ensure the competitiveness and integrity of the market.  The government should not engage in productive activity save for the provision of utility services such as water, electricity and transportation. And even so, where these are inefficiently provided or operated at a loss, they should be privatized; where they are efficiently provided and profitable, they should likewise be divested to the private sector (Levitt 2005). Infrastructures must be provided to enable entrepreneurial activities. Social services such as education, health-care and environmental protection must be provided where no markets exist to provide them. These provisions aside, the state should not venture into the market.  Having applied these policy prescriptions, developing countries should have experienced economic growth and social development. In reality, however, such has been, and continues to be elusive for many developing countries, including CARICOM states which attempted to implement them under the Washington Consensus.

 

The Failure of Neoliberalism and the Washington Consensus

Kean and Mykhnenko (2010), Cerny (2008), Harvey (2007), Giroux (2005), Escobar (2004) among many describe the period of the 1990-2000s as not only lost decades for most developing economies, but relatively destructive ones. Therein, industries were lost, unemployment burgeoned, mass migration ensued, poverty increased, bringing with it an increased level of crime and violence, civil and cross border wars, as well as terrorism in many developing countries.  CARICOM states such as Jamaica have not only failed to grow, but have stagnated under the neo-liberal paradigm as packaged and sold by the WB and the IMF; the state has since displayed several symptoms outlined above (Levitt 2005 and Girvan 2011).

While there are a few studies claiming the opposite (See World Bank Report 2002), it is generally agreed amongst scholars that the gap between the rich and the poor has widened within countries, among developing countries, and between developed and developing countries. The former cites the following as proof: rise in per capita income; a decrease in inequality; increase in life expectancy; low infant mortality and increase in literacy rates in most countries as evidenced since 1980. The latter however cites an increase in inequality and absolute numbers (poverty head-count) of those in poverty in Africa, Eastern Europe and Latin America between the years 1980 to 2000 (Pritchett 1997, Wade 2004a, Chang and Grabel 2004, Leftwich 2005, Stiglitz and Charlton 2005, Gallagher 2005, Reinert 2009). Girvan (2010), Levitt (2005) and others have noted the persistence of poverty in the Caribbean despite national, regional, bilateral and multilateral measures of neo-liberal reforms to correct it.

Scholars such as Wade (2004b) have questioned the empirical basis of the findings of the World Bank, while others such as Leftwich (2005), Selwyn (2009) and Sandbrook (2011) note that East and South East Asian states such as China, Singapore, Taiwan and South Korea, which never accepted fully the neo-liberal paradigm, were actually responsible for the statistical decrease in global poverty and income inequality. This is due to their tremendous growth since the 1960s. Research carried out by scholars such as Chang and Gabriel (2004), indicates that world growth domestic product (GDP) per head has been slashed by more than half after the onset of neo-liberalism. At best, the statistical evidence is conflicting.

The Economist (2011),an internationally acclaimed and widely read think-tank which champions the virtues of neo-liberalism sees things differently. Its publication of December 2011 celebrated the impressive growth being experienced in sub-Saharan Africa, which, two decades earlier it wrote off as a hopeless case destined to indefinite chronic dependence on international aid and mineral exports. However, through a reduction of trade barriers, increase in education and political awareness, better governance and higher productivity, many African states have benefited from commodity exports, and have grown steadily richer. The think tank however warned against being overly optimistic, as while the middle class in countries such as South Africa and Nigeria is growing, severe poverty and inequality among the majority stubbornly persists. This is no surprise. The Economist failed to mention that due to neo-liberalism’s favored preference for transnational corporate interests, “rising prices of commodity exports in Africa brings greater benefit to foreign corporations operating these industries, rather than the countries themselves” (Kwa 2007:12), hence the wealth trickles down to only a few. This indicates a meeting point where the media even in a scholarly form, and academics can agree, as the general consensus seems to be that the neo-liberal economic order has hardly been an era of exuberant wealth creation capable of changing the socio-economic conditions of the majority of citizens within a single country (Birch and Mykhnenko  2010: 259) . This would explain South Africa’s nationalistic tendencies, and its contemplation toward constructing a developmental state.

Despite the conflicting thoughts on the success or failure of the Washington Consensus and its neo-liberal under-pinning, scholars are unanimously in agreement that the neo-liberal order has failed to match the growth rates which many regions including Africa, Latin America and the Caribbean experienced during the Keynesian era of the 1960s (Growth rates of over 5.5 % before 1980, to growth rates of less than 2 % after 1980 [Stiglitz 2010, Mkandawire 2000].  It is therefore fair to agree with scholars who believe that the regions (or the countries within) which attempted to adopt the Anglo-American/regulatory type neo-liberal paradigm encapsulated in the Washington Consensus as their sole growth model have either stalled or regressed.

 

Contemporary State Behavior in the International System: The Opening up of Practical Policy Space?

The Economist (2012) expressed concern regarding the behavior of some states on the international stage. The issue of 21st January, 2012 reports that the crisis of liberal capitalism has coincided with the rise of a powerful new form of state capitalism in emerging markets; a coming trend which it believes represents the future. The Magazine appears to be concerned that powerful states of Russia and China are not only deepening their state-capitalist structure, but are overly confident that their form of state-capitalism is more effective than the current economic framework. These states are being joined by South Africa, India and Brazil, three states which, since the 2008 crisis, have been exhibiting state-capitalist tendencies. India, most recently, denied access to Wal-Mart, the American retail giant from operating within its territory, claiming that Indian small and medium size enterprises (SMEs) would not able to compete. The current policy models of these states, known as the BRICS, “encourages domestic industrialization by channeling credit to targeted industries and requiring that foreign investors engage in technology transfer and use local suppliers- but to the end of creating and maintaining globally competitive export industries” (Bresser-Pereira 2010, in Babb 2012). In effect, these countries are demonstrating the characteristics of state capitalism.

That state-capitalism may represent the future, then, is a legitimate claim made by the newspaper, as these states are influential giants within their regions. South Africa and Brazil command influence on the African and South American continents respectively, so does Russia (to a small extent), India and China in Europe and Asia. The BRICS are also crisscrossing regions, interacting and strengthening their relationships with developing countries in Africa, Latin America and the Caribbean (Onis and Guven 2011). The possibility therefore, that they may win converts in the form of struggling developing countries disenchanted with the failure of the Washington and Post Washington Consensus does exist, as “dominant economies not only influence the world economy, they are archetypes for other economies” (Gilpin 2001 quoted in Ferchen 2012: 3). Further to this, China appears to be gaining legitimacy among scholars, some of whom are now debating whether the Chinese growth model is a possible emerging alternative to the prevailing, but flawed neo-liberal economic paradigm (Ferchen 2012; Breslin 2011: 1323). The rise of these states have re-created a multi-polar international environment, which has important implications for CARICOM states, as this creates an urgency to rethink the position of SIDS within this changing global structure.

While the western media (for example The Harvard Business Review, the Times, The Economist) to some extent, as well as orthodox proponents of neo-liberalism continues to champion the free-market in an Anglo-American/regulatory neo-liberal form, the inherent flaws within its structure are not entirely overlooked. Regulatory, lassiez- faire states generally substitute government interventionist regulatory measures characteristic of state capitalism, for regulation through relatively independent state agencies such as competition commissions and federal administrations, which in turn are overseen by the state. However, as reported by The Economist of February 18th 2012, “over regulation” of especially the United States since the 2008 crisis has been choking its economy and further inhibiting growth.

This is one of the most puzzling paradoxes of Anglo-American type neo-liberalism. While the state is expected to play a minimal role in the market it in fact does the opposite, and as this case demonstrates, to the detriment of the market itself. This paradox presents a problematique, and its analysis has important implications for not only the question of government intervention, but the type of government intervention and the amount necessary for effective functioning of any economy or industrial policy. More specifically, it demands an analysis into whether state institutions such as those which characterize developmental states such as China are more effective regulators of the economy, as opposed to relatively independent state agencies of regulatory states such as the United States and Britain. The former type of regulation, which is interventionist in character, is aimed at achieving a particular outcome, such as rapid industrialization in a particular sector of the economy. The latter, usually described as ‘arms-length regulation’ is aimed at facilitating competition, preventing fraud and ensuring market efficiency.  However, the paradoxical nature of regulatory statesis such that regulations can be more invasive than traditional types characteristic of social democratic or developmental state contexts (Moran 2003, Cerny 2008). This is an important question for CARICOM states as they embark on political economic restructuring for growth facilitation and economic and social development.

 

Shifting in Policy Space at the Multilateral Institutional Level?

The theme of the annual World Economic Forum (WEF) 2012, “The Great Transformation: Shaping New Models” gave evidence of an impending change to the current paradigm. The request of the board of the organization to the attendees of the 2012 meeting was for “new ideas for reforms and new models for political and economic leadership”, as “capitalism in its current form no longer fits the world around us” (Mail and Guardian 2012). This speaks to the current nature of global discussion, and demonstrates the widespread recognition that there is need for a reformed economic paradigm. This discussion has implications for CARICOM states, which must begin to seek ways to enter at the policy and academic level, if they are to influence the neo-liberal evolutionary trajectory in their favour. The WEF is an annual meeting held in Davos, Switzerland. It is organized by an independent, international organization by the same name. It spawns a time span of four days, and over 250 sessions discussing issues within the broader topics of environmental sustainability, economic growth, financial systems and social development. The meeting attracts and engages the top business, cultural, political and academic world leaders in an attempt to shape the global, regional and industry agendas.

World Bank Chief Economist and Senior Vice President, Justin Lin, produced a paper in which he requested that “governments should play an active role in facilitating industrial upgrading and infrastructure improvements” (Lin 2011:194). The article was published in the World Bank Research Observer, a journal aimed at informing readers of research being undertaken in the areas of economic relevance for development policy. The journal in which the article appeared, as well as the author’s position within the organization is indicative that an international institution which acts as the pantheon of the neo-liberal ideology contain elements sympathetic to the cause of greater government intervention and a more sensitive approach to development as it relates to developing economies.  This may indicate yet another possible wave of World Bank rethinking of neo-liberalism. Having become apologist of its own failed model- the Washington Consensus, the organization had already undertaken a more statist and leftist approach to country development with the Post-Washington Consensus (Sandbrook 2011:2).

Those who have observed a formalized power shift in voting rights within the IMF (Birch and Mykhnenko, 2010; Babb, 2012) draws their conclusion from the rapidly growing economies of Argentina, Australia, Italy, Brazil, China, Mexico, India, Indonesia, Saudi Arabia, South Africa, South Korea, and Turkey, which, along with the G8, now forms the G20 group of nations. They are implying a change in future relations between developing countries and the IMF regarding loans and structural agreements, as these newly added countries are more sympathetic to the cause of developing countries. A few of these countries, for example the BRICS, not only demonstrate characteristics of the developmental state, “they endorse more interventionist visions of how to empower developing countries” (Babb 2012: 1).

Literature supportive of alternatives to market fundamentalism has also been increasingly emanating from international organizations within the United Nations such as United Nations Conference on Trade and Development (UNCTAD, 2004) and United Nations Economic Commission on Africa (UNECA, 2011). These organizations have been producing literature supporting an investigation into the feasibility of the developmental state model of East Asian becoming a feature of African states. This is especially telling. UNCTAD was developed in 1960s, with the purpose of tackling the social and economic problems of developing countries with appropriate policy actions. Including the developmental state theory into its analytical content regarding macroeconomic management demonstrates the renewed popularity and faith scholars and policy makers alike have in the developmental state strategy. Belief in the view of renowned scholars such as Ha Joon Chang (2002) and Evans (2010) that without some form of developmental state, there can be no meaningful, sustainable development seems to be expanding.

 

Intellectual Shifting in Policy Space?

The number of political economists who are advocating a return toward greater state intervention in national market economies, and a more tailored approach to development is steadily increasing. Besides traditionally known heterodox thinkers such as Rodrik (2011), Stiglitz (2005), Helleiner and Pickel (2005), Leftwich (2006), Wade (2010), among others, there are now thinkers such as Ferchen (2012), Clift (2012), Sandbrook (2011) among others. This demonstrates a greater intellectual shifting away from the extremes of market fundamentalism. Between 2010- 2012, the literature supporting alternatives to market fundamentalism has increased, as scholars are calling for a revisiting of alternatives such as emancipatory-based community led development (Ledwith 2011), a return to social democracy (Sandbrook 2012), as well as a revisiting of the dirigist/developmental state (Clift 2012). Additionally, the literature supporting developmental states in African countries has also dramatically proliferated (Edigheji 2006, 2007, 2010, Moyo 2010, Mkandawire, 2001 among others).

 

Is there really a shift?

Since the 2008 Global Economic Crisis, scholars have proclaimed the ‘collapse’, ‘fall’ ‘failure’, ‘dissipation’ of, and “damage to” the neo-liberal paradigm. However, the literature has been very careful not to toll its death-knell. Scholars maintain that neo-liberalism still maintains its hegemonic position in the global economic structure. While confidence in this paradigm which has dominated the world for three decades has weakened, with more policy-makers desiring either a radical restructuring or an alternative, there is every reason to believe the neo-liberal paradigm will continue to heavily influence the international and national economy.

Likewise, it is predicted that a new ideology, if and when one emerges, (or an older ideology which had had been banished with the triumphant arrival of neo-liberalism, but have recently, confidently emerge out of exile due to its failings), is set to incorporate elements of the neo-liberal paradigm. This is due to the fact that having used the vehicle of globalization to propel itself, its tentacles have reached into every corner of not only the global economy, but also societies, as well as the human psyche, and therefore will be almost impossible to roll-back (Kean and Mykhnenko 2010). In the words of Harvey (2007), “it has incorporated itself into the commonsense way we interpret, live in, and understand the world”.

All thinkers who have acknowledged the disruption in the neo-liberal trajectory (Fine 2010), Jessop (2010) Sandbrook (2011), Gamble (2009) and even Gordon Brown (2009) make mention of its perpetual character. They all highlight neo-liberalism’s “ecological dominance” (Jessop 2010: 53) within capitalism, characterized by its ability to not only self-adapt, but to displace its own contradictions into the future, as well as to attach itself to other capitalist systems, shaping their evolution to resemble something of itself. Neo-liberalism has been doing this since its inception. For example, coming under pressure for its failure to spur growth in developing countries with the Washington Consensus, being criticized for its inequities and glorification of profit over social need, as well as its environmentally destructive tendencies, neo-liberalism attached itself to the socialist ideology with the Post-Washington Consensus (PWC). The PWC compromised the hard-headed neo-liberal stance of minimalist government to allow government intervention in the area of good governance, environmental protection, welfare safety nets and corporate social responsibility. This is a clear example of elements of the socialist ideology being captured by neo-liberalism to form (if in a very limited form) a sort of social-market neo-liberalism, a variety within neo-liberalism itself. However, even when it yields to a compromise, neo-liberalism still maintains its primacy, and almost all of its orthodox neo-liberal tenets. Caribbean scholars such as Bishop (2012), Girvan (2005) and Payne (2012), for example, poses the argument that where CARICOM states were concerned, the Post-Washington Consensus, like its predecessor, was grounded in neo-liberal orthodoxy. It “did not relax policy space in these states to allow for the selective engagement or disengagement with the global economy that would involve the strategic use of tools like taxes or duties or, more importantly, concerted government action to proactively develop a country’s political economy” (Bishop et al 2012: 7). Neo-liberalism therefore demonstrates a bad habit: whenever it attests to the failure and inappropriateness of its policies within a particular context, it prescribes more of said policies as the solution. Thus, engaging in a vicious cycle of what Girvan (2005) refer to as “adjustment without end”.

Babb (2012) and Blackman’s (2008) analysis of Kuhn’s paradigm shift theory demonstrates that only one of the two necessary ingredients for the replacing of the neo-liberal paradigm has been fulfilled,  that is, it has proven to have failed. The other element, a viable replacement paradigm, does not yet exist. While some scholars have spoken of the Chinese Consensus (Chinese-type state-capitalist economy) being a possible alternative to the Washington Consensus, the work of Babb and Ferchen (2012)  indicates that the current policy framework of not only China, but the BRICS in general, represents a ‘form of capitalism’ which is heavily market-based and so does not constitute a new paradigm. It seems to be more akin to a second-order variant within the neo-liberal paradigm. Both scholars note that these countries have been, and continue to pursuing policies that are not that far removed from the core tenets of the original Washington Consensus. Ferchen (2012) additionally, highlights the fact that the Chinese Consensus is itself highly controversial and contested among academics and policy makers both within and outside of China as a proper growth model capable of ensuring future growth even within China itself. A solid consensus on the Chinese Model is still a far way off. Additionally, China lacks the hegemonic power as well as the support of IFIs wielded by the United States during the 1980s and 1990s to impose this model upon the global economy. This indicates clearly that neo-liberalism and the Washington consensus will continue to govern continue to dominate the global economic structure.

The 2008 economic crisis is analyzed by two eminent scholars, Gamble (2009) and Hay (2011), each basing their interpretation on varying degrees of the definition of a crisis to decide whether the label fits the occurrence. Gamble’s view of a crisis connotes a long-term, on-going, but sickly phenomenon. The 2008 financial meltdown is hence more akin to an emergency within an ongoing crisis, rigged by underlying weaknesses (what Hay calls pathologies), which culminates into an “operational emergency” situation which must be quickly rectified. A protracted period of uncertainty ensues thereafter, involving a turning point where a decisive change must be made, for better or for worst. The inference from Gamble’s work indicates that neo-liberalism is and has been since its inception, in a crisis. However, according to Hay, this decisive change is yet to be made by political actors and policy makers, which led him to question whether the meltdown of 2008 truly fits the definition of a crisis to begin with.

Hay, as well as Onis and Guven (2011), and Babb (2012), Meunier (2012) treats crisis and structural transformation as combined elements, the latter being the logical reaction to, and the outcome of the former. By their interpretation of the occurrence, the 2008 economic crisis should have resulted in transformation; decisive intervention which renders change in the global political economy immanent. However, as Hay indicates, the severity of the ‘crisis’ measured against the actions taken by political agents to correct it represents a very wide disparity. This indicates that no substantial transformation or replacement of the paradigm is on the horizon. What these scholars observed is a borrowing of Keynesian measures, not only in Britain but also the United States, to provide economic relief and to set the economy back on track, after which such measures will be discarded. Hay’s work is supported by that of Meunier (2012), who referred to the European continent’s passive and sympathetic reaction to America regarding the crisis as “the dog that did not bark”. Both scholars seemed surprised at a sympathetic European reaction to the American-made crisis, and even more confounded by the fact that Europe remains largely pro Anglo-American neo-liberal. The conclusion is evident. Since policy paradigms are usually driven by political forces (Babb 2012), with the evidently little political dedication to fundamental change in the international structure, change is very unlikely to be forth coming. In the words of Onis and Guven (2011:483), “[T]he crisis simply did not turn out to be cataclysmic enough to bring about a radical shift…”.

The work Hay and Meunier indicate a resistance to reform on the part of the West concerning the Anglo-American neo-liberal model. The media (see The Economist 2012) as well as scholars are indicating that the BRICS on the other hand, as well as the developmental and other emerging economies of Asia such as Indonesia are confident in their growth models and show no intentions of restructuring (Babb 2012). This lack of coordination between the powerful G7 and the now G20 (the developed and the emerging economies) demonstrates continuity of the current status quo of global structure, as both sets of economies continue along divergent paths. The implication this has for the IMF and WTO, and ultimately developing states, is that with no coherent reform-minded movement supported by a critical number of states to instigate change in the way the multilateral organizations do business, they

will continue in the short term to be trapped by its existing architecture, the outcome of which may be a greater proliferation of bilateral and regional free trade agreements, which may prove to be more debilitating prospects for small and vulnerable developing states lacking structural influence and bargaining power (Drache 2011).  

While these international political economists appear almost certain of a continuance of the neo-liberal trajectory, they have all indicated that evolution within the paradigm is in-fact taking place; The literature, both academic and the media indicates that intellectual policy space has opened up to include heterodox interpretation of economic development. The tenets of neo-liberalism which speaks to self-regulating market is officially defunct, and the state has now been given an opportunity to re-establish itself firmly in the centre of the development process (Onis and Guven, 2011; Sandbrook, 2011; Fine 2010). The evidence indicates that the United States no longer holds a hegemonic position within the global structure, and has conceded space to the BRICs and other emerging countries. By logical extension, the pure form of lassiez-fair market model advocated by the United States no longer dominates the intellectual and policy environment in terms of development strategies. This ultimately has created and solidified a multipolar environment of different actors who employ and advocate different developmental strategies, different models of capitalism, as well as different varieties of capitalism. While they may adopt tenets of the neo-liberal paradigm, they do not necessarily conform to the Anglo-American mold.

The conclusion to be drawn from this examination of neo-liberalism and the global economic crisis is that the disregard that many states displayed concerning multi-lateral rules, including the United States, Britain and the Eurozone in their interventionist measures to cushion the effects of the crisis, as well as the practical policy measures being taken by the BRICS provides an indication that a shift is indeed occurring. The intellectual move away from the extremes of neo-liberalism, and the growing sympathy toward heterodox development thought is also telling. However, regarding Small Island Developing States (SIDS), there is to date no clear indication of how this shift in policy space both in academic and state policies will reshape and restructure the global political economy. Neither is there any publication demonstrating how any small Island developing state has capitalized on this shift to reform their trade and industrial policies.

The implications of this for the developing states of CARICOM are important. As the evidence demonstrates, a new and equitable global trading regime is will not be handed to them on a platter. CARICOM states will need to take advantage of policy space within the confines of the current trading regime and carve out a more effective development and industrial policy for themselves. This is not an impossible task.

 

Neo-liberalism and Policy Space as Dynamic Variables

Neo-liberalism was unable to fully penetrate the economy of all the players in the international political economy. The literature would indicate that some of these states had already reached a level of development before the 1980-1990s when neo-liberalism took root and policy space began to constrain states such as the developmental states of East Asia (Amsden, 2005; Girvan, 2005) and the welfare states of Scandinavia. In essence, these states had a head-start. It can be argued, however, that even within the neo-liberal paradigm, the institutions and norms which had already been embedded within these states continue to allow them to maintain their developmental industrial policies along an already cemented path dependency. The Chilean economy stands out as one that has managed an incredible fate, and serves as evidence of the dynamism of neo-liberalism. Chile has managed within a neo-liberal framework, and while being hailed as the vanguard of neo-liberal economics to incorporate indigenous, strategic developmental elements into its development policies, leading it to become one of the most economically successful states in Latin American today (Stigliz 2009). It created its own path dependency, independent of a historical trajectory, toward a particular type of state institution.

In his work on the models of capitalism, Coates (2000) examined various models of capitalism practiced by four sets of leading states, namely Germany, the United States, the United Kingdom and Japan. Coates examined these states by addressing the relationship between labour, the private sector and the state in each. In an Anglo-American/regulatory type neo-liberal setting, neither labour nor the government play a prominent role in the economy; it is the market which holds preeminence, with the government providing regulatory standards. In the German Scandinavian model, the private sector and labour work hand in hand, both having a form of predominance over production. In the developmental state or state capitalist system of such states as Japan, the state and the private sector work together in an institutionalized relationship, with labour being relatively marginalized. Where the debate lies among scholars concerning the models of capitalism is whether globalization is causing a convergence of the three, where the need for investment, as well as the need to become globally competitive is narrowing the gap between them, bringing them closer to the pure market form of Anglo-American/regulatory type neo-liberalism. This paper will not enter this debate; it will however argue that even if this convergence is in fact occurring, there will never be a convergence into a single form of neo-liberalism.  Neo-liberalism is, and has always been a dynamic variable, in that, it is a malleable agent capable of being manipulated and shaped by different actors into what they wish to construct from it (Hobson and Ramesh 2002, Cerny 2008).  The importance of this to CARICOM states is that an examination of states which have used endogenous and localized means of spurring growth within the neo-liberal paradigm, and which have been successful at carving out policy space can be examined, and the transferability of state institutions assessed, to decide the feasibility of an alternative model or variety of capitalism for CARICOM states.

 

Taking Advantage of Policy Space

While there is a general consensus among scholars that policy space has decreased with the advent of neo-liberalism and neo-liberal globalization, not all heterodox thinkers agree with the argument that it prohibits development in developing states.  Several scholars (Lall, Amsden, Evans, 2005, Mayer, 2009) have disagreed that this de facto and de jure reduction in policy space necessarily decreases a state’s ability to actively intervene, coordinate and strategically diversify, expand and grow its economy. They unanimously agree that neo-liberalism did more than just reduce policy space; it redirected it (Evans 2005: 203). This redirection is now toward creativity, good governance and the right institutions, which states should use to create effective policy targets and instrument-target relationships (Mayer, 2009: 389). Mayer’s instrument-target relationship can be made more effective with by employing what Girvan (2005:7) calls “feedback loops”, whereby the results of policy intervention are constantly evaluated by social actors so that adjustments can be made. These thinkers believe that routes taken toward industrial development, whether orthodox neo-liberal, or heterodox neo-liberal policies has the potential to work, provided the instrument used is tied to monitorable performance standard and operate under reciprocal control mechanism that disciplines all parties involved in this industrial expansion (Amsden, 2005:230)

This therefore speaks to the necessity of a re-configuration and re-orientation of state institutions within developing economies. Neo-liberalism has re-directed industrial policies away from traditional industrial policy failures such as those under import substitution industrialization (ISI), where governments patronized rent-seeking inefficient industries, toward more collective investment policies which can drive “capability-centered” development (Evans 2005). This form of development occurs through the building of human capabilities through access to education and healthcare and other welfare amenities. These scholars are confident that developing countries can develop under the current neo-liberal model, even with a reduction in traditional policy space, provided they avoid engaging in what Gallagher (2008) calls “trading away the ladder”. This concept of the ladder was first used by German Economist Friedrick List (1839), and modernized by Chang (2002), who argues forcefully that developed states through multilateral and bilateral measures are denying developing states the very tools they employed to attain the high level of development they enjoy today- in other words, they are kicking away the ladder. Small island developing states with little structural influence and bargaining power against more powerful, developed states will be less likely to attain a high level of industrialization if they continue to engage in rampant bilateral and regional trade agreements, especially those which are WTO Plus. In other words, they should desist from trading away the ladder. The premise of their argument is that WTO, IMF and World Bank regulations and constraints offer more space for maneuverability than bilateral and regional regulations and stipulations. Further, small island developing states are protected by multilateral agencies such as the WTO, whose rules also govern the behavior of developed states. This protection is reduced under a legally binding free trade agreement, and leaves developing states even more vulnerable in the multilateral trading system.   

 

What Needs to be Done?

To begin addressing the issue of policy space for CARICOM states, and developing states in general, analytical and theoretical work must be done to provide policy makers with a greater understanding of the concept. The discussion surrounding policy space disproportionately entails thinkers making the case for more heterodox approach to development, which includes greater levels of state intervention in industrial and private sector development. However, the debate is yet to evolve toward more tangible forms of applicability, where the different academic arguments surrounding policy space can be tested and applied in a policy context. The concept of policy space must be nuanced for analytical and contextual purposes; additionally, proper investigation must be conducted to demonstrate the extent and the rate at which policy space has been shrinking for SIDS such as those of CARICOM, and, as noted above, investigation is needed regarding how the crisis of neo-liberalism and the shift in policy space is being reflected in changing policy approaches and international norms (Bishop et al (b), 2012).

As the paper sought to demonstrate, policy space involves more than meets the eye. Not many scholars, with the exception of Hamwey (2005) have made mention of the internal dynamics of policy space.  He highlights that policy space is both endogenous and exogenous. Endogenous policy space can be constraint by domestic interest groups resulting from a lack of coherence between stakeholders, lack of political commitment resulting from poor leadership, as well as state corruption. The least amount of endogenous policy space a state has to implement developmental policies, the more constrained it will be by exogenous policy space. However, Hamwey merely scratched the surface; Scholars are now beginning to question the extent to which national elites have internalized ideas concerning the importance of policy space (Murray-Evans 2012). This discussion is crucial for CARICOM states, as it highlights the need for careful study which determines the extent to which powerful interests, political and cultural institutions, norms and ideas influence and hence determine the extent to which policy space, both endogenous and exogenous, is either increased or decreased in developing states.

 

The Need for Quantitative Analysis in Policy Formulation and Implementation

Girvan (2005) advocated for the acquiring of policy autonomy in CARICOM states using participatory policy making at the regional level. His argument being that CARICOM as a region has the potential to open up policy space at the multilateral level, and shape globalization in its on interest, as regionalism is known to influence multi-lateral institutions such as UNCTAD, when developing state groupings speak with one voice. Girvan advocates for policy cycle of participatory policy making through horizontal and vertical information flows. This cycle “begins with a problem definition and identification, and proceeds through the elements of research, policy generation, policy implementation, evaluation and feedback, and policy modification” (Girvan, 2005: 7). Social actors would play a major role in evaluating policy interventions. This would enable policy makers to tap into “the accumulated knowledge, experience and wisdom of the population” for better policy formulation and implementation. Girvan’s solution to the issue of policy making toward gaining policy autonomy is however ex-post, and could be fortified using ex-ante measures.

CARICOM states need to engage
in an investigation into how best to exist within the space it has not been able to exist in for the last thirty years; this will involve the creation of a quantitative impact analysis model or models formulated from the ex-ante socio-economic and environment policy impact analysis (ESEPIA) of EASYpol[2] (2009), which is capable of doing two things: (1) it needs to measure the level of state involvement necessary within an economy, sector or sub-sector of an economy for development to take place. This model must of course be formulated taking into consideration state actions which are legally permissible under current multilateral and bilateral constraints; (2) the model should be able to measure interventionist policies, and quantitatively predict and measure their effectiveness and outcome. The aim of these two prerequisites will be toward improving our target-instrument effectiveness, to bring about greater benefits. Basic questions which must be asked include: what sectors or sub-sectors of the economy require state involvement and interventions (targets), what policy instruments are available given financial, information and human resource constraints; what are the expected outcomes, and who are the expected winners and losers (EASYpol 2009).

This model must be designed to be fundamentally predictive, which will facilitate policy makers and academics measuring, ex-ante the socio-economic impact of interventionist policies.  This is important because policy makers will be better aware of the desirability of their specific intervention policies, the level of intervention required, and, given the numerous aspects of the economy demanding state support, this model will assist governments in prioritizing and targeting those areas where intervention will bring about the greatest socio-economic impact                    (EASYpol 2009: 12).This model must of course take into consideration the “law of unintended consequences”, which must be built into the model. It is impossible to predict with absolute accuracy and certainty the effects of an intervention, even with the best quantitative tool or model. Hence, it is absolutely important that the ex-post element of feedback and monitoring be built into the model, to complement the ex-ante element.

 

 

Conclusion

The neo-liberal economic paradigm has been largely blamed for prohibiting socio-economic development in developing states, by stripping them of their policy autonomy through multilateral regulations of the IMF and the WTO. The global economic crisis of 2008 has created a crisis of, and widespread loss of confidence in the neo-liberal economic paradigm, and is believed by many to offer an opportunity for a restructuring of the status quo. This economic model championed through the Washington Consensus and disseminated to developing states of Africa, Latin America, Eastern Europe and the Caribbean through structural adjustment policies has failed in its promise to deliver socio-economic growth. The subsequent level of disenchantment has increased the number of policy makers and academics calling for alternatives to market fundamentalism. Further, a number of states, the (BRICS) are observed to be employing state capitalistic tendencies. This combined element has led a number of scholars to acknowledge an opening up of policy space at both the intellectual and state policy level, which they claim has provided developing states the opportunity to re-establish itself firmly in the market of their national economies to coordinate industrial growth. However, the evidence is yet to emerge regarding exactly how policy space has opened up and how and whether developing states have begun to take advantage of this opening.

The paper argues that CARICOM states should begin investigations into how it can carve out a niche within the current neo-liberal paradigm, by finding creative ways of strategically coordinating industrial growth. While regional scholars seek to contextual the concept of policy space, and monitor the evolving neo-liberal, global trajectory for signs of opportunities for developing states in the evolving, yet stagnant multilateral trading regime, policy makers must begin making a case for state intervention.  This case must be made with quantitative facts. This is toward the assumption that should CARICOM states quantitatively demonstrate the benefits of intervention toward growth, diversification and industrial expansion within their economies, and are able to numerically and near accurately predict their outcomes, they can make a more convincing case for policy autonomy in future multi-and bilateral negotiations. Additionally, they may be able to exert a greater influence on the changes within an evolving neo-liberal trading regime.

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[1]               It is important to note at this point that John Williamson, architect of the Washington Consensus in his article, From Reform Agenda to Damaged Brand Name: A Short History of the Washington Consensus and Suggestions on What to Do Next (Williamson 2003:11), claims that the Washington Consensus was equated with neo-liberalism in a way he did not intent; as tenets within the economic order were not on his ten point list. These, he implied, were added by other congressional in Washington. 

[2] Easypol is an organ of the Food and Agricultural Organization of the United Nations, which acts as a repository of resources for policy making in agriculture, rural development and food security. These resources are centred around policy findings and methodological research tools.

Written by fortheloveofcaricom

July 20, 2012 at 1:52 am

Posted in Uncategorized

‘everyone an police a war’- What Britain should Learn from Jamaica and TnT.

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Today marks the third day of rioting, looting and burning, which has beset the city of London and its surrounding areas. According to the BBC World News, the uprising is spreading, and as early as Tuesday evening, has moved to ” cities including Manchester, Salford, Liverpool, Nottingham and Birmingham, with shops being looted and set alight”. http://www.bbc.co.uk/news/uk-14474393 .

The riots, which some  aptly describes as an urban youth rebellion, all started when Mark Duggan, a black youth, was shot and killed by fire-armed police in Tottemham,  London. Mr. Duggan’s death is mired in shady and questionable circumstances, which have lead many to theorize as being rooted in racism, racial profiling and stereotyping. This document makes for appalling reading: http://www.normangirvan.info/wp-content/uploads/2011/08/austin-london-burning.htm

The treatment of Mr Darcus Howe, Trinidadian-born journalist and community activist as he was interviewed about the uprising on the BBC World News only served to concretize the theory-both in his personal account as well as the treatment he received from BBC anchorwoman, Fiona Armstrong. See here: http://www.youtube.com/watch?v=YBTyZr3LBus

Mr. Howe attempted to analyze the situation in London from a historical context, and likened it to the uprisings in the Middle-East. He also spoke of the issue of race, using his own family’s constant harassment from the police to illustrate the problem of extra-judicial policing in London, which seem to target mainly black youth.

Mr. Howe however was rudely handled by Ms Armstrong, who accused him of supporting the riots and hinted at him being a rioter himself. The BBC, it seems have taken pains to withdraw and conceal the interview from the public, and have not yet issued an apology to Mr. Howe.

(A group of individuals, including myself, were outraged at Ms. Armstrongs unprofessional behavior, and have written complaints to the BBC, see here: http://www.normangirvan.info/have-some-respect-for-an-old-west-indian-negro-darcus-howe/ )

The purpose of this blog article is to highlight the fact that while extra-judicial policing and ensuing riots in England is nothing new, the country had better take heed to the situation of Jamaica and Trinidad and Tobago  if it wishes to avert a descension into a spiral of lawlessness as a result of the public’s mistrust and dislike for the law enforcement arm of the government.

Lessons for London

Extra Judicial policing is almost endemic to the Jamaican society, as indicated by Amnesty International and their consistent rebuke of law enforcement in the country. See snippet here: – http://amnesty.org/en/library/asset/AMR38/003/2009/en/70ce3f21-be1a-4c08-8403-293a4a189664/amr380032009en.pdf.

Jamaican reggae singer, Queen Ifrica makes it clear in her song “Serve and Protect” , the current state of relations between the Jamaican police force, and the citizens of the country. Listen here: 

For Trinbagonians however, the phenomenon is fairly new, but on a rapid increase. See here :http://www.trinidadexpress.com/news/Police_killings_on_the_rise-127078978.html.

Police brutality, harassment, and corruption within law enforcement have a very damning effect on these CARICOM countries,  contributing a great deal to the increase in crime and violence now plaguing them both.

Police brutality in these countries have resulted in the population-by and large-being mistrustful of the police. This, in itself perpetuates the crime problem, due to the fact that many homicides go unreported, as no witness is willing to step forward with their account in order to facilitate the identification, apprehension and incarceration of criminals.

A murder taking place in broad day-light, in front of ten witnesses might result in none of the ten being willing to give an account, giving true credence to the Jamaican idiom: “see an blind, hear an deaf”. Citizens prefer not to get involved with the state where criminal matters are concerned, because there is no guarantee that the very establishment to whom they are reporting a crime, will not, itself, single them out as the “informer. Moreover, every Jamaican have heard the stern warning at least once in his/her lifetime, that “informer fi dead”. Many an informer have indeed ended up dead, resulting in even less criminal conviction as a result of witnesses fearing for their lives.

This is an emerging problem in Trinidad and Tobago as well, see here: http://jyoticommunication.blogspot.com/2009/10/police-run-for-cover-as-gunmen-kill.html .

Hal Austin wrote that in England, white police officers often treat  blacks as if they were criminals just waiting to be arrested. One may argue, with a high degree of truthfulness, that this is the attitude of the Jamaican police force toward inner city “ghetto” youths.  This has allowed for an entrenchment of passionate hatred for law enforcement officers on the part of the youth, many of whom are already marginalized by the wider society which views them as none-progressive elements and criminals, blaming them (and not the wider society) for the conditions they were born  into.

This forms a self-fulfilling prophesy, as marginalized “ghetto” youths, disregarded by the planto-cracy, and constantly  harassed by police officers see no way out of their socio-economic condition. They therefore rebel.

These teenagers and young adults become easy targets of criminal gangs and drug cartels, who recruit and capitalize on not only their pitiable economic condition, but more so their healthy hatred for law enforcement. This hatred often-times manifests itself in open warfare with the armed forces, especially in Jamaica.

In order to protect their interests, or to assert their dominance in the society and over the communities in which they exert their diabolical control, criminal gangs in Jamaica are known to randomly execute police officers. Read here: http://go-jamaica.com/news/read_article.php?id=28050

In other situations criminal elements engage in open warfare with law enforcement officers. The case of Jamaican Drug Lord, Christopher ‘Dudus’ Coke,  and his extradition to the United States served as the latest illustration of this. See here: http://english.peopledaily.com.cn/90001/90777/90852/6997527.html

Incidence such as these serve to reinforce a vicious and deadly cycle, as gunmen display a willingness to shoot and kill anything dressed in police uniform, while the police officers are inclined to shoot and kill anyone one resembling a “ghetto” youth.  Both groups are locked in a deadly game of cat and mouse, both armed to the teeth and shooting to kill.

Should the British government refuse to address the issue of race relations, and the treatment meted out to black, and other marginalized youths by the British law enforcement officers, it may not only encounter occasional riots, but on-going, increasingly detrimental warfare between poor communities and law enforcement officers. Such an environment would provide fertile grounds for organized crime to deepen its roots within these communities, destroying what is left of them, while bringing the whole country down.

Prime Minister David Cameron had vowed, upon taking office,  to make “broken Britian” a cornerstone of his premiership. However, from the looks of things, he has not yet gotten to it on his to-do list.

He would be very wise t0 rid himself of the level of naivety he is currently displaying by his description of the situation as mere criminality of idle youths. He needs to wake up and smell the smoke of the burning buildings, and see the riots for what they truly represent:  a revolution by angry, marginalized and victimized youths who are  simply fed of  the social and economic conditions in which they live. The day they no longer revolt by burning and looting, they will be brandishing guns, and engaging in open armed conflicts with law enforcement officers, while receiving the full backing of the powerful drug cartels and deadly criminal gangs they were recruited to serve.

Written by fortheloveofcaricom

August 10, 2011 at 11:07 pm

Posted in Uncategorized

Re: [Jamaica Land We Love] THE WAY FORWARD FOR THE CARIBBEAN AS A REGION

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An Article I received, written by one Robert Stephens. Could not have said it better myself.

Sunday Herald, 17 July 2011 04:51

By Robert Stephens

Let us admit the fact that as individual islands and certainly in the case of Jamaica, if we continue down our current insular path of Governance and Economic Under-Development we will not survive as a sustainable society.
Norman Manley and those who proposed a Federation as the path to sustainable development were correct over 50 years ago and the concept seriously needs revisiting.

If that opening salvo has not got your attention then here are some simple facts:

 

1. Sun Sea and Sand are at the center of our economies in terms of Tourism for the majority of the Islands but instead of nurturing the rare beauty and fabulous environs, which make us so attractive our approach to development is slash and burn then landscape and we even import flora and fauna from outside the region to landscape.

2.Energy except for Trinidad and Tobago that have utilized the oil they discovered to subsidize development, is a very high cost input into our operations of business reaching a rate of almost US$.40 in some islands when our cheapest source of energy, the SUN is the first that we recognize for tourism but we fail to utilize for energy. The entire region needs to liberalize the energy sector to allow the use of the natural sun, sea (wave energy) and wind to become the main sources of energy, which will be the least polluting of our beautiful environment.

3.Caribbean Culture, which includes our music, food, rhythm, dance, theatre, and essentially our warm and captivating personality as a people must be as central as sun sea and sand to our Tourism product and in fact is what separates us from the rest of the world as a region.

There are so many people of the world, who would love to be able to talk, walk, run, dance and generally have a lifestyle like us but we do not fully appreciate and understand the value of what we have. Our entire focus especially regarding Tourism must put our culture on par with our sun, sea and sand in terms of developing and sustaining our competitive edge in tourism.

4.Our Natural Environment must be regarded as sacrosanct and we must preserve and protect it with every ounce of our strength. Man in harmony with nature, which is at the core of why we love our region and because it is so fabulous we invite the rest of the world to visit us to share our natural beauty, is what separates us from other regions. Why are we so hell bent on destroying our own beautiful islands if we seriously recognize this fact or is it that we are totally undereducated and really are intent on destroying the very reason why we love what we have? Our entire approach to development and planning for future survival must put the natural environment and its protection front and center.

5.Sustainable Economic Development must be approached as a long-term regional philosophy and we must have regional policies, which support the concept. Our spices, rum, and regional delicacies must be developed as Caribbean brands which though they may have the unique flavor of our individual islands really must be within the context of regional policies, which encourage and support our development.

Clearly the short-term approach of our regional governments whose horizon is on winning elections every four to five years is really backward and is often detrimental to sustainable economic development as “spending “to win an election is usually more important than the bigger picture longer term approach.

This is not at this stage intended to be a comprehensive dissertation but I have just touched on one or two items, which are intended to begin a serious discussion of the way forward for the Caribbean as a region.
Robert Stephens is president Pragma Consultants Ltd.

 

Written by fortheloveofcaricom

July 17, 2011 at 11:13 pm

Posted in Uncategorized

Agreeing to Agree at a Later Date: Time Wastage and Verbal Flamboyance in CARICOM Meetings

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Sometimes I consider myself blessed to have had as my first job the post of Trade Policy Officer at the Caribbean Association of Industry and Commerce (CAIC), a post I held for 2 years; a post which gave me my first practical exposure to CARICOM and regional affairs. However, at other times I sometimes wonder if this experience might not have actually been a curse.

CAIC, a not for profit organization gave me the opportunity to become somewhat intimately acquainted with, and in the execution of my duties, deeply involved in regional affairs not only at the private sector level, but also at the level of government and civil society.  I had the opportunity to travel throughout the region to attend several meetings, a few of which I am proud to say I have helped to plan and manage.

Other meetings I attended in my capacity as Trade Policy Officer were to represent the views of the private sector to such organizations as the Economic Commission of Latin America and the Caribbean (ECLAC), as well as CARICOM and its various organs including the Office of Trade Negotiation (OTN), Council of Finance and Planning (COFAP) etc.

In fact, one of my most important roles was being private sector coordinator for the CIDA-CARICOM Trade and Competitiveness Project, a project funded by the Canadian International Development Agency (CIDA) aimed at streamlining and hastening the implementation of the CSME. This project necessitated a number of meetings throughout the region, under the mandate of the CSME Unit.

A majority of these meetings hosted by different organs of CARICOM were held to discuss different aspects of CARICOM and the CSME. Some of these meetings were held with a view to creating different elements and aspects of regional integration that will allow it to start functioning like a well oiled machine. Others were simultaneously attempting to diagnose its many ailments and provide a remedy that will make for a healthy, functioning regional entity. At times, there could be several meetings going on at the same time within the region, all of which are aimed at bringing the CSME to fruition.

By attending these meetings I came to realize one main thing: they almost always end with the meeting agreeing to reach an agreement at a later date.

What saddens me and ingrained in me a sense of despair, disenchantment and pessimism concerning the future of regional integration and the prosperity of the peoples of CARICOM (the curse of which I speak), is the fact that millions of tax payer dollars and donor funds are spent to conduct these meetings that are held so very often, yet,  so many of them accomplish so very little.

Usually, before these meetings are held, written documents are made available to participants. For some meetings, reports are prepared by consultants who were paid thousands of dollars in US to conduct studies and present their findings. These reports are sent to participants before hand to read carefully, examine and analyze, in order to attend the meeting ready to make meaningful contributions so that decisions can be made. The participants are then flown to the meeting if it is not being held in their host country.

However, one thing happens far too often: CARICOM participants attend these meetings wholly unprepared; browsing through reports and documents that were sent to them weeks in advance only five minutes before the meeting is scheduled to begin.

To add insult to injury, throughout the meeting, while presentations are being made, some are smiling to their laptops, hacking away at their key boards.

When one party makes a comment, another will not be outdone, he too stands up to grandstand, repeating at length something that was already said: “Mr Speaker, St Vincent and the Grenadines totally endorses the view of the representative of St Lucia…” going on to repeat everything St Lucia already said, using ‘bigger’ words. In other scenarios, participants stand up to make lengthy comments that are unrelated to what is being discussed, because he/she was not listening.

In even more depressing scenarios, the chairman is seeking the contribution of participants who were funded to attend the meeting: “may we have the views of the representative of the Guyana (organization shall not be named) concerning the CARICOM Financial Services Agreement?”, the chairman may ask. The Guyana representative will then inform the meeting that s/he was only sent to the meeting because the party who was supposed to attend was unable to do, and s/he was sent to represent in his/her stead.

The attendee is not a suitable candidate, and therefore is incapacitated where meaningful contribution is concerned. However, s/he promises to ensure that upon their return home, a meeting will be held with all the relevant parties, and the views of their organization on the matter will be emailed to the CARICOM Secretariat within a few days.

Then we wonder why after so many years, the agreement is still far from completion.

Very often, lunch time is extended by sometimes up to half of an hour, as individuals are busy catching up with old friends from other islands. Sometimes the meeting has to be resumed with less than half the participants in the meeting room.

In one outrageous case, I witnessed with my own eyes and ears the head of a very important national not-for-profit organization of one CARICOM country tell a colleague he is going to his hotel room to take a nap, to “sleep off this heavy lunch” promising to “return in a while”. I got tangible proof that day that ‘niggaritis’ not only affected the ‘Negro’ population.

At the end of the meeting (sometimes way after 8 PM when the agenda explicitly said 5- due to a late start, grandstanding, lengthy comments, extra time for lunch break) the participants agree to reach an agreement and finally close the chapter of the discussion at the next meeting. If there is no follow-up meeting, then the participants agree to ‘properly’ read the documents that were sent to them weeks in advance, and email in their comments and close the discussion via email.

Participants, after ‘a hard day’s work’, can finally head to the hotel bar to catch up with colleagues, or head to the airport where duty-free shopping awaits them before their flight home.

And there we have it, another meeting wasted, thousands of dollars wasted in travel costs, hotel costs and per diems; decisions that were to be finalized have been rolled over into another meeting’s agenda where it does not belong. If not, then whatever was to be agreed upon was done  hastily by ill-informed individuals, or otherwise left to be finalized via email at a later date.

One of the greatest follies I have found in this region concerning regional meetings is that we feel a sense of accomplishment that the meeting was actually held, even when it accomplished nothing, and made no advancement toward the wellbeing of the peoples of CARICOM. One gets the impression that image takes precedents over productivity.

It is of no surprise, then, that our Heads of Governments have the same attitude toward meetings in which the future of the peoples of CARICOM are to be decided.

I was not surprised to read that Professor Norman Girvan “was deeply disappointed at the outcome of the two-day retreat of the Caribbean Community (CARICOM) leaders in Guyana over the weekend”, as printed in the Trinidad and Tobago express of Yesterday (June 7, 2010). In fact, I feel his pain.

The Professor is not the only disappointed soul concerning the outcome of the latest CARICOM Heads of government meeting, held late last month. The Starbroek news of Guyana reported that the deafening silence of the media concerning the meeting indicated, no doubt, the level of disappointment felt by the peoples of CARICOM at the communiqué issued at the end of the meeting.

The meeting basically agreed, using sweet sounding statements, to do what they have been promising to do since time immemorial. The communiqué is aptly titled, “CARICOM Leaders Seek Greater focus on Prosperity for the People”. As the StarBroek news outlined, the title alone shows a tremendous level of complacency on the part of our leaders.

The whole aim of the creation of CARICOM in 1973 was essentially to ‘seek a greater level of prosperity for the people’. Thirty-eight years later our leaders are still gathering to agree on this, but cannot agree on a way to actually get it done.

The meeting further agreed to “the need to focus on building a greater sense of community and shared values as a Caribbean people”. This agreement has been in the works since the West Indian Federation was agreed in principle in 1947.

They further agreed to, “identify practical initiatives in specific economic areas which would redound to the benefit of the people of the community”. How many more practical initiatives our Heads of Governments need to identify before one is fully and effectively implemented? Only the Good Lord knows.

As far as appointing a new secretary-general of CARICOM is concerned, the meeting “agreed that the persons shortlisted for the position would be subjected to further processes”.

I have been led to one depressing conclusion with regards to regional meetings, be they Heads of Government meetings, meetings of government representatives or representatives of non-governmental organizations: the bulk of our decision making is deciding to decide at a later date.

While our leaders pussyfoot and mark time, the region is facing numerous existential threats (see article). We are becoming poorer, and more vulnerable to external and internal economic and environmental threats.

Sadly, it is  CARICOM’s poor who suffer the most, languishing in poverty and despair over an uncertain future.

Buju puts it correctly when he sang “…only hike in the price arm and leg we haffi pay, while our leaders play…”

Those who are charged with the responsibility of looking after the people of CARICOM by attending regional meetings and voicing the concerns of those they represent, as well as to make meaningful contributions toward the reaching of decisions can no longer be so careless, reckless and irresponsible with our future. It needs to stop, now!

Written by fortheloveofcaricom

June 7, 2011 at 3:43 pm

Posted in Uncategorized

Corruption-Getting in the Way of Regional Integration

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In today’s newspapers, Gopaul and Company Ltd of Trinidad and Tobago won the bid to enter a $TT 40 million contract from the Government for the supply of trailer trucks used to haul gasoline. Many are now crying foul, due to the fact that during her election campaign, Prime Minister, Mrs Kamla Persad-Bissessar had stayed at apartments owned by Ralph Gopaul, and is a close friend of the family.

Last week, Minister of Planning, Economic and Social Restructuring and Gender Affairs was fired for allegations of corruption. The issue of Calder Hart still hangs over our heads, as well as the nepotistic appointment (and subsequent relieving of duty) of Reshmi Ramnarine. The pianos have been found, but Patrick Manning refuses to face the privileges committee for having accused the Prime Minister of being in the process of building a multi-million dollar home with drug money. I could go on and on.

Jamaicans are also living with an even more demonic, diabolical version of corruption: the marrying of criminal elements to those elected to serve the country. Organized crime and criminals have found their way into the belly of the Jamaican government, to the point where a known international drug baron and murderer was allegedly being cuddled by the Prime Minister himself. I speak here of the Manatt-Dudus issue.

A close look at what is occurring in especially these two CARICOM states will reveal that our elected government officials are constantly either:

a) accusing each other of corruption;

b) firing cabinet members for engaging in corrupt practices (and replacing them);

c) ordering commissions of enquiry to get to the bottom of corruption; or

d) defending themselves against allegations of corruption.

With this level of corruption (or allegations of corruption) taking place in just two of our CARICOM states,  one has to wonder when (or even if) we will ever find the time to give regional integration the kind of attention it needs to come to fruition in a meaningful profitable way for the peoples of CARICOM.

It is indeed time for us as citizens of CARICOM to wake up and smell the stench of corruption, and foresee the damage it is doing to our future. We elect government officials to secure a prosperous future for us and that of our children, but instead they seem to be busy securing their own financial future and that of their friends, and then spend valuable time defending themselves against allegations of wrong doing.

We need to demand supranational institutions in this region, made up of notable, non-political regional figures who are known to champion the goal of regional integration: individuals such as Professor Norman Girvan, PJ Patterson, Shridath Ramphal and others, who will remain outside of politics, and not allow themselves to come under the influence of politicians.

One of their roles would be to keep regional integration at the forefront of every country’s national agenda, even as politicians battle among themselves over whose family member was awarded a government contract, and which politician is in bed with which area don.

There is no telling when this level of nonesense will end, but one thing for sure, time is running out. Without regional integration, CARICOM countries stand very little chance of surviving in an increasingly neo- liberalized, globalized world.  We are facing serious existential threats (see here) such food security, energy security, transnational crime and climate change.

As citizens of CARICOM we must act now!

To join the fight, go here: http://www.facebook.com/pages/Caribbean-Movement-for-Civil-Empowerment/160340864027154

Written by fortheloveofcaricom

May 19, 2011 at 2:17 am

Posted in Uncategorized

Professor Norman Girvan on Existential Threats to Caribbean Countries

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I had the privilege of attending the C.L.R. James Memorial Lecture, hosted by the Oil Workers’ Trade Union of Trinidad and Tobago (OWTU) and the Ciprini Labour College last Thursday, where I heard a very interesting presentation by Professor Norman Girvan. Professor Girvan spoke of the life and work of the late CLR James which inspired and motivated me immensely, but it was his presentation on Existential Threats in the Caribbean: Democratising Politics, Regionalising Governance that so impassioned me, I had to write this piece.

Professor Girvan spoke on what he called existential threats, which he defined as:

 “systemic challenges to the viability of our states as functioning socio-economic-ecological systems; due to the intersection of climatic, economic, social and political development”.

From the presentation, one main theme stood out and rang loudly in my ears: Professor Girvan was essentially saying that should things continue the way they do today in the region, then sooner than we think CARICOM States, and by extention the West Indies as we know it will cease to exist. As ominious and apocalypic as this sounds, I am inclined to agree with him.

Professor Girvan noted in his presentation that devastating hurricanes have become a permanent, recurrent phenomenon in our reality. He goes as far as to call it an integral feature in Caribbean development. And he is right. We can look forward to at least 1-3 devastating hurricanes per year, leaving economic wreckage in their wake as they move through our islands. Barely are some countries able to recover from a previous hurricane before they are hit by another.

Hurricane Thomas in St Lucia, 2010

Added to this, is the depressing economic situation faced by the region; in his presentation, Professor Girvan quoted some recent statistics:

“there is still a significant level of poverty (in Caricom) despite the middle level per capita income that has been achieved. The level of poverty was reported to be 27 percent in St Kitts, 15.9 percent in Nevis, 37.7 percent in Grenada, 18.4 percent in Antigua and Barbuda, 14.5 percent in Jamaica, 28.8 percent in St. Lucia, and 16.7 percent in Trinidad and Tobago.

If this level of poverty keeps rising then we are indeed headed for big trouble; and further existential threats seem determined to get us there. One such threat he spoke about is food security; and rightly so. The region is a net importer of food. We import most of what we eat, or what we use to make our food. According to the Professor:

Food imports is one of the fastest growing items in the overall import bill and at $3.5 billion, are about three times the value of exports of agricultural products. The recent spike in the prices of food commodities in international markets, due largely to speculative purchases, has left most countries without a cushion and created severe political pressures.

Indeed, food security has become an extremely critical matter for CARICOM countries in light of global occurrences beyond our control, and its gets even more serious. According to one article of the Foreign Policy online magazine( found here), it reads:

Already in 2011, the U.N. Food Price Index has eclipsed its previous all-time global high; as of March it had climbed for eight consecutive months. With this year’s harvest predicted to fall short, with governments in the Middle East and Africa teetering as a result of the price spikes, and with anxious markets sustaining one shock after another, food has quickly become the hidden driver of world politics. And crises like these are going to become increasingly common. The new geopolitics of food looks a whole lot more volatile — and a whole lot more contentious — than it used to. Scarcity is the new norm.

Now this is what I call ominous. With a steady increase in food prices internationally, and scarcity becoming the new norm, more of our people will be thrown into dire poverty, especially those who are already poor and spend the majority of their income on food. We do not have to be reminded of the effect the increase in oil prices in 2008 had on the price of food here in the region. Now, oil prices are not the only issue we have to grapple with where food prices are concerned, we are starting to grappling with the scarcity of food itself.

The world’s population is increasing beyond sustainable levels, as an additional 219,000 mouths turn up at the dinner table every night. This increase in population is starting to take a toll on the environment, and is already starting to severely diminish its capacity to produce adequate food. In the meantime farm lands are already giving way to housing projects, even in the Caribbean context. 

Farm Lands being bulldozed by the Trinidad and Tobago Housing Development Corporation

Droughts, great forest fires and severe heat waves are also becoming a permanent feature of our global reality- recall the severe drought and forest fires of Russia in 2010, which drove up the price of grains, wheat and cereals. We can be sure that such occurrences are here to stay, especially since addressing climate change is not a current priority for many world leaders such as the United States, the biggest contributor to greenhouse gases.

Great fires are also becoming a permanent feature of our global reality

What will happen to us if countries stop selling us their food, and keep it to feed their own citizens? We saw it when Russia banned the export of grains in 2010 in order to feed its own people during the severe drought, resulting in a shortage and a spike in the price of grain food products on the international market.

As “independent” nations, we have allowed ourselves to become totally dependent on other countries for the very food we eat. The price of gas, political turmoil, environmental catastrophes- any of these events in other countries can cause us in the region to go hungry, triggering mass social unrest. This should give us good enough reason to be thoroughly ashamed of ourselves.

And what of regional tourism, the breadwinner of many Caribbean economies? With no diversification from the sun, sand and sea offering to tourists, CARICOM countries dependent on tourism will be left bereft of a source of income with the continued rise in sea levels. The issue was taken to the UN Climate Conference in Cancun, where is was suggested that:

with a sea-level rise of one metre, which is now regarded as highly likely by the end of the century, the Caribbean would see at least 149 multi-million dollar tourism resorts damaged or lost and would also see loss or damage of 21 of the Caricom airports, and the inundation of land surrounding 35 of the region’s 44 ports.

Professor Girvan also touched on the issue of crime, and spoke of its adverse effect on our economies. In further research I have come to learn that crime and violence is weighing heavily on the national budgets of countries such as Trinidad and Tobago and Jamaica. In a recent report, Jamaica spends U$S385 million, or J$33 billion a year, on indirect medical and other costs related to crime and violence.  It goes on to state that:

“These costs are comparable to estimates of the cost of civil war. Based on growth base lines for cross-country panel date in the last 50 years, researchers estimate the costs of civil wars to range from 1.6 percentage to 2.3 percentage of GDP per year of violence. For the average country affected by violence, these effects, compounded over time, can cost the equivalent of up to 30 years of missing GDP growth.”  Read more

Crime in the streets of Jamaica

Crime is also destroying our countries’ private sector, without which our countries cannot survive in a neo-liberal globalized age. According to the Private Sector Organization of Jamaica (PSOJ): “The worst effect of crime is certainly the loss of lives, but crime is also costing the country investment, jobs, economic growth and a better quality of life for all. Read More    

The murder of Ricardo Balentine who was stabbed in the neck  in broad day light in the streets of Port of Spain, Trinidad, lead Gregory Aboud, President of the Downtown Owners and Merchants Association, Port of Spain, to lament that: this type of lawlessness threatens Port of Spain, threatens the tens of thousands of jobs that Port of Spain still provides, threatens the reputation of our country and threatens the future of the capital of our country. Days after this incident, another man was gunned down in broad day-light in Down-town, Port of Spain.

Crime in the streets of Trinidad

The drug trade and trafficking in fire-arms is contributing enormously to a far more dangerous and resilient form of crime, which threatens not only these two countries, but the entire region. Said Baldwin Spencer, prime Minister of Antigua and Barbuda last week: organised crime has created a great deal of fear, uncertainty and anxiety amongst Caribbean people already having to deal with the uncertainties occasioned by the global economic crisis. 

Organized crime has transcended national borders to become a regional problem. Our large un-manned coastlines, as well as our strategic position in the hemisphere makes us prime transhipment routes for narcotics and fire-arms. Increased income inequality, poverty and youth marginalization are also contributing to the problem. Increasingly, we are witnessing young, poverty stricken, marginalized and vulnerable young men being sucked into the drug trade, fighting over drug turfs.  According to Professor Girvan: we are all aware of the alarming increase in gun-related violence associated with the proliferation of criminal gangs warring over the drug trade in several regional countries. 

Our energy dependence is also another issue we must address. According to Professor Girvan, most Caricom countries are energy-dependent and have only survived the spike in energy prices in the 2000s thanks to the generosity of Venezuela through PetroCaribe. No one knows how long this will last. 

He is absolutely correct. Lets bare this in mind: a change in political leadership in Venezuela could mean the end of Petrocaribe; political turmoil or social unrest in that country could also mean an end to the arrangement.  What will certainly end Petrocaribe eventually, is the end of Venezuela’s oil reserves, or at least when it reaches level where the country can no longer afford to share, or have preferential arrangements with countries such as ours. Let us be reminded that oil is a finite resource.

Political turmoil and the burning of oil fields

Another issue which the Professor spoke of, which CARICOM states must deal with is its debt. As of 2009, the public debt of most of the English-speaking Caribbean countries has exceeded levels that could in any way be defined as sustainable. According to Professor Girvan, except for the Bahamas, Suriname, and Trinidad and Tobago, at the close of 2009 this subregion showed levels of public debt that ranged from 60% of GDP in Saint Lucia and Saint Vincent and the Grenadines, to almost 120% in Jamaica. He went on to quote a study conducted by the Economic Commission of Latin America and the Caribbean (ECLAC) which demonstrates that:

Barbados, Belize, Guyana and Jamaica would have to post primary (fiscal) surpluses of between 2.3% and 3.9% of GDP over the next 20 years in order to reduce their current public debt to 40% of GDP, a level considered to be sustainable…In every case, it is important to bear in mind the marked recessionary effects of such fiscal adjustments, as well as their economic and social costs, which would be magnified if the current recessionary climate and economic slowdown resulting from the international crisis were to continue.

I predict that further indebtness will be incurred by many CARICOM countries, as we struggle to recover from the global financial crisis. Since the crisis hit, four CARICOM countries have already entered into International Monetary Fund (IMF) programs.

Energy dependence, food dependence, national and transnational crime, debt, poverty and climate change all amounts to what Professor Girvan refers to as a “lethal cocktail”, which WILL  significantly worsen our current situation if steps are not taken immediately to correct it.

One would not be surprised to learn that millions of dollars has been spent, consultants have been hired, studies have been carried out and reports and recommendations made toward fixing ALL of the above mentioned issues that are plaguing CARICOM countries.

The Professor outlined the:

  • Strategic Plan for Regional Development (now being finalized)
  • Regional Food Security Plan
  • Jagdeo Initiative for Agriculture
  • Regional Agri-Tourism Project
  • Renewable Energy Project
  • Regional Task Force for Crime and Security, and
  • Framework for Promoting Climate Change Resilience
What he did not mention, were the myriad of regional organizations that have been sucking up tax payers’ and donors’ money to address these problems; organizations such as the CARICOM Implementation Agency for Crime and Security (IMPACS), as well as the Caribbean Community Climate Change Centre (CCCC) are just two examples.
With regards to the initiatives mentioned,  in the words of Girvan, most if not all were never implemented, or have been only partially and unevenly implemented. They keep being re-cycled. Spinning top in mud! As far as the organizations go, they are ineffective to say the least.
I agree with the Professor when he noted that its not that these problems definitely will mean CARICOM countries becoming failed states (a term he despises). Nor do they have to spell the end of CARICOM and the West Indies as we know it. He notes that the problem we have in this region that is preventing us from correcting these problems and moving ahead is one of an implementation deficit. See earlier post where I spoke in length concerning this thorn in our flesh at : http://fortheloveofcaricom.wordpress.com/2011/04/25/our-condition-is-more-one-of-powerlessness-than-of-power/.
In my opinion, that we have an implementation problem in this region that has been plaguing us for years is cause for not only concern, but suspicion. What I believe, and what the Professor might be too polite or politically correct to state, is that regional heads of governments are deliberately consipiring against its peoples, determined to keep us in poverty, determined to see us suffer. if you think I am going psycho, or becoming a conspiracy theorist, then I am not the only one.
Well-known and highly respected trade specialist, James Moss-Solomon of Grace Kennedy and Company Limited questioned in the Jamaica Observer yesterday (speaking of the Jamaican Government) whether keeping people poor is not a cleverly orchestrated strategy…
Nothing else can explain why proposals after proposals have been made, why studies after studies have been done, why millions of donor and tax payers’ money has been spent, but CARICOM governments refuse to implement decisions that will move us forward.
CLR James once said: the most backward elements in the West Indies are the politicians; they are the deadweight on the West Indian people. Over 50 years later, Mr. James words still ring true. But he went on to give us a solution to this problem; he said: I have always believed that all progress in the West Indies depended upon the mobilization of the population, and the building of a (regional) party.
It is time for us as a people to rise up and take a stance against our governments, and demand that our future and the future of our children be attended to. Corruption, party politics, ego, self interest are all getting in the way of a sustainable future for all of CARICOM citizens, and it is time we stand against this. In Trinidad and Tobago, the issue of Reshmi Ramnarine, and that of missing pianos are taking precedence over food security.  In Jamaica,  the Manat and Phelps issue involving the Jamaica labour Party trumps the eradication of poverty. We cannot leave our future up to our heads of Governments, for as CLR James said, political leaders in the West Indies discuss everything else other than serious politics.

The presentation made by the Professor Norman Girvan can be found here.

Written by fortheloveofcaricom

May 17, 2011 at 2:48 pm

Posted in Uncategorized

Our Condition is More One of Powerlessness, Than of Power…

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One particular paragraph struck a chord in me, as I embarked on the reading of the Overview of the Report of the West Indian Commission- Time for Action. It goes:

“The fact of us being a Community of Sovereign states must  not detract from our need to be a ‘community’ first and foremost – for it is the reality of community that enlarges our prospect as sovereign states. Keeping a sense of community to the fore calls for more than structures of unity. It will avail us nothing to gear up for the world of market economies and liberal democracy and simultaneously gear down by clinging to old habits of self-centredness. There is no magic in the symbols of ‘community'; they must be reflected in our way of life”  (West Indian Commission, 1992).

Even though the West Indian  Commission was completed and reported since 1992, it simply amazes me how well it speaks to the issues affecting the region; how poignantly it points out the problems that needs to be fixed fix, as well as how applicable and sensible some of its recommendations still are. However, something about it rather bothers me.

The West Indian Commission emerged from a challenge to the region’s Heads of  Governments (HoGs) in 1989 to act quickly in order to prevent the region from being left behind in the “main current of human advance in the 21st century” (Payne and Sutton, 2007). The commission, led by Sir Shridath Ramphal, was charged with the responsibility of coming up with some strategic options for CARICOM countries as they forge ahead in the post cold-war era, and prepare for the challenges of the neo-liberal 21st century.

The report of the commission was well received, and in-fact, received rave reviews from many. One critic said, ” the report was a literal source of wisdom on everything under the sun; from currency to culture; from science to human rights; from exports to cricket; from CARICOM to gender issues” (Brewster, 1993:29). For shortened version see here.

However, I cant help but get this nagging feeling that in especially one of their recommendations, those charged with the responsibility of conducting the commission were somewhat overly concerned and careful not to step on any toes. Either this was the case, or they were too trusting of regional heads, in bed with them, or were simply naive.

In this post, I am going to examine one of the recommendations made by the Commission to HoGs, to deal with the problem of  implementation deficit in the region.

The Commission noted that “we face a highly demanding challenge to imagination and creativity in making regional integration a more effective vehicle for the realization of the hopes and ambitions of our people” (Overview, 1992:25). This challenge being spoken of by the Commission relates to the regions crippling implementation deficit. The recommendation made by the Commission, which they believed was the answer to this perennial problem which characterized the region then, and is plaguing is now, is the setting up of a CARICOM Commission. They believed that we needed this ” central authority, freed of national, domestic responsibilities  and allegiances, and appropriately empowered to implement CARICOM’s decisions” (Overview, 1992: 25). However, the proposition of what this central authority should be and how it should operate was, in my opinion, incredibly weak to the point where it was impracticable and naive. It could not have possibly achieved what the Commission had meant for it to achieve.

Why do I say this?  The Commission proposed that this permanent CARICOM Commission be set up, and given executive authority to implement CARICOM decisions  This was in recognition of  the need “to device a machinery by which CARICOM decisions can be translated into action with a minimum of delay” (Overview, 1992: 28). However, the commission went on to say that their proposed CARICOM Commission “cannot over-ride national action”. In fact, the Commission explicitly stated that “we do not go for a radical restructuring of political organization in the region…”, which is enough to lead one to conclude that the recommendation lacked innovation, and was in fact more of a fantasy.

Some called this proposition radical, but I cannot agree, especially when the nature, and description of the proposition came from the horse’s mouth. And the horse spoke clearly in stating that  “we do not go for radical restructuring”. In fact, the recommendation was contradictory in nature. It knew what needed to be achieved, but grossly watered-down the process of achieving it. For example, it identified “a need for a central authority, freed of national, domestic responsibilities and allegiances, and appropriately empowered to implement CARICOM’s decisions” (Over-view, 1992: 26). Yet the commission said of the CARICOM Commission :

“the instrument of Implementation will be declaratory, not statutory. It will enunciate the decision in terms that are operational; but it will not itself have the force of law” (Overview, 1992:29).

The commission felt satisfied, or felt it was necessary to restrict their recommendation to a solution which left the operationality of their proposed CARICOM Commission up top the whims and fancy of each individual Head of Government of the region. And they said it:

This system will require, of course, the goodwill of Member States. If we do not create a governmental apparatus at the centre, with power to over-ride national action- and we are not proposing this-we must proceed on a consensual basis, and that must imply that member states will respect and cooperate in giving fulfilment to decisions taken in CARICOM by due process” (Overview, 1992: 29)

This is where I believe they went wrong. This is where I felt the Commission gave up a great opportunity to lead regional integration unto a path of efficient operationality. A historical analysis might reveal that the Commission was somewhat afflicted with the drunk obsession  with the false notion of sovereignty, which characterized the heads of Governments who mandated them to carry out their work. Either this, or they were concerned about stepping on toes. It is plain to see from the over-view.

What can also be surmised, is that they were then being contradictory in their own report, for the commission itself dubbed the idea of sovereignty within the region as being nothing short of mythical, yet in their proposal they sought to hold unto it. Quiet strange.

Karen E Bravo, Assistant professor of Law wrote a very interesting paper titled: CARICOM, the Myth of Sovereignty, and Aspirational Economic Integration. It makes for excellent analysis of why we are in the situation we are in.

To be fair to the HoGs, they felt they had to cater to their national and domestic responsibilities and allegiances, and probably thought they needed room to do so. They therefore felt they could not be bound to adhere to any policy counter to their aspirations even for the sake of regional integration. The recommendation of the Commission-the CARICOM Commission-would have ensured that they would not have to, even though it spoke out against self-centredness.

The commission therefore made an error; the challenge they spoke of was not to “creativity and imagination”, it was to discipline, dedication, sacrifice and humility on the part of regional heads of Government. There can be no creativity and imagination in dealing with  political leaders unwilling to cede political power even to a watered-down version of a regional executive authority. They wanted to remain supreme decision-making authorities for their tiny pieces of rock. I am tempted to think the Commission was sympathetic to their cause.

Surprisingly, HoGs discarded with the recommendation for a permanent CARICOM Commission, and proposed something that was even more pathetic, but speedier on the journey to failure.  And fail it did, including every other subsequent policies put in place by CARICOM Heads to correct the implementation deficit:

  • The Heads rejected the CARICOM Commission in preference for a CARICOM-quasi Cabinet with allocation of portfolio responsibilities among the different Heads of Government together with a Bureau of Heads to facilitate implementation (IIR, 2011). This fell flat on its face.
  • In 2003 (yes, it took them that long to do decide that an alternative mechanism to correct the implementation deficit was necessary),  with the Rose Hall Declaration, the HOG agreed in PRINCIPLE that CARICOM decisions should have legal effect in member states, and a permanent Commission should be set up to over see implementation of CARICOM decisions. However, up until 2010, the HoGs were yet to agree on the implementation of the Commission (IIR, 2011: 13).
  • In 2010, their was an establishment of a Committee of Ambassadors to facilitate implementation of Community Decisions. This Council was seen as nothing more than a band-aid, and many were at a loss in terms of how it would function, and, at best, how it could possibly serve the region. Read more here.

More disappointing, is that up to this point,  some still think the CARICOM commission with its executive authority is still the answer. I beg to disagree. Taken in its current state of the 1992 recommendation, it still shows an obsession with sovereignty, and would fail. Why? The Commission was at best bereft of the ability to enforce member states action toward implementation of the CSME. The Commission did nothing more than propose an organization lacking in supranantional scope, and today, we are still buying into it. We are still missing the point; still fooling ourselves.

We need to avoid anything resembling the CARICOM Commission, especially since history has taught us, in the words of Louis Henkins, “sovereignty does not encourage cooperation, it breeds going at it alone”. The last thing we need is another organization which encourages the “pooling”, but not “ceding” of sovereignty. This will get us nowhere, slowly.

What we need in this region is exactly what the West Indian Commission was avoiding, and exactly what HoGs do not wish to entertain, let alone sign unto. Clearly, their unwillingness  to relinquish an amount of sovereignty necessary to cement the regional integration process has held the region back, and no amount of grand speeches, poignant rhetoric, fancy and complicated proposals (laden with big words) will get us anywhere. What we need is one single supranational organ.

I do agreed that Rome was not built in a day, and I empathize with those who are quick to defend regional integration, and who love to point out the fact that “slowly but surely” we are heading somewhere. What I think is ludicrous however, is for us to reinvent the wheel. Rome took many years to build, but all we have to do to build our own Rome in less than half the time, is to borrow the blue print, and see what we can borrow from it.

The European Union is the paradigm of successful regional integration. And according to Bravo, an analysis of the European integration project indicates that some of the minimum requirements of the achievement of economic integration among sovereign states  include:

  1. limited opt-out opportunities on the part of member states;
  2. the direct effect of supremacy of measures intended to cause economic integration, as well as limited time and enforcement periods for implementation;
  3. independent supranational body that drives policies and enforces economic integration;
  4. a legitimate dispute settlement mechanism with enforcement powers;
  5. a strategic planning/decision-making mechanism that defies deadlock

An analysis of CARICOM might demonstrate that these are the very ingredients we lack. The Caribbean Court of Justice might be serving as our legitimate dispute settlement body, but its existence is being threatened by member states, the majority of whom have not ratified, and continue to undermine its purpose. For example, the Jamaican government suggesting the creation of Jamaica’s own Final Court of Appeal will do nothing but contribute to the further fragmentation of the region.

I am in no way stating that we should adopt in a wholesale manner the blue print of the European Union, but it would be to our benefit to see what we can utilize from it, and what lessons we can learn. I would encourage HoGs to commission an in depth analysis of the the European Union’s history, construct, nature and character, and see what lessons we can learn, and what methods we can adopt to expedite and make effective our own regionalism, of course, fitting into our own unique context.

However, I urge the immediate establishment of a supranational body, as this is critical for any forward movement within the region. We need to build the home while we occupy it, and the foundation is a supranational organ to ensure that the work is done timely, and that all workers conform to the building code, and stay true to the blue-print.

In my next post, I will give several reasons why a supranational organization is imperative for regional integration.

Written by fortheloveofcaricom

April 25, 2011 at 5:05 am

Posted in Uncategorized

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