Bahama Pundit

Government Statement on Energy Sends Right Signals

by Larry Smith

The new Progressive Liberal Party government issued its first statement on the future of energy in the Bahamas recently, and all signals were positive. 

In a communication to parliament, Environment Minister Kenred Dorsett said the government was committed to lowering the cost of electricity by continuing to upgrade generating plants on New Providence and pursuing renewable energy initiatives.

"Reliability upgrades, replacement and rehabilitation of auxilliary equipment, and considering additional heavy fuel baseload generation, is an integral part of reducing electricity prices, and is a priority for the Bahamas Electricity Corporation," he said. "Increasing baseload generation could save BEC $100 million annually."

But achieving such savings would require significant upfront investments in new plant. Former BEC Chairman Michael Moss has said the corporation's bottom line can't sustain that level of investment without heavy capital inputs from the government, which is already struggling under a $550 million budget deficit.

Is the PLP Playing a Numbers Game?

by Simon

There is considerable discussion on a national lottery and whether the numbers business should be legalized.  Yet, a compelling issue has been given short shrift.  It concerns whether most of the proceeds from this lucrative trade will be used for public purpose or private gain.  

Bahamas Information Services issued a story last week on Prime Minister Perry Christie’s communication to the House of Assembly confirming the government’s intention “to hold a referendum on the issue of a national lottery and/or web cafes.”  

He was quoted as advising: “I wish to confirm that it is my Government’s intention to proceed with a referendum on the issue of a national lottery and/or web cafes as soon as practicable following the anticipated by-election in North Abaco later this year.” 

The story noted: “The referendum will seek to ascertain whether a national lottery should be instituted and or whether the popular web cafes or web shops be legalised, regulated, licensed and taxed.

“He [Mr. Christie] also reiterated that the Government would maintain a position of complete neutrality on the referendum issues:  ‘We will not campaign for, nor will we encourage the adoption of, either a yes or no position on any of the referendum issues.’ ”

The communication obscured more than it revealed.  Given that this is a debate on the numbers business it is ironically fitting that the government’s statements seem less like a serious policy discussion and more like a confidence or shell game.  

Tax Havens and Inequality

by Larry Smith

 In July, the Observer newspaper in Britain published an exhaustive study by the Tax Justice Network asserting that at least $21 trillion of unreported private financial wealth was hidden in secret tax havens by the global super-rich elite at the end of 2010 - a sum equal to the combined size of the American and Japanese economies. 

The Price of Offshore Revisited is the most comprehensive study ever on the offshore economy. It was written by former McKinsey & Co chief economist James Henry, amid rising concerns about an enormous and growing gulf between the rich and poor in countries around the world.

Accompanying this research was another study by TJN, entitled Inequality: You Don't Know the Half of It, which argues that all reports of economic inequality to date have failed to account properly for this hidden offshore wealth. It therefore concludes that inequality is much worse than we think.

Henry drew on data from the World Bank, the IMF, the United Nations, central banks, the Bank for International Settlements, and national treasuries. He compared this information against demand for reserve currencies and gold, as well as data from private banking studies by consulting firms and others.

The Tax Justice Network is an independent organisation launched in London a decade ago. It focuses on financial transparency and the impacts of tax evasion and tax havens. "Our objective is to encourage reform at the global and national levels," the group says on its website. "We are not aligned to any political party."

Looking at Bahamian Education—Again

by Larry Smith

Prime Minister Perry Christie recently acknowledged that continued poor results from government schools posed a threat to national development. Former Education Minister Desmond Bannister said our schools suffered from an entrenched bureaucracy that protected "unqualified teachers in critical subjects". Current Education Minister Jerome Fitzgerald admitted that half of all Bahamian students are flunking high school and called for "a frank and open discussion" on reforming the system. Did we hear all this right? The following are condensed versions of two articles on this subject - the first was published in October 2005 and the second in September 2007.

A Primer on Bahamian Education

This past summer scores of experts from around the country sat down in a hotel ballroom at great expense to figure out how to “transform” our failed education system. It was the first major re-evaluation of Bahamian schools since a national task force was set up in January, 1993.

What happened at this four-day meeting has implications for the 50,000-plus students in our public schools as well as our entire future as a modern society. But we have yet to receive any kind of report. So to help put this critical issue into perspective, here is Tough Call's primer on Bahamian education.

August 19, 1992 -- A New Birth of Freedom

by Simon

The struggle for majority rule was a march for freedom and social justice.  The second emancipation ushered in a new era of racial equality and greater opportunity for the majority.  

The empowerment of the black majority comprised political, economic and social advances.  Yet, much of the spirit and many of the promises of January 10, 1967, were corrupted or ignored as the party of majority rule coalesced into a cult of personality and a leadership so avaricious, so hungry for power, that it betrayed core ideals and values of the movement.

Various freedoms were stifled as the PLP entrenched a political culture of intimidation.  The instruments of the state were directed to intimidate scores of Bahamians, freeze out opposing voices in the broadcast media, deport the spouses of opposition supporters, economically destroy opponents, corrupt electoral processes, and to marshal a host of other practices antithetical to democracy.

August 19, 1992, represented not only a break with this past and a new direction for The Bahamas.  It also represented an opportunity to renew much of the spirit and many of the promises unfulfilled after 25 years of rule by Sir Lynden Pindling’s PLP.  The election of the Free National Movement in August of 1992 was a new birth of freedom for Bahamian democracy.

The Very Strange World of Gambling in the Bahamas

 

by Larry Smith

When I was young, people called me a gambler. As the scale of my operations increased I became known as a speculator. Now I am called a banker. But I have been doing the same thing all the time. -- Sir Ernest Cassel (1852-1921)

In gambling, the many must lose in order that the few may win. -- George Bernard Shaw (1856-1950)

The gambling debate in the Bahamas has always been surreal - part of a weird fantasy world that is difficult to navigate with logic.

There are two zones to this strange world - one in which three or four hotel casinos operate legally as tourist amenities, and another populated by hundreds of illegal Numbers sellers catering to tens of thousands of Bahamian gamblers.

The casino zone originated in the 1920s, when Prohibition in the US offered a chance to make huge profits from bootlegging. Money flowed freely, and millions were invested in real estate, with new resorts like the Colonial and Montagu Hotels coming on stream.

Although organized gambling was officially banned nationwide, a small casino called the Bahamian Club began operating seasonally in 1920 on New Providence, catering to a very restricted clientele. It was located on West Bay Street, east of Fort Charlotte.

The Numbers zone dates back to 16th century Europe and has been thriving here since the 1800s at least. This game of chance is associated with poor communities around the world because punters can bet small sums of money and get credit from their bookies.

The Most Illustrious Prime Minister

by Simon

Recently, a leading politician enthused: “Sir Lynden Pindling will have his place in our history.  But to my mind, Hubert Alexander Ingraham is the greatest prime minister in the history of an independent Bahamas.  History will be more than kind to him.  History will celebrate him as the Great Reformer and Modernizer.”

This encomium to the former prime minister was delivered at an FNM function a few weeks ago by the party’s Deputy Leader Loretta Butler Turner.  What makes such high praise even more noteworthy is that its author is the granddaughter of Sir Milo Butler, a Father of the Nation and a colleague of Sir Lynden and others in the struggle for majority rule and independence.

As Hubert Ingraham retires from frontline politics, the assessment of his premiership will begin in earnest.  Many are already of the view that, thus far, he has served as the nation’s most illustrious prime minister in an independent Bahamas. 

Sir Lynden, also a Father of the Nation, is a pivotal figure in an independent Bahamas, and will be accorded his due in the nation’s history.  In the pantheon of heroes, Sir Lynden is a sort of mythic figure, his portrait adorning the one dollar bill and his name the nation’s leading international airport.