The final lap

Though Prime Minister Dr. Hubert Minnis repeatedly promised a fixed date for general elections, we are at the point in the term where many people are constantly asking, “You think Minnis gonna call an early election?”

It was Minnis’ view while in opposition that one man alone should not know the date of the election, but it is not a pledge he moved on in government. Making excuses for failing to fulfill many of his promises, he said recently his government lost three years to crises – hurricanes and the COVID-19 pandemic.

Whether there ought to be a fixed date for election is something that can be debated in another column. Indeed, we addressed this topic in an editorial last month, observing that a fixed-term parliament may prove to be inconvenient due to unforeseen circumstances.

In fact, early elections may sometimes be to the overall best interest of a country, such as when a government with a small majority needs to establish a clear majority. This was done by the Progressive Liberal Party (PLP) government in 1968 and by the Free National Movement (FNM) in 1997.

The fact now is that we will have to wait for Minnis to determine when he will go back to the people – many of whom are disappointed, disillusioned and even disgusted by his administration’s performance to date.

Early this year, Minnis seemed determined to call an early election. All the signs were there: candidates were being named, regular campaigning was taking place even in the middle of the pandemic, campaign paraphernalia was being prepared, and election ads started running frequently.

With the country battling a third wave of COVID-19, a slow roll out of the government’s vaccination program, and a new budget about to be presented – which means a budget debate must take place in Parliament in June – there will obviously be no election in the first half of 2021.

Minnis might decide to call one late summer, early fall; but, again, no one knows what is in his mind.

He might recognize, notwithstanding the oft expressed delusion of his administration, that it is in his best interest to run out the term in hopes of a greater spark on the economic horizon, and take the time to squeeze in a few noteworthy accomplishments.

Giving this some thought this week, we wondered what the Minnis administration must achieve in the next nine to 12 months if it is to maximize the time it has left.

Economy

The famous phrase “It’s the economy, stupid”, coined by Bill Clinton’s strategist James Carville in 1992, remains as true a slogan in today’s Bahamas as it was back then in the United States.

But there is no clear sense that the Minnis administration has a clue how to grow the economy and begin the process of digging us out of the very deep fiscal hole we find ourselves in.

The lack of competent leadership in the Ministry of Finance – with a clueless minister of finance and an equally out of his depth minister of state for finance – does not bring any comfort that there is a team in place with the acumen necessary to begin addressing our ballooning debt.

The Ministry of Finance reported earlier this month that in the first nine months of the current fiscal year, the deficit was $878.2 million. Government debt stood at $9.5 billion. The government borrowed $2.3 billion in that period compared to $936.5 million in the same period of the prior fiscal year.

“Our number one priority should be growing the economy,” noted CFAL President Anthony Ferguson, speaking with National Review yesterday.

“Number two, it should be managing our debt – making sure we have the right mixture of debt and then re-educating a lot of displaced workers, and then we’re going to have to address tax reform. Whether we like it or not, that is going to come. You can postpone it, you can delay it, but if you don’t address those things, you’re going to have some challenges.”

Ferguson predicted the government will need to borrow another billion dollars in the next fiscal year.

Growing the economy will depend a lot on how safe The Bahamas is. COVID remains a significant challenge as The Bahamas is experiencing a third wave, it has only enough committed doses of COVID-19 vaccine to vaccinate 60,000 people. Some Bahamians have already been fully vaccinated abroad, but there is no expectation that that is a significant number of people.

The Bahamas will no doubt benefit from a strengthening US economy.

Standard & Poor’s stated a few weeks back, that an improving vaccination outlook, faster reopening schedule, and the $1.9 trillion stimulus “shot in the arm,” along with a $900 billion package approved in December, all point to a seismic shift in the US economic outlook relative to where it stood in December 2020.

The ratings agency’s forecasts of real GDP growth for 2021 and 2022 are 6.5 percent and 3.1 percent, respectively, up from 4.2 percent and 3.0 percent in its December report, with its 2021 GDP forecast (and now the Fed’s) targeting the highest reading since 1984.

With both business and consumer confidence well into expansion territory, the US economy is on the mend, S&P said in March, adding, “Even accounting for a possible resurgence of the virus later in the spring, it’s hard to see a contraction this year that is severe, broad, or long-lasting enough to be considered a recession by the National Bureau of Economic Research.”

This is good news for The Bahamas, whose tourism industry was fully shut down for a great portion of 2020 and which continues the struggle to rebound.

The Bahamas hopes to benefit from pent-up travel demand in the North American market, where most of our tourists come from.

But we are nowhere near letting the good times roll, meaning, the Minnis administration will face grave difficulties convincing a worn-out electorate to give it another run. 

Another financial and economic advisor, who spoke with us on Monday without any expectation of attribution, said the way it is now is the way it’s probably going to be for the rest of the year – subdued economic performance.

“When we talk about the recovery period or the return to something more acceptable or more likely to represent a way back toward normal way of living, I think we are talking definitely well into next year,” he said.

“I think it will happen. I think it will be during the course of next year unless something very much unexpected does happen; that is to say if we have setbacks of a health nature which we can’t know really right now, but which we don’t believe is going to happen once we achieve a certain level of immunization.”

There is no expectation that anywhere near 50 percent of the population will be vaccinated between now and the end of the year. As of Monday, roughly 40,000 people in The Bahamas had gotten their first dose of the AztraZeneca vaccine; about 3,500 had gotten the second dose, according to the National COVID-19 Vaccine Consultative Committee.

The prime minister on Monday forecasted a return to normalcy before August, pointing in part to the vaccination program, but his projection is unrealistic.

Reform and change

Minnis is seeking understanding – and if you read between the lines, forgiveness – from the electorate for failing to make significant achievements this term. He blames COVID-19 and hurricanes Irma and Dorian.

While it was unreasonable to expect perfection from the Minnis administration in its handling of these crises, true leaders rise in tragedy.

Excuses just do not cut it.

Due to obvious insecurity and pettiness, Minnis rejected the offer from former prime ministers Hubert Ingraham and Perry Christie to help in the Dorian response in 2019. 

Ingraham’s organizational skills would have worked well on the ground in Abaco, his second home, and the international contacts of both men would have been beneficial to recovery and rebuilding. Not to mention, Minnis could have avoided much of the political backlash he has gotten from the opposition, which would have had no choice but to be more measured in its criticisms of the process had the former Progressive Liberal Party leader been an active participation in the process.

Regarding the economy, the government is not today doing anything particularly innovative.

“It’s a pretty grim situation,” the analyst we spoke with on Monday acknowledged. “The Minnis government has just been pretty useless. The only reason I believe that they may not lose is because of who [the alternative is] and that’s going to save them, maybe.”

In October, when Minnis spoke in Parliament while tabling the report of his Economic Recovery Committee (ERC), he said “we must be willing to innovate within existing industries to open up to new opportunities and markets, including tourism”.

Minnis said, “We must be open to reform and change”.

Speaking of some of the recommendations of that committee, Minnis noted the ERC has recommended the full legalization of marijuana for medicinal, religious, and recreational purposes.

Six months on, no substantial movement has been announced in that regard.

Minnis also announced the government will review Sovereign Wealth Fund legislation “to determine what amendments might be required to allow the Bahamian people to take advantage of this and how a National Sovereign Fund may be constituted”.

Again, six months on, no announcement has been made on this actually happening.

The prime minister also said the government would “expedite the processing of the Bahamian and foreign direct investments currently before the government”.

Minnis should provide a full report on what has been expedited in the last six months since the ERC’s report was brought to Parliament.

There is a desperate need for economic growth, and hence job growth.

Just yesterday, Atlantis Resort, the country’s largest private employer, announced that it is making 700 workers redundant. For our population size, that level of job cut is significant.

We note that the government has made progress in developing online platforms for various government services, but little progress appears to have been made to date on the committee’s recommendations.

It appears the government is just floating along in a rudderless fashion with no real energy and no clear strategy.

We see no aggressive effort to attract more investments and business to The Bahamas. A good use of the remainder of the term would be a stronger focus on doing just this.

Even if Minnis decides to go until the end of the term, he does not have much time left.

Telling us what he plans to do next term means little to anyone.

What have you done this term? That’s the question that will be foremost on the minds of voters.

He would do well to use wisely the time he has left.

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