Bait and switch crony capitalism:  A race to more exploitation

Bait and switch crony capitalism: A race to more exploitation

It’s the time of year when wallets are opening and cheerfulness is expressed. In the midst of this, oftentimes the commodity advertised as very good value or a real bargain is actual counterfeit. The option is usually to re-gift, recycle, refund or discard. 

In contrast to political affairs, far too often citizens are on the hook for four to five years of miserable representation, burdened with less value for money, ideas and solutions to national issues. 

What’s more, the political representation of such paradox enters a state of pathological lying. Pretence and insincerity become cultured and mixed with polarizing rhetoric, drawing on psychological projection, and self-aggrandizement and enrichment.

The jarring nightmare to other aspects of bait and switch is that people delude themselves into thinking their votes manifest change, when in the majority of cases it produces lame ducks taken to the water by the cleverness of tricksters.

Essentially, President Barack Obama promised “Hope and Change”, which may have produced President-elect Donald Trump’s “Make America Great Again” – whatever this slogan means; it needs to be carefully stewed for its phrasing and polished platitude.

Allen Greenspan said: “Crony capitalism is essentially a condition in which… public officials are giving favours to people in the private sector in payment of political favours.”

Those relationships [between public officials and the private sector] depend heavily on the distribution of permits, government grants and lucrative contracts, special tax breaks and other creative forms of state intervention that let some people get rich first, with the hope that economic growth and/or the country’s wealth will trickle down. 

Individual subsidies that favour one business over others and market manipulation, leading to the introduction of value added tax [VAT], by special interests should not be permitted. A perception that cannot be denied!

There must be a change of policy that is consistent and fair. State economic incentives should be equally applied to support competition on a level playing field, in an effort to turn away manipulation that increases the inequality gap between the wealthiest, the middle class and young people where, intergenerational transfer is most unequal and stagnating rapidly.

Let’s anticipate that precedent is set in privatizing the National Printing Corporation, the National Insurance Corporation [NIC] and other national assets under consideration.

Recently, Saudi Arabia cut ministers’ salaries by 20 percent, canceled bonus payments for state employees and members of a legislative body [advisors of the monarchy] were cut by 15 percent in a desperate move to save money. 

In addition, six Gulf States comprising the Gulf Cooperation Council agreed to introduce VAT for the first time in a radical policy shift, hoping to move their economies and populations away from a dependence on oil and gas. It is appropriate that healthcare, education, social services and 94 food items will be excluded.

Europe and northern American economies pay taxes, finance hospitals and infrastructure in the Caribbean and provide development aid. 

Yet in the case of Saint Lucia, the Prime Minister Allen Chastanet-led administration propagates, while others take pride in not having to pay taxes, but expect services and economic development.
Indeed, it is better to subscribe to the principle that the first responsibility of good citizens and the first element of corporate citizenship is to pay their fair share of taxes. 

And yes, there is merit to simplifying the tax code and the need for tax harmonization. 

But as explained in previous writings, “Five to Stay Alive” is wrong-headed, while drawing heavily on business relationships, conflict of interest and nepotism that equates to corporate welfare in the practice of bait and switch crony capitalism. 

And that’s in addition to monopolies, pretence and racketeering, the denial of access to legitimate entrepreneurs and ordinary citizens, who have gotten screwed, hoping others will discover soon enough, to fall in line with corruptionists in government.

The conventional wisdom is that the Saint Lucian economy is at a standstill; yet, the handful of state projects that were ongoing has been stopped, within one month of taking office on June 6.

This is based on conflicting ideologies and without looking at the numbers, oblivious of economic fundamentals to avoid sharp cuts and legal repercussions for abrupt work stoppage. 

In other words, if one is not a crony of “the party” and will not make the government “look good” – that has to change. Hence, fear and mass hysteria is being cultured to restore inconvenient truths about initiatives and job creation schemes, in keeping with the promise of “change”. 

There is cause for concern among investors and analysts that the government is in denial and playing footsie with the state of the economy, in the face of their challenges and lack of depth. 

Clearly, the economy requires a stimulus package that will help bring back growth, investments and increase confidence; and meanwhile, while privatization, public-private partnerships and remodeling a few state assets may help bolster the economy, such measures ought not to be handled within the secrecy of bait and switch crony capitalism.

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