REPORT #59 April 1999
TWO SIDES OF A COIN - Economic Development and Democratic development!

Produced by the Belize Development Trust
World Bank economists in the past have pointed to third world countries that appeared to be recently successful; as recovering from some financial debacle through strict fiscal discipline programs. Usually forced upon the country in question by some outside source, such as the International Monetary Fund.

This narrow focus on external set fiscal discipline ignores related factors, such as the level of democratic freedoms, less regulations, reduced government micro-management, more entrepreneur friendly economic policies and smaller grandoise political manifesto's with pragmatic goals.

What these foreign economists don't tell you, is that; such countries are propped up by foreign aid! Belize fits somewhere in this category of failed self-sufficiency, due to a combination of unrestricted foreign loan borrowing, enhanced by a political system that forbids policy sharing by the voters, run by an autocracy of half a dozen people. A very small brain pool and extremely minor view of consensus democracy. ( less than 1/20,000 % in Belize).

The excuses are many by most failed ex-colonial system leaders working under "elected representative political party dictatorships." Excuses range from historical colonial transgressions, to uncontrollable world markets and the need to modernize on a larger scale than either population requirements, or natural population growth could possibly require.

The hard reality is; that foreign aid and foreign loans are itself a world wide growth business and a whole new industry has been created by entrepreneurs in industrialized rich countries, or organizations like the United Nations and international banks. The targets of such business, are third world countries like Belize, for new mobile foreign agency lend and advise professional degreed mediocre incompetents, on fat living allowances and gargantuan salaries, or commission incentive goals. It is in their own selfish self interest to push for more economic aid, even when a small country like Belize cannot amortize it, or adequately maintain, or use such projects. Often big projects like government hydro-electric dams could be better met by simply opening up electric production to private entrepreneurs using risk capital for the profit motive and demolishing state foreign loan financed monopolies. Economic changes through less restrictions and more competition orientated legislation, couple with less taxes allowing more profits could do the same job.

There is an old joke floating around the foreign diplomatic and lending agency crowd in Belmopan, the Belize capital and the major intellectual town of Belize City. They talk of two foreign aid students attending University in the USA who became friends. One was an Asian and one was from the Caribbean. Years later each became Finance Minister in their respective countries. The Caribbean friend visited his Asian counterpart on one of those government paid travel trips. He was startled by the palatial home of his Asian friend. The swimming pool, five cars, chauffers and servants, stupefied him.

"My God!" the Caribbean Finance Minister said. "We were just poor students before! How on earth can you afford all this?"

The Asian took him to his balcony window and pointed at a busy highway in the distance. "You see that road?" Then tapping himself on his chest, said "Ten Percent!"

A few years later, the Asian returns to visit his friend in his Caribbean island country. He finds his Caribbean friend with a palatial 100 acre estate and what seem to be either multiple wives and families, each with their own home, several very expensive landrovers and bank accounts in the Cayman Islands.

"How on earth did you get so rich?"

This time his Caribbean friend took him to the verandah and pointed down the hillside and out toward the Caribbean Sea. "You see that coastal road through rough, hilly, mountainous terrain?"

The Asian squinted and looked, but could see only descending hills, trees, scrub and the sea. "I don't see any coastal road!"

At this, the Caribbean Finance Minister smiled. "Exactly!" Then tapping himself on the chest boasted, "One hundred percent!"

The moral of this expatriate joke based on fact, is that without checks and balances on a six Belize District national level and some form of district veto on national government, like the Swiss Cantons on their Federal Government; our British style, one party winning elected dictatorship has no way to prevent a clique in the controlling political party from running financially amok!

With a near one $ billion national debt in Belize for 220,000 persons, you must draw your own conclusions about political restructuring needs in Belize.

Around Latin America and the Caribbean, all you hear are excuses from the leaders. It's the colonial legacy, it was slavery (150 years ago), it's world markets, it's a cold war legacy, it's corruption. Yet places like Singapore and Switzerland have nothing but human resources and seem to do well. They have no commodities, no agriculture products! If you point out the holes in these leader's excuses, you get defensiveness, followed by anger and then accusations that you do not understand the difficulties, or history.

Rarely do Caribbean leaders talk of bloated bureaucracies, inflated cabinets, spending appetites and growth economic projects based solely on foreign loans, or on economies that should be self sufficient on smaller scales. They talk of illiteracy and the lack of engineers, technicians and artisans. In Belize, they will not talk of founding an aircraft frame and powerplant school, using volunteer teachers from abroad, or including engineering courses in the port city University branch.

What separates failed debt ridden Caribbean countries with inherited British style government from successful nations? Two things! The structural style of government and discipline! People who come from overpopulated countries have more discipline, but within our political system, such discipline is wasted on political infighting. We will have to wait for bankruptcy and then fiscal discipline will be imposed from outside from someone like the IMF. What you get instead is double-speak, apologies, excuses and above all hypocrisy from those aspiring to cushy lucrative spots in political party controlled dictatorship government, financed by foreign loans.

The population itself is kept in subservience through the struggle to survive, taxed to support the growing foreign loan based economy and through the nationwide tentacles of micro management by political ministers with discretion. The foreign loan based economy supports those many in politics and the bureaucracy. Many of these intellectual, well educated, smart people should be in the fields of manufacturing for export, or export orientated farming ventures instead of politics and bureaucracy. Government by foreign loans doesn't work!

Foreign loans fuel growth, growth in excess of natural population levels and birth expansion, loan sponsored growth fuels immigration into Belize in excess of emmigration out of Belize. Immigration into Belize fuels increased poverty, and inadequate social services and infra-structure, this in turn cycles around to fuel more foreign loans, ad finitum! The only winners in this process are the growth success of more higher paid politicians and a bigger higher paid swollen bureaucracy. Politics and bureacrats are the only real growth segments of current 1999 Belizean national society. The quality of life suffers for everyone else.

Our elected representatives under this system, act like corrupt potentates calling for ever increasing amounts of foreign loans. If this is leadership, then we need a new political structure, based on District Federation and Belizean Cooperative management organizational techniques. A place where people get paid by what they produce. And managing committees ( by whatever name, e.g: cabinet ) do not lead, or create policy, but are confined to management functions.

A strong self reliant Belize has to come from Belizean pride! The ability to say no, to projects and debt we cannot afford at this level of population growth. At some point we must consoldiate and re-evaluate our progress and direction. It might as well be now.

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