I have tried a number
of times to compose a response to the Council of Ministers'
proposed priorities 2015-18 document. It has been challenging not
least because the document makes absolutely no sense to me. Which is a great pity as I broadly
agree at least two of the four priorities ought to be
objectives for the life of this elected States. So instead of a structured posting I'm going to post some observations and see if someone elese can make a coherent formulation of either the Ministers' priorities or my notes.
I'll start at the
beginning – the contents page. Now you know things are bad when
even the contents page causes a problem. We have three sections
presented - setting the scene, then developing the priorities,
followed by creating a sustainable future. The first two seem
sensible, but the third does not flow or follow. The largest part
of the section has nothing to say about the future, it spends much of
its wording giving justification for the selection of the four
priorities. But crucially a sustainable future is NOT one of those
priorities. Why would you have a major heading of a section with a
title that is most definitely not what the document is not about?
Either it is grossly incompetent or there is a will to deceive the
casual reader of the real nature of the contents.
It is very confusing to
have page numbers the header of part of the document, but not all of
it. It makes referencing difficult as the on screen display does not
match the layout version.
On to the Introduction.
Nothing much there about the content, but why include a whole blank
page with just the word Introduction on it? A complete waste for
anyone who had decided to print the document.
Setting the scene. Now
things get 'interesting' . The report starts with a quote from the
OECD wellbeing report. What is said is true, but it is
simultaneously a half truth. The cherry picked bits are all the
positives.
Notice the areas where
we scored particularly badly both relatively and absolutely - civic
engagement and environmental quality - do not figure in the Council of Minsiters' priorities.
At the foot of the page
we have a statement “Over the next
20 years the number of people over-65 will double and there will be
nearly three times as many people over-85. Fewer people working,
fewer people paying tax, more demands on our health and pension
systems. This is unsustainable.” The
first sentence is probably true, but I note there are reasons to
think life expectancy here is declining
see 1
.The second
sentence is almost certainly false. People do not stop being tax
payers at 65 or 85 years old. Since the introduction of GST it is
almost certain that everyone resident in the Island pays some tax - one of the great 'benefits' claimed by the proponents when it
was introduced.
The
details on page 8 are inconsistent. On the third paragraph it reads
To enable us to meet this
financial challenge, we need to drive productivity-led economic growth". By the 7th
paragraph this imperative had transformed into "Economic
growth and public sector productivity are our preferred options to
meet the financial challenges we face”. We
do not need to do something if it is a specific form of an option.
There seems to be some very woolly thinking, or is it simply mantra
regurgitation occurring here?
Health
and wellbeing is covered on page 9 (or is it 8?), and there are some laudable aims
here. But again we have a sentence that causes great concern. At the
end of paragraph 4 we read "Declining
health leads
to social exclusion, loss of earnings, and adverse consequences in
the wider economy." But
in the section quoted here two paragraphs above we were led to think that
it was the ageing population that was creating a health demand
problem. Retired people do not in general lose earnings being ill
because in general they are not working and so not earning in the
first place. Again there seems to be some fundamental inconsistency
in the minds of the ministers here.
Page
12 is the education section. Saying I have misgivings about the
thrust of this section would be an understatement. More than once
this section suggests that the purpose of education is to mould
children and youths into supporting the economy. It is quite
disgraceful to write "The fact
that some of our children are not fulfilling their true potential is
a waste of Jersey’s
most
precious resource – our people - and an economic inefficiency we
can ill afford” This
notion that people exist and are valued only by the extent they make
an economic contribution is outrageous. I don't believe I have seen
such an unspeakably illiberal suggestion since a former Home Affairs
Minister said he wanted more political control of the police force.
There
is a practical problem with the proposal "Jersey’s
education system is aligned to, and supports,
the Island’s economic needs” It
takes a decade or more to educate and train someone . We have
little idea what will be the economic need in ten years time.
Several members of the Council of Ministers were in the States a
decade ago . How many of them then were arguing bringing
propositions etc for IT education to train a generation for today's
digital economy?
A
remark must be made about the quote in this section: "Education is the
most powerful weapon you can use to change the world". I think this is
quite inappropriate to use here. Madiba first gave that quote on his
visit to Boston in 1990 , just months after his release from prison.
He was not talking about education his people for taking jobs in the
white controlled economy of the day – he had supported campaign
for divestment from South Africa! He was talking about the sort of
change of world that the OECD has us scored as 0 in the the wellbeing
report cited above.
Economic growth is the
final priority, addressed on page 13. I cannot recall a time when
the States of Jersey didn't have economic growth as a priority. It
seems we just cannot get enough of it. This time round we have a new
twist. This is not ordinary economic growth this is Council of
Ministers' sustainable productivity-led economic growth.
In theory one can
achieve a long running period of economic growth from efficiency
improvements without any increase in material consumption or
pollution or population growth. It is extraordinarily hard however
as countless governments around the world have discovered when they
have tried it. There is a rapidly diminishing return on the effort
involved. It would require a society of less work and increasing
low energy, low consumption leisure activity. That goes against
several generations of belief that increased material and financial
acquisition is the way to a better future. And therein lies the
problem.
If the policy succeeds
we have more people on average with more disposable income, and more
tax revenue for the States presumably, but equally the potential to
consume even more than now. That's not a good outcome in the face of
resource limits, climate change and the ecology of the Island. But
what if educated, well trained people are not motivated to have more
money. Also there is nothing to suggest we would tackle the
increasing inequality in income and wealth that would be expected
produce. Then the policy fails as more and more comfortably off
people effectively downshift work and lives at ever earlier ages.
Even if that were the
intention it is quite unclear if it might be manageable. The current
global economic conditions are quite unlike any in the lifetime of
any of our currently elected politicians out side perhaps of Japan.
Half decade lows in prices of gold, oil, iron ore, copper, corn and
interest rates point clearly to a deflationary environment. Growth
of any sort under such circumstances is a rare thing. The
goldilocks economics proposed by the Council of Ministers works the
other way round – the productivity gains eg from new technology,
produces price deflation (and increased consumption). We have it the
other way round – a sequence more likely to lead to recession. The
more likely outcome is lower costs, lower wages and an even lower tax
revenue for the States. What is suggested is a step closer to what
is needed than any previous growth ambitions of the States. It is
still some way however from the steady state economy2 that
I would advocate.
Of course I have again
to comment on the quote. “Someone's sitting in the shade of a tree
today because someone planted a tree a long time ago”. Warren
Buffet . You might think that in an Island so dependent on the
finance industry they would have got right the spelling of the name
of probably the world's most famous living investor -Warren Buffett.
If you cannot get such an easily checked detail right .........
Of course Mr Buffett was referring to investing
for the long term (smart man - he's right too on that aspect).
However there is also a deep fallacy in that quote. It is not the
case that all trees are planted by someone. Who do you think planted
the Amazon, or the taiga, or the great rainforests of Africa? Trees
for the most part are self seeded, they are the bounty of nature.
When you start thinking that a tree can only be because someone
planted it, you are in danger of thinking all that is of value is
that which humans create. It also underlines a critical point so
often overlooked in economics. It is nature who provides 'free
services' like trees and pollinators and rain without which we would
have no economy. We cannot have a sustainable economy, let alone
growth, unless we have a sustainable underpinning foundation – the
ecosystem services. As our species consumes and pollutes
increasingly beyond the capacity of the planet 3 , as it
has done since the 1970's, we get further and further from that
possibility.
3/
http://unearthnews.org/2013/10/01/earth-overshoot-day-how-can-we-reduce-our-ecological-footprint/
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