Piecemeal ‘transparency’
IN its latest financial report to the Legislature, the administration provided additional information about the pension obligation bond it issued, which was unknown to the public at the time. Now we’re told that the loan agreement was signed in December 2024, and the amount was $51 million. So why did an earlier statement from the administration mention $30 million only? And why weren’t CNMI taxpayers — who will be paying $491,000 a month — told about the POB in December?
When it comes to the government’s financial state, the administration — which prides itself on “transparency” — seems to prefer piecemeal disclosures. Prior to the midterm election, its supporters claimed that “effective spending controls and enhanced tax enforcement” allowed for the restoration of the 80-hour work schedule of government employees (i.e., voters). Later, the governor admitted that ARPA funds, which he earlier said were “depleted,” allowed him to lift the austerity measure. In fact, he said, (the no longer nonexistent) ARPA funds allowed the government to “survive.”
And oh, by the way, the CNMI government still has over $500 million in federal funds for infrastructure investments.
We can’t help but wonder: What other details of the government’s financial situation will the administration choose to reveal, if at all?
Political arithmetic
DOES that sound right? On one hand, the governor warns us about “more challenges ahead in our tourism economy,” while on the other, he informs us that the government has borrowed a significant amount of money to, among other things, provide additional funding for an overstaffed government that refuses to live within its means.
It may be poor fiscal policy, but it is based on sound political arithmetic. Government employees and retirees comprise the CNMI’s largest voting bloc. They vastly outnumber the business owners and private sector employees (many of whom are non-voters) whose taxes can be raised, one way or another, to cover the government’s financial recklessness.
Voters, through all these years, how many candidates for office have vowed to “reduce the size of government” or “prioritize and spend public funds wisely”? Did either of those promises ever materialize?
But not to worry. There is always another election, right?
Self-inflicted economic loss
TO help revive the tourism industry, there is one thing the governor can do but hasn’t yet: allow MVA to do its job and tap into all tourism markets, including China. Two years after (indirectly) informing the public about it, his “pivot” policy — for which he has no mandate — has yet to secure the massive U.S. funding assistance needed to compensate the CNMI for, in his words, “the economic loss we have experienced as a result of the CNMI’s pivot away from China.”
As we’ve said before, if the governor chooses to continue to double down on his failed policy, fine. There’s another election next year anyway. But in the meantime, he must align government spending with the limited revenue the economy can generate. He should also stop proposing tax hikes. The struggling private sector, which has to live within its means, is not the government’s ATM.
