So what did the CNMI government do? Instead of diversifying the local economy, it brought in more factories, which then hired up to 15,000 nonresident workers. The industry, moreover, was exempted from paying the business gross revenue tax. It paid user’s fees, which was peanuts compared to its annual earnings that, at one point, reached $1 billion a year.
As documented by a report commissioned by the Interior Department, the garment factories cost the CNMI more than their contributions to the local coffers. The industry strained the commonwealth’s infrastructure, public services and environment. Puerto Rico dump had to be shut down. A new and costly landfill had to be built. Sewers in San Antonio were clogged. The beach water was polluted. Prostitutes and illegal drug pushers never had it so good. And because the garment industry spawned numerous labor, human rights and immigration abuses, Saipan is still known as the island of sweatshops and slaves.
The industry also allowed elected officials to further expand the local government bureaucracy, freeze the local minimum wage and hire, for $10 million, a lobbyist whose temporary success in fending off federalization ensured its eventual implementation.
Now, finally, this industry will be gone. The CNMI can finally move forward and make better choices about what type of an economy it wants to create for its people — and not for special interests.
LAWMAKERS should begin the new year by enacting a new budget that accurately reflects government priorities, operational expenditures, revenue sources and personnel salaries. Without a new budget, the governor will have a free hand in spending taxpayer money. He should not be given a virtual blank check in an election year.
Indeed, even as the administration reports revenue shortfalls and stiffs the Retirement Fund and government vendors, it is hiring nonessential employees — clearly, a political move. While dozens of hospital and other professional positions remain vacant, there is an unexplained but continuing demand for entry-level positions in almost all government departments.
The governor wants to continue to do this, and he can, under a continuing resolution, which is why he vetoed the FY 2009 budget bill.
The governor, in short, pulled a fast one by rejecting the budget and announcing a downward revision of revenues. He is now urging the Legislature to approve austerity measures — which he did not implement last year even in the face of garment closures and airline pullouts.
There is, in any case, little prospect of this government operating on its current spending levels without endangering the immediate future of thousands of government employees and pensioners.
But this is a general election year, and fiscal reality has little chance of survival. The deals have already been cut and the votes for a budget veto override will reflect the political reality on the Hill. Even in these most troubling times, some lawmakers will overlook the big picture and focus instead on sweetheart arrangements with the administration. This is to be expected in the world of politics, but one would hope that when the CNMI is reeling from a 60 percent drop in arrivals from its high of over 700,000 visitors in 1997, alarms would sound and the commonwealth’s leaders would finally admit that a new budget is crucial and unnecessary hiring should no longer be allowed.
We are urging the more principled lawmakers to do the right thing. Ignore the siren call of this soon-to-be lame-duck administration and override the governor’s veto of the budget bill.
