It failed to attract new investments and ended up doling out tax breaks to the politically well-connected companies that were already doing business here.
The Commonwealth Port Authority, long regarded as one of the better run agencies, has taken a hit due to a combination of poor policies and bad management, and a decline in port activities, all resulting in a threat to its bond rating. The decision of Northwest Airlines to cut its Saipan flights by 50 percent may put CPA in an even more precarious situation.
The Retirement Fund is approaching insolvency.
The Commonwealth Utilities Corp. is bankrupt.
These agencies have one thing in common. They are managed by politicians or political cronies to perform tasks that can be better handled by the private sector. Experience has repeatedly shown that politicians cannot make business decisions — unless it’s politically advantageous to do so. The government simply cannot run itself “like a business.” Government is not a business entity, and this has nothing to do with any ideological preferences. It’s a time-tested fact. Government is run by politicians, and politicians are exceedingly bad business managers. Politicians have to be liked; they need your votes; they want to stay in power. Business managers, on the other hand, must make decisions based on what is best for their companies — and that includes hiring only the best people, reducing costs, maximizing productivity and firing the incompetent.
That is why banks, unlike CDA and NMHC, will only lend money to people who can afford to pay their debts. Companies that run airports, pension funds or utilities will not hire inexperienced managers. They will not retain bungling managers or hire more of them. They will not neglect maintenance. They will not charge less for more. They will not “forgive” loans. They are not pressured by partisan politics.
Indeed, if CDA, NMHC, CPA, CUC and the Retirement Fund were businesses they would have been out of business in the very first year of their sorry existence.
What the government can do is to remove barriers to private sector wealth creation. The government must “get out of the way” through privatization, tax cuts and laws that will level the economic playing field.
Bailouts are now all the rage in the U.S., but unlike the federal government the CNMI cannot just print over $700 billion for a “stimulus” package. The CNMI has no mint. But it can muster the political will to cut government costs and create a business climate that rewards real entrepreneurs and not just political cronies.
Sadly, however, while CNMI government agencies are reporting hardships and while more businesses are shutting down, the executive branch continues to fill government rosters with nonessential personnel and focuses its attention on its lawsuit against the federal government. Even if the lawsuit is meritorious, as some have argued, it is only distracting the executive branch away from the nuts and bolts of running this terminally obese government, encouraging reckless hiring policies and promoting questionable private sector ventures.
This upcoming election can be evaluated in countless ways, but one way to look at it is to find out which candidates will bring real relief — relief from broken promises, insider dealings, power outages, cronyism, special interests and other “same ‘ole, same ‘ole” approaches that have already brought the commonwealth to its knees.
