I’VE read the text of the speeches delivered by governor and the lieutenant governor at last week’s economic summit, and oh boy.
Like most everything else involving the CNMI government, there is nothing new about holding an economic summit (federally funded usually) during an economic crisis (the local economy’s default mode). Even the title of this latest summit is a rehash:
“Charting Our Future Economic Development.”
But the sheer audacity of it! The CNMI government can’t enforce its anti-littering act, among other laws. It can’t pay CUC and/or its vendors on time. It can’t meet its revenue projections. It can’t do a lot of things that it says it will do — that its laws say it should do.
But it can and will “chart our future economic development”!
In his remarks, the governor said he wants the summit “to chart a bold course toward economic recovery.”
How exactly?
He said he doesn’t want us “to succumb to the same failed economic policies that include, among others, the CNMI’s overreliance on one market.”
What are those economic policies? Do they include capitalism? The governor also decries “overreliance on one market” — i.e. China — while suggesting that in the meantime, we should instead (over) rely on a still non-existent market, military “investments” and tourists. (And never mind that prior to the pandemic restrictions, the CNMI had three tourism markets, not one. No one — neither MVA nor businesses — was advocating for “overreliance on one market.”)
According to the governor, “it’s during these moments that our resilience, our innovation, and our island ingenuity shine the brightest.”
When did that happen? When did “resilience, innovation and ingenuity” improve the local economy?
Before World War II, the local economy boomed during the Japanese administration because of its pro-growth policies that created an export-oriented, agriculture-based economy, which required the hiring of tens and thousands of “guest” workers from Japan, Okinawa and Korea. In the late 1980s and mid-1990s, the local economy ascended to lofty peaks because of the strong Japanese economy that resulted in major investments in the CNMI and an influx of Japanese tourists coupled by the presence of garment manufacturers whose market was the U.S. All of which, again, required the hiring of thousands of guest workers. When the local economy came to life again from 2012 to 2017 it was because of a new tourism market (China) and a Hong-Kong-based business entity whose money-down, multi-million-dollar investments prevented the collapse of the CNMI government’s pension fund. (See 2017 Settlement Fund Trustee’s Report.) And yes, it was an economy that required the hiring of thousands of guest workers.
Says the governor: “Economic recovery cannot be achieved by any one individual, by any one of the branches of government, by the private sector alone, or by any singular department or agency working in silos.”
In reality, economic recovery can be achieved by the private sector, which unlike the government, spends and risks its own money, but whose growth is almost always stifled or curtailed by politically popular but economically illiterate government policies. (In stark contrast, see Hong Kong under British rule.)
“We must work together to provide a clear, realistic, and measurable path to economic growth through the implementation of sustainable, long-term strategies,” the governor said.
But what does it mean, “sustainable”? And what long-term strategies? Like a five-year plan? How did that work out in the Soviet bloc or India? Or like the previous long-term strategies drafted by previous CNMI leaderships?
“We share a vision to expand upward mobility and provide wider access to higher-paying jobs to CNMI residents,” the governor said.
CNMI residents (locals) already have access to higher paying jobs for the simple reason that they are citizens of the U.S. whose economy is still the world’s largest and most robust.
The governor also reiterated his “vision to maximize military partnership and investment.”
So how’s that going? It’s a policy call, to be sure. But considering the paltry returns so far, the governor should also make significant adjustments to the CNMI government’s (over) spending habits. It cannot continue spending revenue it’s not collecting. Where’s the “strategy” for that?
“We share this vision to tear down government red tape and make the CNMI business-friendly,” the governor said.
Considering the rest of what he said in his speech, I don’t think so. What he wants is for the summit participants to justify his pre-ordained policy choice: dependence on military spending.
“As we stand” he said, “at the crossroads of progress….”
That’s probably a typo. The CNMI is actually standing (if at all) at the crossroads of a full-blown economic depression.
From the lieutenant governor (who used to have better speechwriters):
“Our Commonwealth has all it needs to build its own small island economy and remain self-sustaining while building its strength to grow financially and economically strong…. We just need to look from within to invest and use our existing capitals to grow.”
What do those words mean in terms of specific government policies?
“Self-sustaining”? Like North Korea or Pol Pot’s Kampuchea? Back to subsistence fishing and farming and seeking shelter in a cave when the next typhoon comes along?
In a way, the governor is somehow right when he mentioned local “resilience, innovation and ingenuity.” Individually, locals are all that and more. And like their fellow U.S. citizens in the states, they can always vote with their feet, and head to other jurisdictions where “resilience, innovation and ingenuity” often result in a much better life, and are not just handy platitudes strung together by politicians.
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