UNDER the U.S.-administered Trust Territory government, many people in the NMI complained about their virtually non-existent economy.
Under the Commonwealth government, the NMI economy took off, but many people were still complaining, this time, about other issues.
The local economy boomed in the late 1980s and early 1990s before slowing down a bit, and then riding high again until 1998 when the financial tsunami that was the Asian currency crisis crashed into the NMI.
Three years before the end of the NMI’s economic “good times,” the Bank of Hawaii published a 19-page report written by its regional economist, Wali M. Osman. Factual, detailed and well-written, the report was big news back then, and should be read today by the NMI’s current policy makers and politicians.
As of 1995, Osman wrote, the Commonwealth of the NMI had developed “an economy that has Micronesia’s second highest per capita gross income after Guam, much higher than that of any other member of the former” Trust Territory of the Pacific Islands. In 1990, the CNMI’s gross business receipts had reached $1.2 billion, up 494 percent from 1980, generated by 3,550 business firms in 1990 compared with 598 in 1980.
In 1992, appearing before a U.S. House subcommittee that was looking into the NMI’s controversial garment industry, then-Gov. Larry Guerrero informed U.S. lawmakers that the Commonwealth had “brought about an economic miracle in the Pacific…. We reduced the size of government relative to private sector. We decreased our burden on the Federal Treasury. We have dramatically increased local revenue and just as dramatically reduced our reliance on the federal taxpayers.”
The CNMI, he said, exported more than it imported. “We enjoy a favorable balance of trade with Japan. The size of our garment industry is very small in comparison with the entire U.S. garment business. And we don’t put people out of work on the mainland. On the contrary, we are creating jobs on the mainland. We import shiploads of U.S.-made products into our islands….”
Presently, he added, the CNMI “can boast of a caring, healthy society with no homeless sleeping on the street, no warehousing of the elderly in ‘old folks’ homes, and low drug addiction and AIDS statistics.”
Economic self-sufficiency for the Northern Marianas was in sight, Governor Guerrero said. “We have a booming tourist industry. This industry, and the garment factories as well, will collapse under the weight of mainland wage and immigration policy. Don’t send us back to a coconut economy. Don’t make us a federal welfare state again.”
In his 1995 report, Osman mentioned the newly opened casino on Tinian. According to our news files, the “first-ever casino establishment in the Commonwealth” was U.S.-owned Lone Star Casino Corp. which held a “soft opening” for its “temporary mini-casino” on April 28, 1995.
As in many other rapidly growing jurisdictions, more government revenue in the CNMI meant more government spending. Osman said unless the “CNMI government’s financial fortunes improve dramatically following large and growing budget deficits since 1992, the search for other revenue sources will only accelerate.” And because “other sources of income are often hard to develop, requiring large sums of capital and years to pay dividends, gambling has a special appeal, and the hurried search for revenues has to some extent overshadowed issues of the social costs arising from gambling in a small and isolated market.”
Tinian’s Lone Star casino shut down in December 1995. Amid a raging Asian economic crisis, Tinian Dynasty opened in April 1998. It was conceived when the going was still good, and NMI tourism was about to reach its peak. In 1996-1997, the future for the Dynasty looked bright, its general manager said in a 2007 interview with Marianas Business Journal. “On paper,” he added, “you couldn’t have gone wrong.” Dynasty shut down in Sept. 2015.
Memo to policy-makers, candidates for office and would-be saviors of the CNMI:
• Events unexpected, unforeseen and unwanted happen all the time, making a mockery of even the most well-thought out “plan.”
• Many socio-economic-political problems can’t be solved, but they could be mitigated.
• Many “solutions” create new, and sometimes worse, problems.
• It is usually the case that the primary question before us is this: Which problems would you rather have? In a representative democracy, voters will have to answer that question — and the same voters can change their minds in succeeding elections.
• The CNMI is not a “country”; it is a part of a much larger nation, the U.S., and like their fellow U.S. citizens in the states, the U.S. citizens of the CNMI can also vote…with their feet.
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