|UWI lecturer Dr. Dhanayshar Mahabir fixes the mike during his address at the 71st Annual Conference of the All Trinidad General Workers' Trade Union (ATGWTU) at Rienzi Complex, Mc Bean, Couva,|
Monday, November 10, 2008
Does Government understand economics?
By HERMAN ROOP DASS Monday, November 10 2008
THE Government is behaving as if they do not understand economics and could repeat the mistakes of the past, according to UWI economist, Dr. Dhanayshar Mahabir.
“The way they have responded to the lowering global oil price could only be described as a foolish approach to the situation,” said Mahabir as he delivered the feature address during the 71 st anniversary celebrations of the All Trinidad General Workers’ Trade Union (ATGWTU) at Rienzi Complex, Mc Bean, Couva, on Saturday.
During the function four members received awards for their contribution to the growth, stability and resourcefulness of the union over the years.
The four awardees were : John Jaglal, Anand Tiwari, Sahadeo Seejore and Doobraj Ramroop.
Mahabir said that the US Economy was feeling the pinch as already some ten million were out of employment, and by 2009 the figure should read 11 million. He stressed that Trinidad and Tobago would face a similar fate shortly.
“Possibly there could be industrial unrest in our country,” he emphasised.
He predicted that Trinidad and Tobago would lose some $5 billion during the next quarter as instead of collecting $40 billion they would receive $35 billion.
“It would be an unpleasant surprise, and when this happens Government would be forced to cut back on expenditure,” Mahabir said.
He explained that oil prices had now dipped to $60 US per barrel but this was “meaningless to our country.”
Mahabir felt that the Government should be pumping extra cash into the Heritage and Stablisation Fund “instead of spending money as if they had won a lottery.”
He was amazed to learn that Government’s spending had soared from $13 billion in 2001 to $52 billion in 2008, and predicted that “the real problem would arise when next year’s budget is presented and commodities remain as they are.”
He pointed out that “revenues are expected to drop by a further five percent because of more falls in production and this would be coupled by oil companies seeking tax write-offs to compensate for dry wells and exploration.”
He said that he admired Barack Obama, the US President Elect but was sympathetic that he had come at such a dismal time in the economic history of the US.
“What a way to welcome him, but thank God he is technically competent,” he stressed.
He told officials of the sugar union that despite unfavourable conditions of growth, they will survive.
He said that every time there was a global recession the international economy becomes volatile.
He felt that the manufacturing sector would continue to suffer in TT, but the agricultural sector would continue to perform even though it is dwindling.
“As a conservative economist, we have been telling the Government to slow down and cut back and try to adjust,” he said.