“Forward together, not back”
“Standing strong, putting Bermudians first”
Bermuda’s future is looking bleak. We’re 3 weeks away from the election and each party is busy trying to discredit the other while neither has proposed tangible solutions to our predicament. What little is out there represents the OBA touting their slow and steady track record but they lack any discussion of new plans and new ideas. The PLP, by contrast, have their Vision 2025 which is big on ideas but short on how to actually achieve them. Hopefully things change before the election and we see solid platforms released soon with credible ideas and plans. If not, Bermuda’s future doesn’t look so good.
From the perspective of this blog, the greatest concerns for the next government are
- How we manage our debt and deficit
- How we manage our economy
- How we manage our morale of our people
The debt and deficit are of huge concern and yet garner limited discussion. We are so deep in debt and unfunded pension liabilities that it is hard to see how we’re going to work our way out of it. We’re at risk of running towards bankruptcy as rates rise. We can make things considerably worse if we take on more debt and can’t reduce our deficit. We risk pushing ourselves into a corner where drastic solutions like mass layoffs, currency controls and nationalizing private pensions become economy crushing realities. There aren’t nearly enough people talking about this.
The OBA’s approach thus far has been to not rock the boat. They avoided reducing the civil service through anything but attrition and they’ve avoided raising debt aside from that required to pay interest and roll over previous debt. It’s a low risk approach that hasn’t won them great accolades but has been working thus far, albeit incredibly slowly. Unfortunately they likely will need to manage to stay in government for the next few hundred years it’ll take for the strategy to pay off. They haven’t suggested they’d do anything differently. Is it safe to assume an OBA government would be more of the same?
The PLP are frankly terrifying when it comes to the debt and deficit. Don’t get me wrong, if Eugene Cox were still alive today and in charge of finance it’d be easy to sleep at night. However, finances after Eugene Cox were a nightmare. We’re billions in debt and have very little to show for it. The PLP’s track record is concerning because their answer to almost any problem is to throw money at it. We don’t have that luxury anymore. The PLP haven’t said anything about what they learned or what they’d do differently. They frankly spend more time blaming the OBA for adding to the debt while conveniently sidestepping the question of how they would have cut the deficits they left behind and avoid more debt. I truly pray that they are sitting on a credible strategy for addressing this that they’ll reveal shortly. If not I fear a PLP government will put us on a path to national bankruptcy or drastic solutions and then national bankruptcy.
The economy is also a big concern. We’re not in the midst of an amazing recovery and instead we’re still limping out of the recession. International business is facing increased global competition and low rates that has led to consolidation in the industry. Job numbers are still low and barely growing. The days of reinsurance being a growth industry are over as it has matured over the years. Increasingly companies are having to start thinking about how to be more efficient vs. how to get more business and this is much harder to do. On top of that, Bermuda has a big target on it’s back from politicians in the US and EU that introduces considerable uncertainty about our future. Our economy has really only been kept afloat through stimulus programs like the hospital project, America’s Cup and soon the airport. It is likely we wouldn’t be faring all that well if we didn’t have this stimulus. We have to grow our way out of our predicament while simultaneously reducing costs and increasing efficiency, where are the plans to do so?
The OBA’s approach to the economy seems to be finding creative ways to stoke the fire with stimulus as well as public opposition while struggling for solutions to reignite growth. Beyond that they’re on a campaign to raise awareness of both our international business and tourism products. They’re busy copying other jurisdictions with things like LLCs and casinos but where is the innovation? Doing business in Bermuda can be painful, bureaucratic and expensive. We simply aren’t terribly competitive and while the OBA deserves credit for introducing a variety of positive small steps, they haven’t produced plans for how we can innovate and lead once again. What tangible and innovative ideas does the OBA have to reignite growth or increase efficiency?
The PLP deserves credit for doing many good things when it comes to international business in their time while they also deserve credit for doing things that made the recession significantly worse. Solvency II equivalency and TIEAs comes to mind as something where the PLP didn’t take their eyes off the ball and positively set up our future. However, poorly thought out policies like term limits were a disaster. If 70% of people on work permits received a waiver from the policy then it wasn’t just ineffective, it was a joke. It did nothing to solve the underlying problem of providing more opportunities for Bermudians. It was a politically expedient solution fueling populist notions that Bermudians were being put first when they weren’t. In the end it was a failure and it contributed to the drastic downturn in jobs in the recession.
The PLP claims they are “putting Bermudians first” but that only seems to apply when it suits their political aims and doesn’t represent long term well thought out solutions that actually put Bermudians first. Protectionist populist notions seem to drive the PLP’s agenda which can be good for short term political gain but disastrous for long term growth. To their credit, the PLP have quite a few ideas in their Vision 2025 but they are short on details and feasibility when implementation is the hard part. To lead effectively, you have to do more than come up with the idea. You have to execute on it. Execution of ideas is where the PLP struggles. What concrete well thought out plans do the PLP have to grow our economy or make it more efficient?
The morale of our people are the biggest concern as an angry populace can scuttle the best of efforts to recover the economy and tackle our debt. Many Bermudians feel left behind and wonder if Bermuda is in their future or if they’ll have to migrate elsewhere. Populist and protectionist biases drive people to believe that nationalism will provide better results in an age where we’re heavily dependent on global trade and commerce. These biases drive misunderstandings and fake news in this new age of the internet which has changed the scope of how people become aware of issues. As such, it is incredibly important that people are involved in the decision making process far more than ever before and properly informed of what they’re deciding so that populist and protectionist biases don’t result in the local equivalent of Brexit or Trump.
The OBA have largely been out of touch with the people but to their credit have shown signs of learning from their mistakes. The OBA that was elected and the OBA we’ve seen over the last few years were very different from one another. As a result they’ve made some pretty big gaffs that have riled up the populace. One of their biggest problems they’ve faced is communicating with and involving the people in the decision making process. Many people feel left out of the process and feel the OBA isn’t focused on making the people’s future better, only that of the privileged class. This is a serious perception problem that the OBA needs to address. It was promised in the last election but we haven’t seen enough of it. What indication is there that another OBA government will live up to those expectations? The OBA claims “forward together” but they haven’t demonstrated enough thus far that together means all of us so how can we believe it will happen with another OBA government?
The PLP are very in touch with the people but too often capitalize on it for political gain at long term cost to our future. Blocking parliament over the airport deal was a great example. The cost to our reputation for stability wasn’t worth it and the fallout from it was disgraceful. We truly need to put Bermudians first in the long term. The PLP’s insight into what is broken and how Bermudians end up disadvantaged and discriminated against is valuable. However they tarnish their cause when they conveniently shift their positions for political gain. Worse, their attempts to redefine “Bermudian” as only encompassing a certain segment of the population do more to divide us against one another than unite us to put all Bermudians first.
Frankly I’m discouraged with the prospects for the coming election. Yet again we’re being presented between the choice of who is the least worst option rather than who is the best. We’re being bombarded with a disgusting amount of rhetoric and pointing fingers and almost no real solutions. Neither party is living up to their slogans. The OBA haven’t lived up to be who they campaigned as and certainly don’t yet instill enough confidence that they’ll fulfill the pledge that by electing them we will move “forward together, not back”. The PLP don’t yet instill enough confidence that they’ll fulfill the pledge that by electing them they will be “putting Bermudians first” vs putting the party first. I hold out faint hope that things change before the election and that each party will wake up and start campaigning to deliver a better future together that puts Bermudians first. Each party publishing real tangible platforms outlining their visions and plans for the future would be a good start.