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IMF MUST BE WELL PLEASED by Dr. Godfrey Vincent

posted 9 Oct 2016, 18:48 by Gerry Kangalee   [ updated 9 Oct 2016, 18:56 ]
Image result for washington consensus cartoonIt is not often that the government, the private sector, and the University of the West Indies (UWI) speak in unison against the labor movement and the wider working class. Normally, these three entities take diametrically opposite positions on issues affecting the labor movement, the working class and the working poor.

However, these are not normal times. We are living in the era of neo-liberal globalization when “everything is for sale,” when the state has become the auctioneer for the assets that belong to the people; when the private sector seeks to purchase state assets at “giveaway prices,” and when the education system promotes the philosophy that it has to teach students for the job market rather than becoming critical thinkers.

Therefore, when the Prime Minister opined that the citizens should not depend on the government, he is promoting the IMF’s philosophy that government should not regulate the economy to benefit the masses but regulate it to benefit the 1%.

Moreover, when Nigel Baptiste calls for the complete removal of government subsidies and transfer payments that benefit the masses, he has become the voice for the philosophy of “Thatcherism” that calls for the total dismantling of the “Welfare state” and the promotion of the unfettered free market.

Furthermore, when Dr. Daren Conrad attacks the trade union movement and doubles down on the workers’ lack of productivity, he has become the standard bearer for the doctrine of the USA right to work states, payment of minimum wages, and removal of severance pay and all related benefits.

All in all, these gentlemen subscribe to the Washington Consensus, a set of economic policy prescriptions backed by the IMF, and the World Bank. These policy recommendations include:

· Fiscal policy discipline, with avoidance of large fiscal deficits relative to GDP;

· Redirection of public spending away from subsidies ("especially indiscriminate subsidies") directed toward broad-based provision of key pro-growth, pro-poor services like primary education, healthcare and infrastructure investment;

· Tax reform, broadening the tax base and adopting moderate marginal tax rates;

· Interest rates that are market determined and positive (but moderate) in real terms;

· Competitive exchange rates;

· Trade liberalization: liberalization of imports, with particular emphasis on elimination of quantitative restrictions (licensing, etc.) any trade protection to be provided by low and relatively uniform tariffs;

· Liberalization of inward foreign direct investment;

· Privatization of state enterprises;

· Deregulation: abolition of regulations that impede market entry or restrict competition, except for those justified on safety, environmental and consumer protection grounds, and prudential oversight of financial institutions;

· Legal security for property rights.

Therefore, my friends don’t holler, cuss, fuss, and get your blood pressure up for the positions these men have advanced and with whom the IMF must be well pleased. Instead, educate yourself on the issues and understand that the 1% and their allies in government, the private sector, and the educational system are working in tandem to pauperize the masses.