REPORT #418 August 2001

Produced by the Belize Development Trust

I don't see the IMF as colonialist. I see them as the local MAFIA loan shark bone breakers and enforcers to collect vigorish, or interest on loans you took out.

Anybody who gets themselves into this kind of situation deserves what they get.

As to the comment saying that the PUP were trying to jump start the economy and get it back on track. There is obviously some truth and intention in that opinion. I will go along with that. But that doesn't make the opinion of the PUP the right one. I would do it differently. Totally differently, which would also include more de-centralization, more local governments and more political power disbursements. We have lots of articles on the Belize Development Issues reports discussing such ideas.

The essence is that the PUP and the UDP and ME have different views and alternatives on how to accomplish the same goal. Which is economic wealth for all the population, including the uneducated and self sustaining poor farmer. That said then, since there are different alternatives, the debate should center on whether the course that the PUP have chosen is the right alternative? Since there are other alternative options of action.

Since the PUP have followed this option of their's every time in office, one would think after 40 years they would learn it does not work and try something else? Do we have to keep repeating a cycle of failure for another 500 years? How many years does it take to teach the PUP party leadership in that port town? If it doesn't work as a policy, shouldn't you junk it? Apparently not, when you are dealing with taxpayer voters money, cause it is not your own. But if it was their own money, I'm sure they would learn eventually.

Prime Minister Musa has said that there is RISK with this financial policy. From my seat in the balcony bleachers, I would say it isn't RISK, it is the fact that the PUP have abandoned FISCAL RESPONSIBILITY. They are gamblers, with YOUR money. That the IMF have to come in to collect on the loans, is proof that the PUP are addicted to fiscal irresponsibility.

I say this based on many observations, but one that remains in my mind is an incident some 20 years or more ago, concerning a number of banks in the Dade County area. I had an account with Coconut Grove Bank at the time. Banks were collapsing ( all around the USA ), but particularly in South Florida. Going bust at an alarming rate. The reason was they took too much RISK. They were looking to get rich quick. When the dust settled, the Coconut Grove Bank turned out to be the No 1 most solid bank in the USA, of all the states. So I took the trouble to investigate why that was? You know why? They followed conservative banking methods. They quantified and did not take any excessive RISK. In other words, they kept their heads while all other banks around them chased the mirage of economic success in a short period of time and lost their heads and their customers deposits. Speculating on junk bonds and that sort of thing.

It didn't hurt that the Coconut Grove Bank did not have a Director under 70 years of age. ( experience ) There is a tried and proven method of making money in banking. You give service to customers, you depreciate your loans to a reasonable RISK ( less than 50 % ), you settle for giving interest on savings below what the treasury bills pay and buy treasury bills at auction and just keep the difference in percentage rolling in as profits. Little RISK! No gambling! Guaranteed to succeed in banking.

In governing, it is the same. GROWTH and economic success comes from a variety of factors. But it is conservatism that builds wealth over TIME. Takes longer in the beginning, but accelerates as you go along 15 to 20 years. Cause you have CASH. Don't have to borrow foreign loans and you get to keep the normal losses spent on INTEREST for capital investment and growth.

On the contrary, the PUP are gamblers! Looking for a quick short term gain. You can succeed temporarily this way, but not over a long term.

Nope! Anybody who blames the IMF are nuts! I blame the PUP policies! If all the INTEREST we have paid and lost had been put into capital investment, Belize after 40 years would already be a little Switzerland of the Americas. How many hundreds of millions of dollars has the PUP wasted and thrown away on interest payments, that could have built the country instead?

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