It goes without saying that the most important thing impacting the economy of The Bahamas is the economy of the United States.
However, there seems to be a growing consensus that governments can turn an economy around by simply spending money and putting the clamps on greedy business people. They usually point to policies implemented by Franklin Roosevelt as turning things around.
But not so fast. Andrew B. Wilson points to "Five Myths About the Great Depression" in this article that Bahamian politicians should consider in their desire to turn our economy around.
In other words, we can point to a few things The Bahamas Govenrment should not do.
It's clear that laissez faire was not the culprit in the Great Depression as it's not the culprit in 2008.
Question: Isn’t the economy of the Bahamas the government?? To fix the economy, you must fix the government..
I think the Government should do all it can about the economy which, isn’t much except get out of the economy’s way.
The government isn’t in the economy, other than to restrict trade in practice, and tax it for revenue by law.
The private sector is the economy, which feeds the civil service and government largess, and all charity.
Didn’t the P.M. just give the civil service a raise, in the face of an economic downturn? Didn’t the P.M. just raise the duty rate on average by 3% but in other catagories by as much as 45%, in the face of an economic downturn?
Of the little they can do, these actions were inprudent and Ill advised.
But then, Ministers of government are largely from the legal realm, not the business realm.
you make my point.. the government is the economy. The government’s right to tax is the power to control.. How many companies have been forced to close because government taxes, policies and useless regulations.. sad as it is, the government is the economy.
Hi all,
Nice comments. However, the government can always do things to help businessmen and women and the average person on Main Street. But, as with everything, it takes money and, ultimately, re-distributing that money from one source to another. In another light and even more of a sweeping generalized understanding, we can go further and suggest that with re-distributing money, is the re-distribution of resources or burdens, from one portion of the economy and society to another.
The thing is, assessing who is hurting and why, is very important before we begin throwing money out to folks, who may not need it. A silver bullet, top down, incentivized plan does not solve this issue- financiers and big business, hoard it in a time of crisis and wait until conditions become favorable again, to start expansion. And, putting people on the welfare line, just gives money to folks in the short term to pay basic food bills and really does not end up in advancement or a savings for those said people; especially if the social services, are unorganized and wrought with money pit-falls.
Taxes on business in the country are pretty low and for the most part, from reports all over, that a majority of people don’t even pay National Insurance tax. Real property tax, even reported by the former finance Minister, is poorly regulated. We need to find out where the money is, like a good finance manager should, and put resources in it to scoop out all that we can.
So, we have to get straight and on the narrow path, first, before we try to get fancy with stimulus packages and what not.
Best,
Youri
http://globalviewtoday.blogspot.com/