Mr. Elcott Coleby, in a letter to the editor of the Nassau Guardian on Monday, applauded the government for it's "projection" that they will reduce the GFS deficit by 100 basis points in the upcoming fiscal year, emphasising this is good news for the economy.
He makes this claim after suggesting a 40 basis point reduction in the GFS deficit projections for budget year 2012/2013 puts "a brake on the out of control spiralling debt" by the government.
Mr. Coleby also applauds the PLP governments $8 million revenue surplus in 2006/2007 fiscal year.
Lets scratch below the surface for a moment:
- 100 basis points = 1%
- 40 basis points = 0.4% i.e. less than 1/2 of one percent
- Central Bank data for fiscal year 2006/2007 the government recorded a deficit of $182 million
Work the "basis Point" calculation for yourself here…
In other words Mr. Coleby seems guilty of similar improprieties he's charging other people with.
If party supporters like Mr. Coleby continue to attempt to provide "cover" for bad public policy with verbiage designed to obfuscate, is there any wonder we've had 40 years of debt and deficits and now the chickens are coming home to roost.
Keynesian policies have our 'democracy in deficit" as James Buchanan and Richard Wagner warned back in 1977.
Our country is in deep financial do do, and doublespeak will not help Bahamians. In fact it makes matters worse.
Sometimes you just can’t believe what you read in the daily press particularly when fiction is represented as “facts”.. I checked with a good friend who has been a consulting economist for over forth years to ask him if the the financial term “basis point” or its plural usage can or has ever been used to measure changes in aggregate economic statistics.. Surprisingly he said yes, but was quick to add that in this particular case its use showed a lack of economic credibility and fundamental understanding of the proper use of this term.. As a measurement of the absolute rate of interest paid on debt financial instruments (bonds), it is primary used by fixed income traders as a measure investment return.. To describe changes in economic variability in terms of basis points is a folly in rational judgment.. No wonder economics has often been described as the “dismal science”, but perhaps that is a better description the so-called neophytes and spin doctors that turn economic fiction into foolhardy “facts”.. Again, it must be said for the less informed that in both Bahamian as well as American politics there are no such things as lies, only the truth keeps changing.. VERITAS