Friday, 7 November 2008

Yes we Can - No we Cannot

7th November 2008

The Malta Independent - Friday Wisdom

President elect Barack Obama’s battle cry for his successful election as the 44th President of the United States was ‘Yes we can’.

It has been indeed an incredible achievement for an Afro-American to win presidency with a landslide. His ascendency from obscurity to the highest post in the short space of four years is stuff dreams are made of.

It was in the Democratic National Convention in July 2004 where John Kerry was mandated to challenge (unsuccessfully as it eventually turned out) George W Bush for the presidential elections of November 2004 that Obama was introduced to America and to the world.

Beating the challenge of favourite Hilary Clinton for the party nomination was a feat that was unimaginable just 12 months ago. Raising an incredible amount of internet based ‘democratic’ contributions to fund his sparkling election campaign and energising youths to participate and vote in elections they would generally disregard, have been basic ingredients which led to ultimate success.

Luck lent a hand too. The financial turmoil which escalated in the last 2 months of the campaign would have given a great advantage to anyone contesting a representative from the incumbent party occupying the White House. Obama capitalised on this luck by appearing as steadier than John McCain who seemed to sway his position on a daily basis. McCain started by saying that the fundamentals of the US economy are strong, when clearly they are not, and finished by criticising colleague President Bush for not doing enough to help homeowners losing their property through foreclosure. He cooked up confusing instant recipes for such help on the trot.

‘Yes we can’ impressed the US electorate and indeed the international public opinion, who would have elected Obama with a higher margin if they had a vote, that he is a transformational leader, one in a generation, who can bring a new approach to resolve old problems and to restore America’s economic ship and geo-political weight by seeking engagement and co-operation rather by venturing on lone ill-thought adventures which characterised W’s presidency.

Early this year (The Malta Independent on Sunday 13 January 2008 – The Mark of a New Generation) I had opined:

“He is the only candidate who shows a preference for persuasion before guns and offers dialogue to America’s enemies almost in biblical spirit where the Son of God was willing to speak to sinners because it is the sick that need the doctor.

Free from support ties of the establishment and gaining substantial funding with minimum reliance on corporate handouts, Obama seems to carry more credibility in his claim to give America a social soul starting with universal health care. Obama is shaping up for America into something like what Tony Blair was for Britain but without the Iraq baggage which tarnished Blair’s legacy.

It is far too early to hold out any reasonable hope that Obama can build enough momentum to seize the Democratic Party nomination from the hands of Hillary Clinton, who seemed to have it already wrapped up before the start of the primaries. But if Obama can pull a feat of gigantic proportions and become the next President of the United States, we can certainly speak of 2008 as a year when the new generation takes over the running of this world from the baby boomers who did not live up to their promise to free the world from war and to make society more just and honest.”

Against all odds Obama has showed the world that truly “Yes we can”.

What a contrast this was to the message coming out from the Budget for 2009 presented in parliament last Monday. If there is a tag line worth attaching to this Budget it is “No we cannot”.

Can we raise politics to a new level and start preparing budgets based on what the economy truly needs rather than on political calculations in the interest of the party in government? No we cannot. To generate a false sense of feel good factor for the upcoming elections government pumped up the economy last year when prudence would have suggested moderation. It deliberately underpriced utility bills hiding that the appointment with reality was merely being postponed till after the elections.

Now that an international recession of worrying proportions is well on the horizon and prudent economic management would suggest fiscal and monetary loosening, government is constrained to rein in last year’s excesses.

Can we start passing back to the consumers, reductions in the international price of energy which is leading to dramatic falls in prices of fuel at the pump in other countries? No we cannot. On the contrary, we increase the price of petrol and diesel purportedly to fund green eco initiatives announced in the budget. I could understand not reducing prices to channel savings from lower energy prices to such purposes but outrightly increasing prices when international energy prices are half what they were last July is just incomprehensible.

Can we properly explain why we cannot reduce utility rates which were increased 30% last July when energy prices were double what they are today? No we cannot. On the contrary, we raise utility rates again ahead of the budget supposedly to abort a subsidy of e55 million which is imaginary and which is nothing but an excuse to hide cost overruns related to other recurrent expenditure largesse to get re-elected.

Can we explain the logic of why we paid e56 million to induce able bodied at the Shipyards to accept early retirement and are now constrained to increase taxes when in fact we should be loosening them to protect the economy from the coming external shocks? No we cannot.

Can we explain why the Public Transport Reform is being again postponed to 2010 and this after having suffered a crippling strike to liberalise hearse transport which in reality needs regulation not liberalisation and are instead keeping for yet another year regulation over other forms of public transport which desperately need to be liberalised? No we cannot.

Can we explain why rather than dismantling bureaucracy we are compounding it? No we cannot. New cars registered in 2008 can switch to the new system of lower registration tax but only recoup their overpayment by offsetting future annual road licenses. If we overpaid cash, we should be refunded cash rather than create complicated and expensive time consuming bureaucracy.

Can we explain why the Budget does not even mention how the much heralded Pension Reform is to continue being rolled out through fiscal incentives for the creation of private pension schemes? No we cannot.

The Americans sing Yes we Can to the most improbable and difficult things. We lament No We Cannot even to the most obvious and sensible.


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