What became apparent to all economists was that the “free competition” led to a paradoxical situation: each time there were less economic units that survived both the cyclical crises and the competition itself. That is, competition tended to negate itself. By the late nineteenth century it was clear that companies existed that were true monsters which controlled an entire branch of production or all phases or levels of an industry: the trusts and monopolies or oligopolies. The property tended to be concentrated in fewer and fewer hands, the prices are no longer settled in the struggle between buyers and sellers, but are the result of unilateral decisions or agreements between the monopolies. These trends coincided with one another: capitalism becoming global. Another, of great significance for all forms of capital, which was becoming a dominant issue, was financial capital. In the early twentieth century there was already a fact that economists – not just Lenin, who was fundamentally a political revolutionary – called “imperialism.”
Imperialism is a new era. It is not an exclusively economic, but political, cultural and military reality. It is still valid today the general characterization made by Lenin, based on Hilferding, that imperialism is the epoch in which capitalism dominates the sphere of the planet, in that financial capital is dominant, and the major powers are political and military instruments of those great interests in the struggle for the control of markets for commodities, capital and labor, territories and access to wealth. The same logic operation of the system led to wars of plunder and domination of the world’s peoples.
– from a paper by Jesús Puerta delivered at the III INTERNATIONAL SEMINAR ON AFRICA, THE CARIBBEAN AND LATIN AMERICA in St. Vincent and the Grenadines, November 25 and 26, 2011. Jesús Puerta is a Venezuelan who is Director of Social Sciences, coordinator of the Doctorate of Social Sciences at the University of Carabobo. He is also a journalist and writer on the reality of Venezuela.
There are spokesmen for the Opposition PUP who still claim that the Belizean economy was going great guns in August of 2004, that the G-7 were/are villains, and that what we in Belize need is a return to the pre-G-7 era of neoliberal financial policy.
To maintain this kind of ignorant position, one would have to completely isolate the political side of the 2004 Said Musa administration from its financial side. But how can you do this? The essence of political power is the ability to tax the people, which is to say, have them hand over certain portions of their money to you, the elected politicians, in order for you to provide certain services for them on an ongoing basis. Political power, then, is about the administration of the people’s money. The politics and the financials are as one: they cannot really be separated.
In a strictly theoretical exercise, nevertheless, we can try to separate them, and we will. In July of 2004, the vaunted UDP was like a lost cause. They had lost two consecutive general elections by huge margins, and the present Prime Minister, Hon. Dean Barrow, seemed addicted to his financial relationship with Lord Michael Ashcroft. In 2002, Lord Ashcroft was making obscene profits at BTL, and the Musa government believed he could reduce some telecommunications rates, and that he should. This was when a serious rift developed between Prime Minister Musa and Lord Ashcroft. If you go over the political campaigning leading up to the March 2003 general elections, specifically the UDP newspaper, you will note, I think, how much mollycoddling of the Lord was being done by the UDP. That is why, I submit, they lost so badly in March of 2003.
In July of 2004, a serious scandal began breaking out at the Social Security Board (SSB). There were PUP Cabinet Ministers who knew that the financial policies of the Musa administration, policies which were being implemented by Minister of Finance, Ralph Fonseca, were unsustainable. Inside the PUP at the time, Ralph Fonseca’s power was almost unlimited.
Likely the first Cabinet Minister to be spooked by the SSB scandal was the Caribbean Shores’ area representative, Joe Coye. Caribbean Shores is the constituency where the bulk of Belize City’s private sector business people live, and they had elected Coye, to a certain extent, to have him keep an eye on Ralph. If anything went wrong, fiscally speaking, Caribbean Shores’ constituents would take Joe Coye to task.
The next two Ministers to become mobilized were the brothers-in-law, Mark Espat and Cordel Hyde, and then Johnny Briceño, the Deputy Prime Minister who was vacationing in Chicago, came on board, long distance. His protégé, Servulo Baeza, was a given, and then came the mighty Eamon Courtenay, to be followed quickly by the ambitious Godfrey Smith.
All this took place in a matter of three or four days, and then the brave challenge was made, in the supportive absence of Briceño, by the remaining six Ministers on Thursday morning, August 12, 2004, in Prime Minister Musa’s Belmopan office. The Prime Minister took it, and proceeded to “spin” it in the next four days, as a challenge to his constitutional authority, when what it was, was an attempt to break with Ralph’s reckless fiscal policies.
Now, this is what I can’t figure out. Public finances are a matter of numbers – the business of economists, accountants, auditors, bankers, and so on. Is there no group of experts within the socio-political structure of Belize who can tell us if the fiscal policy changes occasioned by the G-7 challenge were a good thing or a bad thing where the health of Belize’s public finances were/are concerned? I suppose one of the reasons this has not happened is that no PUP financial expert can subscribe to such a study/analysis because of the political implications. And, on the UDP side, red-leaning financial experts would be branded as biased, besides which, the people have already spoken and the speech of the people is as the speech of the gods. I suppose.
For me, as a Belizean citizen and employer, the bottom line is that Belize ended up owing a lot of money in the form of the superbond, and we could not account for all the money in the form of functional investments, solid assets, and fiscal health. The days of wine and roses began to end in 2004: would it not have been a worse crash if we had waited until 2008 to make the visibly necessary corrections?
There was one night on the old Kremandala Show in 2003 or 2004 when the issue came up of Belize’s excessive borrowing and the danger of default. I can remember Bill Lindo, to my immediate left, blurting out, “Mek wi default then!” I thought this was in incredibly irresponsible statement, but then, Mr. Lindo is known for this kind of shock tactic where his discourses are concerned. What the hell did he mean, and what is his position today?
When the G-7 crisis became quite ugly on Monday morning, August 16, 2004, with the Northern Caucus deposing Briceño as its leader and issuing releases threatening violence against the G-7, Mr. Lindo supported the Northern Caucus against the G-7. Politics is politics, I suppose.
Thus, we can go back to May 15, 1994, when there was the very first organized move inside the PUP to curb the burgeoning powers of Mr. Ralph Fonseca. There were high ranking PUP people who felt that the calling of the June 30, 1993 elections fifteen months before they were due, primarily served the interests of the said Ralph. And the so-called May 15 Movement sought to clarify his party standing and control his power.
As soon as the PUP was returned to office in August of 1998, however, it quickly emerged that nothing had changed from the previous PUP administration of 1989 to 1993 where Mr. Ralph was concerned: he was in complete charge of the money. And there are some PUP around today who say they liked it that way. For them, it is what it is and it will be as it used to be.