Jul 07, 2016 KN News

 By: Sase Singh.
INTRODUCTION
Every month hundreds of union members across the country had cash deducted from their paychecks to finance their respective unions. But some union leaders continue to not serve their membership at every level by failing to advance and promote the workers’ causes because they serve a different master – their political bosses.
These union bosses are the epitomes of what is called partisan union leaders. They are part of the problem in the system; not the solution. On the other hand, you have union leaders like Lincoln Lewis from the TUC and Kenneth Joseph from NAACIE who continue to fulfill their true mandate, in the true spirit of “Critchlowism”. They serve the workers exclusively.
sase singh

THE WORKERS AND GPSU
Where was the GPSU boss over the last 385 days as public servants saw their real wealth dwindle? This belated shout out for 40% is nothing but a carrot to dangle in front of the unsuspecting workers. But this 40% is just a wicked illusion that has no substance or fiscal foundation; it is another Alice in Wonderland song.
Any trained mind will tell you that the economy in its current state cannot afford more than 9%, so why falsely build up people hopes with this call for 40%? Why not a more realistic call? Have we gone “lobially” wild to recklessly shout out 40%?
This situation could very well rebound to bite Patrick Yarde where it hurts. If he does not get even half of this 40% what will he tell the workers? Will he call a strike? That is the question since of late he seems incapable of advocating for the workers in a genuine and committed manner.
I would not be surprised if the final numbers are already locked up. We will, however, have to wait a few more weeks to see how big a betrayal is about to unfold on the workers. Only then will we know if the public servants have been sold out down by the river before the negotiations have even started.
THE GPSU AND JAGAN
Henry Jeffrey did a good job at setting the record straight on the Cheddi Jagan term in office. According to Jeffrey, in 1992 only months after Cheddi Jagan was sworn in (as President of the Co-operative Republic), he took the executive decision to “raise the minimum wage by some 46%.”
All of this happened in less than six months, yet the GPSU took strike action for more money. But today with no money on the table after 385 days, the GPSU is in a deep sleep. This goes to show different masters and not the workers are driving the actions of the GPSU.
`I am personally aware of the situation where Dr. Jagan stuck to his guns on this 46% even when the IMF and his then Senior Minister of Finance advised otherwise. Dr. Jagan was right then. Those wage increases contributed to an explosion in private consumption and an economic boom unseen in the history of this country – growth of 7% and more.
Of course there were several reasons for the economic growth under Dr. Jagan. But the increase in private consumption from the workers (because most of them spent 100% of these wage increases immediately), helped.
THE 2016 BUDGET
If one interrogates the 2016 national budget, one has to stand guided by the comments of the Finance Minister when he said in March that “public servant should not expect big salary increases”. That should be the benchmark but not the final outcome. This decision is not only economics; it is very political.
I would encourage President Granger to give the workers a little bit more than is being advised. It will resound to the economic benefit of the entire nation and serve him well politically. Empirical evidence from the past proves that the majority of the workers will spend all of their wage increases.
Such an action will drive private consumption, which will directly drive GDP growth. This will be a win-win situation especially in an environment where the Minister warned the nation of a persistent low inflation rate in the 2016 Budget speech.
We all know that 2016 is shaping up to be a tough economic year irrespective of the propaganda from some executives. However bucking the trend will be great economics and even better politics. These times require political “testículos” and bold decisions in favour of the workers. Such a position will pay-off handsomely for the Granger administration.
Yes, there is a hole in the 2016 budget; that we know. The VAT has always been a significant cash cow for the respective governments since it was launched in 2007. It is a tax on consumption and today consumption is down. Over the first three months of 2016, the VAT collection declined by some $2 billion compared to the same period in 2015.
This VAT situation is exclusively as a result of the economic drivers not working in harmony. But that is a different issue, which has to do mainly with a shortage of progressive financial public policies, which is leading to a poor investment pipeline and low productivity. But that is for another column.