Economist Marla Dukharan’s Advice to Barbados, ‘Pick Your Poison’

Marla Dukharan – Economist

It is the opinion of BU the resonance of economist Marla Dukharan’s with the local population is not because she brings any fresh analysis to the fore. The reason is because she is perceived as an independent voice to be trusted. Her lucid commentary on local and regional economies which started when she was Chief Economist for the RBC with responsibility for the Caribbean has exposed a growing belief that several of the home grown economists have allowed themselves to become compromised by the lure of lucre from the political and economic class.

On the 23 August 2017 the Institute of Chartered Accountants of Barbados (ICAB) hosted a session which featured Marla Dukaran as the main speaker, the topic was Home Grown or IMF: What should Barbados’ economic recovery plan look like? From all reports it was a constructive session that served to reinforce the view among the professional class present decisions being taken by the government will not steer the country away from the economic precipice we continue to rapidly approach.

To give wings to the view that the Democratic Labour Party (DLP) appears to be focussed on the political dimension to how we manage a tiny island is to review the agenda and resolutions passed at the just concluded DLP annual convention. Two items carried in a resolution was for the political party- that forms the government by the way- to issue a communication to Attorney General Adriel Brathwaite to investigate the qualification (or lack of) of Mia Mottley to practice law in Barbados AND the use of wire tapping equipment by former Commissioner of Police Darwin Toppin supported by you guessed it, Mia Mottley.  Sensible Barbadians are left to wonder why has it taken the DLP until the end of its second term to force these two issues to earlier resolution. BU’s position is not to defend Mottley or Dottin of wrong doing, it is to find the government guilty for politicising the matter IF there is credible evidence to support the charges. Didn’t Prime Minister Freundel Stuart promise to share the contents of the FBI file that has mysteriously disappeared? What about his reference to a list of CLICO investors he also promised to release? #JAs

To the credit of ICAB they brought in Marla Dukharan to focus on an anaemic performing economy while the entity charged with managing the economy took a decision at its annual conference to focus on issues not related to the economy. What the juxtaposition shows is that in civil society the citizenry, this includes Non Governmental Organizations (NGO), must continue to find ways to inform the public so that tension is brought to bear on policymakers to make the best decisions in the interest of the wider public.

What did Caribbean Economist Marla Dukharan remind us?

  • Barbados has been recording fiscal deficits averaging 5.4% in the period 2000 to 2017. It spiked to 10.4% in the fiscal 2013/14 and as dipped to 6% in 2017/18 on last report. In stark contrast for the same period growth has averaged 1.1% with a -0.1% decline in 2013/14 easing up to 1.6% growth in the current period. The point Dukharan emphasized is why with the billions in government sending it did not significantly move the growth indicator.
  • Barbados recorded the lowest fiscal multiplier compared to five other major Caribbean economies i.e..Jamaica, Trinidad, Guyana, Suriname and Bahamas.  The fiscal multiplier is defined as the growth generated based on government spend.
  • Debt sustainability threshold is noted at 55/60% of GDP. The analysis supports that a greater number has a negative impact on growth. It is a matter of record that Barbados debt to GDP is far north of 100%.
  • The monetary base has increased to almost 5 times, close to 5 billion from 2000 to 2017. The will obviously stress foreign reserves given the island’s high conspicuous consumption fueled by imports. The proof is in the fact foreign reserves of abut 300 million in 2017 are at 2000 level.

The solution can be linked to the expression offered by Mara Dukharan, Barbados will have to pick its poison. And it does not matter if DLP or BLP wins the next government.

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99 Comments on “Economist Marla Dukharan’s Advice to Barbados, ‘Pick Your Poison’”

  1. fortyacresandamule September 11, 2017 at 9:06 PM #

    Economists are so jealous of the guys in the hard science, that they even called their top prize in the field, the nobel prize in economics. Alfred Noble, bequeath no such prize to the dismal science. And most of the theories that have won the so-called nobel prize, neither are reproducable, nor can verified emperically on a consistent basis.

    Like

  2. Chad99999 September 12, 2017 at 4:23 AM #

    40 Acres

    Is poorly educated. He says things like, “Human beings are not rational, so economic models do not work”.

    Even when an economic model assumes rational behaviour, it is useful for predicting the tendencies or forces at work in the real world, because people are sometimes rational, even though they may not be always or consistently rational.

    PLT

    Stop being an ass. Arthur Laffer is not an important economist, but he has a BA from Yale and a PhD in Economics from Stanford. He taught in the business school at USC and at Pepperdine.

    Which is to say he knows a lot more economics than you, and he has called for attention to supply side forces in the economy, which is a useful offset to the demand- side focus of Krigman, Stiglitz and many other prominent economists who are public intellectuals. Show some respect for that.

    Like

  3. Bush Tea September 12, 2017 at 6:35 AM #

    Give us all a break Chad…

    It has long been established on BU that economics is a shiite ‘science’ created by those of limited intellect who could not manage the real sciences and had no talents in the Arts.

    What the hell is an ‘economist’? …21st century snake oil sales.
    It CERTAINLY does not meet the definition of being a science, and has been assembled around a late 20th century, post WW2, paradigm of growth and optimism – which has faded into history leaving the concept of ‘economics’ stranded on the rocks….

    Even ‘Economists’ (whatever the hell THOSE are..) now admit that the whole thing is a lotta shiite…

    Like

  4. Artaxexes September 12, 2017 at 8:15 AM #

    Bush Tea

    Astronomy. biology, chemistry, geology and physics, (probably what Bushie would consider as “the real sciences),” require a knowledge of mathematics.

    For example, it is essential for a physics student to be proficient in mathematics…………… algebra, geometry, trigonometry, etc. In addition to mathematics (which is a form of problem-solving), it is helpful for the prospective physics student to have a more general knowledge of how to tackle a problem and apply logical reasoning to arrive at a solution. (Sounds similar to economic concepts, Bushie?)

    Economics, especially at post graduate level, also requires the student to be proficient in mathematics………….. multivariable calculus, differential equations, linear algebra, real analysis, statistics, logarithms and indices, linear and simultaneous equations, geometric progressions: interest and growth, sigma notation and matrices, differentiation and integration, etc.

    How could you conclude an economist to be of “LIMITED INTELLECT who could not manage the real sciences,” when economics and physics both require knowledge of mathematics………..but would not describe a physicist similarly?

    I know that proving you to be incorrect creates a fundamental problem for you; rather than admit or yield, you would “shift the goal post,” while using witticisms to relieve the awkward feeling.

    Engineering, according to Wikipedia, is the application of MATHEMATICS, as well as scientific, ECONOMIC, social, and practical knowledge, to invent, innovate, design, build, maintain, research, and improve structures, machines, tools, systems, components, materials, processes, solutions, and organizations.

    However, the general consensus is that engineering is NOT a science either.

    Then your views about engineers should be similar to your views about economists.

    In the future, I’m expecting you to write “engineers” (what the hell THOSE are….)

    Like

  5. Bush Tea September 12, 2017 at 8:49 AM #

    @ Artax…
    Bushie has NO ISSUE with being proved wrong…. it is WELCOMED….honestly…
    BUT, given the SOURCE of Bushie’s knowledge, ….good luck with THAT!!!

    Do you know what qualifies a field of study to be called a science?
    …or do you want some assistance..?

    Mathematics is ALSO needed to be a Minister of FineAnts too … but looka ours…!!!
    Mathematics would be useful if a minister planned to collect $10 per person from Bajans to build a stadium too …especially if he can get this to add up to $20M…..

    OBVIOUSLY the need to understand mathematics – in and of itself – does not make a field of study, or practice, into a ‘science’.

    Like

  6. Hal Austin September 12, 2017 at 8:51 AM #

    Bush Tea caught out again. You can run, but you cannot hide. Wit can only hide so much.

    Like

  7. millertheanunnaki September 12, 2017 at 8:54 AM #

    @ Bush Tea September 12, 2017 at 6:35 AM
    “Give us all a break Chad…
    It has long been established on BU that economics is a shiite ‘science’ created by those of limited intellect who could not manage the real sciences and had no talents in the Arts.
    What the hell is an ‘economist’? …21st century snake oil sales.
    It CERTAINLY does not meet the definition of being a science, and has been assembled around a late 20th century, post WW2, paradigm of growth and optimism – which has faded into history leaving the concept of ‘economics’ stranded on the rocks….
    Even ‘Economists’ (whatever the hell THOSE are..) now admit that the whole thing is a lotta shiite…”

    So is religion! The most unscientific “lotta shiite” humans ever expurgated from their brass-bowl minds.

    Have you ever stopped to consider that those 21st Century snake oil salesmen aka economist have simply replaced the priests and religious magicians of the past selling the same old bullshit of creating Heaven on Earth by selling an impossible dream of an easy life?

    Maybe Artax has a ‘fundamental’ point regarding your Big Boss Engineer (Brass Bowl Engineer aka BBE).

    BBE might just be another quack posing as a figment of Bushie’s imagination fertilized with an extravagant dose of human shiite from Bushie’s burning backside.

    Like

  8. Artaxexes September 12, 2017 at 9:04 AM #

    Bush Tea

    I NEVER IMPLIED that “the need to understand mathematics – in and of itself – does not make a field of study, or practice, into a ‘science’……..”

    My point is………… if physics and economics require PROFICIENCY in mathematics, then to say an economist is an individual “of LIMITED INTELLECT who could not manage the real sciences” is non sequitur.

    Like

  9. Bush Tea September 12, 2017 at 9:05 AM #

    @ Miller
    …and your point being…?
    You are correct about religion….
    Perhaps it is GP and Zoe that you may wish to address…. not stinking Bushie… who has been at war with such ‘snake oil pushers’ now for YEARS…

    @ Artax
    Perhaps the best qualification for a field of study to be considered a science was given by Carton and Hofer (2006) where they assert that “if the measures used in a discipline have not been demonstrated to have a high degree of validity, that discipline is not a science”
    As you know, no two ‘economists ever seem to concur – and even individuals are unable to give consistent results over different time frames.

    Like

  10. Bush Tea September 12, 2017 at 9:10 AM #

    @ Artax
    My point is………… if physics and economics require PROFICIENCY in mathematics, then to say an economist is an individual “of LIMITED INTELLECT who could not manage the real sciences” is non sequitur.
    ++++++++++++++++++++++++++++++
    A valid point.

    However, IBHO (in Bushie’s humble opinion) any highly intelligent fellow who CHOOSES to pursue such a field of study, when he has the CAPACITY to make a useful contribution to society via a “REAL REAL” field of study…. suffers from an even WORSE ‘limitation of intellect’ than a fellow whose academic capacities constrain him from doing any better…

    ….so it is the same “limited intellect’ …only worse… 🙂

    LOL
    ha ha ha
    Murdah!!

    Like

  11. David September 12, 2017 at 9:13 AM #

    We are splitting hairs!

    Less formally, the word science often describes any systematic field of study or the knowledge gained from it

    Like

  12. Artaxexes September 12, 2017 at 9:42 AM #

    Bushie

    is a clever individual and a “verbal contortionist.” He must have an IQ of around 140.

    He previously stated: “It has long been established on BU that economics is a shiite ‘science’ created by those of limited intellect who could not manage the real sciences and had no talents in the Arts.”

    …………….. which, if interpreted within the context it was written, means people “who could not manage the real sciences and had no talents in the Arts” are of limited intellect and would endeavour to pursue “easy courses,” one of which is economics.

    However, when challenged about the logic of his statement, being the “verbal contortionist” he is, Bushie conveniently “shifts the goal post” to jest:

    “………..any highly intelligent fellow who CHOOSES to pursue such a field of study, when he has the CAPACITY to make a useful contribution to society via a “REAL REAL” field of study…. suffers from an even WORSE ‘limitation of intellect’ than a fellow whose academic capacities constrain him from doing any better…”

    Bushie, I admire your determination to stay afloat when the air is slowly escaping from the rubber dinghy…….. but you cannot qualify your former comment with the latter, since both comments are “mutually exclusive.”

    Like

  13. Sargeant September 12, 2017 at 10:03 AM #

    Wunnah don’t realize that getting BT to admit he is wrong on any topic is like pinning jello to a wall, it ain’t gonna work he would have made a superb politician ( perhaps he is).

    Art ax should move on, don’t waste your time.

    Like

  14. Hal Austin September 12, 2017 at 10:08 AM #

    Lack of understanding of behavioural economics??? My, my. Plse explain.

    Like

  15. Artaxexes September 12, 2017 at 10:24 AM #

    What is ‘Behavioral Economics?’

    According to Investopedia: “Behavioral Economics is the study of psychology as it relates to the economic decision-making processes of individuals and institutions. The two most important questions in this field are:

    Are economists’ assumptions of utility or profit maximization good approximations of real people’s behavior?
    Do individuals maximize subjective expected utility?

    Wikipedia:

    “Behavioral economics, along with the related sub-field behavioral finance, studies the effects of psychological, social, cognitive, and emotional factors on the economic decisions of individuals and institutions and the consequences for market prices, returns, and resource allocation, although not always that narrowly, but also more generally, of the impact of different kinds of behavior, in different environments of varying experimental values.”

    Or we could read the “Behavioral Economics Guide 2017,” edited by Alain Sampson, PhD

    https://www.behavioraleconomics.com/the-behavioral-economics-guide-2017/be-guide-2017-download/

    Like

  16. Tron September 12, 2017 at 10:51 AM #

    The maximum level of taxation was reached long ago.

    Barbados taxes like Scandinavia but offers 3rd rate social services and bullets flying around, food prices higher than Switzerland, productivity like Mozambique. In other words, an economic concentration camp.

    The categorical error of the local elite is their obsession to copy every sh… from Britain with their many ministries, civil servants, embassies and bureaucracy. Whatever the Brits crap, Barbadian decision makers take it for gold. Some kind of Stockholm syndrom, indeed.

    We need a smart and slim solution, streamlined and fitting to a MICROstate like Barbados:
    – electronic administration, not a royal bureaucracy, with decisions within a week for business and building permits
    – fast judiciary, not colonial badges and sleeping judges
    – small subsidiary civil service, not a civil service as a mass employer of last resort
    – low consumer taxes, not the highest taxes in the region
    – flexibel currency, not a religion called pegging, far away from national productivity
    – solar power for the whole island and solar powered vehicles, not silver Mercedes for the new plantation class
    – a better tourism product, not the same golf courses and drinks like the last 50 years.

    Like

  17. NorthernObserver September 12, 2017 at 11:22 AM #

    @Artax
    Skippa, you are on a roll these days.

    Like

  18. Bush Tea September 12, 2017 at 11:22 AM #

    @ Artax
    Sargeant’s non-commissioned jealousies notwithstanding, Bushie is READY and WILLING to admit to ANY error that you are able to produce… and the Bushman hereby apologises in ADVANCE …since, being human, he MUST errr from time to time…
    HOWEVER, you will need to COME GOOD … because Bushie THINKS before he writes….

    Let us do this slowly (so that Hal can keep up…)

    1 – Bushie said.. ” It has long been established on BU that economics is a shiite ‘science’ created by those of limited intellect”
    Points to note:
    A- It was established on BU
    B- It was CREATED by persons of limited intellect.

    2 – YOU Interpreted this to mean that “”people “who could not manage the real sciences and had no talents in the Arts” are of limited intellect and would endeavour to pursue “easy courses,” one of which is economics.””

    Do you understand the DIFFERENCE between”CREATED BY” …and PURSUE /STUDY/ CHOOSE?”
    IF SO….
    Perhaps now you can follow the deduction that ‘any highly intelligent fellow who CHOOSES to pursue such a field of study, [that had been CREATED by a dimwit] when he has the CAPACITY to make a useful contribution to society via a “REAL REAL” field of study…. suffers from an even WORSE ‘limitation of intellect’ than a fellow whose academic capacities constrain him from doing any better…”

    @ Artax
    Don’t follow an NCO like Sarge into the trenches. You are much better suited for the officer’s mess… the drinks are much better.

    Apologies also the the big boss David(BU) for splitting some more hairs…. It is always fun doing so with Artax….
    LOL
    ha ha ha

    Like

  19. peterlawrencethompson September 12, 2017 at 12:41 PM #

    @Chad99999, said “Arthur Laffer is not an important economist,” we agree so far; and “he knows a lot more economics than you,” we are still in agreement: I was not disputing his qualifications.

    I was simply pointing out that the Laffer Curve, the work that he is notorious for (and probably embarrassed by), is useless. It is a political tool, not an economic one. It is either so obvious as to be trite: everyone knows that at a 0% tax rate revenue will be zero, that revenue will increase with an increase in rate, but that at a 100% tax rate the economy will not work and a lot of people will be disinclined to pay. So somewhere between 0% and 100% the tax revenue will be maximized. All this is trivial. Unless we formulate a theory which can predict the shape of the curve, which Laffer fails to do, we have nothing but a pointless “just so” story, not an analytical tool.

    The only time that I am aware that Laffer himself had significant policy input into using the Laffer Curve, it was an atrocious failure. Reagan slashed tax rates, revenue failed to increase as promised, and he ended up tripling the national debt.

    By the way Laffer acknowledges that he did not invent the curve, the idea goes back at least as far 14th-century Tunisian scholar Ibn Khaldun.

    Like

  20. Chad99999 September 12, 2017 at 1:03 PM #

    “the Laffer Curve … is useless. It is a political tool, not an economic one”.

    PLT

    Political tools are not useless. Laffer has mobilized the political arguments for tax cuts and for avoiding tax increases.

    The Laffer Curve is actually both a political tool and an economic tool. In economics, it has spawned new research into the punitive effects of taxation.

    Like

  21. Hants September 14, 2017 at 10:36 AM #

    ” Bitcoin at crossroads after shedding more than $20 billion in value ”

    http://www.marketwatch.com/story/bitcoin-at-crossroads-after-shedding-nearly-20-billion-in-value-2017-09-13

    Like

  22. fortyacresandamule September 14, 2017 at 6:59 PM #

    @Bushie. You are not far off point. Political economy has transition to modern day economics by the less-than- gifted pure mathematicians and theoretical physicists. You see, when these individuals were flunking in their first choice discipline, they then migrate to the field of economics, because it was amenable to mathematical abstraction.

    Rigor and abstraction replaces common sense and concreteness . That is why economics has become so MATHEMATIZED today. The founding fathers believed, that, in order to establish respectability credibility, and prestige, the discipline should be underpined by mathematical abstraction.This is where the physic envy comes in. Even with all its ‘MATHINESS’, the pretentious discipline has no more respectability than astrology in my opinion.

    Like

  23. Bush Tea September 14, 2017 at 7:25 PM #

    LOL @ Fortyacres
    Bushie was not guessing … or grabbing at straws…
    When you are working a whacker, yuh can smell shiite from far away…

    Like

  24. Pachamama September 15, 2017 at 5:28 PM #

    Economics is largely about ideology NOT science

    There are many examples:

    The unscientific assumption that markets are free and fair and not be protected by parties.

    That actors are not biased by advertising and other propaganda

    That CBs are somehow independent actors not influenced by politics, political interference, international diktat.

    That free trade is somehow unconnected from enforcement actions

    That reductions in taxation translate into increase capital investment and more jobs etc

    That corporations operate in environments of true competition with no desire to seek monopoly or oligopoly.

    That corporations are not dependent on government for expansion, military and other support to capture domestic and foreign markets

    That slave wages are helpful to all involved even when middle classes are being decimated

    That ownership and control are to be separated.

    And we could go on all day!

    Like

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