IT IS NOW some weeks since the Prime Minister descended from cloud nine, throwing punches in every direction and vowing, not only to disclose the names of those responsible for the forcible removal of Montego Bay street people, but to bring down brimstone and fire upon their head.

I make it a habit never to believe more than 10 per cent of what the Prime Minister says, though there is one exception. If he tells me he gets his suits from Saville Row, I would believe him entirely.

I suppose therefore, that the profound silence which has resulted since the Montego Bay incident is a form of prestidigitation on the lines of now-you-see-it-now-you-don't. I can only assume that the truth of the matter, having been ascertained is something, deemed unsuitable for us to know.

Butch's Advice

My old friend Butch Stewart, while giving his support to Finance Minister Dr. Omar Davies, added "he's got to change gears pronto."

Butch added "he's got to change from demand side to supply side economics almost as instantly as we talk and go for growth."

I join with Butch in his admiration for Omar Davies and in his disagreement with his financial policies. While Butch's advice is sound enough, I wonder whether he realises that the Finance Minister, and Governfments before him, have painted themselves into a corner.

Unfortunately, you can't go for growth if you haven't got the capital to do so. Jamaica's capital for development has been whittled away by years of living beyond our means. In consequence, we are so burdened by debt and by high taxation, even upon savings, which entails that we no longer have the capital to finance the large creative enterprises needed for growth.

For years, this column has been criticising the policy of eternal credit and borrowing. Yet, up to this very moment, the borrowing, now at high interest rates, never stops.

The truth of the matter is that our stupid politicians, in order to gain favour with the electorate, have continued not only to allow, but to encourage Jamaica to live beyond its means. There is the serious matter of high interest rates. But while the Government is being obsessed with maintaining the value of the Jamaican dollar and rigidly restricting money supplies, it has had of necessity, to keep interest rates high, which in turn makes development difficult, if not impossible.

The fact is that the unfortunate Minister of Finance, due in part to his own fault, simply does not have the means at the moment of taking Butch's advice, sound as it is.

There are however, a few ways of getting out of the chains with which we have encumbered ourselves. First of all we must postpone, if not repudiate, the repayment and servicing of our foreign debt. Secondly, we must refrain from further borrowings. Thirdly, we must allow the Jamaican dollar to find its own natural level.

While we must avoid gross inflation, we must not worry about a small degree of it. A little inflation now and then is relished by the wisest man.

I do not know whether Butch would agree to those three suggestions, nor do I know whether our academics would agree either. But if they don't, I'd be much obliged to know if any of them have any better suggestions. Certainly I have heard none from any of the academics who confine themselves very learnedly to going around in circles.

In the meantime, the fabric of our country is collapsing.

Debt Again

Another but smaller matter concerning debt is beginning to emerge. The good Mr. Coe of Courts, while announcing excellent profits for his company, has noted that his bad debts have been increasing. This is a small cloud gathering upon his horizon.

It is not my place to try to tell the successful Mr. Coe how to run his business.

However, I hope I shall be pardoned for making some general observations concerning the increasing trend by many merchants towards allowing easy credit.

It is not a matter of allowing easy credit, but actively encouraging people by every known means of publicity and advertising to acquire goods on everlasting credit. These erchants should remember what happened to the financial sector when it began to lend money left, right and centre without regard for prudence.

The merchants may be doing well now by inducing people to take advantage of easily available credit, but it should be obvious to them, that in an economy which is contracting, it will not be too long before debtors will begin to default in large numbers. Courts and the rest may be splashing credit around now by hire-purchase agreements, but if they are not careful, they might suddenly find that their warehouses are over-filled with recovered but un-saleable goods.

In any case, it's not my business to give the merchants a lecture about how to conduct their affairs. But I must observe that in a country whose people are sadly lacking in thrift, the reckless encouragement of credit is not only a danger to the individuals, but reflects itself in the financial policies of the country as a whole.