As major economies’ national budgets try to address existing high levels of debt, brought on by the essential financial sector bail-out and the current unsustainable growth in social programs investment, Governments must facilitate public sector reform. Effecting change toward higher efficiency levels, reducing waste and corruption, while increasing sustainable jobs, changes that politicians would instinctively avoid.Poor wealth distribution systems have always encouraged people to seek power, political power with control of the public purse, to invest in strategies and programs that would benefit their supporters and keep them in power. Of course, the supporters of the group not in power, wishes to be and many recent elections have brought about that change. Reality, however, brings a different change, change to campaign promises, change in responses from assigning blame to taking responsibility and change from “Yes We Can” to “We are looking into it”.
Running a financial deficit is acceptable and expected in a recessionary cycle, coming after years of growth and savings, to support and maintain a satisfactory standard of living. However, a deficit cannot be the way to fund growing social benefits, these are normally funded through savings, but most developed countries’ savings were used to bail-out the banks. Now, in the perfect storm, with export sales down, high import bills, demand for higher wages, business lobbying for lower taxes and growing unemployment, what can supporters expect from their elected politicians.
Where economists rely on trends to forecast growth or declines, politicians must rely on managers to get things done. The answer can only be in a more efficient action oriented public service, geared to deliver with all reasonable checks and balances rooting out the delays and obstructionists. A public service that is not constituted on job security but on job performance, with a great “Chinese Wall” protecting against political interference, can reduce spending and cut the current deficit.
Having a plan to drive growth will further complement cost cutting measures, for without one, unemployment will increase to the point of social unrest. Which industry or sector can, given the global economy, add sustainable jobs and growth quickly? Traditionally private owners have answered this question by investing actual monies, if the public service clears the way. Armed with all necessary approvals and permissions given in a reasonable time, the risk taking entrepreneurs will lead.
Construction and extractive (mining, drilling, agriculture, fishing, forestry) activities have always quickly reduced unemployment, if the workforce is sufficiently trained, but there must be some underlying, long-term, feasible, market-driven, economic realization for these undertakings to be considered sustainable development. Capitalizing on strengths, such as, geographic location as a key transportation (people or cargo) hub, traditional or event tourism, calls for the full range of development (horizontal and vertical integration) strategies, and these policies must also guide training and design investments.
Rationale
T.A.J & Associates Company Limited uses this occasion to comment on topics that have been covered, both academically and by the mainstream media, to add its opinion and point out investment opportunity, not to invoke any social action.
