Economic confidence
Premier Paula Cox urged Bermudians not to be “self-haters and self-doubters” at a town-hall meeting on the economy this week.This can be viewed in different ways. As a question of confidence, it is a chicken and egg conundrum. Without economic growth, you will have self-doubt. But if doubt is pervasive, growth will be difficult, because there is no confidence. This is where leadership comes in. The leader who can plan for growth and opportunity and convey their optimism can change the public mindset. Both Ronald Reagan and Bill Clinton, despite their different political views, had that ability.Similarly, the leader who can develop a plan for the future and convey it will reduce doubt and criticism, although it will never be eliminated. But for a politician, criticising the public for suffering from self-doubt is dangerous, and Ms Cox needs to take care that her remarks are not seen as blaming the victim.Bermuda has always been self-critical, and it has not necessarily been a bad thing. It can ensure high standards. But too much self-criticism can be dangerous if it breeds a sense of inferiority. That seems, at least in part, to be what Ms Cox was driving at. If Bermudians do not have the confidence to compete, then they won’t.But a reluctance to criticise can be just as dangerous; it can breed complacency and low standards. Indeed, it can be argued that that is what has happened in Bermuda in the last ten years. Ms Cox laid out five “seeds for success” in her speech. She said they were stability and financial growth, enhancing competition, using talents and opportunities, removing the barriers to growth and reforming public finances.It is fair to say that Bermuda is struggling with stability now, because of the economy and the rise in crime. But it is fair to say that it is politically calmer than it was when confrontation tended to be the order of the day.Enhancing competition in a shrinking economy is difficult because the tendency is to consolidate. But using the Bermuda Small Business Development Corporation and working with banks to ensure that credit is available and ensuring that hiring is relatively painless would all help. Taxes also reduce competition. The major failing Government has had is in removing barriers to growth. As entitlements and payroll costs grow, growth is slowed down, especially in a service economy like Bermuda. Indeed, the Government’s natural tendency is to regulate and to intervene in the private sector, rather than establishing a framework and a mindset where the private sector can flourish.Shadow Finance Minister ET (Bob) Richards’ proposals on ways to cut red tape and roll out the red carpet to international business make sense in this context. Finally, Ms Cox has made some progress in reforming public finances, but the fact is that she did not do much on this while she was Finance Minister, and allowed debt to grow rapidly. That debt is now hampering growth.Where the Government does deserve some credit is in “using talents and opportunities” through some of the job schemes it is starting now. But the major problem remains in education, where improvement is still needed. It may be that Ms Cox was hoping that her appeals for people to get behind the Government’s efforts to turn around the economy would reduce criticism of the Government.That echoes Government Sen Jonathan Smith’s calls last week and his comparison to it being like airline passengers criticising the pilot of the plane. The natural retort to that is that passengers will shout at the pilot if the plane is spiralling out of control. In Bermuda’s case, a suspension of criticism does not work in democracy. But the criticism needs to be well-founded, and not done for criticism’s sake. It is encouraging to see the Premier coming out to tell the public what her Government is doing and more meetings will be welcome.Ms Cox needs to develop a plan for recovery and it’s not there yet and then convey it to the public. That is the only way to build confidence and reduce doubt.