I have read many times that some people feel that there are no tangible reasons for Bermuda remaining a Colony.

A Government's cost of borrowing money cannot be higher than a company's cost of borrowing money in that same country. This is because the Government has the power of taxation over that corporation. Credit spreads or marginal borrowing costs are layered over what is perceived to be risk-free assets.

Sovereign debt or Government debt has the power to tax a corporation in order to avoid defaulting on its obligations.

Bermuda has a credit wrap very much like the credit wraps which insurance companies here do. Insurance companies in Bermuda will find companies with healthy balance sheets who are paying a high-risk premium in the debt markets.

They then take these companies and insure against default, off- balance sheet, refloat the debt at a lower rate and amortise the principal gain. Bermuda's credit wrap at this stage is one of international confidence which leads to a vibrant economy and lower debt problems than most nations. I find it ironic that a country which is known for insurance would want to give up free insurance from a diverse, deep pocketed block of 280 million people. It's not like we are suffering from taxation without representation or reciprocal rights. We need at least a full generation of top-notch public schools before we think of taking these kinds of risks.

Bermuda really needs good technocratic government at this juncture in world history. Mistakes made by special interest dogma will be very hard to overcome. Taxes for the little man in Bermuda have been manageable because of fiscal prudence and confidence in our Government. At a flat 12 percent with additional sensible consumption I think that one would be hard-pressed to find countries with progressive taxation structures who would have lower brackets than we do. I guess it's the middle class they want to thump.

BRIAN WAY Seniors lose out March 14, 2001 Dear Sir, Senator Calvin Smith could be right up to a point, but why take this out on the poor senior citizens of this country? No increase in pensions.

A CONCERNED SENIOR P.S. Do two wrongs make a right?