Tell us what it's going to take for you to return to Guyana.

Wednesday, August 27, 2008

What I've been up to

I'd like to apologize for having been on hiatus for awhile. The job I expected to get after graduation didn't come through. I came back from Guyana with a wonderful 10 acre lot in my mind up on the highway and I have been arranging to get into graduate school and move my family to another state. I apologize for not bringing any excellent material or rhetoric your way since then. I will try to be forthcoming in the near future and also positive. I realize that it's easy to get pessimistic when you look at the reality of the situation in Guyana. I'm going to resume my efforts to bring new things to the mix of Guyanese politics, be sharp and try to keep things as bright and cheery as I possibly can whilst I do all of it. Also I may start podcasting about Guyana. More on that later.

Cheers to all

Monday, May 26, 2008

Guyana's Prosperity Barrier

In a free market, the price of a good or service is a phenomenon that emerges from the countless interractions of countless people. It's a valuable and yet simple signal that lets people know whether or not to buy now or wait. It also lets producers know whether it's a good time to produce more of that particular good or service or to produce something else.

Guyana's government has intervened in the economy in such a way as to frustrate any hopes to one day see a prosperous Guyana.

When the President Jagdeo announced all the subsidies for various foodstuffs about a month ago now, he was also announcing the death of the price mechanism in Guyana's economy.

When the government uses money taxed from the populace to bring down the price of food, it does two things: Firstly, it disables the signal that would let others know that it's time to grow more food on the widely available land here in Guyana. Also, it creates a shortage. A high price is a rationing machanism that ensures that a good will never run out. As it becomes more scarce, the price goes up and this tells people to economize.

The US and UK learned in the 1970's that a government can't manage the economy and country to prosperity. It's too large a task that simply never has good results.

The foundations of prosperity and even civilizationitself are private property and the abiltiy to buy and sell without government intervention and meddling.

When a government taxes away most of a nation's wealth and uses it to further muddle things by creating monumental market distortions, that nation is well on its way to serfdom.

Sunday, April 06, 2008

Guyana's tragedy of the commons

Every single time I come back to Guyana my heart becomes laden with the shame that one of our most visible and visited areas never looks presentable. I'm talking about the section of seawall between the Le Meridien Pegasus and Kitty and especially the section with the bandstand.

The heart of the problem is this: Since no one person gains something from having a clean and attractive area, no particular person takes action to make and keep it that way. Governments have usually circumvented this problem by creating public maintenance bureaucracies like national park services. This requires the confiscation of money via taxation.

My question is: Should we really be clamoring for the government to do more? How smart is this considering the record of government in taking on much larger matters than piles of trash at the seawall?

I can't remember where I heard this: "Ownership is everything".

If someone were to adopt or be granted ownership of sorts of this area, they could maybe charge a small fee for vendors to do business there, charge admission to musical groups scheduled to play at the bandstand, or charge a little money for parking. The monies could then be used to hire people to gather rubbish, haul it away and constantly improve the grounds. I imagine expanded parking, a bricked walkway, an expanded beach area and manicured landscaping. Even better would be small outdoor cafes with wireless internet.

The government could maybe do this, but do they really want to? If they did, how much would it cost for the government to revitalize the area versus a private entity with a profit motive? Enterprises motivated by profits automatically make better use of scarce resources than governments who can simply confiscate money to feed a bloated budget.

May your next morning walk on the seawall be an instructive one. Don't just look at the trash, but also think of the possibilities. Paint your own picture of what it would like like if you owned that area and had something to gain by beautifying it. The way things work right now, should give a new meaning to the phrase "pride in ownership." Right now, there is no ownership and nothing to be proud of. Happy jogging.

Friday, March 21, 2008

Racial harmony and prosperity in guyana

Here's another view that most people haven't covered as regards Guyana.

I think that most would agree that the major tension between the two groups plays out at the political level and not on the grassroots level. Politics fosters the continuance of these "group views" because it is inherently collectivist. Politics sees parliamentary voting blocks composed of collects individuals into blocks of similar interest. The very system of democracy perpetuates the friction that has existed since so long ago.

Benjamin Franklin once said that democracy was two wolves and a lamb voting on what to eat for dinner.

Winston Churchill once said
"Democracy is the worst form of government except for all those others that have been tried."

Let's cut right to the bone here. Democracy is popularity. Populism is LESS likely to abridge people's rights as often as a monarch or a dictator and will generally unseat anyone who isn't popular.

I imagine that in a nation where everyone has a common heritage and race and religion etc, The evils of democracy are less visible.

This melts away in a multi-ethnic system. If you can see a block of people taking away your rights and they are of a different color from you's perceived differently. I don't know that there is any way to overcome this other than power sharing, because only then would people realize that ALL the politicians were abridging their they can be dissatisfied with all of them. But power sharing would be undemocratic now wouldn't it? The most popular candidate and/or party should have the most power shouldn't he/they?

Do you see the catch-22 situation here? Democracy is the "least worst" and what is popular may sometimes be the least evil but the way it is done with ethnically-based parties perpetuates feelings and social dynamics that threaten peace and democracy.

What's the solution? I think it would go a long way for the individual to be brought back into politics.

Democracy works best when it has much less power to abridge the rights of individuals or give special treatment to one group of individuals over another.

Democracy can even be GREAT when there are codified RIGHTS which aren't abridged by the government.

Government works best when is has less power in general.

Would someone mistrust the dominant ethnic group that had control of government if government had little or no power to intervene in his life against his own will?

The very essence of government that makes groups covet it and other groups despise it is its virtual monopoly on the use of coercive power to enforce popular laws, tax money and shape society through legislation.

If racial relations are better on the person-to-person societal level than on a governmental level, find things that the government doesn't need to be doing and let other consensual entities in society like charities and businesses take over. If there is a demand for the particular service, then they will find a way to get funding. If the market finds no use for the services, then maybe government shouldn't be doing them in the first place.

For those who love and have more faith in government and its power to wield coercive force on others, your faith in government may yield more efficient government someday but in the meantime stop expecting racial harmony.

The path to prosperity in Guyana isn't more planning and combating poverty. Government planning means sub planting the plans of a bureaucrat's over the plans of an individual. Combating poverty just redistributes wealth..often from one GROUP to another. It is, in my opinion, fallacious to expect people of different races to choose to get along with each other via the coercive power of the state.

The path to prosperity for Guyana is wealth creation (not poverty alleviation) and individual rights. The most prosperous places have few natural resources and many rights and freedoms! Hong Kong, Singapore, the cayman islands and others were forced by scarcity to come up with other ways to create wealth and they did so out of thin air (!) by codifying more rights and exercising less government power to coerce and tax.

Have you ever thought that creating a free and prosperous Guyana meant less government and less laws and less and less and less of most things that government cooks up?

Less really is more.

Free the individual.

Sunday, March 09, 2008

Is Guyana's government threatening or enabling freedom of the press?

I've sat back for a while now and watched the debate about whether or not the government of Guyana is actually threatening the freedom of the press. I was on the fence leaning towards the 'yes it is' side until about 2 minutes ago.

Firstly, I'd like to ask what freedom of the press entails. Freedom of the press is freedom from whom or what? A state's governing body has the legal monopoly on the use of coercive force. If the government is one of your newspaper's larger clients, does that increase or diminish your freedom to publish what you want? I can think of arguments that could go both ways.

A safe assumption may be that if government is no longer a client of a publication, the publication would have more liberty to publish material that is critical of the government.

Likewise it is helpful to examine the government the way one would a self-interested individual. Who in his right mind would choose to fund another entity that is highly critical of it? It's counterintuitive to bankroll the exposure of one's own impropriety. The government is a consumer of advertising. It should be expected to react to the same incentives a company might. Would Banks DIH buy advertising in the same medium that also writes exposes of its executives?

It's fallacious to deal with government while expecting it to act on a higher plane when in fact it will usually act like everyone else, or worse.

It seems to me that Stabroek News doesn't view government ad revenues in this light. My guess is that it sees them as a tax rebate or as a subsidy. A newspaper that gets handouts or special treatment like that from government can hardly be expected to continue to play the important role of an independent medium. Can one be free from a government while being dependent on its business? Stabroek News can better serve the public by doing what it can to execute a successful business model without government ad revenue.

As long as the government isn't doing anything else to cause tangible losses to Stabroek News, the government is simply using market behavior to retaliate against the newspaper. It's mean-spirited and certainly not 'fair'. Nevertheless, it leaves Stabroek News freer to criticize the government without causing a conflict of interest.

Sunday, March 02, 2008

Wednesday, February 20, 2008

An unpopular solution to gun violence

Sorry to all for having been a bit distant lately. I'm finishing up some school and getting ready for my move across the US.

I am, like anyone else, worried about the gangs that seem to run roughshod anywhere they want to and have killed more than several along their way.

I put this forward knowing that it will not be popular with most people who read my blog. Nevertheless, if we are to be intellectually honest, we should constantly and honestly review new information or arguments.

I don't' have the references on me, but there are studies that show that US states with very lax firearm carry laws have lower crime. How less likely is someone to do whatever he wants knowing that people around him may very well have guns and can shoot back?

We may never get to test the truth of my theory which is this: Allow law abiding citizens to buy and carry firearms without great government imposed impediments. You will see a reduction in crime.

The police come after the commission of a crime to investigate and take eye witness accounts. Rarely do they come in time to save anyone. As a matter of fact, I don't ever recall the police having ever saved anyone.

I would like to challenge the supposition that it is the responsibility of government to protect the citizenry from criminals. If you insist that they do so, you tell me exactly how much money it's going to take to make sure that nobody with a gun can ever harm us. Will 20% or 50% of the workforce need to be employed in law enforcement to make us safe? Even then, will they get there in time?

Sunday, January 27, 2008

Democratising Guyana's Oil Part II

The Roop Column

RBP + LEF + O = D
Kaeiteur News
26 January 2008

Peter R. Ramsaroop, MBA

RBP + LEF + O = D (Race-based Politics + Limited Economic Freedom + Oil = Disaster)
This column is a follow-up to my column from December 23rd titled “Natural Resources” where our team proposed that the profits of oil be shared with the people as written in an academic paper from one of our team members, JC Bollers.

The riots in Kenya have killed hundreds of people and displaced hundreds of thousands more. This should motivate us to conclusively resolve ethnic conflict in Guyana if we ever want to have lasting prosperity. The post-election violence and riots have caused tourists to flee Kenya or decide to visit somewhere else. Trust in Kenya's political system has been shattered. Their economy may soon follow; and they don't even have oil.
This should teach us that democracy is much more than being able to vote once in every election. When people use their own money and judgment to make purchases or donations, they are practising a type of 'economic democracy'.
Everyone is part of the mechanism that chooses the best firms and charities. When one ethnic group or race is favoured over another for both political office and economic opportunities, both types of democracy are lost. The disenfranchised in Kenya are not rioting only because their candidate has (probably wrongfully) lost the presidential election. They are rioting because their country has not even found a half-measure to resolve the ethnic discrimination that characterizes both their politics and also their economy.

If Guyana's oil reserves are proven and then controlled by our government, it could spell disaster for our country. With the nature of our current politics, we cannot allow simultaneous control of both political and economic power. We may be able to foster long-term prosperity and peace if we can somewhat separate political favour from economic opportunity.
We have researched and written about democratising Guyana's natural resources extracted from public property. This means that oil royalties would be dispersed evenly amongst our citizens. The government would have to accountably tax us in order to fund its operations. To date, our organisation Vision Guyana is the first and so far the only organisation to adopt this as part of their vision of a prosperous future for Guyana.
On January third, CGX Energy Inc. released an independent assessment of the probable amount of oil found in the offshore Corentyne concession. Its best estimate puts our oil reserves at 2.7 billion barrels. However, the odds of finding no oil at all are 61 percent. This leaves a 39 percent chance of finding even a little oil at either one or both major drill sites, to be produced at Global Competitive Prices.

One Saudi oil minister once said, “All in all, I wish we had discovered water.” We too may be 'lucky' enough to understand why he said this. The risks we face as a resource rich nation are as real as Saudi Arabia's. Those we face as a developing multiracial democracy are as real as Kenya's. If we allow the bounty of our country to further divide us along racial lines, we may forever be the land of many backwaters. Most Guyanese may continue to prefer living elsewhere.

Let us act now to secure our democracy by 'democratising' our natural resources extracted from public land. Each Guyanese citizen will vote every day by spending or investing his or her share of the royalties in a free market economy. No one's race will be an issue to someone wishing to sell or buy something. No one's party affiliation will affect whether or not they profit from the public natural bounty that rightfully belongs to each and every one of us. I don't offer this as a solution to all our problems, but this might be the one thing that makes the biggest difference in our way of life. We propose that consultation be started on exploring these recommendations.
“Democratising our natural resources” can help us realize our hope for ONE NATION, ONE PEOPLE, with ONE DESTINY.

Sunday, December 23, 2007

Guyana Resources - A Christmas Blessing or Scrooge Curse

The “Roop” Column

Guyana Resources - A Christmas Blessing or Scrooge Curse

Peter R. Ramsaroop, MBA

One of my young advisors, JC Bollers, the grand nephew of the late Sir Harold Bollers, recently completed his academic paper on Guyana Resources . In our discussions I thought it was appropriate to share with the public his thoughts and our discussions on the issue of Guyana Resources. This is the season when we reflect on the year and why the average citizen has not progressed from last year and for some, they have gone backwards given the economic environment we are faced with. I would ask that you keep this column for future reference as we get closer to oil:

For as long as I can remember, I've always asked myself how our country can have so much natural wealth but still be poor? Guyana is suffering from what academics call the 'resource curse' . This happens when a country's economy becomes too dependent on primary exports like oil and sugar, sugar in our case. It's more likely to happen in a country with institutions that lack transparency and caring leadership for all.

A resource state's incentives are to keep the handful of export producers happy. In this situation, voters and the private sector commonly find themselves subject to a government that isn't as accountable to them as it is to the sugar or oil company. When commodity prices fall, the economy falters and lacks a private sector strong enough to pick up the slack. Normal economic growth needs a healthy private sector, which requires predictable enforcement of laws, contracts, property rights and an open economy. This is often absent in a resource state.

A functioning democracy requires that the government be dependent on the electorate for tax revenue . The government produces accountability in exchange for this. This accountability creates trust and legitimacy. It is absent, though, when a government gets enough of its funding from resource rents. In this situation, various groups fight for their 'fair share' of the resource rents at the government level. When the resource wealth gets distributed according to politics, that's when widespread ethnic conflict and political instability take place.

UK journalist Nicholas Shaxson says: " If citizens had the oil money in the first place, and the state had to bargain with them to get its cut, it seems likely that would change the game entirely."

Maclean's Magazine of Canada has said that Guyana may be able to eventually match Kuwait's annual oil production of 500 million Barrels . However , if only one tenth of that amount is produced and royalties are 55 percent, at US$100.00 per barrel, that means an average annual payment of roughly $US3600.00 per person or $US300.00 a month.

Do you want that HUGE AMOUNT to go to the government?

For the future, I STRONGLY recommend the following:

• Amend our constitution to state that ALL natural resources belong to Guyana 's citizens .

• Let each Guyanese choose at which bank to have their royalties deposited.

• Have CGX (or any extractor) publicly state each payment and pay it directly to the banks.

• Tax only withdrawals of principal to encourage saving and investment.

• Allow banks to issue credit to citizens based on all types of income.

• Enjoy an economy bursting with energy, life, HOPE and PROSPERITY for ALL.

“The people may get lazy,” you say. Is that worse than government using all the money to selectively bless others with laziness?

”Well people may waste the money,” you say again. Does the government have the monopoly on being wasteful? People spend according to their priorities. Governments spend money on what is politically expedient. We should be asking if people are more wasteful than the government.

“Well what about infrastructure?” The government will get REVENUES through taxation . That should be enough to build infrastructure and buy some accountability. That would be a very merry Christmas indeed for ALL.

Our Best Wishes for a Merry Christmas with a Healthy and Prosperous 2008.

Friday, December 14, 2007

Washington, Caracas and Georgetown get talking

High level talks have begun between Guyana and the US. I've been predicting that with Hugo Chavez next door and oil in Guyana, that the US would do what it found fit to not only secure a likley US oil supply but also contain Hugo Chavez. A Venezuelan invasion or "destabilization" of Guyana would not be ideal for the US who would seek to prevent it. The article mentions the possibility of a US base in Guyana once the lease for one expires in Ecuador. Given the way that the US tends to protect regimes who supply oil to the US and host military bases, it would seem that 2011 would be the best time for a pro-western/pro-business government to be installed.