what’s in your wallet?
May 26th, 2009For pretty much as far back as I can remember; whenever something wasn’t going too well with the country – someone would always pipe up and say “but look, there is a war on. We can’t be expected to fight an insurgency and do things that make economic sense at the same time”. And this was completely true. This type of war doesn’t make economic sense anyway (OTOH, if we invaded the Maldives and got into a war there, now that may have made some sort of economic sense).
But so it goes.
In the past 20 odd years (really, the mid/late 80s didn’t count too much – economic liberalization really started trickling down in the early 90s), we were the subject of many casual conversations and head scratching by economic types. Usually, you see, other countries with this sort of debilitating civil war tend to do a lot worse than we did. Oh, which isn’t to say that we had it all good – but the relative isolation of fighting to a section of the island (with only the occasional spillover) meant that economic activity could continue.
But there was always this shrug of the shoulders and “Yeah, we’re fighting a war” as an excuse to not even pretend at bridging the deficit, make populist subsidies and the like. How many times has the war been the single biggest electoral issue? I think the last time it wasn’t a serious issue was in 1990/1991.
Which brings me to my main point – there are no more excuses.
In the space of 12-14 months (yeah, I know the offensive started earlier – but May 2008 is as good a point as any), we have been transformed from a case of economic curiosity into yet another common or garden mismanaged third world economy. One with a massive budget deficit, a crushing amount of public debt and a horrifying trade imbalance. And we still have one of the largest cabinets in the world. I don’t mean the sort that you store ornamental porcelain in either.
And I guess everyone thought the hard part is over.