By Raffique Shah
Sunday, May 3rd 2009
TRINIDADIANS would swear that the world is gripped by “blight”, a toxic mix of negative forces or “spirit lashes” that have us reeling every-which-way. Those who believe in the biblical end-times would counter that God is angry with man, hence the confluence of wars, pestilence, human misery and harsh economic times. Whatever the reasons for the seemingly intractable problems that have engulfed the world, I choose to adopt calypsonian Blakie’s refrain, “Ah never see t’ing so yet!”
First came the economic recession that started in the seat of unbridled capitalism, the USA. Some might argue that the many wars America initiated were a precursor to the economic contagion that quickly spread from the sub-prime crisis to a global meltdown. That’s the typical chicken and egg situation. Now, out of the sty comes a “swine flu” pandemic, threatening us with another doomsday scenario.
As if the AIDS epidemic or the bird-flu scare weren’t bad enough, man now faces possible extermination from a virus that began with the much maligned pig. Whoever or whatever triggered these multiple crises, reality is before we can deal with one deadly threat to civilisation as we have known it for centuries, another crops up to compound our woes.
Except for Prime Minister Manning, whose periscope shows an “economic blip” that will soon dissipate, most economists, analysts and agencies that monitor the world’s economic health are not that optimistic. The World Bank, the European Commission, the International Energy Agency and several other institutions have all revised their projections for recovery. They first said that by the end of 2009 we should see signs of a reversal of the decline that started in 2007 and infected the world by mid-2008.
Later, they projected 2010 as the turnaround year. Now, with confusing signals coming from the many engines of growth, these agencies are themselves confused. If you track their prognoses, as I often do, you, too, will be confused.
Mr. Manning no doubt made his “blip” comment based on oil prices, in which case he may well be correct-to a point. When prices plummeted to just above US$30 per barrel a few months ago, many argued that they would fall further. Those who monitored global trends would have anticipated oil prices rebounding by mid-2009, as they have. In fact, I expect that by year-end oil may recover to $60 per barrel, with even higher prices in 2010.
The point the Prime Minister remains oblivious to is that the global economy no longer revolves around oil and gas prices. Both these commodities, which are critical to our foreign exchange earnings, will remain important for us and for other net producers of energy. But it will not matter a fig if we pile up huge surpluses in our reserves and other funds, only to face global food shortages and decreasing fresh water for agricultural use, livestock rearing and human consumption.
At the recent Summit, Bolivia’s Evo Morales was said to have objected to the final declaration on grounds that it did not include a clause to curb the promotion of biofuels over food production. Many people laughed at him. Stupid Indio, the uninformed and racists would have said. In fact, one Tunku Varadarajan, a Stanford fellow, wrote in the Miami Herald: ” Obama has been harangued by a motley assortment of caciques and panjandrums at the summit ” His article was titled “Obama in Lilliput”. Clearly, Tunku is a “tuntu”, not to add an ignorant and arrogant racist: he knows not his anus from his elbow.
Suffice it to say that the global balance of economic power has shifted, that President Obama has accepted that, and that South and Central American countries are no longer North America’s playground. Indeed, understanding the paradigm shifts, Obama’s mantra at the Summit was, “We meet as equal partners.” Before the Summit he invited President Lula of Brazil to the White House. That was not just extending courtesy. Obama understands that Brazil will play a critical role in the future development of the hemisphere.
When it comes to food and water, two commodities that will fuel global growth and sustain life, Tunku’s “caciques and panjandrums” hold the hemispheric keys. They will use their vast land resources and tropical rain forests to produce both. Oil and gas will remain important, but not the determinants of the future world.
So while Manning might see economic recovery in oil prices, he’s missing the seismic shift in the relative values of commodities. We can garner all the money possible from our fossil resources, unless we produce food and conserve water, we shall be no better off than we were 40 years ago. I find it difficult to understand how, in the face of this glaring reality, our PM insists on pursuing goals that have little to do with sustaining life.
Colm’s complex roads network and rapid rail will not satiate people’s hunger. More Waterfront-like projects will not quench people’s thirst. Let’s get back to basics before it’s too late. The PM should re-read the history of the French revolution, relive the fate of Marie Antoinette when she offered the masses cake as they clamoured for bread.