"We cannot live with a system of growing endemic underlying corruption, punctuated by egregious cases of epic fraud and dishonesty”

Interview: Manou Bheenick

‘We have to rebuild trust — trust in the political class, the police, the judiciary, and in our electorate which must not give in to electoral bribery.’

* ‘There is nothing worse than populism to corrode any political system’
Populism is not known as a good breeding ground for nation-builders and statesmen

We asked Manou Bheenick to share his views on the general trends likely to affect the world economic landscape in 2023, a troubled era of uncertainties when neither the Covid pandemic not the Ukraine crisis are yet out of the way. Inevitably, the management of public finances and the current state of the economy came under the scanner. He was also invited to share his personal views on the political forces that, without giving in to populism, have to unite for the municipals or general elections to get the MSM and its minions out of the way.

* 2022 has generally been the year of living with a Covid hangover for most parts of the world. It has also been another year of living dangerously in some other places with several colossal events dominating the headlines, the most prominent of which has been the war in Ukraine and the worldwide inflation that it helped spark. What’s your assessment of 2022?

2022 is most definitely one of those years that you are glad to put behind you, another annus horribilis of the kind that the world has gradually adapted to since Covid struck, and forced us all to change established routines and mindsets to learn to live with the virus and its succeeding variants. And we are not out of the woods yet: some of the new habits will stay with us and serve us well in the years to come as Covid becomes endemic. And this is irrespective of the raging debates that Covid has unleashed on its origins, conspiracy theories, vaccine efficacy, and the suspicious proximity between big pharma and key decision makers leading the fight to combat it.

We would be wrong to read the Ukraine war, undoubtedly the biggest marker of 2022, as just another shooting war or an isolated event on a par, say, with the killing of Saddam Hussein or Muammar Gaddafi, which the world took in its stride. It brings with it systemic risks for the body politic. We may actually be on the cusp of a major geopolitical reordering. The post-World War II dispensation may be in its last days, and together with it, so many essential elements of the global platform supporting peace and security, international trade, global finance, and so much else, will also change.

We are not leaving these concerns behind. The shooting war will end with one or both of the main combatants much reduced and spawn realignment as NATO may have overreached and added wind in the sails of BRICS. With so much change in so many fundamental aspects on the horizon, the coming year will be far from peace and prosperity.

The spike in Covid-induced inflation is, mercifully, abating but it will be with us for quite a while, possibly until end-2024 at the earliest, before the flood of money-printing which kept the global economy afloat, is withdrawn and normalcy is restored to international finance, money markets and trade. If we look at the largest economy, the US as an example, inflation rates in the lower single digits may not be on the cards this year as economic recession may occur as collateral damage if the US FED maintains an aggressive stance to soak up all the liquidity that it flooded the system with. So, here again in the fight against inflation, we have an issue that we ignore at our risk and peril.

As we move into the new year, we carry with us a legacy of major concerns that should figure prominently on our policy agenda.

* What do you think would be the most pressing trends to watch in 2023, especially those that are likely to have an impact on our country’s fortunes?

I would break them into two sets of issues, first the global and exogenous ones on which we have little or no say and, second, the domestic ones which we as citizens, or our government, can influence and rank as our policy priorities and thus inform our action.

First, the global landscape. We’ve touched on some of these issues in the preceding answer and I won’t repeat those. The trend towards increasing bilateralism and deglobalisation is an existential threat to small states like ours. We have neither the size nor the clout to succeed in bilateral agreements individually with the rest of the world if ever the likes of the UN, the EU commission, the WTO, the WHO, and others like them in other sectors of activity like UNEP, the ILO etc, continue to be sidelined and marginalized by the big players opting for increasing bilateralism and power-play.

The geopolitical realignment, with the rise of China and BRICS, should definitely be on our scanner. As indeed should the sanctions regime, to which the US and the West have resorted to browbeat others into submission, i.e. when not attacking them in pursuit of regime change for trumped-up reasons: trade embargoes, asset seizure, reserves freezing, debarred access to global payment and settlement system like SWIFT, etc., which Libya, Iraq, Iran, and Russia have experienced.

Still at the global level, I would emphasize global warming and effective coordinated action to implement the global climate change programme. I wish our countrymen were more alerted to the risks our country runs from such phenomena as sea level rise.

The dollar-dominated trade and settlement system may be changing and we should spread our risk.

Major countries are turning inward and becoming inhospitable to migrants. Is it just a coincidence that Mauritius had a reported net migration of 0.00 in 2022!!

There will be some fallout from the spectacular bust-up of FTX Trading, the biggest crypto currency exchange, also a hedge fund, last month. It is the ENRON of the digital world. There will be enhanced vigilance to combat this type of extraordinary fraud.

Locally, our policy agenda as Mauritian citizens, is to stop the spreading cancer that has proliferated across government bodies, public institutions, publicly-owned companies, and regulatory/supervisory institutions. We cannot live with a system of growing endemic underlying corruption, punctuated by egregious cases of epic fraud and dishonesty. We have to rebuild trust — trust in the political class, the police, the judiciary, and in our electorate which must learn to make wise choices and not give in to electoral bribery.

Once the trust is being repaired and regained — an uphill, if not impossible, task if the corrupt go free and enjoy their ill-gotten gains in total impunity as they have so far—then we can set to work to regain our long-lost and now all-but-forgotten lustre as the well-run little tiger of the Indian Ocean. We need to go back to become yet again a working democracy with totally free and fair elections, blessed with a confident population under an enlightened leadership that can put our society and our economy back on the rails and make up for the years which we have wasted by entrusting our country and its fortunes, especially its fortunes, to an unprincipled bunch of political bandits.

* With the next elections said to be in the pipeline – possibly next year itself, should the Prime Minister decide not to expose himself to any discomfiture in the wake of an unfavourable judgement in the Dayal’s electoral petition before the Privy Council – one could expect populism to trump responsible economics in the coming months. Is populism really bad economics?

There is nothing worse than populism to corrode any political system. A recent example would be Mr Trump, who seems to have whipped up the anti-establishment sentiment to the point that some extremists even stormed the White House. It’s a form of demagoguery, with a hefty dose of political opportunism, seeming to address complex issues—but actually doing nothing of the sort — in a simplistic manner to maximize its appeal to the masses.

Its negative repercussions are certainly not limited to the political sphere: the road to Nazism and Fascism started that way, with a couple of populists like Adolf Hitler and Benito Mussolini, firing their first shots to local electorates… and World War II was the cataclysm that resulted. Populism is not known as a good breeding ground for nation-builders and statesmen.

As regards the options facing Mr PK Jugnauth, the Prime Minister, I wonder if he cares two hoots about popular sentiment. He seems to be in his element mouthing well-rehearsed set-pieces and slogans to the docile audience provided by the socio-cultural crowd, old-age pensioners, and other groupies of a saffron bent. I am given to understand that the Privy Council will bend over backwards to avoid taking sides in an overtly political case. Maybe I’ve got that wrong. What I mean to say is that a Privy Council judgment against the PM is not a foregone conclusion. But will he risk such a possible negative decision before going to the country at the end of his full term?

Will his financial backers and his political minders advise against running such a risk, and encourage him to dissolve the National Assembly before any judgment is handed down? The municipal elections, which were supposed to be held in 2022, did not happen and may be on the agenda for next year.

If we abstract from the PC judgment for a moment, the municipal elections may serve as a curtain-raiser for the next general election: Will PKJ run the bigger risk of taking on the combined already-announced phalanx of Labour-MMM-PMSD in these elections? A defeat in the municipal elections will deflate MSM’s pretensions for a third successive victory in the next general elections.

* Again, as regards the issue of populism, one could argue that a reasonable dose of welfare populism need not necessarily be that bad. That could have been at the back of the mind of the Labour Party’s leader when he came forward with his proposal in favour of State-financed trips to neighbouring Reunion for old-age pensioners. How do you react to that?

Be careful there! Populism makes for bad policies. The welfare dimension is something else. A majority of Mauritians, as taxpayers in this caring society of ours, support the main planks of our welfare state such as free education, free health, subsidized housing, subsidized utilities, etc. But many of us have looked askance as the welfare bill, 100% funded by the taxpayer, began assuming alarming proportions. And this occurred as some of the welfare planks were allowed to turn into bargaining chips, even outright electoral bribes, to garner voter support in competitive political auctions at the hustings.

This was clearly the case with the basic old-age-pensions — a direct charge to the public budget with no beneficiary contribution to any pension pot during their working life — in the last general election when the outgoing Prime-Minister-cum-election-candidate announced, just a few days before polling, a steep increase in these pensions to the OAP’s, bussed from all over the island to assemble in the largest convention centre in the country. If that is not an electoral bribe, what is? Electoral petitions seeking to annul the election results, because of this and other alleged electoral malpractices and irregularities, moved at a severely-handicapped snail’s pace through the local courts without any success. Hence the recourse to the Privy Council.

We cannot bid up the burden of our state-supported welfare just because OAP’s have the numbers to bend political office-seekers to their will, irrespective of the cost to public finance. We forget that welfare support to the needy, the poor, the invalids and so forth, have a foundation in ethics and morality. Beneficiaries of state largesse via these pensions, get a regular take-home-packet which, in many cases, is much bigger than what they earned during their working life — a perversion of what happens with a contributory pension!

And, let us remind ourselves, Mauritius is neither a resource-rich economy, that can plough its resource earnings in social support without regard for financial sustainability, nor a flourishing economy with a population pyramid tilted towards the working-age group, strong finances and a budget surplus, an adequate cushion of external reserves, low public debt and an external surplus, and bright prospects generally. Quite the opposite, unfortunately.

Navin Ramgoolam, as leader of the biggest and oldest political party, has the right to do some kite-flying. He is not running in an election. He is not an outgoing Prime Minister dangling a bribe. I see no difficulty in his floating new ideas for debate. Having served under him in his first Cabinet, I know he’s not given to make policy on the run. I will not read deeper into this unguarded pronouncement. I would be worried, very worried, if he wanted to include that in his alliance’s electoral program without making compensating reductions elsewhere.

Our public finances have already taken a heavy drubbing under the sustained mismanagement of the ruling gang of cowboys. We do not need more. Welfare populism would be a highly-explosive mix, best avoided if we want to leave anything standing for our children and grandchildren. Read More… Become a Subscriber

Mauritius Times ePaper Friday 30 December 2022