Casserly
The current economic crisis is the third major one since the ending of slavery. The first was the disillusionment with Emancipation, which led to the 1865 revolt. The second arose out of the Great Depression, and culminated in the political crisis of 1938. We are now in the midst of our third major crisis as a result of the financial collapse produced by market fundamentalism.
The 1865 crisis arose directly out of the taxation and land policies of the British colonial state after slavery ended. The main policy objective of the British then was to ensure that the ending of slavery did not mean the ending of the plantation system.
The upshot was that by 1840, only about 3,000 people owned land over 10 acres, and about another 20,000 owned plots under 10 acres in size. The vast majority - numbering about 355,000 persons by that time - remained landless, rent-paying tenants or squatters on estate land. Those who therefore think that squatting is something new in Jamaica are woefully mistaken.
unjust taxation
The arrest of Lewis Miller, a farmer from Stony Gut, arose directly out of a charge of squatting on the adjoining estate of Middleton. His case came up for trial at Morant Bay on October 7, 1865, and was attended by large numbers of people from his district. It was while the people were waiting on Miller's case that the case of Geoghegan was heard, and he was convicted. That was when the well-known rallying cry, "Pay the fine, but not the costs!" went up, triggering the subsequent revolt.
But it was not only landlessness which was behind 1865. In an eerie echo of the present, the issue of unjust taxation was also critical. The British imposed 'GCT' on the basic imported products long consumed by the people - such as salt fish and mackerel - and reduced the taxes on goods used by the planters, such as buggies, as an 'incentive' to investment and production. Moreover, the newly freed population was required to pay road tolls and taxes to support the Anglican Church, as well as to finance indentured immigration from India, the purpose of which was to reduce wages.
The Great Depression and the Role of the State
Our next major crisis arose out of the Great Depression of 1929, although its roots go back further. Again, there are interesting parallels with our current situation. After the 1846 Sugar Duties Act, the British moved to a global free- trade regime which was the direct forerunner of the current neo-liberal globalisation.
Between 1873 and 1900, sugar prices fell by 56 per cent, from 25/6p to 11/3p per cwt. There was an equally catastrophic collapse in the number of sugar estates. In 1839, there had been 664, but by 1900, these had been reduced to 122. Sugar production declined 72 per cent between 1838 and 1900, from 1,053,000 cwt to 295,000 cwt.
After 1880, massive rural out-migration followed, to Panama, Central America, Cuba and the United States, and to Kingston also. The population of Kingston had fallen to about 27,000 in 1861 (after the cholera epidemic of 1850-52). But by 1911, it had increased by about 80 per cent, to 48,504 persons, many of whom had poured in from the countryside.
The market fundamentalism of the second half of the 19th century - the first globalisation - produced massive squatting in rural, but especially urban areas. The entire inner city belt along Spanish Town Road - including 'the Dungle' and Smith Village on which Tivoli, Denham Town and Arnett Gardens have been constructed, developed during this period.
Market fundamentalism culminated in the 1929 crash, just as it has culminated in the 2009 crash. Our entire history since 1938 has been an effort to grapple with the negative economic and social legacies of this 19th-century free-trade period.
This brings us up to the present period and our current third crisis. Although it was the doctrines of market fundamentalism which brought about the present crash, the doctrine still seems to prevail in Jamaica, whereas it has been abandoned on its home turf - in the United States itself. This was clear in the prime minister's Budget speech which, unfortunately, turned out to be a narrowly technocratic exercise. It was also the framework for the presentation of Dr Omar Davies, despite the fact that his was clearly the stellar performance of the Budget Debate.
interventionism
In the United States, the state is back with a bang. Market fundamentalism is dead and Keynesian state interventionism has been restored to its throne. The US state is intervening left, right and centre in the economy every single day. The Federal government now owns the largest insurance company in the world - AIG - is basically in control of two of the major megabanks, and will end up owning General Motors and GMAC, its huge financing arm. Further, states such as New Jersey and California are bankrupt and will require huge Federal bailouts.
Yet in Jamaica, we seem blissfully ignorant of these fundamental policy reorientations and continue to mechanically mumble outdated mantras about the private sector being 'the engine of growth.' In the post-war period up until 1971, the state interventionist Keynesian social democratic policy framework prevailed worldwide. Both the developed countries and Jamaica experienced substantial economic growth and social improvements, even though inequality in Jamaica worsened severely. The French call those Keynesian years Les Trente Glorieuses - 'The Thirty Glorious Ones' - from 1945-1975.
19th-century-style free-trade regime
The abandonment of Keynesia-nism and the restoration of a 19th-century-style free-trade regime in the late 20th century began with a fury when the US came off the gold standard. Market fundamentalism proved as devastating to the Jamaican economy in the 20th century as it had been in the 19th century. First banana, then sugar collapsed, followed closely by manufacturing and bauxite-alumina. Our only remaining lifeline is tourism - kept alive thanks largely to the Canadian market.
The chief lesson I draw from our history is that Jamaica made substantial progress economically only in periods when the State played a major role in our economic development and the global economy environment was development-friendly.
Today, the entire policy framework of both the JLP government and the Opposition PNP is based on the premise that the private sector will be the 'engine of growth' of our economy. Largely as a result of this mentality, the extremely serious issue of growing social and economic inequality is being sidestepped by all.
We have to move beyond such blinkered mentalities. The empty abstractions of the Medium Term Socio-Economic Policy Frame-work and the 2030 Vision will not take us very far. This 2030 vision is stillborn, representing outdated pre-crisis thinking. Moreover, both the 'Vision' and the 'Policy Framework' are suffused through and through with the market fundamentalism of the discredited Washington Consensus.
Far more important than these documents, are initiatives, such as the Caymanas Special Enterprise Zone, announced by Karl Samuda. This ministry needs to be strengthened and initiatives of this kind need to be expanded to other nodes of development in the countryside. Without a more interventionist state, we will not be able to overcome the problem of the lack of linkages between the tourist sector and the rest of the national economy. Without a more interventionist state, we will be unable to address the complex challenge of extending our tourist economy deep into the Jamaican countryside. We will not be able to expand the fledgling business process outsourcing sector so ably developed by Patrick Casserly and his group.
Without a more interventionist state, you can forget about reducing unemployment or squatting, not to mention crime.
Our third crisis challenges us to reconsider the knee-jerk market fundamentalist dogmas which the developed world has abandoned. We have to take a different direction.
Karl Samuda has announced the Caymanas Special Enterprise Zone, which has great potential. - File
Squatters along Rodney Arms in Portmore St Catherine.
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