The economic crab pot

Saipan has experienced this lesson in economics, though it has never learned it: Destruction follows delusion. Personally, I’d like to see construction follow coherence, but it’s not up to me to determine such things for the Commonwealth.

Let’s draw a distinction (well, my distinctions, anyway) between optimism and delusion, and go from there. In fact, I’ll spell out my entire theory on the gig.

Optimism is having rational confidence in yourself and your abilities. Thus goes the adage: When the man is right, the world is right.

Delusion, by contrast, is having irrational confidence in everything else; it is the refuge of those who lack confidence in their own productive abilities, who will therefore believe anyone who tells them that the world owes them a living.

Delusion leads to a sense of entitlement (which we’ll call “Somebody Else” syndrome). Entitlement leads to bitterness. Bitterness leads to malice. Malice leads to destruction. That’s pretty much how I’ve seen things sort themselves out in the world of dysfunctional economies.

Let’s consider Somebody Else syndrome. The Commonwealth has a bad case of it. Somebody Else is going to “invest” in projects, in which Somebody Else is going to take the financial risks, while Somebody Else is going to do the planning, as Somebody Else is going to do the management, and Somebody Else is going to do all the labor.

This works just fine, until Somebody Else decides they don’t like the arrangement and they leave. Then you’re stuck with a shortfall in entitlements; be they of money, or of status, or of deference. One glaring example was the rabid tantrum that some in the CNMI threw when JAL pulled out a couple of years back. The insults aimed at the Japanese by some of our learned officials were incredibly vulgar. (That’s not hearsay, I was present when one such act of economic brilliance was showcased).

Such is the end game of entitlement; when Somebody Else won’t cooperate, they’re vilified. The malice just spreads from there.

And that sort of malice is growing in Saipan. It has changed the very tone of the islands. It is repulsive to legitimate professionals and investors. Many leave. Many others simply stay away.

Those who remain are virtually in internal exile, not wanting to say anything that will attract the low cunning of a patronage kingpin, or the envy of the kingpin’s least balanced relative, or the malice of the growing ranks of the chronically disenfranchised. Heck, I’ve seen some hapless victims who managed to antagonize all three elements, in the Saipan version of a grand slam.

Anyway, the behavior is economically destructive. Over the years I’ve talked to scores of managers and professionals who have pulled out of the Commonwealth. The most cited reason for leaving? No, it’s not the limited opportunities of a small island economy. The most common reason for leaving was the air of hostility they perceived. As somebody put it, the only thing more worrisome than failing in Saipan is succeeding in Saipan, that’s when your real trouble starts. Americans and Filipinos often call it the “crab pot” effect, as those who can’t elevate themselves out of the pot busy themselves by pulling down those who are climbing their way up.

The paradox of the Commonwealth is that is has so many nice people, but they have become sort of a silent super-majority that doesn’t really set the tone of things. Well, not directly, anyway. Indirectly, when it’s Bota Bota Bota time, the status quo is reaffirmed.

The good news, if you’re looking for some, is that if the CNMI changed its economic behavior, it could eventually attract many investors, millions (yes, millions) of tourists, and could actually be a very wealthy place. The other news, however, is there’s no evidence that the CNMI will change its economic behavior.

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