Deterioration of living standards


There’s a sweet rendition of Our Father playing in the background, an excellent tune as I quiz what’s ahead preparing to rein in the holiday season. Sadly, we do so with tons of uncertainty running wildly through our minds. Yes, I know that villagers too are also singing it for some respite of hope in these bad times.

In the meantime, we go about our daily routines with troubling thoughts when would we be free of the destructive effects of economic stagnancy—where nothing works—for 14 long years. In economics, two quarters of a drop in revenue is called a recession. Four quarters is a depression. Ours is 14 long years of vicious economic depression!

I know the big boys are troubled meeting people they represent for their grand failure to improve the family lot. The central issue remains the obvious lack of leadership to do anything right. The bad times keeps getting worse!

Families struggle daily, dealing with health premiums, CHC deductibles of over $1,000, real estate loans for the first family home, real estate and auto insurance, cost of goods heading into the heavens while family income remains the same for 14 long years. Nearby, you hear empty rhetoric and poorly thought out posturing about poverty. Do you lead or sit back and conjure more confused statements in half-cocked PR work?

The lack of a fully thought-out economic plan lends to an already despicable depressed conditions at home. It’s a tale in itself that the “solutions driven” team either misses or ignores. Yet the team is worried sick if there’s sufficient revenue for retirees’ pension of $30 million for this fiscal year and $45 million for fiscal year 2017, $86 million for PSS and CHC, $100 million for land compensation, and at least $62 million for CUC to buy fuel to fire up the power plant at Lower Base.

Moreover, would the projected revenue for this fiscal year of some $145 million ever be realized? Oh, sorry, I forgot it’s just a projection! Deduct 80 percent the balance of which would cover everything else. How much are we talking about? Isn’t it $20 plus million? It goes to show a huge budgetary shortfall, doesn’t it?

And the list of obligations urgently waiting on the wings for funds increases by leaps and bounds. Why am I discussing these? Oh, sorry, I forgot about the future of our children and grandchildren whose fate are fatally at stake with bankruptcy taking its permanent seat! Keep your ears to the ground and listen intently to the voice of “we the people.” Allowing the growth of negligence grounded on corruption isn’t the answer either. It only breeds more poverty among the local populace!

Growing economic chaos

The deepening economic mess at home is the result of collective failure of nearly four decades. This mess started in 1977 when the Legislature repealed the foreign investment board, a law requiring a 51-49 local participation in any and all investments here.

This opened two floodgates: 1). The direct sophisticated foreign investment schemes moving in without local participation. 2). Elimination of local investments in new economic ventures.

The repeal of that law wiped out any decent local participation in investments. Partnerships founded before the repeal were eventually bought out. It started the slow death of a learning and investment process that has benefited our industrious folks at the outset.

The history of the repeal isn’t for eventual exclusion of local participation but to spur revenue generation when the CNMI took over the reins of self-rule. The unintended consequence is the elimination of locals from any and all exogenous or foreign investments.

The unintended consequences didn’t end with the elimination of local participation. It went further (even to date) of the elimination of locals in the tourism industry. The sophistication is such that investors used what’s known as “vertical termination” or coupons to purchase everything at home before tourist head out to jet ways.

In other words, tourists bought even their meals and places to eat before leaving home. It resulted in another slam against the NMI where there’s literally nothing to tax. It translates into far less revenues for local coffers. Locals who ventured into the restaurant business had to shut down for being effectively eliminated in the process. I think it’s called tourism!

This is the reason why it behooves the elected elite to hunker down to finding relevant answers in terms of whether in fact the tourism industry is helpful to the local economy or is it mostly a perfect drain of resources and alienation of benefits to the indigenous people! I can’t fathom the lingering effects or aftermath of the depressing conditions at home! How do you justify visitor arrival going up while revenues take nosedives?

Over the years, and a lot is our fault too, the industry hired foreigners because they were cheaper and better equipped in terms of education and business savvy. Locals have a lot of drawbacks, especially ones that dropped out of school. So it’s a job displacement and negligence from within where we failed to encourage our people to engage in skills acquisition.

It came to a point where locals categorize certain jobs as strictly for foreigners while they kick back to collect food stamps, housing, Medicaid, and other entitlement programs to live happily ever after. Gee! Notice the pitiful attitudinal deficiency in terms of staying productive citizens? I find this very troubling. And now there’s a federal mandate to eliminate CW workers by 2019. Halo? Everbody home?

I think a more realistic timeline needs formal discussion to resolve complete economic collapse up ahead. Economic chaos would deepen in the short- and long-term. A deadline looms closer after seven years of long yawns and sleepwalking. It’s now the eleventh hour and you quiz how do we meet current and future development plans? Or is this a way the feds are saying that we take back what’s ours?

John S. Del Rosario Jr. | Contributing Author
John DelRosario Jr. is a former publisher of the Saipan Tribune and a former secretary of the Department of Public Lands.

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