An economic consultant who was invited to explain the CNMI’s current economic crisis to the CNMI Board of Education at its meeting last Wednesday had dire words for the board: “Now is the time that we’ve got to brace for, for what could be terrible circumstances that are going to be painful.”
Matthew Deleon Guerrero, Hive Analytics president and chief economist, the board will need to start considering “what is the appropriate policy going forward that is able to protect the entirety of the system.”
Deleon Guerrero, who was invited by the Public School System to enlighten board members and PSS teachers present during last Wednesday’s board meeting about the terrible circumstance the CNMI is currently facing, thinks it is important that all policymakers begin to realize that the current situation is turning into an unprecedented scenario—one that the CNMI has never seen before.
“Previous disasters and all previous recessions, previous moments of economic turbulence, there were different pieces that [we were] able to mitigate some of the effects that don’t exist today,” he said.
“There needs to be a full picture about the total economic circumstances…a more total viewpoint based on a severely contracting market,” he added.
He warned of dire effects not just on tax revenues but also on consumer debt and the ability to afford essential services like public safety, the hospital and Medicaid payments.
Deleon Guerrero, who spoke at the meeting to explain the importance of implementing austerity measures in PSS now rather than later, said that everyone needs to make difficult decisions now, no agency is exempted, because the economy is not generating the revenue that it needs.
“The economy is built on tourism. The historic tourist numbers have originated from China and Korea, and we’re losing significant, if not all, the numbers. …If you look at the numbers for Korean flights coming in, there’s cancellations upon cancellations and you can only base future projections on what the current information is. We don’t know when the threat and concern about coronavirus is going to dissipate and when it does, that takes some ramping up time and so we’re really at odds with what is funding government services,” he said.
Deleon Guerrero said that there’s a lot of ideas being discussed in both private and public sectors, but the priority is to ensure the members of the community are safe and healthy.
“The first step in figuring out a way to ensure that people are safe and people are healthy and lives are [not] impacted as much as they could. That’s just what a lot of people are trying to do, the Chamber of Commerce, [Department of] Finance. There’s a lot of people working on this and it’s generating some really good discussions,” he said.