September 5, 2021
Observing the way in which the APNU+AFC and the PPP/C approach several key policies indicates an emerging political dichotomy in Guyana. With the exception of a few independent parties such as D’Aguiar’s United Force and the Alliance for Change, the historical PPP and PNC were essentially left-wing parties of varying flavour. More recently, the PPP/C – notwithstanding its Marxist-Leninist constitution and the cognitive dissonance – is evolving into a pro-business and centre-right party, while the PNCR appears to be heading, albeit somewhat tentatively, in the direction of centre-left. The WPA still has its Marxist overhang in spite of the open ethnic loyalty of some of its leaders. This hopeful evolution could potentially move the quality of politics in the right direction, but the ever-present ethnic voting patterns could still throw sand in the wheels.
A clear dichotomy between PPP/C and APNU + AFC could provide independent voters with discernible differentiation when it comes to addressing economic policies, as well as security and social challenges. Regardless of political party, almost everyone agrees what are the overarching systems and infrastructure that must be completed. For example, no self-respecting political leader disagrees with having alternative bypass highways on the East Bank and East Coast for addressing the depleted quality of life resulting from traffic congestion, as well as bridging the Demerara River, increasing power generation, and arresting criminals. However, the manner these tangible proposals and more qualitative ones are presented could signal clear differences between the two camps.
Let me present a first piece of evidence which signals the emerging political divergence. The Jagdeoian PPP/C is clearly a pro-business party. The PPP/C boasts openly how many business taxes they have reduced, receiving much praise from the local private sector bodies. The first-order of policy is to benefit certain domestic investors with the secondary understanding there will be a trickle down to workers. The key words here are: certain domestic investors.
On the other hand, the PNCR is not necessarily anti-business, it just was not willing to get too close to the business community – an outcome that can be explained by at least five decades of ethnic socialisation of the PNC leadership. The PNCR is not foolish, it is well aware it cannot run a country without a vibrant business sector. As a result, in the tradition of a centre-left political party, the APNU+AFC budgets had higher taxation and cast a wider net. The private sector bodies – not all private businesses – opposed these taxes.
Higher taxation, tax cuts and pro-business concessions result in redistribution. The APNU+AFC was redistributing from the top income earners to the middle- and lower-income earners, particularly for paying for the growing civil service – because the logic of the pro-ethnic strategic vote meant the PNCR had to provide fast employment for members of its base. This is one of the major troubles the PNCR will have to work out because economic development requires a non-politically compromised civil service. On the other hand, the PPP/C cuts business taxation – including providing generous incentives – thereby increasing the income shares of the already well off and in the process, most likely, furthering income inequality. The notion of redistribution ought to present independent voters with a clear political product differentiation.
The PPP/C has decided that it will emphasise private hospitals, which will ultimately draw human and other resources from public ones. Some will argue that the present government is also spending large amounts on the public hospitals. That is true. However, the very fact that healthcare is moving in a privatised direction means that the elites and the well-off will no longer rely on public healthcare. The well-off folks will have the private insurance that will no doubt pay for quality privatised healthcare. Those less privileged – who do not have the power and knowhow to influence public policy – will be left behind with reduced services. In the United States, for example, those who have health insurance get the best treatment – I would say the best in the world. Those who do not have health insurance are kept in a poverty trap. Why should there be a different outcome in Guyana?
Privatised healthcare can only be equitable if there is a national health insurance risk pool. Moreover, private insurance companies can fill some of this gap, but they will still ration out the most sick and vulnerable because the sick bring higher risk – which implies lower profit. Therefore, a national health insurance system is a great opportunity for political product differentiation (PPD) between the two camps.
The present government has no such plans since it views development as projects in which physical things are made. APNU+AFC and more so the PNCR has a legacy of the NIS on which it can build. The Jordan budgets had brief nuggets to resuscitate NIS, which will first need to occur before thinking about an expanding into a national health insurance system. Therefore, if the PNCR (it can never win an election by itself!) and its coalition partners can outline how development is not only about building physical things, but also establishing qualitative institutions that enhance human capability and happiness, they will clearly present a clear case of PPD for the independent voters.
Furthermore, we observed a proliferation of for-profit schools and universities under the previous Jagdeo Administration and this pattern is continuing today. The APNU+AFC sought to increase taxation on these schools. I have to confess how I feel about this emergence: there are few worse ideas than a for-profit university or high school. I am, of course, not against not-for-profit private universities and schools. A university in a developing country like Guyana has to provide the positive externalities and the many public goods. These are achieved by having faculty research and good students, as well as the fundamental academic programmes. Buzzword programmes will not cut it! A for-profit university is never interested in funding research on acquiring basic knowledge that in the initial period appears to have no commercial application. Basic research is very important because all the gadgets, safe airplanes, medical treatment, measurement of social and economic problems, great systems of public management, and others, we enjoy and take for granted are derived from a basic spark that some curious person had while doing research.
Unfortunately, the PNCR itself was unable to outline a clear vision for the University of Guyana, a public institution. The Granger Administration even fell for the lure of the free market forcing the university to seek more private gifts. However, this is a clear opportunity for PPD.
Here is another example: the PPP/C views cash handouts with great suspicion. The party only uses cash grants under restricted terms expecting a political reward. This is the case of the Amerindian cash grant and the help to displaced sugar workers. The Granger Administration was itself not too circumspect regarding the cash handout proposal; nevertheless, their independent intelligentsia was most vocal in its support. Mr. Jordan recently noted that he would have implemented a more long-lasting cash grant programme from the oil revenues. From their point of view, vocal and highly privileged supporters of the PPP/C – many with political access that determines economic returns in Guyana – are quite scornful of cash grants from the oil funds, claiming that the policy will cause laziness and dependency among the poor – who, by the way, lack the same political privilege. Hence, a clear opportunity for PPD between the two sides.
Ultimately, a welfare state will require higher taxation. The PNCR and its partners were incapable of explaining what the voters and business community can expect in return. Is it going to be universal healthcare? Greater physical security for businesses? Hence, reduced cost on security guards? Happier and more productive workers for businesses? The last I checked labour productivity boost business profits. No garbage on the streets? Should university students pay for part of their tuition, or all?
In closing, as the PPP/C heads in the direction of trickle-down economics, it will need to explain how the outcome in Guyana will be better than the hollowed-out middle class the policy framework caused in world’s richest country: USA. The PNCR will have to explain how it will surmount election rigging and the historical ethnically based distrust of the entire business community.
Comments: tkhemraj@ncf.edu
