Is GoL Kicking the Can Down the Road?

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“Kicking the can down the road” according to the MACMILLIAN Dictionary, is an expression that means to delay dealing with a serious problem in the hope that it will go away. It says for example you can’t solve a debt problem with more debt. That is just kicking the can down the road.

“Kicking the can down the road” can aptly describe the Weah led government’s approach to solving the current economic difficulties, particularly the liquidity crunch.

The situation is exacting quite a toll on ordinary Liberians who are experiencing extreme difficulty meeting their daily needs. In the face of threats by civil servants to begin “go slow” action should government fail to pay their salary arrears by December 15, 2019, the President Pro Tempore of the Liberian Senate Albert Chie has declared that printing new banknotes to pay civil servants is the way to go.

This is the same line pushed by Minister of State Nathaniel McGill in an interview he held with James Butty of the Voice of America recently on the Day Break Africa program. In the interview, the minister argued that other Central Banks around the world are printing money as part of their functions and so the printing of new Liberian dollar banknotes should not be considered abnormal. In the eyes of these officials who find themselves pressed for answers to the economic crunch, printing new banknotes is desirable in order to pay civil servants.

It is the opinion of this newspaper that the printing of new Liberian dollar banknotes will send inflation spiraling beyond control. Already, this government faces a problem of accounting for the L$16 billion worth of Liberian dollar banknotes printed and brought into the country sometime before the November 2017 elections and after the inauguration of President Weah. At the moment some former CBL officials are on trial facing criminal charges related to the printing of the L$16 billion Liberian dollar banknotes.

Without accounting for the missing banknotes, proposals are now being advanced to print new banknotes. Most troubling about this affair are reports that new banknotes have already been printed and brought into the country and will be put into circulation shortly. This is indeed worrying because huge amounts of the banknotes are being held in private homes of officials of this government and this change of currency will provide a perfect opportunity to trade in their illegally held billions for new money. And most Senators, according to insider sources at the Capitol have allegedly received payments of US$36,000 each to approve the printing and introduction of the new bills.

And in view of ongoing developments, this newspaper must warn of the consequences of printing new banknotes (worthless paper as some describe it) to pay civil servants. In other words, a quick fix solution is being derived to deal with a complex problem. In the opinion of the Daily Observer, what this government needs to do is to adopt measures to stimulate productivity. The over reliance of government on taxes from which about 60 percent of its total budget is derived, rather than from exploitation of the country’s huge natural endowment of resources is self-defeating.

Government cannot not tax its way out of recession.

The President Pro Tempore, apparently desperately trying to sound upbeat, encouraged Liberians to believe that help from the international community, particularly the International Monetary Fund (IMF) will be forthcoming not now but in February. Truth be told, help may come but with conditions and prime amongst those preconditions likely to be imposed will be a demand to bring down inflation levels in order to receive the desired assistance requested.

But with the penchant for extravagant spending by officials at the highest levels of government, it appears unlikely that government will be able to meet those benchmarks which could compound the situation even more. And it should not be lost on officials of this government that the patience of the people will be severely tested and there is absolutely no guarantee that assurances of better times ahead as promised by Senator Albert Chie (Senate President Pro Tempore) will prevent people from taking to the streets in popular protests.

Recalling the experience of the 1979 Rice Riots, it appears more likely than not the security forces will be out in full force on December 30 to forestall or quell any street protests. And as Deputy Defense Minister-designate Davis aka Zoely Zoe has promised, he is prepared and will kill any street protester, particularly those “messing with” his properties. But just what the reaction of the people to such potential show of force remains unclear and to what extent the country’s fledging military will be impacted by any likelihood of a breakdown in law and order Monrovia also remains unclear.

The 1979 Rice Riots and its aftermath provides some clues because it left the Tolbert Government hanging by a thread and made certain its demise only a year later. This government will do itself well to avoid being drawn into any provocation and to studiously avoid overreacting, lest it may find itself in similar straits as did the Tolbert Government in 1979 and, who knows, no body knows just what may happen.

As the old adage says, “an ounce of prevention is better than a ton of cure”.

3 COMMENTS

  1. Dear Webmaster Admin,

    Thank you for your great pieces of advice. I hope they will heed to some of them. As a Christian, I believe God speaks to people in different ways. We have said it enough, you have reechoed. Let’s wait and hope they will heed.

    Let me just ask the President Pro Tempore of the Liberian Senate Albert Chie a question: Let’s assume you all agree to voting in favor of printing new banknotes today to ease the plight of the exacting Liberian working populace, would you do likewise in 4 or 5 months to come when there is no cash in the coffers again?

    I just read the Weah’s administration has paid Senators $36,000 to vote in favor of the bill to print new banknotes. If this piece of information is true, the 30 senators were paid a total of $1.08 million. This amount can help pay some salaries Mr. President. Why bribe your way into chain?

    I also just read that 60% of government spending is derived from tax revenues, what a disaster!
    With the natural resources and economic values in the asset of the Liberian balance sheet, why would you run such administration?

    Look, we know and understand the job is difficult for you guys. On the football field, when the coach finds out that you are no longer productive, you are replaced by a fresh and dynamic player to boost the team’s morals. You recently said in Dubai you did not cheat to earn penalties, that you were a fair player. Continue to be a fair player, Your Excellency. SIMPLY RESIGN for the good of Liberia! Your VP is qualified to finish your mandate with better results. We want a peaceful transition, and there will be a peaceful transition, make no mistake about that.

    A hint to the wise is quite sufficient!

  2. Incredibly, the writer of this editorial heard the Butty- McGill interview, yet didn’t read FPA’s story – “Snubbed by White House? Liberia: Dillon, Costa Meeting With White House Executive ‘Called Off’ as the Pair Provide Conflicting Stories on Why”. Here was Costa, who threatened to “buy guns” for “old rebels to kill on his orders” and had vowed “to bring down” the President should government close his radio station, taking a conspiratorial Senator to the White House in search of help for December 30 confrontation that could turn bloody and deadly, but a veteran anarchist editorial writer doesn’t think Liberians need to know.

    It suggests that Daily Observer will conceal information that doesn’t support its rabble-rousing for an nconstitutional regime change while fanning any story that further alienates a discontented public. Fairness in reporting is one of the four core standards of journalism, however, this newspaper has an anti-establishment agenda and don’t give a damn. So, this government should account for L$16 billions which were printed against the wishes of the Legislature in 2016 and brought in before the 2017 election even though bank officials that were part of the scam are facing trial.

    Facts have no currency in the world view of inciters falsely representing themselves as members of the Fourth Estate when half-truths satisfy gullible people. The excuse for Ellen printing that $16 billions was to replace old LD. Her government didn’t, thus dirty and disfigured notes are still in use. Moreover, not even CBL has any idea of how many are in circulation or how many hoarded by money speculators or economic saboteurs. Faced with such situation, every government that inherited a recession will replace all old money with new ones. It explains the printing. Perhaps, this editorial writer was promised a big payday jackpot should December 30 morphed into an uprising, hence has lost his freaking mind – wishful thinking rubbish!

    • CDC needs economists, bankers and financial analysts to resolve this currency problem. Do not look for “your man” to give him job. These are problems other administrations around the world have been confronted with when taking over office.
      Stop accusing credible press agencies for your incapacity. Go ahead and print new banknotes idiotically. You will feel the consequences!
      Beware of economic crimes!

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