WEDNESDAY, JULY 20: “But it is equally of note that ..... we have kept our debt levels at significantly lower levels than virtually every country in the developed world. Sceptics will dismiss this; ratings agencies, the IMF and the United Kingdom will not.”

That was Walton Brown writing about the PLP’s economic record. Walton maintains a strategic as well as practical error in describing and relating Bermuda’s unique economic situation to so many other economies.

Bermuda must always be analyzed first in Bermuda context and then in ordinary context.

It seems that the Minister and Ministry of Finance also make the same kind of error — and, unfortunately, do so, and have done so, consistently.

Perhaps I can most easily explain all of that by discussing Bermuda’s national unemployment:

1. The US, UK, Greece and Canada and so on, have closed populations. When national unemployment occurs, it is reflected in the working population of 180 million previously employed Americans dropping to 160m employed. The 20m now unemployed Americans all remain in America. America reports an unemployment rate of 11 per cent.

Foreign workers

2. Bermuda does not have a closed population. Bermuda imports foreign workers in order to grow and maintain its national economy. When unemployment occurs, or when the economy shrinks, one way or other, Bermuda sheds its foreign workers. Effectively, therefore, Bermuda exports a proportion of its unemployment. No other country with which Bermuda is normally compared can even begin to comtemplate doing what we actually do.

3. Up-to-date example. Minister Kim Wilson’s July 2011 reading of 1,121 unemployed Bermudians looks good. Assuming that six-figure earners did not register, the real figure might be 1,500 (1,121 + 379) unemployed Bermudians. 

 

Putting all the facts together:

• Fact 1. National Workforce peaked at 40,213 in 2008.

• Fact 2. National Workforce reported as 38,095 for 2010.

• Fact 3. By subtraction, overall national job losses were 2,118.

• Fact 4. There are still (more or less and the 2010 census should have told us) the same numbers of Bermudians on the island but there are now fewer foreign workers.

• Fact 5. Because Bermuda is not a closed society, and Bermuda is a unique economy, between 2008 and 2010, Bermuda exported 2,118 lost jobs.

• Fact 6. The real measurement of movement in Bermuda’s National Workforce should therefore be analyzed like this: 2,118 already exported plus 500 or so additional exported between January and July 2011 plus the 1,500 (1,121 + 379) or so uncovered by Minister Wilson’s July 2011 survey = 4,118.

• Fact 7. Bermuda’s real unemployment rate is now put into global context. It is now compared to any of the other 199 global economies. It is or should be, 4,118. That’s just over ten per cent!

Also, the fact uncovered by this analysis is that within the overall unemployment ratio, one new jobless Bermudian (who stays on island) turns up for just over every two newly-unemployed foreign workers (who are both booted off-island).

It is a fact of this magnitude that whizzed right by the the well-educated Walton Brown and that seems, somehow, to be beyond the reach of the Ministers and Mandarins in the Ministry of Finance.

To conclude, consider this:

• Fact 8. If, between August and December 2011, Bermuda has another total loss of 850 newly lost jobs, then Bermuda will likely see about 580 lost jobs exported and only 270 lost showing up as newly unemployed Bermudians. Bermuda’s true national unemployment would then be a still growing 11.5 per cent. That is very high and has not been seen since the period October 1939 to April 1941.

However, it is well-camouflaged by the unique Bermuda factor that I have explained and that so many miss. But sharp insight and good intelligence should enable Ministers and Mandarins to see through that camouflage and hone in the right issue.

Oblivious to facts

With all that has and still is happening, I’m now scarily contemplating a national economic future where so many people seem to be flying blind; or seem oblivious to easily ascertainable, though camouflaged, facts; or seem just plain incapable.

The failure to understand the need to first see the unique Bermuda context and then the global context is the vein, the thread, the link, that runs through every attempt to see and explain Bermuda’s national social and economic situations. It bedevils discussion of national debt, education, tourism, crime and so on.

Please people, please, isn’t somebody — at least one, just one, Mandarin or Minister — ‘on-the-ball’?

PS. Ratings Agencies rated Lehman Brothers as AA on 01 September 2008. Lehman Brothers went bust, fourteen days later, 15 September 2008.

Editor’s note: Not one to let open heart surgery slow him down for long, Larry Burchall wrote this column — post-op — at Johns Hopkins Hospital, where he is recuperating. We wish him a full and speedy recovery. Larry conveys his sincere thanks to all his well-wishers.