In the past two Decembers, Jamaicans have had two very different kinds of Christmas packages from the Government: a stimulus, and a tax package. On December 14, 2008, Prime Minister Bruce Golding addressed the nation to speak of the "global tsunami" and how the Government intended to stimulate the depressed economy. As of January 1, 2009, $47.7 billion of multilateral support and tax relief would prime the economy to save jobs and stimulate business.

On December 17, 2009, exactly one year later, Audley Shaw addressed Parliament to announce Jamaica's third tax package in eight months, all amounting to $47.6 billion. Economists think these packages will not stimulate the economy at all but drive it into deeper recession.

In 12 months, the Government came full about-face from a stimulus plan designed to put more money into the economy, to a tax package taking money out of the economy by almost the same amount. Its stimulus plan reduced general consumption tax (GCT) to the tourism industry by 50 per cent for six months, waived taxes on dividends for locally owned companies, reduced transfer tax on property, and waived user fees paid by manufacturers on capital goods. There was no stimulus for the poor.

40,000 jobs lost

The stimulus package has not worked in a high interest-rate environment. We have had an unprecedented eight quarters of negative growth and the Planning Institute of Jamaica expects this to continue in the new year. By April 22, Golding had again addressed the nation ahead of Audley Shaw's delivery blow of a $24 billion tax package. Neither had jobs been created. The Caribbean Policy Research Institute (CAPRI) found that the stimulus package had not created jobs. We subsequently learned that 40,000 jobs had been lost in the last two years.

Why did the stimulus package fail? The People's National Party (PNP) claimed that the stimulus package was designed to benefit "those sectoral interests that have shouted the loudest and enjoy ready access to the prime minister". The package was designed for political appeasement. We have heard from time to time that the Government is a rich man's government. In his December 21, 2008, article, Ian Boyne was very upbeat about the stimulus package but sounded a serious warning.

Faith-based package

He said that the stimulus package was a faith-based package because the Government had doled out concessions and incentives but had "no set of performance criteria attached". This, he said, would not have been done in the Far East where "capitalists had to meet targets and performance criteria". He added that Jamaica's private sector had received concessions and incentives in the past "and the country has not had much to show for it". In Boyne's words, "They bawl and we give them what they want without anything concrete and measurable in return."

Boyne makes these damning statements. First, he says, "Our capitalist class is backward, timid and parasitic." And, they get away without giving back anything to show "because of their enormous class influence on all governments in Jamaica, with Michael Manley making a gallant effort to be exceptional".

By September this year, Transparency International was warning Jamaica of the dangers of state capture where "powerful individuals, institutions, companies or groups, within or outside a country, use corruption to influence policies, the legal environment and the economy to benefit their own private interests". The youth organisation of the People's National Party believes this is behind our current crisis. If we dole out money to capitalists and ask for no accountability we will get none. Government will keep coming back to the rest of us taxpayers to pay the costs.

The PNP has come around to this argument now. It says the Government has avoided taxing the rich and has put the burden on the poor, the middle class and the disabled. Portia Simpson Miller certainly made clear in her April 2009 Budget that the most vulnerable should be protected and burdens shared equitably. Omar Davies says the Government has lost moral authority among the poor and the middle class by not making the rich share the burden.

As part of its Progressive Agenda, the PNP has been talking about the importance of participation, accountability and responsibility (PAR). Portia Simpson Miller believes in participatory budgeting, and Bruce Golding has abandoned (or as the National Democratic Movement says, sold out) the idea of "no taxation without representation". The Government's present loss of moral authority, or at least loss of face, is a good case of why we need to have participatory budgeting.

Political failing

Quite apart from the economic failings of the December tax package, it represents a political failing as well. It failed the test of participation and representative taxation. All major organisations (trade unions, exporters'association, the disabled community, chambers of commerce) have condemned it for not consulting, engaging and listening.

Participatory politics does not mean consulting only with special interests either. It is only democratic when the different interests, rich and poor, for example, can check and balance each other's demands. Without this we could have absur-dities, like higher GCT of some $25,000 on the cost of an artificial leg, which, according to the Combined Disabilities Association already costs at least $150,000. Probably, the Government did not know this or did not care to know. But this is precisely why it must hear from others and resist those who do not want others to be heard.

Progressive politics is also accountable. The business class was given billions of dollars in stimulus money this year with no measurable performance criteria set or reported. Principles of accountability, like equity in sharing the burden are absent. So, those who can afford it are not asked to pay more taxes on government paper, which they benefit from at high interest rates, the same rates that are killing the economy. Omar Davies says if they paid this, the rest of us would have been spared this high-cost tax package.

There is no accountability to Parliament either. This onerous package was presented by fiat by the executive, without time for debate in committee or on the floor of Parliament and it was then announced without vote. The package was almost as great as that of the April Budget package, and far greater than that of the supplementary taxes in September. Yet, it was brought to Parliament and announced in one afternoon. This makes a mockery of parliamentary accountability and sets a dangerous precedent. The Opposition now wants the taxes debated in Parliament and revoked by that Parliament.

Taking responsibility

Progressive politics is also about taking responsibility. The Government has to take responsibility for failure to meet its four or five deadlines for an IMF agreement; for instability of our financial management and negotiating teams; successive reductions in our international credit ratings; 35 per cent increase in our national debt; lack of credible economic plans; and, an increasingly costly government. It wants Shaw to take responsibility and resign.

We might think that participation, accountability and responsibility are just high-sounding principles. But without them we will lose the trust of the people, and without that trust our policies will not work. That is why our stimulus plan and tax packages have cost us nearly $100 billion this year alone and we have nothing but anger to show for them. So, let all MPs consult their constituents and come back to Parliament next year to debate the economic plan for the IMF.

Robert Buddan lectures in the Department of Government, UWI, Mona Campus. Email: Robert.Buddan@uwimona.edu.jm or columns@gleanerjm.com.