State of the Republic: On Borrowed Time

December 20th, 2012

Not a day passes without one hearing or reading about the dire financial state of the Honduran Government.  It is said the present administration came to power at a bad time, but that is the excuse all politicians use to explain their incompetence.

Maybe it’s not too late to save the situation, but something has to be done immediately, without regard to political consequences. All the government-run utility companies are operating in the red, and no one knows how much longer they will continue to operate. Many other vital government services are also failing, like public hospitals and health centers, where nurses and doctors are going months without pay. Teachers and firemen are also having to wait for their pay.

chart-1-our islands-webThe President has in three years created three or four new ministerial posts with corruption, bonuses and subsidies. This country is bankrupt, but none of the politicians are addressing the issue. The same politicians keep making the same baseless promises that only inspire hope in the minds of the ill-informed and the ignorant.

The municipalities are suffering because the central government has defaulted on the portion of sales tax revenue it is required to redistribute to them. Parts of the Bay Islands are struggling through this ever-worsening crisis, but no one is paying us any mind.

It is the general belief in this country that the Bay Islands are prosperous and that everybody has money. People who think that should talk to the people of Santos Guardiola and Guanaja if they want to hear some sad stories.

With all this upon us, the government has decided to close down the business of diving for lobster (see November Voice). This closure will be a death sentence for Guanaja and La Mosquitia. But it will also have drastic effects on many other parts of this country. The Islands and la Mosquitia spend hundreds of millions of lempiras in La Ceiba on dry goods and other products that are brought in from other parts of the country and shipped to these destinations via coastal freighter.  As usual, these shipments will drop 60-70 percent starting in February, but things will not return to normal in June as they have in the past. Nothing will ever return to normal.

Aside from the approximately 2,400 families in La Mosquitia and Guanaja that depend directly on the diving, many others will be indirectly affected: merchants who operate businesses in these places, workers of these businesses, freighters that carry the merchandise, freight haulers, airlines, electric companies, municipal workers, carpenters, fiberglass workers, mechanics, refrigeration experts, cable companies, bars, restaurants, banks and all others that have anything to do with sales and services. Banks in Guanaja and Puerto Lempira have already cut back on some services to their customers.

This government, instead of trying to bolster the economy, is doing things to aggravate our precarious situation, like a surtax on checks drawn on checking accounts. This tax is levied on your balance without regard to your non-personal expenditures. I use my checkbook to pay my workers. They get their money, and I’m left to pay the extra tax.

The Honduran Government is also getting ready to spend Lps. 1,234 million on fast boats to chase cocaine traffickers. The US, which is the destination of most of the cocaine, is not sponsoring this scheme, so I can’t see the reason for spending all that money. A very sad state of affairs, and this can only get worse. Help!

P.S.  The November World Court decision in the Colombia-Nicaragua maritime boundary dispute reminds me of the Bible verse (Mark 4:25): For he that hath, to him shall be given: and he that hath not, from him shall be taken even that which he hath.

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