Tag Archives: private sector

Nov 5 2010

WE NEED TO ELIMINATE PUBLIC EDUCATION IN HAITI

This is a public policy matter, and I do expect many to disagree with me. Public education in Haiti needs a total reshuffling; it must be incorporated in a comprehensive plan to reform our economy. We cannot be talking about reforming the economy if we do not address the problems with our education.

We need a new system of education to prepare our kids to compete for the jobs of tomorrow at home and abroad.

Public education is a total failure in Haiti, and things will not get better if we do not change course. We need to take government out of the business of educating our kids and let the private sector take over.

Is Haiti a socialist or a capitalist state? Maybe we need to be clear on the type of economic system we have and the type we really need for Haiti. I am a big proponent of capitalism, for it does make sense to me. Maybe that’s what we need for Haiti. Right now, whether you want to agree with me or not, we have a socialist state; government controls almost everything.  

Before we get further in this, let’s take a moment to explain what the job of government should be in a capitalistic economy.

The role of government in a capitalistic economy is NOT to create jobs and compete against the private sector. It is, rather, to enact policies that would encourage private sector jobs. It should work to strengthen the private sector, and the two must work hand in hand to get things to work for the betterment of our society. So needless to say, we need a strong private sector.

In Haiti, government is the biggest competitor we have in the market, preventing the economy from expanding because it stalls competition. It should not be this way. Government is not to compete against the private sector. It is to set the path for the private sector to walk on.
 
I propose the elimination of all the public schools or state-funded institutions of learning and let the private sector take over them. As we have them right now, they are ineffective and represent a symbol of failure because of a lack of competition within the sector of government. We need to get rid of that.

Government should not be in the business of opening schools. It needs to allow the economically disfavored students to attend private schools or the school of their choosing by making grants and scholarships available to them. Doing so will create a market of schools for them to choose from. Giving them the ability to choose the school of their liking will empower them, and that will fuel the competition needed to get the system to work.

If competition is the engine that gets the economy to move, choice is the ignition that gets it to crank up. When government gets in the game, competition is stalled; the economy automatically stops expanding. On the other hand, when you have the players in the private sector competing against one another, it is good for competition in that it results in quality production or quality education for the students. In such a competitive climate, only the best schools will stand. The subpar or mediocre ones will have to close their doors because they won’t be able to sustain the competitive wave. That’s the phenomenon of the “invisible hand” Adam Smith, the Father of Capitalism, talked about in his masterpiece entitled An Inquiry into the Nature and Causes of the Wealth of Nations.    

In conclusion, we need to revamp the system of education in Haiti by allowing the private sector to assume its total control. The government should not be in the business of opening and managing schools. It should be there to subvention the economically disadvantaged students by providing them with grants and scholarships to attend the school of their choosing. Such a strategy will automatically fuel competition within the system, which, in turn, will produce the best educated kids to contribute in the economic and social development of their society.

Oct 5 2010

ROLE OF GOVERNMENT IN A FREE MARKET ECONOMY

Some, if not most, in our society are very confused when it comes to the role government must assume in a free market economy. There is a reason why it is called “free market economy.” It is called so because government must not dictate the course the economy should take. When you have government controlling and/or interfering in the course the economy should or must take, then we have an economy that ceases to be free.

The role of government in this type of economy is to guarantee the fluidity and complete functioning of the world of business. That is so easy to say. But how can government make that possible? That’s where the bulk of the challenge lies.

Government makes possible the fluidity and functioning of the business world by enacting and implementing laws/policies that could guarantee the rights of the individuals to own properties and have these rights secured and respected. Also, government must strengthen the institutions that could guarantee the security of the physical aspect of all private investments in a stable political climate.

There is no doubt that government alone cannot make an economy work for the betterment of all its citizens. It does need to partner with a progressive private sector (watch the emphasis put on the word progressive) to make that happen.

Government must not position itself as the ultimate competitor, which, sadly, is and has long been the case in Haiti, our beloved country. When you have government -whose primary job is to guarantee a safe environment suitable for business -competing against the private sector, the market tends to become unfair, which in itself is a detriment to economic development and progress.

It is imperative that government guarantee a secure and politically stable playing field where all the players in the economy can play freely within the realm of fairness and dignity.

What we need to keep in mind is that business people are like migratory birds. They would build their nets and lay their heads wherever they can find their peace of mind to operate, without having to be reminded of the possibility of their investments being ransacked. So when you have a volatile political climate -where any unexpected thing can happen at any given time, which may put in jeopardy the security and good operation of private investments -then you have a situation that cannot synchronize itself with the expectations of the private investors. What will happen next? That’s when you start seeing private investors leaving the economy for places where the security of their investments can be guaranteed, creating an anemic economy.

We need to do more to attract private investments from foreigners and Haitian natives living in the country and in the Diaspora. Money is just as important to the economy as blood is to the human body. No economy can survive without money circulating in it.

I’ve said this before and I am going to say it again –this time I am going to say it louder so it can finally register in the carcass of your heads. THE ERA OF “DECHOUKAJ,” “KRAZE BRIZE,” KIDNAPPING, INTOLERANCE AND LAWLESSNESS MUST BE OVER!!!!! These practices have not produced positive results for the country as a whole and the economy in particular. We have been doing “dechoukaj” and “kraze brize” since 1804, the year our nation was officially created, what have we gained? I can tell you that we have not benefited anything positive. Instead, we are progressing backward.

So, what is the job of government in a free market economy? It is to make sure that the democratic and institutional structures are in place and strong to guarantee a stable political environment and a strong economy. That’s when we’ll start seeing investments coming in, and we will be able to keep the ones that are already in the economy. Needless to say that security and political stability are paramount.