By Michael L.Alberga
CurrentCommentary
The Budget- A Leading Economic Masterpiece
By Michael L.Alberga
Michael Alberga is athird generation attorney and has been practicing law in the CaymanIslands for over 20 years in the firm of Myers & Alberga.He is a member of many distinguished organisations including theAmerican Bar Association, the International Tax Planning Association,and the International Business Law Consortium, and was Presidentof the Cayman Islands Law Society for 4 years ending in 1997.
A daisy cutter year will most likely bethe appropriate way for our historians to memorialize 2001. Welead the way from beginning to end. Our first feat of leadershipwas to sign the OECD tax harmonization commitment letter beforethe EU parliament had even committed itself to the program andthereby weakening the position of all non-OECD financial centres.
After sacrificing private client business,one of the most important engines to our economy, we were rewardedby being placed on a blacklist requiring significant legislativechanges which placed costly and uncompetitive burdens on the financialindustry in order for us to get off such a list. Luckily, theUnited States of America killed the tax harmonization initiativebefore it was able to attack their economy and partially savedus from our own stupidity.
Our second major feat was the secret signingof a tax information exchange agreement with the United Stateswithout competent tax advisors, thereby shocking the world andourselves and obtaining nothing in return except placing our nationalswith dual citizenship in great jeopardy.
Our third and final feat, the presentationof a budget obviously based on new and enlightening economic treatiesknown as the CRT Economic Theory.
This new CRT theory (Cassava Republic Theory)is so impressive that Mr. Alan Greenspan has requested that acopy be expressed to all members of the FOMC with a speciallyautographed copy from the Honourable Linford Pierson, his counterpartin the UDP, to be placed beside the works of John Maynard Keynesin the Congressional Library.
Economists in most leading countries includingthe United States of America have advised governments of the world'sleading economies that in order to avoid a deep recession theyshould undertake a series of monetary and fiscal measures includingthe reduction of interest rates (11 cuts in the U.S. this year)and a reduction in revenue raising measures, ie. taxation as partof the urgent effort needed.
Our new revolutionary Cassava Republic Theoryhas come to the conclusion that these old time tested methodsare unworkable in the 21st century.
We have proposed a new and much better process,ie. raise the cost of doing business, transportation, and employmentsignificantly. Concentrate all major revenue measures in the areasof the economy that employ the most people and produce the enginesfor economic viability.
This will bring more business, make ourindustries much more competitive with those whom we compete thusenabling our economy to grow rapidly and produce a bright futurefor our children. An important by-product of the new illuminatingtheory will provide more money to our government to waste in orderto ensure their re-election in a couple of years.
Perhaps the most enlightening juggernautof the Cassava Republic Package was the ingenious thought processof charging garbage fees based on the consumption of electricity.
The obvious result of this brainwave willbe that a person or family living in a two or three bedroom housewith air conditioning will pay much more in garbage fees thana 10 unit apartment occupied by 20 or 30 people without any airconditioning.
This completely destroys one of my old theoriesthat governments should be restricted to the treatment of sewageand garbage collection. Now even that is doubtful.
Perhaps prior to the final passing of thisleading 21st century masterpiece, one of our illustrious luminarieswould propose three minor amendments:
1) That persons working on cassava plantations be deemed not tobe professional, thus removing the additional levies on theirwork permits;
2) Work permit fees for temporary labourers who may be neededto fill in from time to time and reap the crop be reduced from$1,000.00 to $100.00 per month;
3) That gas and diesel surcharges for the equipment used in productionand transportation to market be exempted from the increased levy.This would at least make a pound of cassava about equal to theprice of an ounce of platinum and enhance its marketability.
As we prepare to enter the third world withthe speed of light, we should not despair as we will be takingthe lead in the year 2002 with further earth shattering stimuluspackages.
I now understand that very shortly we willbe signing the necessary agreements which will commit us to theEU tax savings directives (not agreed in Europe yet) and thatthe second volume of the CRT will be released.
This will reinvent the old third world argumentthat farm products should be exchanged for finished products ona barter basis, thus allowing us to exchange a pound of cassavafor an ounce of platinum which we can then sell to earn foreignexchange in order to feed and educate our children.
In addition to this, the doctors of theGeorge Town Hospital have identified the gene which has producedthe Caylini Syndrome in our leaders.
This syndrome is apparently similar to theMussolini Syndrome which caused Mussolini to march his troopsover the edge of huge cliffs in order to show loyalty with theexception that it has mutated and now causes our leaders to takeflight with pen in hand and sign all agreements placed in frontof them. As we all have noticed, the effect of which has beento progress our economy at lightening speed from one which producedsurpluses to that of a third world economy producing deficits.
The systematic destruction of all industriespreviously shown to be successful in their ability to employ personsand earn money to keep the country running is a by-product ofthe syndrome. This remarkable breakthrough has two very importantpossibilities.
Firstly, if we find the necessary vaccineto cure the Caylini Syndrome, we can sell the same to the UnitedStates of America and other G-7 countries who no doubt will giveit to other third world leaders and save themselves billions ofdollars in aid which could then be used to restart economies intheir own countries.
If we fail to find an antidote, we couldsell the virus to other third world countries who could threatenmembers of the G-7 with spreading the same among their electedleaders in return for which they no doubt will be bombed and receivesignificant aid for reconstruction and proper directions as tohow to manage their economies. In either case, significant sumsof money could be gained for the benefit of our people.
We are of course very proud that our littlecountry lead by Big Mac Bush could have put forward this new andforward thinking budgetary methodology now going to be used tosave the economies of the world at the very time when the UnitedStates of America lead by George W. Bush was unable to have hisadministration come up with a similarly brilliant program. Anothermajor feather (ostrich like) in our camp.