The current economic crisis in Europe is an indication that the welfare state can no longer be maintained in its present form.
And it follows that Barbados cannot sustain its welfare-type state with a declining revenue base. Economic adviser to the Leader of the Opposition, Clyde Mascoll, issued this warning today as a panel of experts examined the pros and cons of economic stimulus and austerity.
Mascoll was reacting to comments made by Head of Research at First Citizens Investment Services, Vangie Bhagoo-Ramrattan, who had suggested that it was difficult to implement stimulus packages in poor countries where the revenue base was relatively narrow.
The former Minister of State in the Ministry of Finance said printing money did not affect the US dollar because it was a currency of choice on world markets. Mascoll maintained that small countries like Barbados had to grow themselves out of an economic crisis.
He told the packed conference room that Minister of Finance Chris Sinckler’s plans for a $600 million stimulus should not be taken seriously.
Directing his comments to General Manger of First Citizens Investment Services, Jason Julien, Mascoll stressed that in spite of the adverse comments made by some Barbadians, Barbados needed the financial resources of Trinidad and Tobago to build the economy.
Commenting on Government’s plans to invest in alternative sources of energy, Mascoll suggested that there should be a mix of fossil fuel exploration and investment in alternative energy.
He noted that Barbados should continue to explore its on-shore and off-shore reserves in the event that the price of fossil fuel drops and research in alternative energy proves costly.