Vexed Bermoothes

There is much talk in local corporate boardrooms about the arrogance of the Bermuda Government, its inexplicable hostility towards the international business community, and the disintegration of Bermuda’s once-envied public/private partnerships.

The divide was clearly shown in the Senate yesterday, when a UBP Senator raised a quote from the CEO of major Bermuda insurer at a business lunch on the island last week.   Michael McGavick, CEO of XL Capital, was describing the proposed tax law changes in the US aimed at Bermuda:

“The threat this time around is extremely real” and without a united effort to address the threat “tax regimes that are punitive to Bermuda and other countries will become law”.

And the response to this plea for unity to protect Bermuda’s most important economic sector? According to news reports, PLP Senator David Burch questioned the credentials of Mr. McGavick to make such a statement.  And PLP Senator Walton Brown apparently noted that Mr. McGavick was previously an unsuccessful Republican candidate for the US Senate and called him incorrect and misinformed.

Way to go team!  Epic fail!

For Senator Burch’s edification, as he apparently does not know his customer, Mr. McGavick’s credentials are that he is the CEO of one of Bermuda’s most visible companies.  Even in these turbulent times, XL has assets of over $50 billion and a market cap of over $1.7 billion.  And most importantly, XL is a major employer and taxpayer in Bermuda.

And, to be gratuitous, I’ll point out that both Senators Burch and Brown have also been unsuccessful in being elected to public office as well.  They are political appointees to the Senate.

Bermuda faces many external threats these days.  But sadly, we also face internal threats caused by the partisan pettiness of our own leaders.

The worries reflected by Mr. McGavick are real.  The Bermuda Government would do well to work with our customers, rather than belittle them in public.  Rough remarks like these reverberate for a long time.

When a CEO, who must answer to his shareholders, hears such intransigence coming from Government leadership they have a responsibility to make other plans.  That’s the reason why so many of our “job creator” roles are bleeding out to places which may have higher taxes, but have responsive government, greater convenience, and larger qualified hiring pools.

Update:  Paula Cox, as usual, gets sent out for damage control.