Vexed Bermoothes

This letter to the editor by the author of  “A Guide to the Economy of Bermuda” deserves some additional emphasis.  In addition to the growing debt, Bermuda is racking up some serious deficits in its pension funds.  These costs will eventually come home to roost with future generations of Bermudians.  Note that his rough analysis doesn’t include the unknown but substantial deficits related to Government’s FutureCare initiative.

Dear Sir,

In the endless and dreary list of articles about the credit crunch there has been one conspicuous absence. Conspicuous for Bermudians, that is. What has been missing is any comment on the huge Government debt that is accumulating, especially for our children and grandchildren.

Let me explain further. When you add what is owing to (or missing from), Government-sponsored pension funds the total amount of Bermuda Government debt is alarming. The figures read as follows: $ MILLION.

1. Government debt per budget 539
2. Deficit on Legislators’ pension fund 10
3. Deficit on Civil Servants’ pension fund 760
4. Deficit on Social Security Fund 1,774
5. TOTAL GOVERNMENT DEBT 3,083

Bad as this is, there is more red ink. As at March 31, 2008 the amount invested in equities in the Legislators’ and Civil Servants’ pension funds came to $1.024 billion. Assuming a conservative loss in market value of 40 percent or so, there is a further $400 million debt to add to the $3.083 billion stated above.

So what, I can hear people saying. This will be paid off soon and besides all this stuff about debt is nothing to worry about. I doubt it if this massive accumulated debt will be paid back anytime soon, and it should be a worry – at least if you have any moral scruples.

If you divide $3.483 billion by around 60,000 Bermudians, the per person debt is around $58,000 for each of us. That is $58,000 for every man, woman and child, or $232,000 for a family of four. Anyone born in 2009, does not have a golden spoon in his mouth but a huge overdraft in his back pocket.

What this means is that our leaders in the House of Assembly, and those who are in the civil service have been paying themselves (and us) more than we have earned, and, as a consequence, have stiffed the younger generation with the bill. They could teach Bernie Madoff a thing or two.

This is theft of major proportions – a large Ponzi scheme. Although a small part of future repayment will fall on adults around 50 or under, the vast majority of the bill will be paid for by little children with backpacks going to school.

It is one thing for the plundering politicians and bureaucrats to rob adults who vote. It is quite another to stick it to people in primary school or in baby carriages who do not vote. This is child abuse of monumental proportions – and it is a disgrace.

I might just add that in 1989, Government debt was nil, and pension fund deficits were minimal.

What has caused this huge increase in debt over the past 20 years? Try thinking about endless government travel, movie stars coming to Bermuda to have their picture taken, endless rumours of corruption, civil servant job growth, baseball games, or just plain incompetence or recklessness in Government financial management. The Auditor-General, Larry Dennis, has a much better handle on this than I ever will. Or it could be the Bermuda public pushing for more and more Government benefits without paying the cost in current taxes.

As adults, we have stolen the future of many Bermudian children by providing them with a fraudulent education. We are also fleecing them financially by standing idly by and watching the monstrous debts created by the Bermuda Government.

The next time you see some energetic, enthusiastic five-year-old with that innocent trust in her eyes when she sees adults, try not to smile at her or give her ice cream. Rather, just regard her as some plump chicken to be plucked by us adults who enjoying our big houses, big cars, foreign travel etc at the future expense of people too young to read or understand our criminal behaviour.

Anyone over 50, including myself, should be disgusted with our failure to stop this government racket. I shudder to think what will happen to young Bermudian children should President Obama succeed in his objective of shutting down international business.

ROBERT STEWART
Smith’s