Money and Confidence Gone?

June 24, 2010

Where is the financial plan to sustain the CNMI government? Today it was reported that Lt. Governor Eloy Inos said that only salaried "critical employees" are "secured" for the next payday, which is July 2nd. How stressful this must be for other "non-critical" employees knowing that they are working and may not get paid on time again. Inos stated:
“If we have enough funds in our payroll account by next week Friday, then we should be able to issue the payroll checks. If not, we probably have to go through the same exercise.

The former Finance secretary said doctors, nurses, police officers and firefighters will always be the priority when it comes to getting paid on time.

Some $1.5 million is needed to pay close to 1,000 of these critical positions, and another $1.5 million to pay for the rest.

“Whoever is saying it's irresponsible, they better get used to it because that's how it's going to be. When there's no balanced budget that's passed, the constitutional amendment provides for those folks [employees in critical positions] to be paid and operations to continue. My message out there to the naysayer, better start getting used to it because that is how it's going to flow,” Inos said in an interview at the second day of the 13th Micronesian Chief Executives Summit yesterday.
What a pompous thing to say to government workers: "Whoever is saying it is irresponsible, they better get used to it because that's how it's going to be." No one anywhere should ever get used to irresponsibility or bad governance. In fact, constituents should demand good governance. Elected officials can be voted out and if they show exceptional poor leadership can be removed from office.

Austerity measures should apply to all government offices, and not just to government employees who are asked to take a cut in hours and accept that their pay will be late. How many "special advisors" and lobbyists does one governor of a territory with about 50,0000 or less people really need? How much has been paid to Jenner and Block and are they still receiving funds? Were there people who were hired before elections in the typical CNMI "a job for a vote" scheme that should be let go? It is irresponsible not to answer these questions.

Robbing Peter to pay Paul never solves financial or budget problems and could complicate them.  If there are inadequate funds to sustain services and pay employees then the only way to solve the problem is to decrease spending, increase revenues or do both.

13 comments:

Anonymous said...

This was all a very, very predictable consequence of the federalization of minumum wages and immigration.

Too bad the Unity Marchers never thought to support creation of a CNMI Delegate position and completion of an economic study before enactment of the poorly-thought-out federalization legislation.

The angst and crocodile tears are a bit late now!

George Miller and his cronies are surely happy there will be no further competition from the CNMI garment industry.

Anonymous said...

The buffoonery reaches new levels.

http://www.mvariety.com/2010062427813/local-news/camacho-undocumented-foreign-farmers-vendors-hurt-economy.php

THE number of undocumented foreign workers turned farmers and vendors is alarming, Saipan and Northern Islands Municipal Council Chairman Ramon B. Camacho said yesterday.

He did not provide figures, but he said these foreigners’ illegitimate operation is hurting the economy of the CNMI and they are unfairly competing with local farmers.

According to Camacho, he learned that some foreign vendors who deliver farm products to retail stores are not issuing official receipts.

“They circumvent the law and are depriving the government of revenue,” he said.

The Saipan Blogger said...

The leaders are ill-equipped to deal with the problems because they have forgotten what it is like to be poor. An exodus of US citizens will begin after we've had a few more payless paydays. The mainland US citizens will be the first to through in the towel, followed by the educated indigenous.

Anonymous said...

Anon 6:25

What planet do you live on? Blaming the CNMI's financial problems on federal control of immigration makes no sense. This government was out of money by the end of Teno's term, long before either the minimum wage or loss of local control over immigration occurred. You might as well blame federalization for your hemorrhoids.

Captain said...

As I have suggested many times before, all should be looking at Guam for jobs.
Guam does not have the local work force to fill all of the job requirements for the Military buildup.
Many from here could defray the estimate of 25k workers that are being recruited from the Phil. with the associated costs.
Under the Guam (and Fed) laws, any wages paid for work concerning the Military bases etc. will be paid according the AWD which is higher than the Guam private sector.
US and "H" visa workers get the same pay scale for related jobs in Guam.
Some companies that do business in the NMI have projects in Guam.
By the time the construction is finished in Guam this Gov. will be out of office, and the next elected Gov. may be able to start the long road to economic recovery for the NMI.
The "mass exodus" from the NMI has been going on for years already, but present circumstances are most likely increasing the numbers.
This will surely have an increased effect on the "brain drain" from what little is left in the NMI.

Anonymous said...

Brain drain? Are there any brain here that went off-island? What i know is there are many foreign brain came in to have this island prosper. And when these foreigners sent home, that is the real brain drain.

Anonymous said...

Anonymous said...

Anon 6:25

What planet do you live on? Blaming the CNMI's financial problems on federal control of immigration makes no sense. This government was out of money by the end of Teno's term, long before either the minimum wage or loss of local control over immigration occurred. You might as well blame federalization for your hemorrhoids.


Your facts are wrong. Check the annual budgets from 2001 to present, and also the annual government revenues, and you will see a significant decline associated with the exodus of the garment industry.

The cost and availability of labor is a significant factor in the functioning of an economy. If the required wages are in excess of actual productivity, no business can make money. Likewise if the skilled workforce is not there. (Most of these unemployed guest "workers" waiting for status because they don't know how to find jobs anywhere else in the world don't qualify.) It is really a shame that no economic study was done prior to enactment of the CNRA.

Anonymous said...

Revisionist BS if you ask me. Willens and Siemer have lost the battle over federalization in the Congress and the courts, and now they want to rewrite history to blame WTO rules, JAL's departure, and CNMI deficit spending on PL 110-229.

Anonymous said...

Teno avoided the issue. Juan Nekai had no plan, or he was too busy playing to do any work. BenTan I was all about protecting Willie. BenTan II is all about payback.

Plan? We'll cross that bridge seven years after we get there. No reduction of hours. No limits in spending. No revenue generation. No plan. Useless Legislators. Spineless Judiciary. Vindictive Administration. Co-opted AG.
Sold out CUC. Bankrupt Retirement Fund.

Will the last check recipient from the CNMI government please turn off the lights?

Anonymous said...

the lack of leadership over the past 20 years has been astounding.

Anonymous said...

The garment gravy train is over. The CNMI government must enact property, departure and sales tax and start civil actions on all agency collections with emphasis on CHC and DPL. Fraud and waste departments need to be created to identify government waste. Unproductive employees need to be paid some sort of severace, maybe half their annual salary to voluntarily leave. Legislators may want to look at the sale of CHC to a private organization. A hospital of that size should be able to generate 20-50 million a year, but instead it receives 20+ million from the CNMI government.

Anonymous said...

New revenue is not the answer. Living within our means is.

Anonymous said...

The problem is not the government living within its means. The problem is the spoils system of the CNMI that is directly tied to its civil service. The spoils system will never change unless private sector wages increase to allow workers to be uneffected by political hirings, or guest workers gain voting rights and remain in the CNMI.

I agree that new revenue will likely just create new government jobs and new votes to further protect the status quo. It will also create money for lobbyists to block all actions that threaten the status quo.

Every CNMI leader will enact policies that ensure himself and his political party will benefit and maintain power. The two tiered wage system directly benefits those in power. Descendants of guest workers and non-connected locals leave the island because the wages are 2-3 times less than the mainland for private jobs, and since they leave, they can't vote for any change in the system.