As we face one of the most difficult economic crises for almost a century, world leaders with vision and foresight are taking every step to cushion the worst effects on their economies. Sadly, in Malta our government is reacting in a very different way – wearing blinkers and focusing on issues that in the present circumstances are not a real priority.

After letting the public finances spin out of control in the last year mainly as a result of creating sweeteners to win another term of government, we are now being faced with draconian measures that will put unnecessary grit in the delicate mechanisms of the economy. The recent measures taken to hike up the water and electricity bills and the soon-to-come measure to charge much more for bottled gas will slow down the economy with the inevitable consequence of job losses and an economic slowdown.

We are already seeing well-managed enterprises resorting to discharging workers or reduce their production to a four-day week. These companies and others that are still struggling to keep the momentum of production going need support not whip lashes from the government in the form of high cost for energy services.

Malta is not alone in facing the threats of an economic recession. Most homes in Malta today follow what is going on in the world and are constantly updated on the initiatives being taken by world leaders to ensue that their economies do not stall more than is absolutely necessary. Let us, for instance, look at what the Labour Prime Minister is doing in the UK to save the British economy from serious collapse.

Gordon Brown is generally considered as a conservative in the fiscal management of the British economy. Yet in Parliament he recently stated that the economy was facing “exceptional circumstances” and therefore exceptional measures were called for. He announced a number of tax cuts and postponed the planned introduction of tax increases in order not to burden the economy with even more handicaps.

He encouraged, or rather pressurised, banks to ease the pressure on homeowners who are facing temporary difficulties in keeping up the repayments on their home loans. He also hinted that unless the banks played ball, he would introduce new legislation that would make the foreclosure process a more onerous process for lenders.

Moreover, in exchange for the massive bailing out effort that his government introduced, he insisted on banks making credit available to small and medium enterprises so that they could continue to operate and keep people in employment. Brown went even further and told banks that increasing charges or even changing loan terms and conditions for SMEs in the present circumstances was unacceptable.

He even tackled the multinational giants producing and selling oil and energy products. The falling price of oil should mean a fall in petrol prices at the pumps for the ultimate consumers. Unlike our Minister Gatt, Gordon Brown did not treat people like infants by using arcane arguments as to why petrol prices at the pumps would take several months to affect the consumers.

The Gonzi administration lacks the broad and clear vision of leaders of the calibre of Brown and others like him in Europe. Instead our Prime Minister and his Cabinet prefer to work with blinkers on and plough ahead despite the chorus of advice that is reaching them from all quarters. One asks whether this attitude is a result of crass incompetence, or merely cold and shrewd political calculation.

Perhaps it is a combination of both. In this initial phase of the legislature Gonzi wants to administer the bitter medicine as early as possible, hoping that its bitter aftertaste will be forgotten in a few years’ time when he has to face the electorate again. If this is indeed the government’s line of thinking, even if we do not expect it to ever admit this, then we are really being managed by a politically masochistic team.

Our businesses, and indeed our families, need to be encouraged to weather the coming economic storms with confidence. The situation is bad enough as it is. The last thing we need is a government that breathes down our necks to collect even more taxes and revenue on the pretext of fiscal rectitude.

Now is not the time to wear blinkers. Now is the time to show leadership and foresight, as well as political empathy with those who are struggling to survive in a difficult economic scenario.

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