Austerity: damaged gov’t in election

December 13, 2016
Source: thebftonline.com/Ghana
Austerity: damaged gov’t in election

Since the electoral loss by the government, there has been a lot of questions over factors that caused the main opposition party - New Patriotic Party (NPP) overwhelming victory.

Amid the election defeat of the ruling government – National Democratic Congress (NDC) there has to be a reflection of how austere measures may have overburdened majority of Ghanaians who voted for change to end the economic suffering.

Austerity was introduced from the International Monetary Fund (IMF) bailout over a rising mountain of public debt to restore fiscal probity. Its (austerity) was the only way to restore order in the  public finances, but it has ultimately scuppered growth, caused massive taxes for businesses, joblessness and high tariffs.

From hindsight, it is clear that austerity was the heart of the election campaign. Ghanaian voters realised that government was to blame for the economic damage.

The masses believed that government had set the economy on a downward spiral that could push hundreds of thousands of Ghanaian youth into unemployment.

Many have suffered under austerity, and the country is by no means out of the woods. Though Gov’t consistently projected good economic growth, the country’s unsustainable debt makes further predicament quite likely.

And with the public bruised with job losses, increased electricity bills, higher cost of living, lower investments and worsening public finances it became a horror that stirred in their face.

It resonated politically thus, making it was easier for anyone to blame the NDC government. Austerity has been a hopeless task politically since it depicts an economy in a hole hence, opening room for a barrage of criticisms. What the public care about is gov’t real increases in spending on public services to boost aggregate demand. 

Nonetheless, the governing body’s politicians also failed to provide an understandable vision of the nation’s future, or a good sense of direction under austerity.

All they kept saying was that; money will be in people’s pocket in 2017. Maybe the gov’t did not want to expose itself of why the financial mismanagement which led to high debt and its recovery from the lofty debt.

Gov’t had published a book – Green Book, exhibiting projects to show that it had certainly not created a mess. The book showed a lot of schools, hospitals, roads and other major projects put up. But the honest reaction by the court of public opinion was that gov’t had over blown the actual cost of the project.

One can deny this, but the intuitive nature of the election campaign showed how many voters felt the effects of an economic system that was never going to work for them.  Austerity, which has affected the living standards of many Ghanaians, was not forcibly imposed on us by the IMF but a choice made by the current government. The agreement obligated the gov’t to sabotage its economy.

Austerity in Africa is morally unethical since majority depends on government subsidies to survive. It is a failing system which simply produces a fractured society, a weak economy and persistently high unemployment.

The people rejected the gov’t validity because they would not like to continue to surrender their freedom to a political agenda that has already subjected them to a serious economic torture. They decided for a government that will be strong enough to implement practical economic alternative.

The majority of Ghanaians believe that an alternative vision of Ghana’s future is urgently needed. They need a vision that would be to prioritise all policy decisions focused on delivering a future economic and social sustainability.

Nonetheless, the incoming government would be faced with a big hole in the public finance due to a misguided splurging that has shaped a colossal debt.

How do you find a solution for an economy in a tailspin while meeting your campaign promises of turning Ghana into safe heaven?

The NPP government would only have to limit the damage of taking loans or selling EUROBONDS to service debts while looking to meet its promises. It has to discredit austerity as a recovery policy. Total economic meltdown must be avoided against the odds.

We now have a new political framework. We don't need to remember the old consequences of austerity; it's enough to look to end austerity, no more recession, no more poverty, no more joblessness and no more dependence IMF policies.