The Tribune

EDITOR, The Tribune.

Let’s be clear on what a Chamber of Commerce is – and what it is not. It is an organisation that promotes the interests of the predominant players in the current economic and business environment. As such, it naturally supports the status quo, however good or bad that may be for the population as a whole. It is not a group that has any more knowledge of or interest in the condition of the country’s economy as a whole than anyone else.

In 1833, the predominant Bahamian businesses (cotton plantations in the southern islands, merchant concerns in New Providence and Harbour Island) would have been dependent, respectively, upon chattel slavery and the “truck” system of consumer credit. It is therefore no surprise that, at the time, virtually the entire business class fought tooth and nail to preserve these things.

Likewise, today’s chamber of commerce reflexively defends those aspects of a broken economic model that nonetheless serve its membership well. Among these are a minimum wage that bears no rational relationship to either the country’s wealth or its cost of living. Rather, it reflects little more than historical attitudes towards wealth distribution and the role of labour in Bahamian society (see above).

In reality, every period of robust economic growth in post-war Bahamian history has followed fast on the heels of a hard-fought advance in labour conditions or wages, at the expense of the wealthy, business owning elites. Yet on each of these occasions, the “business community” has predictably sought to spin their own loss of relative wealth and influence into fears of economic collapse. Each time it was a lie.

There is a point at which wages, relative to costs and profits, will begin to retard growth.

But The Bahamas is nowhere near that point. In fact, our domestic economy is sluggish not because workers get paid too much, but rather because they get taxed too much and paid too little. By placing more disposal income in their hands, a rise in our pitiful minimum wage (and the ripple effect it will have across the labour market) will boost consumption, which will lead to more jobs, not less.

But however harmful low wages are to the general economy, they clearly serve the interests of those business owners who have become accustomed to the presently skewed and inverse relationship between worker compensation and their own expectations of profits and lifestyle.

Hence the predictable repetition of the patently false assertion that rising minimum wages will lower growth and employment in the modern Bahamas.

Politicians owe it to their voters to at least educate themselves on the facts of Bahamian economics and Bahamian history before they spend too much time listening to self-appointed experts who serve the narrowest of interests. The time to raise the minimum wage is now.

ANDREW ALLEN

Nassau,

March 10, 2021.