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Thursday, July 25, 2024


"If you had an election today, I believe that the issues that people would be talking about would be different," says Noel Loftus. He should know, because he was right in the thick of the last election discussing the issues that are being discussed today. Some have called him a doom-and-gloom person, but he sees it as his civic duty to report the facts. How people choose to act on them is another matter.
He presented a fairly bleak picture during the last campaign, at a time when the government was predicting an unlimited ceiling of clear skies and smooth fiscal sailing for the territory. While the government was passing out raises, Loftus was talking about the need to create jobs in the private sector to support a healthy and manageable government. While new hires were occurring in many government sectors, he was discussing the need for tax reform to expand the private-sector tax base. In fact, at times Noel Loftus seemed to be a party of one up against a political machine determined to drown out his voice.
If anyone deserves to say "I told you so," it is Loftus. Yet, he does not care about being vindicated; he is merely looking for solutions to the territory's growing fiscal problems. There are, he insists, clear-cut solutions that will bring order to the growing fiscal chaos in the V.I. government. Some of those solutions, he says, have been on the governor's desk since 1999.
The Memorandum of Understanding makes clear that we have to restrain spending. That memorandum was signed by Governor Turnbull and has, for all practical purposes, not been followed. The memorandum outlined a dire situation projected to affect the territory by 2003. It predicted a $113 million deficit by this fiscal year if the measures contained in it were not followed. Almost prophetically, if the administration had not secured authorization to obtain a $100 million short-term loan recently, the government would have exceeded the memorandum's warning by nearly $40 million.
I asked Mr. Loftus about some of the measures that need to occur to reverse the current trend. He said: "You have to grow the private sector. To do that, you need tax reform, tourism spending — not to be confused with a tourism authority — and a greater insurance capacity." He also listed tort reform as a potential boon to business. But Mr. Loftus is quick to point out that the growth of the private sector alone is not enough.
"We have been living above and beyond our means by $650 million over a nine-year period," he said. Asked if this meant that there would be a need for government layoffs, he replied: "We never had to send anyone home." Instead, he contends, attrition and a hiring freeze combined with the growth of the private sector would have put the government on solid footing. Is the memorandum now a moot point?
The very heart of this discussion, however, is what do we do now? "The final solution is to restrain spending, grow the private sector, follow the Memorandum of Understanding and use the five-year economic recovery plan," Loftus reiterated. At times, one cannot teach an old dog new tricks. With Mr. Loftus, this is good news; our financial state is tricky enough already.

Editor's note: Bill Turner is a writer, a former history teacher and the executive director of the St. Croix Environmental Association. He writes a daily commentary on events in the Virgin Islands that can be accessed at V.I. Buzz.
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