Taking sweets from children

Cecil Pace spent 15 years in jail for having bent the rules in trying to keep his bank afloat. His name is still tarnished even if it would appear that the crisis he faced was caused by the misuse of the bank's funds by one of his employees to pay for the purchase of the Nationalist Party's printing press. His life and his family's lives were collateral damage in the Byzantine intrigues of our political hierarchy.

Depositors were enraged to be deprived of their funds and easily made a scapegoat of him. Only now have they learned that their funds were always safe and that the government continues to sit on the final tranche due to them refusing to make the final payments that would leave the government obliged to give a full account of its administration for the past 30 years or so.

Had the government-appointed controllers been private persons appointed as curators by a court they could face long jail sentences themselves. They would have been obliged to provide inventories and deposit guarantees. In 1995, a PN administration passed a law granting immunity to all such controllers past, present and future. Amazing? Inexplicable? People swindled by their government for 30 years? So, what else is new?

SmartCity? These Tecom people really deserve the name. I know nobody smarter than them. They have acquired, at a Lm25 million discount, a majority shareholding in a crucial telecommunications infrastructure company belonging to a state with its public finance pips squeaking. Who sells a controlling interest in any company discounting the market share price by 20 per cent? The government of Malta? A management guru and economic wizard turned politician?

Were they not until just yesterday the free market high priests who believed that the market was infallible? What happened? Overnight they have reversed their doctrine and declared that Malta stock market investors are twits with no regard for fundamentals. So what if they pay cash? Which stock market is strictly fundamentals based? Which seller on which stock market examines the rationality of buyers? Since when? Lehman Brothers, the government's financial advisers, know best. Thank God for Lehman Brothers or the heresy would be too much even for our government to spout.

As in the Bical case, the opposition is absent without leave. The SmartCity announcement just ahead of the local council elections was smartly sidestepped by the opposition though a timely meeting with the investors and taking some wind out of the government's boasts of employment pie-in-the-sky like we could already taste it. The opposition too gave its blessing and therefore earned part of the merit for the wonderful future we are promised.

The opposition will have a hard time climbing out of the hole it has dug for itself and raise its voice over the Maltacom share sale. Will it dare ask questions? Will it squeak? Was it just the local council PR skirmish that kept it quiet? Is it shy of defending Maltacom investors? Of defending the Maltese economy? If Maltese investors were willing to pay 20 per cent more for Maltacom shares than Tecom was willing to pay, how come the shares were not offered to the public? Would the bottom fall out of the market if the government put all its shares on offer? Did it have to put all its shares on offer? Why not in dribs and drabs?

If nobody was found to pay the market price, why not wait until somebody did? Are we to be told that public finances are in order because the government will not have to increase its public debt burden for a couple of years on the strength of the liquidation of the Maltacom shares?

What happens to earnings? So far the bulk of dividends from Maltacom shares have been ploughed back into the economy as government revenue. The rest did likewise earning hundreds of Maltese shareholders a return on their investment which they could save or spend in the Maltese economy.

I loved the bit about commitments to protect jobs for three years. Three years? Safely past the next election? Three years' salaries for 300 people facing the predicted chop comes to about Lm6 million. Given a Lm25 million discount, Tecom can manage that nicely.

There was a bit of spin about strategic partners and competing in the world. It was not explained further. Strategic for whom? What will it mean to Maltese consumers? Businesses? As far as Tecom is concerned, the Maltacom shares come at a factor of 14 of their current earnings, a vast improvement on the purchase of the 35 per cent Tunisie Telecom shares at a factor of 34. Now that is strategy.

At the time of the Mid-Med sale to HSBC we were told to expect Malta to become Luxembourg with droves of international banks following hard on the heels of HSBC. We were all to become bankers as we are now told that we will all become IT wizards. It has not happened yet. But it still sounds good.

It would have even sounded better if the government had taken up the Green proposal to find the Lm100 million it needs from the sale to farmers of agricultural land from which it currently earns a pittance. I suppose that would have meant dealing with too many people, with too few millionaires and almost no sponsors of political parties and there is an election in the offing.

What matters is that the PN wins the next election. Really? Because the MLP would be worse? Really? Would it not be exactly just as bad? Does anybody really care that much anymore? Voting for the Greens would be a disaster wouldn't it? It would be such a terrible disaster for us all. They could save the remnant of our tourism product. They may even send some real swindlers to jail. God forbid that they ever have any leverage. God forbid that they have the right to ask uncomfortable questions in Parliament or speak out with full parliamentary immunity. God forbid that we all come to realise what country we inhabit.

We are in the habit of voting for people who squander our national assets and destroy the heritage of future generations. Our heroes rob us and our children's children of their heritage and we reward them with absolute power, all legitimate authority distilled into the seats around the Cabinet table where this insanity is concocted. Nobody in this country has the power to prevent it.

You may kick and scream about all this now but at election time your choice will be reduced to between bad and worse and you will feel that you have to choose bad. You are unlikely to choose different, to end the game and start a new one, to take some control over your fate. It is too new, too uncertain, too strange to vote Green.

You are expected to reward the people who gave us Lm1,500 million worth of debt and to regard them as economic wizards. You are expected to thank them for selling off the family silver to make good the shortfall they caused. The only other option presented to you will be rewarding Labour who were extremely nasty 20 years ago and have given little sign of profound change. The Greens will not be mentioned. It will be easy. Easier for them than for you. Like taking sweets from children. Or is it?

Dr Vassallo is chairman of Alternattiva Demokratika - The Green Party.

www.alternattiva.org.mt www.adgozo.com