Archive for March 16th, 2010
Property firm bucks trend and hires staff
(CNS): The last two years have been difficult for the Cayman property market but local Real Estate firm International Realty Group (IRG) has said it is making an investment in two new additions to its team in anticipation of the long awaited upswing and both of them are Caymanians. Despite the markets continuing fragility Jeremy Hurst, President and Owner of IRG says the chance to take on two experienced professionals was one not to be missed given his cautious optimism about the future of Cayman’s real estate market.
“There have been good signs of market stabilization in late 2009, although I would still characterize the situation as fragile right now,” Hurst said. “Even so, when the opportunity to add two strong Caymanian professionals to our staff, Mario Sanchez and Trisha Johnson, we decided we could not pass it up.”
Mario has most recently worked in the hedge fund services industry with local branches of Citi and Ogier. He attended Cayman Islands High School before pursuing a degree in architecture at the University of Miami. “Real Estate and architecture have always been a passion of mine,”he said. “IRG is known for its personal service and professional attention to detail. I look forward to working with this talented team and learning from its wealth of experience.”
Trisha Johnson has worked in the Florida real estate market for several years specializing in the condominium and middle income home sector, which she describes as “quite the roller-coaster ride”. She says that Real Estate is not a typical career choice for Caymanians but she encourages others to consider the profession as it can be very rewarding. “Working with an eight person team at IRG is a great fit for me. Clients receive very personal and professional service and that fits with my approach to the business,” said Trisha who achieved top honours on the Cayman Islands Real Estate Brokers Association (CIREBA) exam.
She will be focusing on the condominium and middle-income residential market, an area that IRG is diversifying into after being known primarily as a high net worth residential and commercial property firm.
Mario will be using his corporate experience and relationships to provide additional support to the commercial side of IRG’s business as well as use his local contacts to further increase the company’s middle income residential market share.
“IRG is proud to add two enthusiastic, well trained individuals to our team,” Hurst added. “They fit in perfectly with our firm’s culture of hard work and excellence in what we do. We remain cautiously optimistic about the real estate market in Cayman during 2010 and believe these moves position us well in the current market as well as for the next upturn.”
Individualism over collectivism
As we all know crime has many causes, and as the Cayman community wrings its hands and tears out its hair over how Grand Cayman, at least, went from being a place with a reputation for peace and security to crime-central in such a short time, there are significant cultural and social issues which could be to blame that few wish to confront.
On Thursday evening, however, Professor Brian Meeks gave an incredible key note presentation at the University College of the Cayman Islands’ first regional academic conference. Although the UWI academic was talking mostly of his native Jamaica and the rise of violence in that country, the issues he addressed were ones which the authorities in the Cayman Islands must also begin to consider. While the rise of violence in Jamaica is complex, one of the key issues which Meeks spoke about was the culture of individualism over collectivism.
This concept of selfishness became a political movement in the 1980s, embraced by capitalism and monetarist policies in both the US and the UK, which changed the post war western world from one where people looked out for each other to one where people strove to achieve and acquire wealth, often at the expense of others.
The west adopted the principle of capitalism and all the selfish elements that go with it and branded anyone who was willing to place society as a whole above self as a socialist. When the UK Prime Minister Margaret Thatcher famously said “There is no such thing as society”, she illustrated where the western world was going. While hard working capitalists were lauded as high achievers and people to be revered, the culture of the individual was being enshrined and the concept of community was being lost.
Cayman is part of the capitalist world, and the relentless never ending pursuit of growth and accumulation of wealth which defines the system, because of its role in global finance. Wealth was acquired here in the boom days of the offshore industry, and many of the strong elements of Cayman’s past collectivism were eroded as the country embraced the ideals of capitalism and the wealth that came with it.
It is perhaps not surprising therefore that a generation of young men who have never lived in a society where the collective is placed above the individual have become selfish criminals who pursue their own agendas with little consideration for anyone else.
They have grown up in a world where leaders and politicians praise the acquisition of wealth and where the sins of the powerful, as demonstrated in the recent financial meltdown, go unpunished and in some cases rewarded.
While not wishing to romanticise the idea of poverty and suggest that Cayman was a better place when there was no electricity and the mosquito was king, today many many Caymanians, when they speak of the loss of heritage, are talking about the loss of collectivism and the rise of individualism — essentially, people have stopped caring about eachother. The capitalist system is inherently selfish, and once it “won” the cold war in the late 1980s and early 1990s, it was as if selfishness was legitimised over community.
We in Cayman now have a generation of young people who have little experience of the concept of selflessness and who have been taught that acquisition, having stuff and being wealthy are all good things. Consequently, when they cannot acquire wealth through legitimate means they will acquire it through crime. The selfish nature of modern society has created uncaring individuals who see the men at the top of the capitalist system being equally selfish and turning a blind eye to the pains of those at the bottom of the socio-economic pile — so why should they care who they shoot in order to gain an advantage, be it status, as is the case at present, or wealth?
To suggest that the capitalist system is entirely to blame for Cayman’s crime surge is over simplification, but we must begin to recognise that the legitimate pursuit of wealth with few checks and balances, which is what led to the global meltdown and which lauds individual achievement over that of a society, fuels selfishness and breeds criminal disregard among those who would be inclined towards a life on the wrong side of the law.
We have all heard the discussions recently about the audacity of the local gangs and that they do not appear to care about the impact their actions have on the community at large. But their disregard for the community should not surprise us, as essentially they are products of their time when the individual reigns supreme over the collective. They have simply not be taught how to live with one eye on their neighbour.
Carelessness and selfishness are by no means the only reason why today’s youngsters are more violent, but the elevation of the individual and the undermining of the collective is one of the reasons why. The irony, of course, is that those who belong in gangs find that collective support which is now missing form society in general. Sadly, however, the collective goal is still to acquire wealth or status at the expense of others.
As society itself becomes increasingly complex and diverse, crime will increase; the less a community knows itself the more crime will happen; the further a criminal is removed from his victim the easier the crime is to commit. Consequently, when the ingredients of despondency, greed, selfishness, poverty, wealth, exclusion, population increase, competition for resources and alienation all come together, crime will always be in the mix.
While the ‘powers that be’ around the world (and these days it is the global corporation and institutions more than governments) continue on the relentless pursuit of growth and wealth, those who wish to gain but are excluded from the main event will continue to choose the more undesirable routes to wealth and status from behind a gun.
Miller says CS overpaid
(CNS): The release of the Miller–Shaw report into the public domain on Monday will make tough reading this week for the Cayman Islands’ public sector workers. Although the report made a number of observations and recommendations about the causes and resolutions for the country’s fiscal management problems, the civil service (CS) has emerged as its main target. The report described civil service pay and benefits as “extraordinarily generous by standards of other developed nations” and said that government workers were receiving far more than those in the jurisdictions with which Cayman has to compete for business in financial services and tourism.
The report raises concerns regarding the unfunded liabilities of the civil service health benefits and pension funds, and states that personnel costs are crippling the Cayman government. As a result, it recommends that government undertake major cuts and privatizes some of the services currently provided by the public sector.
Speaking about the Miller report on Monday morning at a specially convened press briefing, the premier said his government would be implementing may of the measures recommended in the report. McKeeva Bush said that during his visit to the UK, the report formed the basis of the talks with the FCO on how government would set about dealing with Cayman’s future financial problems. Bush admitted that, while the UK was supportive of the recommended cuts in the report, the FCO had expressed its disappointment that the authors had not offered any new revenue raising measure such as direct taxation. The report was commissioned by the UDP government as part of the conditions set by the UK to offer approval for borrowing over the government’s own legal limit. The UK had asked the CIG to study not just how to bring down government expenditure but how to raise more revenue in a more direct, equitable and sustainable way.
In the report, the authors, James Miller III, a former aide to the Ronald Regan administration, from the US and David Shaw, a former Conservative MP from the UK’s parliament, both on the right of the political spectrum when it comes to economics and monetarist policies, said that Cayman was already taxed to, if not beyond, its limit and recommended that it did not introduce any more taxes or fees.
“Government’s current levies on the financial services and tourism industries are very close, if not beyond, the point of maximizing revenue,” Miller and Shaw wrote. “Further increases would drive away business to such an extent that even with higher levies revenue to Government would fall.”
The report suggests that if Cayman was to choose a widening of its tax base instead of cutting expenditure, it would have to include all Caymanians including the poorest but that it would still not necessarily produce the desired effect of raising enough money to fund the current levels of public spending.
“In order to provide anywhere near sufficient revenues, the tax -rates would need to be at international developed-country levels, and the tax base widened to include all Caymanians, including possibly some of the poorest,” the report states. “Even that might not work, since with its island geography, an increase in taxes would place Cayman at a significant competitive disadvantage for financial services, tourism, and other potential enterprises, and may residents could depart the Islands.”
The authors conclude that the course of action for the CIG should be to sell assets, privatize some elements of the public sector, but above all to reduce the size of the public sector and engage in a major overhaul of how it is managed and paid. The report is heavily weighted in favour of reducing spending rather than raisingrevenue, so much so that it recommended reducing some of the existing taxation with the removal of tax on fund transfers as well as a reduction of work permit fees.
Echoing the sentiments recently expressed by the UDP administration, Miller suggests that the CIG needs to increase the number of work-permits and make the country’s guest worker programme more flexible.
The report offers no new revenue raising measures other than the utilization or sale of existing assets and the privatization of services therefore reducing the burden on core government. Although it recommends that government study ways of raising the same revenue but minimizing the adverse effects on economic activity of various levies, it does not say what those revenue raising measures might be. The report agrees with the principle of using private sector partnerships to develop the outstanding infrastructure needs of the country and therefore broaden its income base through a growth in private sector.
Among the numerous observations that Miller makes, he also criticises government for its poor record when it comes to statistics and says the budget process need to be far more transparent and calls for more accountability from government.
Check back to CNS throughout this week for more from the Miller report and its comments on the CIG’s lack of financial transparency as well as accountability when it comes to the budget management.
Civil service rejects cuts
(CNS): The civil service has offered to give back its cost of living adjustment of 3.2% for the remainder of this budget year but then take ten days unpaid leave in the 2010/11 budget year instead of a direct pay cut, as proposed by government. CICSA said this was equal to a 4 percent reduction in pay but has rejected all of government’s pay and benefit cut proposals of as much as 10 percent announced by the premier earlier this month. The association has also asked government to offer public sector workers the opportunity to choose from a number of options to help reduce the deficit rather than imposing salary or benefit cuts that they cannot afford.
CICSA also said it could not support the proposal for itsmembership to pay half of the health care benefits. It said the co-pay rates proposed by the government are expensive. However, it said some members had expressed support of co-pay options, “if and only if those options include the ability to choose a health care provider”, and if it was comparable to those in the private sector.
Feedback regarding salary cuts revealed that many public sector workers could not to cope with the proposed pay cuts, the association said. “The Association does not recommend that public servants agree to the pay reductions proposed by the government but that consideration be given to less damaging reductions,” the report said.
“Despite the generalizations being made by some in the public, we have a firm understanding of the difficult financial situation that faces the majority of public servants. Most … will have to make significant life-style changes, and will endure hardship in order to adjust, even to the recommendations of the Association,” CICSA stated. “We believe that Public Servants in general and in most cases have gone above and beyond the call of duty in serving the needs of the people of this country. However, we also recognize that whether justified or not, whether fair or not, more is once again being requested of us.”
The association also suggested government could reap personnel related savings over and above those recommended if it chooses to use a collaborative approach, allowing employees a suite of options to choose from. Options could be researched and presented by the Portfolio of the Civil Service, and should also include other choices that could be used by departments that may have difficulty scheduling unpaid leave.
“This would allow those employees that can go above the required amount to do so and others to consider one day off every 2 weeks or a 4-day work week, since the additional day off would provide time for volunteering, education & training, or getting essential family related tasks done,” the report said.
Unpaid leave, the public sector body added, would create savings to government but would limit the broader economic impact of salary reductions, as employees would be able to choose what works best for them and their personal family situation.