Opinion: Painful shame

POSTED: 07/30/12 1:38 PM

Attorney Karel Frielink gave his vision on the instruction the Schotte-government received from the Kingdom Council of Ministers on his blog site last week. This is what he wrote.

“The Kingdom government has given the government of Curacao an instruction. That means that the government has to stick to financial agreements it made. The governor sees to it, in part, that this is really happening. The popular Dutch expression for this is curatele (a situation wherein someone or an organization – in this case the government – is put under legal restraint – ed.).
Earlier I have said that this instruction is painful. But where exactly is the pain? In the fact that the government did not abide by the agreements it made? In the fact that for the time being she is unable to decide how much money she spends? On what she spends her money? I think that the pain goes much deeper.
It was the intention that Curacao would show after 10-10-10 that it is able to be self-supporting and that it would also be responsible for a balanced budget. Also, that it would have sufficient quality and political discipline for not letting its debts increase uncontrollably. After two years we have to conclude that we have not passed that test. Not yet. And that is why the Kingdom government intervened with an instruction. That’s where the real pain is.
That real pain also has another name: shame. Shame because we have been humiliated publicly. Shame because we have the feeling that we are being treated as a child. Shame because our political autonomy is at stake. Shame because we do not have a good story when somebody asks the question where we went wrong.
We don’t like to talk about shame. We are ashamed because we are ashamed. Shame could lead to different reactions like blaming others, downplaying the facts, mistrust, verbal abuse and even physical violence.
If we acknowledge that we are deeply ashamed the question automatically arises how we ought to continue. Do we know how to get a grip on ourselves and are we collectively going to work on a different, better policy? Or are we going down to the level of denying our own responsibility, whereby we predominantly blame others for the misery we’re in.
In the latter scenario the well-known malefactors and knockdown arguments are mentioned: it is all the fault of the Netherlands and its neo-colonial attitude. Because of the Dutch intervention we are unable to execute the plans that must turn Curacao into a country that is founded on good governance with a high quality of living, sustainable social-economic development and an education system that motivates everyone to get the best out of her or himself.
That the instruction is experienced as a humiliation is audible and tangible. That humiliation is accompanied by unpronounced painful shame. That painful shame appears from the aggression many reactions to the instruction have triggered. Verbal aggression is fueled and strengthened by all kinds of politicians. That is dangerous.
In a situation where many on our island do not enjoy a decent level of prosperity and wellbeing (and let’s not start about the poignant poverty) the proverbial fuse in the powder keg quickly surfaces. The line between painful shame and (physical) aggression is possibly thinner than we think.
Now is the time for the responsible politicians to show leadership. Social leaders like entrepreneurs, sportsmen and women, artists, teachers and so on are asked to take their responsibilities. The smalltime political games that have been played up to now could have serious consequences. The current crisis in Curacao is dead-serious, but we seem to be ignoring the situation’s graveness. The time that we were able to afford this is over, but if we work together we will pass the next test.

A day before he posted the above blog, Frielink went deeper into the legal restraint that has been imposed on Curacao. That went as follows.

“During the last couple of days a lot has been written, and much has been said about the fact that Curacao is under legal constraint. In this case this means something like: not being allowed to take your own decisions about matters that cost money without the approval of a supervisor. How did this happen?
In the run-up to the dismantling of the Netherlands Antilles there were extensive talks and negotiations about debt restructuring. At the time there were debts of several billions of guilders. The Netherlands was in the end prepared to provide an amount of several billions to guarantee Curacao and St. Maarten a sound financial starting position on 10-10-10.
Curacao made agreements with the Netherlands about its debt restructuring and about the supervision on it. Those agreements are established in the Kingdom Law financial supervision. That law is meant to maintain the sound financial starting position and to prevent a repeat of the financial problems from the past. The intention was therefore to prevent that Curacao would again end up with towering debts.
This is therefore about budget discipline: the government must make sure that there is a healthy balance between its revenue and its expenditures. That did not work out. The board for financial supervision (Cft) wrote an extensive analysis of the situation and the conclusions are shocking. Here are a couple of examples.
1. The new country Curacao concluded its first two years with significant deficits.
2. Due to persistent delays in the execution of measures in healthcare, dividend policy and staffing policies the deficits of 2010 and 2011 threaten to occur in 2012 as well. Considering the lack of progress there is a serious possibility that executing several measures in 2012 is not possible.
3. Curacao’s 2010 deficit only became known towards the end of 2011. The 2011 deficit was estimated at 9.5 million guilders in February, but in May this estimate stood at 140 million guilders.
4. During the year 2012 the government has systematically denied that deficits were looming and it has never indicated otherwise that measures are inevitable. Apparently the Finance Minister does not have an adequate grip on the development of revenue and expenditures to be able to correct in the interim (and) to keep the budget within the standards of the Kingdom Law Financial Supervision.
5. The Government of Curacao indicates that it shares the Cft’s concerns with respect to the execution of several measures (especially the reform of the healthcare cost system), but objects to the doubts about the execution of the agreed upon measures.
In other words: the Curacao-government has let things get completely out of control. The debts have become much too high. The government did not abide by the agreements it made and it has also systematically denied that deficits were looming. On top the finance minister does not have an adequate overview of expenditures and revenue. That is the reason why the Kingdom government had to issue an instruction. The message is: Curacao, stick to your agreements.
The Governor of Curacao wrote in a July 25 letter to the government that he will no longer approve or sign draft national ordinances and decisions from the government that are at odds with the Kingdom Law Financial supervision and with the instruction that has been given in this context.
In that sense, Curacao is under legal restraint for making certain expenditures, or for entering into certain transactions like hiring staff. All these decisions now need prior approval by the governor, who is now in a way acting as a trustee. He checks the plans against the instruction and in this way an attempt is made to get the government finances more or less in order again.
That it had to come this far is painful. Being self-supporting also means dealing with money in a responsible manner. We also must want to strive for sound government finances. That the government has proven to be incapable of this has damaged our reputation significantly.
It is not right to point fingers at the Netherlands or the Cft. It is our government that did not live up to the agreements it made. And someone who does not stick to his agreements has to bear the consequences.

Karel Frielink
The author is a partner at Spigthoff attorneys and tax advisers in Curacao.

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