Bubble economy

Have you noticed the new cars all over Saipan? And the construction projects all over the place? What’s going on? Is our economy finally on the rebound? According to the experts up on the Hill, it is. Wow, our casino deal with Best Sunshine is really paying off, huh? Or is there something we do not yet know, maybe do not want to know maybe even know but would prefer to ignore? Are we looking at an economy that could potentially burst in the near future?

Our economy is almost totally dependent on the world outside the CNMI. We have no choice, we are an island chain physically isolated from the world and are therefore forced to import almost everything from our consumer goods to the workforce required for just about everything. Take a look at a couple of factors, which play critical roles in our survival:

Our economy is hanging by a thread we call taxation. This is the only viable way of generating revenue as not too many countries, governments or companies are simply too willing to give us the millions we need to operate the commonwealth in its entirety. There are two main sources of money, our tourism, and the islands’ businesses, which cater to that industry plus the investors, which pump in dollars into the private sector. Both are subject to conditions we cannot control, world politics, the financial markets as well as policies in the countries we connect with for most everything.

For example, if the U.S., China, and Russia continue their shows of force, there can be an incident that can terminate the CNMI-visa waiver program, which will transform our airport, hotels, shopping centers, and roads into movie theater silence.

Our workforce. We knew we had a problem way back leading up to the garment industry build-up. Save for the surrounding waters and the clean air, we lack most resources critical for our economy. Our workforce consists of two groups, local and imported. The locals prefer a government job, one simply needs to be connected by family name or ancestry or politically. The qualification requirements are minimal and the benefits simply awesome.

The imported labor force is subject to policies, rules and regulations, which dictate approval and conformity. They need to be qualified with the minimum education and/or work experience and are restricted to term limitations for their time in the CNMI. And the Consolidated Natural Resources Act, which the U.S. government imposed without our concurrence is the rope and the fire that keeps us at the mercy of the U.S., our political partner. The existing CW program is terminal and the H2 visa category is cost prohibitive for most companies and does not include all the job classifications we require for the CNMI. Not only that, DHS is a federal agency that bends and complies with wishes of ever-changing politicians in Washington. We simply are pawns in a world we have no control over. Just ask our non-voting Washington, D.C. delegate on his accomplishments to head off our impending disasters.

So, are we witnessing an economic boom or is it but a bubble fixing to burst in a couple of years? Ask the major investors what their plans are should the threats to our survival become reality. Maybe then, just maybe and without any guarantee, we may wake up. Good luck!

Rudy M. Sablan
Garapan