The Marianas Budget Trench

The specter of a $226 million dollar budget for the Commonwealth has made me reach for my calculator and a fresh pot of coffee. Want some perspective on this figure? Did you realize that the CNMI government is over three times the size of Guam’s government in comparative economic terms? Are you sick of snotty rhetorical questions? OK, read on.

The CNMI’s government comes to about 40 percent of the economy, as measured by Gross Island Product. This is huge by U.S. or industrial Asian standards, and it under-reports the public sector situation since Uncle Sam picks up the tab for much critical stuff like defense, bank regulation, aviation regulation, environmental assistance, some courts, some law enforcement, and such. Furthermore, I believe that U.S. entitlements such as food stamps are not tallied in the Commonwealth budget, but I’m not sure, because at some point I lose interest in the details and think about…well, I think about cheeseburgers, as a matter of fact, since coffee makes me hungry.

But it’s clear that if we imputed a value to Uncle Sam’s assistance and services, we’d get a situation where total government spending for the Commonwealth comes to over 50 percent of the size of local economy. Permit me to reflect this figure with my deft and subtle journalistic touch:

FIFTY PERCENT!

In the world of economics or finance, that’s a huge, big, giant, towering number, and as for American economists, it’s enough to make their heads explode. Even 40 percent is. As one of my colleagues said about it: “It ain’t exactly got ‘free market’ written all over it.”

You’d think I’d keep better company than that, but we’re into this inverse status kind of middle-age gig where we say “ain’t” all the time because we’re so uncool we want to sound cool again so chicks will dig us.

It doesn’t work.

Uh, anyway, back to this big, huge, giant, towering budget number. At an average room rate of $81.46 per day for CNMI hotel rooms (2002 data), a $226 million budget would be enough to rent EVERY hotel room in the ENTIRE Commonwealth for almost TWO YEARS.

Wow!

So who needs tourists? We could rent the rooms to ourselves for an entire year and STILL have almost $100 million in pocket change to throw around for beer and pizza.

Wow again. Incredible.

Want more perspective? GovGuam, a bloated entity so big it got its own snappy nickname, has a budget that is about 13 percent of their economy. Got that? Thirteen for Guam vs 40 for the Commonwealth. True, Uncle Sam does pump a lot of money into Guam’s economy via the military. And, true again, I think my calculator must be broken. But I did check and recheck, and, well, well, there you have it, thus proving that if I make any stupid errors, I’m smart enough to reconfirm them.

There is no way around this fact: In comparative economic terms, the CNMI has one of the largest governments in the civilized world.

That’s not opinion, that’s fact.

The only opinion I’ve got today is that if they decide to go the hotel room and pizza route with all that money they’re pouring down the Marianas Budget Trench, I’d like a room with a beach view, please…and extra pepperoni.

(Ed Stephens, Jr. is an economist and columnist for the Saipan Tribune. Ed4Saipan@yahoo.com)