‘Blue sky’ leaders

Have your readers ever noticed that their leaders on Capital Hill come up with amazing numbers to justify their ideas and proposals that are supposed to save the CNMI from total failure? Where do their numbers come from? I do not know and I have asked many people and no one seems to know. Probably only God knows. If anyone does know please publish the answers in the newspaper for all to see. Below are a few examples that I remember being used by our leaders in the press the last few years. For example:

At the beginning of the current governor’s administration, we heard of the wonderful potential for making shoes and peanut butter in the CNMI. Where did this and several other opportunity ideas come from? They have now disappeared. What was the source of their information, market studies? Were these the best ideas that the governor’s men could come up with, out of the clear blue sky?

The Legislature took on the concept of selling CUC to take it private. That was a good idea, but where did the value of $500 million come from? I have a simple mind and for me a failing utility, with failing old equipment, debts of several hundred million dollars, poor to no management except for the governor’s declared emergency—CUC was an opportunity that could not be given away to an investor, let alone charging a half billion dollars.

Our leaders proposed to lease land on Tinian that would have taken away close to 5.0 percent of the total land mass to a company that I could not even find listed on the Internet. Where do these proposals come from, out of the blue sky? The people should ask their leaders questions about such “deals.” They are too good to be true!

CHC was recently formed as a new corporation and given “seed money” of $5 million to get started. That “seed” was only about 12 percent of the normal annual operational budget. Where did the numbers come from? Who determined the need and amount of the seed? Then the governor gives away prime real estate next door to the new corporation. Why? I still cannot figure that one out.

We have been told that casinos will generate “$millions”; some have even said “$billions.” Is there a detailed market study somewhere in the files of legislators that confirms these numbers? The people of Saipan do not want casinos, the tourists do not want casinos, who wants casinos and where is their data to justify their motivation? The small amount of research that was done by folks in the community indicate that casinos are a “saturated” market. The performance we see on Tinian seems to verify that point.

Now it is being suggested that the cure for our financial ills is to sell golf courses and hotels fee simple. Legislation has been introduced setting a minimum price of $1,000 per square meter for Saipan golf courses and $500 per square meter for Tinian and Rota golf courses. Doing some very quick and crude calculations I find that Coral Ocean Point, one of Saipan’s smaller courses, will sell for the bargain price of $600 million. For investors of slightly greater courses means Kingfisher would sell for $1.3 billion. And for the “high rollers” that we are always hearing about, LauLau would be available for $2.6 billion. But bear in mind that the $1,000 per square meter figure is a minimum. If we drive a hard bargain, maybe we can get even more. Of course I am being sarcastic. Even during the boom times in the 1980s, only a very few properties on Saipan broke the $1,000 per square meter selling price threshold. And I’m sure those investors have regretted it ever since.

There was also a proposal to develop Aguijan (Goat) Island into a scientific research station. As usual, this was going to generate “billions” of dollars. We were never told who the researchers would be, what they would be researching, and where they would get their billions of dollars to shower on the good people of the CNMI.

I have spent my working career as a technologist and small business owner. If I ever tried to present figures to my management or board of directors that were so preposterous as the above examples, I have no doubt I would have been fired and removed from my position. My business would have certainly failed.

Yes, we have serious financial problems in the CNMI that require drastic actions. But our leaders should stop wasting time dreaming about magic cures. There are none, and they are wasting everyone’s time throwing out solutions that are based on dreams rather than sound financial and market analysis. I believe that they think we are all stupid and will believe whatever they say. They are wrong!