Greece-ing us up for bankruptcy!

Much to my dismay, it appears that despite our country's precarious financial state, our two main political parties are looking towards Greece for inspiration. I am not speaking about the 2012 post-bailout Greece which is tightening its belt desperately trying to stay afloat, but the previous incarnation of Greece that spent recklessly like there was no tomorrow.

Election after election, the Greeks opted to vote for politicians dishing out early retirement and unreasonable social welfare, while protecting a bloated and inefficient public service. They put their national pride (or rather, should I say ego?) before their national coffers when they decided to host the Olympics - a decision which proved to be the proverbial straw that broke the camel's back. The results are there for all to see. The Greeks learnt that it is absolutely not true that tomorrow never comes - the day of reckoning dawned bright and harsh and the Greeks will pay the price for their past financial recklessness for years to come.

When the going gets tough, those of us who want to stay afloat get creative. Families rein in their spending and perhaps look for alternative means of employment to supplement their income. Businesses do the same: implementing cost-cutting measures while actively seeking new revenue streams. Should such simple and common sense measures not also apply to government?

No loss-making business would increase spending without a clear plan on where to match up with cuts elsewhere. Lawrence Gonzi (or is it Simon?) has promised to dish out tablets to anyone studying or working in a school (except for the janitor), a €500 European holiday for our youngsters, an increase in university stipends and various other freebies. Joseph Muscat has also promised tablets, free childcare, paid sabbaticals for teachers and cheaper utility bills. Maltese employers are also being pulled into the fray, forced to pay for our politicians' Father Christmas delusions through increased maternity benefits (which the state usually pays for in other countries and not the hapless employer) and an increased sick leave burden. The final cherry on the cake are the promised cuts in income tax - exactly what the country needs to bolster its finances!

PN has come up with an estimate of the cost of their electoral freebies - however they failed to come up with realistic proposals to explain how they plan to cut costs to make up for this bonanza. The government will become more efficient, they said. If it is so easy to be more efficient why don't they tell us how they plan to do this? The government needs to invest heavily to become more efficient, but bridges to nowhere, roundabouts with pretty flowers and a government-sponsored holiday for rowdy guys in Amsterdam will not get us there. I am not against spending - after all who can disagree with investments such as the enabling of paper-free schools or improved health management systems? However the time has come to acknowledge that every penny the government spends needs to come from somewhere, borrowing is not an option anymore.

The 1996 Alfred Sant administration had many flaws and was responsible for several bad moves that damaged the country. However, I believe that the decision to attempt to modify the stipends system and introduce minimal co-payments for health was courageous and sensible. It is indeed incredible, and an indicator of the level of immaturity of political discourse in the country, that such moves are now perceived to be a liability for the Labour Party, creating a situation where they have to grovel and pledge not to do what actually needs to be done.

Education and healthcare are clearly two areas where government spending is increasing year by year and will continue to do so unless we do something drastic. The PN has pledged to reimburse patients who have to buy medicines and to introduce new medicines on the national formulary. This is a positive move but there is no denying that the costs associated with such a policy are unsustainable. A typical case in point is the recent introduction of expensive medicines for dementia - the government was pushed into introducing such medicines after lobbying by the local association of dementia who argued that they were available in other EU countries. The truth, however, is that other governments only have to fork out a portion of the cost, while the Maltese government funds the full cost of the medication.

I don't know who to blame for all this. Is it the politicians for handing out freebies or the electorate who votes for the freebies? Is it the fault of people who see the folly of what is happening but who opt to keep their head under the parapet instead of making their voice heard? I was glad to hear Stefano Mallia admonishing the parties for making pledges which damage the economy during a recent visit to the Chamber of Commerce and Industry by the Prime Minister. However, it is clear that the business community has not done enough to make its voice heard - business leaders need to become more vocal and should not shy away from confrontation.

I am clutching at two straws. The first one is the fact that politicians have a tendency not to keep their promises. George Bush Sr. famously said "read my lips, no more taxes" - but after getting elected, he proceeded to raise taxes to counter a failing economy. Who knows, maybe we should be banking on our next Prime Minister pulling a similar stunt. My second ray of hope is the EU. I am no expert in the inner workings of the commission but I do know that they are now monitoring our budget, so if there is a way to force our government into doing the unmentionable before we teeter over the edge of the financial precipice, then bring it on Brussels!