by DR. DAYAN JAYATILLEKA
Is anyone at the top, working closely with the Deep State, allowing the crisis to accelerate and even helping it exacerbate, so as to facilitate military rule (or presidential-military rule)?
Is the democratic opposition, from political parties to civil society, unwittingly walking into the equivalent of a well-prepared military ambush by unilateralist-sectarian political adventurism on the part of some, and Weimar Republic weak-state liberalism on the part of others?
The liberal and liberal-left Lankan democrats always had a tendency to cry “Wolf! Wolf”, when there wasn’t one, having never cried “Tiger! Tiger” when there was.
In 2015, they cried “wolf” and pointed in the manifestly wrong direction, having run the risk that there may have actually been a wolf lurking elsewhere. In January 2015 Mangala Samaraweera and Somawansa Amerasinghe of the UNP and JVP respectively led the charge, alleging that as electoral defeat loomed, Mahinda Rajapaksa had plotted to stay on in office with the support of the military. The whole country knew that to be untrue because MR quit before the final results had come in.
I knew it to be untrue more than most others did. At 3 AM on the day of the electoral defeat, while I was watching the results coming in at home with my wife, President Mahinda Rajapaksa spoke to me on Udaya Gammanpila’s or Dayasiri Jayasekara’s phone, told me that his gut-reading of the trend was that he was losing, that he was about to resign and thanked me warmly for my active support and participation on TV and the public platforms, in the campaign. (A campaign in which I knew MR wasn’t at an advantage as I told Opposition presidential candidate Maithripala Sirisena on Dec 8 2014 at Azath Sally’s house.)
Now the untruthful shrieking, about MR planning to stay on with the military, obscured another possibility, namely that there may have been others, not merely civilian, who were advocating such an option or toying with such a contingency, and found that the rug had been pre-emptively, and perhaps even unwittingly, pulled by MR who resigned, thanked his tearful staff and moved out at the crack of dawn.
If there were any such dark elements entertaining thoughts of putschist political Black-Ops we shall never know who they might have been or where they are now, thanks to the anti-MR hysteria of the victors at that moment. We can only speculate what such elements may be thinking now, with no MR capable of spontaneously hitting the democratic ejector button.
What one does know from comparative global history though, is that severe economic crises do not always give rise to one option, but can give rise to two options which battle each other until one succeeds. Economic crashes can cause a shift to the left, in policy (Roosevelt’s New Deal) or political outcome (revolutions, elected left-leaning governments). Economic depressions can also give rise to harsh rightwing authoritarian solutions, including forms of fascism and military dictatorships (classic examples are Italy and Germany in the 1930s and Chile in 1973).
Those who think this doesn’t apply to Sri Lanka because of its democratic heritage should know that Uruguay was called the Switzerland of Latin America and Chile was very proud of its democratic heritage.
Those who think that this doesn’t apply to Sri Lanka for another reason, namely that the Gotabaya option has been tried and has failed, and so Sri Lanka is past that point, have ignored the obvious, and best funded, most efficient institution in the country: the military.
Those who think that the economic crisis is beyond the military’s capacity to manage are almost certainly correct, but that doesn’t rule out harsh, sanguinary military rule which pounds democracy, political parties, trade unions and civil society into rubble, for a medium or short period.
Intellectual Absence & Abdication
The question is: what should be done and of this what can be done? Before that is answered, one has to be aware of what should have been done and has not been undertaken.
The basics have not yet been done. One of the pillars of Ceylon’s/Sri Lanka’s democratic two-party system, the UNP, electorally disappeared. It did so after a prolonged electoral depression, never having won a presidential election since 1988. It’s extinction was prefigured by the defeat it incurred at the hands of a new party, at the February 2018 local authority election. How many articles by the liberal or left intelligentsia—academic and/or activist–have you read analyzing any of that?
By contrast, when Trump won in 2016, the quality American press was filled over the next few years, not only with critiques of him but also with lacerating self-criticism of how the Democrats lost, including in areas and among social strata that had traditionally supported it.
The same goes for the SLFP, the second party in the two-party system, which now resembles Groot when he turned into a twig. How many analyses have you read of how and why it got there?
The Sri Lankan war ended in an internationally rare though not unique victory for the State over a powerful irregular army once referred to by Ron Moreau in Newsweek as the world’s toughest guerrilla fighters after the Vietcong (Moreau had covered Vietnam). How many explanatory essays have you read by the Lankan intelligentsia about the decisive defeat of the indomitable LTTE?
How many analyses have you come across on the reasons for the successive failures of peace efforts with the LTTE, by diverse Sri Lankan leaders, India and Norway?
For the record, I shall note that I have written and published on all these topics, but that is not the point I am driving at.
The first of my main points is that there is a surplus of opinion and absence of analysis on the major phenomena of contemporary Sri Lankan political history, either real-time or in retrospect. This gross dereliction of basic intellectual responsibility and academic duty constitutes a major indictment of the Sri Lankan intelligentsia after the turn of the century and millennium.
What this speaks to is the unwillingness or inability to carry out an honest post-mortem or audit. Given the inability for reflective critical evaluation, there is no possibility of accurate diagnosis. Thus, there is no prospect –or possibility? —of an accurate prognosis and prescription.
This has consequences. If there is no public postmortem on the electoral disappearance of the UNP and the truncation of the SLFP, or the victory in the war and the failure of the efforts at peace, there will be no sense of the state of fragility to which the Sri Lankan democratic system has been reduced today and no comprehension of the militarist project.
Without shining the light of self-critical lucidity, there is no chance of avoiding steps that would take Sri Lanka further into the labyrinth or down the abyss at the end of which is the Minotaur of militarism.
If the various streams of the Opposition do not move swiftly to a position which is proximate to that of the Pohottuwa voter and accommodates that which is legitimate in their grievances and aspirations, the majority of Sinhalese will find an alternative solution to the crisis that is closer to them in their grand narrative.
In 1988, faced with Sirimavo Bandaranaike as rival and the JVP as threat, Ranasinghe Premadasa was able to repackage the nationalist-patriotic and socioeconomic aspirational in a new, organic mix, and beat them both. This proved Ranjan Wijeratne correct when he told President Jayewardene that only Premadasa, not Gamini or Lalith, could save the UNP, democracy and the country. I am not making a pitch in this article for a party or a leader. I merely want readers to understand that unless the democratic parties shift in a certain direction, the suffering masses may accept—even if they do not actively opt for—the military as their savior.
What is the direction the democratic Opposition, including the civil society intelligentsia, should move in and which direction should it eschew? It is easier to start with the latter aspect.
NMSJ’s Constitutional Chernobyl
It must decidedly not move in the direction of the draft proposals for constitutional change of the NMSJ led by former Speaker Karu Jayasuriya. The problem is not with Mr. Jayasuriya; it is with the content of the proposals. The segment on Rights is very good, but there’s something radically wrong at the very heart of the proposals: the Executive and Devolution. Even worse than in the matter of changing ratios of gases by gas companies, the NMSJ proposals mix two ideas which should never be mixed. One is the loosening of the definition of the state and enhancing provincial autonomy WHILE removing the directly, nationally elected executive presidency.
The new constitutional proposals are pretty much the same draft constitutional proposals that killed-off the UNP, viz re-naming the state as an “ekeeiya Rajya” in the Sinhala and English (!) versions while looking for ‘a suitable Tamil term’ appears like a loophole. The Supreme Court found in 1987 that the 13th amendment stayed barely within the framework of a unitary state and did not cross the line over to the federal solely because of the powers of the governor as representative of the executive president.
Delete the term ‘unitary’ in English and there is no ‘link language’ term for the character of the state. Delete the nationally elected Executive Presidency rather than dilute and distribute its excessive powers, and the Provincial powers slide into the realm of the arguably federal.
The NMSJ proposes that the President be elected by an Electoral College, but that has no kinship with the US presidential system because the NMSJ states unambiguously that it stands for a parliamentary system of Government.
Therefore, if you have a parliamentary system, provincial powers under an “ekeeiya Rajya” — which is given no exact translation/definition in any recognized international language—and a president who is not directly and nationally elected but is chosen by an Electoral College, what does it all add up to?
It adds up to a system in which the sovereign people taken as a whole, as a totality, have no office of an overarching character to which they choose the incumbent by election. The island of Sri Lanka with its diverse population will have no elected unifying symbol which represents the overarching, higher value of the whole over the parts.
The PM will be a leader who will only have the legitimacy of being elected by a parochial unit, not of having been elected by a majority of the whole citizenry. A legislature headed by such a leader – and a bicameral legislature at that, as the NMSJ has proposed—will be on a level playing field with the Provincial Councils, which will no longer have an overarching presidency to hold them in check nor a clear definition of the state as ‘unitary’. And this on an island only a few miles away from a neighbor which has the same ethnic composition as the North of Sri Lanka.
This is a model not of a strong, supple democratic state with a separation of powers as in the USA and France, but of a weak, multipolar state; a state in which the centripetal is structurally and systemically weaker than the centrifugal, and provides few safeguards against the latter. Simply put the NMSJ model cannot keep Ministers or Chief Ministers in check because it has no overarching elected Presidency.
The Opposition parties should avoid the NMSJ proposals as they would the plague. Chandrika’s Constitutional ‘package’ stimulated the rise of the New Right, the JHU, and her PTOMS culminated (mercifully) in the Mahinda Rajapaksa candidacy. Ranil’s CFA sealed his electoral defeat. The Yahapalanaya UNP’s draft constitution –which the NMSJ recycles with slight modifications– coupled with the 2015 co-sponsorship of the Geneva resolution with its “international prosecutors, investigators and judges” commitment, helped mightily to catapult Gotabaya Rajapaksa into office and bury the UNP. The SLFP survived because it dissented.
Repeating the same thing and expecting a different result is indeed the definition of lunacy. The real problem is that every time you keep repeating it, the same thing happens but at a further point of the scale.
Listen carefully to what the people are saying even as they curse the policies of the Gotabaya government and rue the day they voted for him. They want a strong state, a leader who will care about them and take care of their material interests; will at the least not harm their livelihoods. They are not fans of a weak state. They want a social democratic policy from a social democratic state. They want a government that will deliver the goods and they want a System that can and will deliver those goods. That is not an overly decentralized, dysfunctional system in the name of liberal democracy, which will be unable to keep Ministers and Chief Ministers in check. This gives liberal democracy a bad name.
If the alternative that the democrats have to offer the people is a Weimar Republic, the people in their despair and anger may opt for or accept an aspirant Hitler, this time a combat veteran of the victorious last war in trademark black military uniform.
Economic crisis: SLPP MPs who endorsed tax concessions also responsible -Kiriella
By Saman Indrajith
The SLPP MPs who did not oppose President Gotabaya Rajapaksa granting a 681-billion-rupee tax concession to big companies were also responsible for bankrupting the country, Chief Opposition Whip and Kandy District MP Lakshman Kiriella told Parliament yesterday.
Kiriella said that Gotabaya Rajapaksa had granted tax concessions to big companies that funded his election campaign and that had contributed to the country’s bankruptcy. “The Supreme Court determination has pointed out that the decision to please mega companies resulted in a loss of Rs 681 billion to the national economy. The MPs who were in the SLPP then should have opposed it.
They did not do so. As such they too are responsible for this crisis.
Godahewa says President by his erratic behavior has become misfit to run country
Member of Parliament Dr. Nalaka Godahewa says that even in this budget, the President’s plan to break a part of the opposition has failed. He said so at a recent press conference held at the Nawala office of the Freedom Janata Sabha on the budget and the current political situation.
“We are in temporary relief like a debtor who hides until the police catch him for not paying back the debt to the creditors. To tell the truth, we are on top of a volcano. Even if the future is not planned properly, even if it happens in early 2022, this crisis is going to explode in a more terrifying way.
Therefore, basically, what we expected from the budget was:
* How can the government reactivate the economy and push for growth?
* How can the government bail us out of the debt trap?
Here are the answers to these problems.
But instead of a budget that will reduce the debt burden of the country and reactivate our economy, the President presented a budget that will increase the country’s expenses further. Instead of reducing the debt burden of the country, which consists of some kind of election gundu (handout) to please the people, it will greatly increase the debt burden. In short, this was presented not as a budget but as a series of loans.
The estimated expenditure of next year is 6978 billion rupees. Let’s say roughly Rs 7000 billion.
It was during the last year before we faced the crisis that is 2021. The actual annual expenditure was 3851 billion rupees. Let’s say approximately 4000 billion rupees.
So, the government is waiting to spend 3000 billion more than before the crisis. The cost increases by 75%.
But the country’s economy has not developed during this time. It has continuously contracted in these three years. We said that we increased taxes and increased government revenue, but we got that tax revenue by robbing the people and businesses of the country.
According to the government’s estimates, the income that can be earned this year is only 4000 billion. In that case, another 3000 billion will be added to our debt burden.
So in such a situation, can the government’s economic differentiation be justified?
That is why we voted against the budget.
During the presentation of the budget and afterwards, the President said several times that 2024 is an election year. He hinted that not only the presidential election but also the general election is likely to be held. I believe that when Chanda Gundu prepared the budget, he might have been waiting to do so. But the final result of the budget was not what the President was waiting for.
He waited and waited to see if a certain group of the opposition would be able to join the government during the budget poll. He also hoped that a large number of the opposition would be abstain from the vote. We have heard that some members of the opposition had discussed this with his agents. But in the end, the government received fewer votes than it received during the previous domestic debt restructuring. Many MPs from the opposition who did not participate at earlier votes came that day and voted against the budget.
This is a kind of personal defeat for the President. He hoped that this time SJB would split. In order to go to the polls without the Rajapakses in the future, it is essential for him to gather a certain group of MPs from opposition. But this final vote proved that it is still just a dream.
Now he cannot bear this. He can see that the SJB team is very strongly with the opposition leader today. He thinks that is because of the influence of the independent groups in the opposition. He thinks that the main opposition, which abstained from voting against the IMF agreement when it was first brought to parliament, is now continuously voting against his economic program because of our influence. That is why yesterday he insulted me and Mr. G.L. Peiris by name in the Parliament. As the opposition leader said, we understand the President’s mental discomfort. He is in a difficult situation. But we have nothing to do with it. We continue to advocate for the economic philosophy we believe in. Fortunately, it seems that the leader of the opposition also stands for the social democratic economy that we believe in. That is why his group has taken a strong stand against the budget without falling into the trap set by the President.
Recently, the President came and spoke twice in Parliament. The first time he got into an argument with the leader of the opposition and left the debate midway. He came to Parliament again yesterday and got into a long argument with the leader of the opposition. In my opinion, the President suffered a defeat on both occasions. So I wonder why this President comes to the parliament in this way and gets involved in debates demeaning his position.
Perhaps as the person who has continuously represented the Parliament for the longest time, he is bored without coming to the House. But I think that he misses a lot of work that needs his attention. As the President is also the Finance Minister and Defense Minister of the country, he has a lot of work to do on a daily basis. But what he is doing is enjoying himself like the retired presidents of America by giving lectures on all necessary and unnecessary topics inside and outside the parliament, traveling all over the world. If this is what he wants to do, then he must appoint a full-time finance minister.
The problem of this government is its inability to implement the policies, more than the fault of the policies.
On the one hand, the government is talking about the need to develop industries, while on the other hand, by increasing the electricity bills, it is making it difficult for industries to function.
On the one hand, the government is talking about the development of small and medium enterprises, while importing even eggs from abroad.
The people are not able to bear the cost of health, and at some time they are preparing to introduce the 18% VAT which will affect the health sector as well.
The left hand does not know what the right hand is doing. Look at the cricket board dispute. The minister says one thing, the president says another.
Now, this country needs an honest agenda.
What we need now is an integrated economic development plan. This country cannot be rebuilt with unrelated proposals like throwing stones at the mango tree, thinking that a mango will fall by some luck.
This country needs proper leadership. It is not a government that depends on a single person, but a unity of a group of skilled leaders is needed. We need an honest, skilled, and experienced group dedicated to rebuilding the country.
We need a team with an understanding of economics. We need a team that understands the ground reality. We need a team that understands the strengths and weaknesses of the government as well as the private sector.
MR blames economic crisis on Yahapalana leaders
SLPP leader Mahinda Rajapaksa yesterday (28) hit back at critics, claiming that a robust economy had been built under his presidency. He said the UNP-SLFP government which ruled the country during the 2015-2019 period should be held responsible for the current economic crisis.
The following is the text of a statement, titled ‘the origins of Sri Lanka’s economic crisis’ issued by former President Rajapaksa: “A heated discussion is now taking place about those responsible for the present economic crisis. The Central Bank reports will show that during my nine years as President, economic growth averaged 6% a year during the four war years, from 2006 to 2009, and it increased to 6.8% in the five post-war years, from 2010 to 2014. Hence Sri Lanka’s per capita GDP increased threefold from USD 1,242, at the end of 2005, to USD 3,819 by the end of 2014. The contribution that my government made to Sri Lanka’s per capita GDP was well over twice that of all other post-independence governments, from 1948 to 2005, put together. Though the per capita GDP came down to USD 3,474 in 2022 as the pandemic caused the economy to contract, that statement remains valid to this day.
The debt to GDP ratio was a very healthy 69% at the end of 2014 having being brought down from 90% at the end of 2005. The All Share Price Index rose from 1,922, at the end of 2005, to 7,299 by the end of 2014. This economic boom was achieved despite the war, the global food crisis of 2007, the global financial crisis of 2008-2009 and the highest crude oil prices in world history. Crude oil cost an average of USD 74 per barrel throughout the entire period from 2006 to 2009 and an average of USD 103 from 2010 to 2014. The IMF Country Report No. 14/285 of September 2014 stated firstly that Sri Lanka’s “Macroeconomic performance has generally exceeded expectations”. Secondly that “Sri Lanka has made notable advances in recent years, and appears to be on its way to joining the ranks of upper middle income countries”. Thirdly that “Sri Lanka’s economic growth has been among the fastest in Asia’s frontier and developing economies in recent years”.
Hence the fact that I left behind a very robust economy in January 2015 is well documented. After I was voted out, the economic growth rate dropped to 4.2% in 2015 and ended up in the negative range at 0.2% below zero by 2019. Sri Lanka’s total outstanding external debt had increased by nearly 28% from USD 42,914 million at the end of 2014, to USD 54,811 million by the end of 2019. The debt to GDP ratio which had been brought down to 69% by the end of 2014, had increased to nearly 82% by the end of 2019. The All Share Price Index declined from 7,299 at the end of 2014 to 5,990 by the end of October 2019. Yet during the entire five-year period from 2015 to 2019 the average price of crude oil was USD 60 per barrel – the lowest in recent history.
There were no external reasons for Sri Lanka’s economic decline between 2015 and 2019. India and Bangladesh experienced average growth rates in excess of 7% and the Maldives over 6% during this period. Even developed countries like the USA and Germany experienced robust economic performance during those years. However, Sri Lanka’s average growth rate between 2015 and 2019 was just 3.5%, equal to the growth rate recorded in 2021 at the height of the pandemic. The accumulation of foreign commercial debt between 2015 and 2019 particularly in the form of International Sovereign Bonds (ISBs) was by far the worst disaster to befall us during that period.
When I was defeated in January 2015, outstanding ISBs amounted to USD 5,000 million and it was amply covered by our foreign reserves of USD 8,208 million. However, between 2015 and 2019 outstanding ISBs increased threefold to USD 15,050 with borrowings of USD 2,150 million in 2015, USD 1,500 million in 2016, USD 1,500 million in 2017, 2,500 million USD in 2018 and USD 4,400 million in 2019. Of this, USD 2,000 million was used to rollover ISB’s taken during my tenure, thus the total amount in new ISB’s issued between 2015 and 2019 is USD 10,050 million. Despite the build-up of the stock of outstanding ISBs to USD 15,050, Sri Lanka’s total foreign reserves was just USD 7,642 million at the end of 2019.
Thus, when I became Prime Minister again in November 2019, our government inherited an economy that was already on its last legs. It was in this weak and vulnerable situation that the Covid-19 pandemic hit Sri Lanka in early 2020 – the consequences of which needs further discussion. In any discussion of the economy, it is vital to note that the per capita GDP is the most fundamental economic indicator used to judge the economic situation of a country and the contribution of my 2006-2014 government to increasing Sri Lanka’s per capita GDP is more than double that of all other post- independence governments put together. The people of this country should base their decisions on proper data and facts and not on noise, lies and propaganda. Sri Lanka cannot afford another political mistake like that of January 2015. “
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