INVESTMENT OF OIL RESERVES IN SOCIAL AND ECONOMIC DEVELOPMENT WILL ELIMINATE POVERTY AND BE ON THE WAY TO FIRST WORLD STANDARDS IN FOUR YEARS

IN the modern world, the world of the 20th century, several programmes affect us. Humanity has been promoted both nationally and internationally. Such would include “Climate Change”, “Green Power” replacing fossil fuels, and “Poverty Reduction and Elimination”. In Guyana, until recently, most of the population fatalistically felt all societies had to have poverty and that what the most governments, NGOs, and philanthropists could do was slowly reduce or ameliorate it. The poverty line differs in different regions of the world and Western-type societies. It is set at US$5.60 per day per person.

The recent experience of China of eliminating poverty from hundreds of millions and bringing them into the middle class in a very short time has changed the view of most developing countries which now feel quite confident that poverty could be eliminated from their societies in a short time if they employ the appropriate techniques.

The discovery and exploitation of oil in Guyana have led to a euphoria that poverty will be instantaneously ended and the painstakingly old ways of addressing poverty could now be eschewed.

Before oil was discovered, Guyanese people had evolved their ways of grappling with poverty. They believed in saving, that is, the deferment of today’s gratification for tomorrow’s betterment. The emancipated slaves understood this when they saved very small pittances of money over several years and were able to buy abandoned sugar plantations and set up villages with thousands of houses, thus becoming the biggest landowners and property holders in the colony at that time. They also ensured that their children received a good primary education and branched off into farming and various trades. The immigrant groups which supplied labour on the estates after Emancipation followed a similar pattern in grappling with poverty, except they stressed more economics than education. All groups also made their food, clothes, housing, education, and medical service go a long way. For example, books were lent to each other or home nursing rather than paying doctor’s fees. By these methods, many crossed the poverty line each year. But Guyanese, like people in all developing countries, felt that it was deterministic that all societies must have poverty and only a comparatively small number would cross the poverty line each year.

The example of China revolutionised the thinking about poverty eradication in a very short time. China was able to raise hundreds of millions out of poverty into the middle classes. India has also been getting scores of millions out of poverty and its main technique was giving everyone a cell phone and a bank account which they would use appropriately to raise their living standards.

In Guyana, we feel that with the exploitation of our Oil and Gas resources, poverty could be eliminated quickly and that the older Victorian methods of addressing poverty could be forgotten. The competing techniques of eliminating poverty by use of oil revenues are two.

The first technique is by direct large cash transfers to every person in society, which is advocated mostly by academicians. By such transfers, poverty would be eliminated instantaneously. Such a technique has been vigorously criticised and dismissed. Into these criticisms, we shall not go except to point out that it could discourage the population from working and the population would have so much money that they would not know what to do with it and could end up like King Midas or the porknocker who got so much riches that he lit cigarettes with currency notes.