November 13, 2012Dear Sir,Every person who runs a household account knows that if their income stays the same and their expenditure goes up that they can't go on and on borrowing more and more money, because that is the path to financial ruin.Yet that is exactly what the PLP government has done. The Government's borrowings have now reached $1.3 billion and are climbing upwards at a rate of about $200 million a year. The interest we pay has reached 11 percent of our national revenue or about $88 million out of our present revenue of $850 million. If there is no growth in our economy for the next few years, and the Government keeps on spending and borrowing as it has done, Government debt will likely reach $2 billion within three years, and our interest costs will increase to about $125 million. Worse, by the time the hospital is completed, the Government of the day will have to add another $30 million or so in lease payments to a foreign party.As our debt goes up the Government will have less and less to spend in the local economy, and indeed we have already seen many unfortunate cutbacks to many worthy organisations such as the Sunshine League, the Family Centre and the Salvation Army. Where are the disadvantaged children supposed to find shelter now?If all this money were owed to ourselves, the situation would not be so dire. Alas, we owe the money to foreign banks and there is a limit to the amount the banks are going to lend us. Further, as soon as our lenders perceive that the Government does not have the discipline necessary to control its spending, they are going to be unwilling to lend us any more. At that point the Government will have run out of time and be forced to balance its budget. This will lead to a kind of austerity that Bermuda has never seen, with unemployment skyrocketing, the possible reimposition of exchange controls, and unbearable social consequences.Unfortunately, the present debt trap that we are in is largely of the Government's making. We have had a term limits policy in place which has not been implemented as originally intended and which has made International business people feel unwelcome and their future uncertain. As a result, many companies and senior executives have now left Bermuda.The PLP government have borrowed money for capital projects which have been ill advised like the Grand Atlantic housing/hotel development, or for projects which ran way over budget for questionable reasons, such as new piers in Dockyard for the mega ships, the Emissions project at Transport Control, the appointment of Global Hue as advertising agents, Faith Based Tourism, the new Berkeley school and the new Dame Lois building in Hamilton. Millions and millions of dollars have been wasted and millions more unaccounted for.The financial record of the PLP Government has been simply awful and they do not deserve to be re-elected.CICEROWarwick