At some point soon, the Government is going to have to level with the general public and say that the economy is in bad shape and may get worse before it gets better.

And what's more, it is going to take a collective effort from the whole community to make sure that Bermuda survives the current recession – and comes out of it stronger than it went in.

Instead, there is an all too common tendency to look on the bright side of everything.

The announcement of Willis Group Holdings Ltd.'s planned move of domicile from Bermuda to Ireland is a good example of this.

It is true that although Willis was domiciled in Bermuda, little of its head office was on the Island. And it is also fair to say that it is maintaining its Bermuda broking office, so the net effect on the Bermuda economy is fairly small.

But the reputational effect is more serious. Bermuda's main international business is insurance and that is the business Wilis is in. This is not like a manufacturing business leaving Bermuda. Bermuda is a major insurance centre and it made sense from that point of view for Willis to be here.

The response from Government was to express some concern, but to note also that other companies are still registering in Bermuda.

What should be of concern is not so much that Willis is moving, but why. Willis said that it believes Ireland is better positioned than Bermuda to "maintain a competitive . . . corporate tax rate" and it is seeking "a more stable environment" than Bermuda.

Willis may be correct on the tax question, although the recent humbling of Switzerland suggests that all countries can be pressured over their methods of taxation, and that the level of hypocrisy by "major" countries when it comes to tax knows no bounds.

Be that as it may, Finance Minister Paula Cox and others have worked very hard to keep Bermuda out of the sights of the OECD and others, and have had some success.

Still, the truth is that Bermuda is to a greater or lesser extent dependent on others on the tax issue.

Mr. Plumeri told the Financial Times: "We reviewed a number of alternatives with our board and believe that incorporating in Ireland will provide Willis with economic benefits and help ensure our continued global competitiveness."

That newspaper also reported that "the move was 'clearly about remaining ahead of the curve in terms of what might or might not happen in Bermuda', said one person close to the group".

What Bermuda has much more control over is its own stability, and Willis' comments that it is seeking a more stable environment undermines a key reason for international companies to form here. If that rationale, along with tax, is eroded, then Bermuda is in real trouble.

What's worse, it is trouble that is largely of Bermuda's making, and can be repaired by Bermuda, if it's not too late.

While some of the questions of stability clearly have to do with the tax issue, more have to do with the Island's attractiveness as a low tax, low crime, quality infrastructure, politically mature, high quality of life island. If those factors diminish, and there is a sense that they are, then companies will move.

And when it is stated that Wilis is getting ahead of the curve, then that is worrying too. International businesses do not wait for the roof to fall in; money is very sensitive to uncertainty, and they will be long gone if Bermuda does not demonstrate that it is stable.