If only it was all about Moody's

So nothing could stop the report that Moody’s agency had downgraded Malta from A1 to A2.

But of course, The Times and PBS did their very best to ensure that the report itself was downplayed as far as is possible, and made to look irrelevant. 

The Times, for all its openness, knows when to lose its ‘journalistic’ inquisitiveness.  Moody was a slap in the face for Finance Minister Tonio Fenech, who will surely not be remembered as the whizz-kid who changed our economy into a tiger economy – instead he will be remembered as the man who took a trip on someone’s private jet.

If he was a real whizz-kid, he would have ensured that the fiscal medicine needed to create confidence in the business community would have been administered. Surely, rising tariffs for water and electricity did nothing to inject confidence in the middle class either.

But it was also the ills of the eurozone that led to this negative trend. On one point Gonzi is right: all this talk of bad vibes leads to far worse vibes. But has he helped to downplay the crisis?

He has… by saying the wrong things and, more importantly, by proving to everyone that their reaction to the economic crisis was raising their salaries by an astronomical amount.

His arrogant reaction to all this was: ‘do nothing about it’. So the Moody’s report was left to the Opposition and once again, it was a black and white story.

The Prime Minister has the added advantage of blaming the outside world for all our ills. The US under Obama is suffering, so why not us, too?

But in saying this, he is reminding people that his references to foreign situations are becoming more exclusive and, specifically, evasive. The PM, for example, avoids mentioning Ireland and the Irish tiger.

So now we await for the Fitch and Standards & Poors… and more of the same.

There is little doubt in everyone’s mind that the confidence needed to uplift the economy will not be seen under this administration.

The million-dollar question is very simple: Can the Opposition tackle the economic crisis?

Well, it will not be easy, but many in the business community are saying that nothing can get as bad as this.

There are some crucial points which need to be tackled by the Labour Party if they are to convince the electorate that their economic solutions are indeed realistic. 

The first thing is that public spending and pension reform must really take place. For a Labour Party leader, focusing on these two reforms will be a difficult – if not impossible – task.

Many will expect Muscat to deliver the goods, when the coffers are simply bare. He may well follow the route of Papandreou.

So it will need some very intense thinking to compromise on economic growth and social tranquillity – faced with a situation where the Nationalist, if in opposition, will promise to be a permanent thorn in their side, with their extensive knowledge of how to create hurdles for Labour.

Muscat is probably more worried about winning the next election, but he really should be worried about what happens after the election. That should be his real priority – surrounding himself with capable economists who have the insight and capability to merge social needs with the high expectations of a declining economy.

Perhaps the very presence of these ‘unknown’ capable people in his entourage may encourage those who doubt his capabilities to have faith him. It will be difficult to rope them in before the election. After the election it will be a different matter.

After every election, the most popular saying is‘Le Roi est mort, vive le Roi!’. In the meantime, many will simply give Prime Minister Lawrence Gonzi the benefit of the doubt.

And if my reading is right, even feel quite sorry for the man, who like so many other politicians has managed to deflect any personal responsibility for the current local economic situation.