Oct. 9, 2003 – Meaningful leadership could bring the territory out of its economic crises, John de Jongh Jr. told members of the Rotary Club of St. Thomas at its Thursday luncheon meeting.
That and an improved educational system could lead the way to an improved economy in the Virgin Islands, he said, chastising the community as a whole for "not agitating for a better education system."
"In the V.I. we don't have a revenue problem," he said. "In fact, property taxes are significantly higher than before. However, we are running a $50 million to $60 million annual deficit, which means we are back to the 1998 level with borrowing or taking money from special funds."
De Jongh headed the team hand-picked by Gov. Charles W. Turnbull that put together the Five Year Operating and Strategic Financial Plan submitted to him in 2000. While isolated elements have been implemented, the overall plan has for the most part been ignored by the administration.
De Jongh also was one of the of seven gubernatorial candidates challenging Turnbull's bid for a second term last year, finishing second to the governor.
"There is no sustainable economic growth in the V.I. right now," he told the Rotarians. "Our labor force hasn't grown. St. Croix is where it was 10 or 15 years ago; St. Thomas is about where it was five years ago."
He expressed particular concern about St. Croix, pointing out that industries which have long provided the island's economic base are losing their grip. "Look at Hovensa and Cruzan Rum," he said, noting that Hovensa is 50 percent owned by Venezuela's state-owned oil company, Petroleos de Venezuela. And Cruzan Rum is 50 percent owned by Trinidadian interests. This circumstance puts both of the companies "at risk," he said.
"We saw the impact of what happened in Venezuela," de Jongh said, when a political crisis prompted widespread strikes last year that dramatically impacted on Hovensa's access to crude oil.
He also cautioned against becoming overconfident of the long-term gains from the territory's Economic Development Commission benefits program. "When it comes to supporting the EDC," he said, "we shouldn't put all our eggs in one basket. We are too comfortable with the EDC program, and it could put us at risk."
De Jongh posed the question: "How long is someone 50 or 60 years old going to fly down here every week to maintain their resident status?" And he said he had heard one beneficiary executive's wife refer to the program as a "tax prison," saying that "we have to move here to get these benefits." Another consideration with the EDC program, he said, is that companies cut back on employment in terms of hours and working overtime. "This is something we can't be silent about," he said.
"The solution to all of that isn't easy," but it's also not impossible, he said. "In many respects, we are like a neighborhood."
Another stumbling block, de Jongh said, is that "many want to be in charge, but don't want the responsibilities of leadership." A 36-hour government work week is not the answer, he said, nor is a 10 percent income-tax surcharge. Both are proposed by Turnbull in his Fiscal Year 2004 budget pending before the Legislature.
Those would be short-term solutions, de Jongh said; in the long term, the solution lies in education, where something is really wrong.
"Forty-two percent of our kids live in poverty," he said. "Our cost of living is 30 percent higher than the other places in the U.S."
Virgin Islands youth are educated to get jobs, not "wealth," he said, but his hope is that someday the private jets at the local airports will belong to those Virgin Islands young people.
De Jongh, a business consultant with many clients in the Eastern Caribbean, said he is impressed with education systems in other nations of the region. "Their superiority is indicated by the fact that these countries are self-sufficient," he said.
Many University of the Virgin Island graduates are from those islands and have gone back to them, he noted. "When you go into a bank in St. Kitts, it's like a UVI reunion," he said.
It will require "speaking out" on the part of the community to bring better education about, he told the Rotarians, most of whom are business people. "You have to challenge" the system, he said.
A key, he said, lies in giving greater autonomy to the school district superintendents to make daily decisions, leaving the commissioner to set policy for, but not manage, the system.
Turning administration of the education system over to the Board of Education, which "has its own problems," is not the solution, he said.
Strong supervisors and site-based school management are not mutually exclusive, he continued. "We have to give governance to the schools," he said. "The two districts should be run separately with full autonomy. Individual principals should each have a budget for their schools. Now, everything goes all into one pot. We need a fully site-based system."
In compliance with guidelines of the Middle States Association of Colleges and Schools, some site-based management has been put in place in the last year. The association withdrew the accreditation of the territory's three accredited public high schools — Central, Charlotte Amalie and Ivanna Eudora Kean — in November 2001. The Education Department is seeking accreditation now for those three plus the fourth and newest — Education Complex, which has never been accredited.
Each school now has a $50,000 discretionary operating budget, but de Jongh, speaking after the meeting, said that isn't adequate; each school should have full autonomy.
He said UVI also has an important role to play in making sure that the public school system is graduating students qualified to continue their studies in college.
John S. Leipzig, chancellor of the St. Thomas campus of UVI, who was at the luncheon, said 80 percent of the incoming freshmen have to take remedial classes in English, mathematics or both. It's a figure that has been cited by UVI educators for years.
De Jongh said the university president should be able to demand that the school system live up to its responsibility to educate the territory's young people. However, he said, "how can the UVI president speak out when the school is dependent on government appropriations?"
Our "biggest crime is our leadership," he said.
At one point in his address, de Jongh said with a smile that he hadn't expected "to be in front of a microphone again until 2005." While some saw that as a signal of his intention to make another run for Government House, he did not elaborate.
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