Swallowing red herrings

Crazy just keeps getting crazier on this insane island. A few days ago we learned that Malta’s deficit is expected to reach 12% of GDP – €1.6 billion –  this year, more than double earlier projections of 5.9%.

That’s an eye-popping four times the EU threshold of 3%, which though suspended for the duration of the pandemic, is still a benchmark of fiscal health and not just a random figure picked out of a hat. It’s also the highest deficit among EU countries.

The debt to GDP ratio spiralled to 54.8% last year and central government debt stood at almost €7.8 billion at the end of June. The ratio is expected to rise to 64% in the next year, putting it above the 60% limit allowed within EU rules.

And yet, what is everyone focusing on? Some malefactor, no doubt in the PL camp, who’s decided to spend his time, or his money, on cloning websites and churning out atrociously written fake press releases in an attempt to spread lies about blogger and Repubblika executive officer Manuel Delia and PN MP Jason Azzopardi.

It would be risible if it weren’t for the fact that Delia and Repubblika president Robert Aquilina have clearly been so frightened by the whole affair that they’ve asked for police protection.

Their urgency to get the clone websites taken down and the stream of fake press releases dammed is understandable. I know from experience how disgusting it is when people fabricate stories and spread lies about one.

Only in my case, the attacks came from Repubblika activist Karen Zerafa Boffa and activist Rachel Williams, who have both attempted, via private texts, message groups, phone calls and emails to third parties, Facebook comments and, under a fake name, in the comments section of this site, to spread a lie intended to discredit me and silence me.

I recognised that the troll was Zerafa Boffa immediately and called her out on it. This, ironically, she didn’t like.

The pair are supporters of Jason Azzopardi, and the reason they launched these attacks was to try and shut down my criticism of the MP, who was caught lying multiple times, not least when he denied having solicited a free hotel room from the uncle of one of the men accused of Daphne Caruana Galizia’s assassination in the middle of the 2017 electoral campaign.

In order to try to smother me and my legitimate opinion of the MP, they spread the word that I was being paid by Caruana Galizia’s accused murderer Yorgen Fenech to discredit Azzopardi and, wait for it, help to get him killed.

This is so ludicrous that when the whole thing started, nine months ago, I ignored it. It was so obvious a ploy, so crude a club, that it was literally beneath contempt. It’s the type of low, underhand and dishonest thing I’ve come to expect from supporters of Azzopardi, but it’s also the type of behaviour that Repubblika and Occupy Justice are supposedly set up to combat.

Hypocrisy is just another word for dishonesty, and questions should be being asked about those who seek to replace the corrupt government we have. If they’re just going to be frying pan-into-fire material, then they should be recognised and shown the door.

Robert Aquilina is aware of what these two ‘activists’ have been doing. I look forward to hearing from him what he’s done about the people within his own NGO who have been fabricating scurrilous stories about journalists doing their jobs.

So, yes, I understand their urgency at getting the lies shut down. But I don’t understand why the rest of the island has allowed this distraction to overshadow the real issues of the day. It’s a barrage of red herrings, smelly, fishy and very nasty. We really shouldn’t be swallowing them.

Especially not when the economic picture being drawn tortuously by the piecemeal release of information on deficits, GDP, national debt, foreign investment and other measures, is such a bleak one. We shouldn’t allow the cybercrime circus to divert attention away from the very real threats to Malta’s well-being implied in the figures.

Deficits above 3% burden economies with heavy borrowing, crushing and ever-more expensive debt servicing and, if the situation isn’t rectified fast, the spectre of a potential default if and when the load of debt becomes too heavy.

Governments borrow money by issuing bonds. Investors buy the bonds because they believe the governments will pay whatever interest is promised on time, and that when the paper matures, they’ll get back their original stake. The reliability of any given government in paying investors’ their dues is what dictates the rate of interest they are able to offer.

It’s usually the most risk-averse investors who invest most in government bonds, or those keen to keep a manageable balance of low risk –high risk assets in their portfolios.

If regular, cautious investors begin to suspect that a particular government won’t be able to meet its obligations, those bond buyers will disappear into the ether. That means the government will have to raise interest rates in order to attract the next level of investors, the ones with slightly more risk appetite, who, however, expect a lot more in return for their investment.

As borrowing becomes more expensive, and more and more of the nation’s money has to go to keeping lenders satisfied, everything else in the country will be drained of resources.

And in a country where corruption and cronyism has been sucking the life-blood out of State coffers for eight long years, the consequences of that will be disastrous.

Finance Minister Clyde Caruana said a few days ago that he’s not contemplating hiking taxes. But in truth, he has very few other options. The government he is part of is composed of pseudo socialists who prioritise stuffing their own wallets, making fat cats fatter and throwing crumbs to the populace in return for their votes – because if they lose power, many of them will face jail time for their part in the rampant corruption of the last few years.

The FATF greylisting has signed the death knell for Malta’s passport-selling get-rich-quick scheme, so Caruana will have to do without that source of income. The government is being forced to overhaul the tax system that’s attracted so many of the foreign investors who set up shop in Malta over the past 25 years, and this after the devastation of Malta’s reputation has decimated the financial services and igaming industries that, up to so recently, were high growth sectors that brought jobs and opportunities to young people.

Tourism’s been devastated by the pandemic, but the unbridled development, lack of any control, standards, taste or sensitivity, means our towns and many of our villages are now hideous, shanty town lookalikes that few tourists will want to visit, even when covid recedes and travel returns to something approaching normal.

While the cyberattacks on Delia and Azzopardi and the cloned newsroom websites must clearly be addressed, stopped and solved by the police, let’s not take our eyes off the things that the government would like us to bypass. The implications for Malta, for our families, friends and businesses, are simply too serious.