How to kill the CNMI economy -- again
Saipan — Before the U.S. invasion of the NMI in 1944, the islands had a booming economy fueled by Japanese investments — and imported labor. By 1940, according to Micronesian historian and scholar, Father Francis X. Hezel, there were about 85,000 Japanese in the NMI and the rest of the Japanese mandated islands (now known as the Freely Associated States). “Eighty percent of the total labor force in the islands was Japanese or Okinawan,” Father Hezel added.
A 1966 economic report commissioned by the U.S. noted that the Japanese-era economy benefited many islanders considerably. They “enjoyed a wider variety of goods and services, greater sources of income, and greater opportunities to develop abilities, and to get jobs than they ever experienced before or, in many instances, since.” On the major islands, most of the people “became accustomed to manufactured and processed goods, including tools, chemicals, foods, utensils, equipment, materials, machinery, fuels, power, toiletries and cosmetics, and many kinds of services, including medical and health, education, sanitation, transportation, communications, and restaurants, retail stores, and movies. In fact, the [islanders] located near the centers of activity generally had access to most of the kinds of goods and services available to the small-town farmer or fisherman in the industrialized nations of the world during the 1930s.”
Then came the war — and desolation.
With the U.S. military in charge of the islands, the “goods and services and sources of income which many [locals] had enjoyed during the Japanese period ceased to exist.” On Saipan, local civilians were concentrated in temporary quarters. “They were severely restricted, poorly fed and assigned jobs by the military commanders. These people did not know the status of their real property and owned little other than the old clothes which they wore. They had no way of fully supporting themselves. Their pre-war sources of income and goods had vanished, and although they were paid for their work as laborers and domestics, the wages were low and many goods were either not available or were priced beyond their power to buy. Most foodstuff were “issued” and consisted mainly of rice, flour, sugar, salt and canned meats. Clothing, utensils, tools, livestock were unobtainable.
A 1966 economic report commissioned by the U.S. noted that the Japanese-era economy benefited many islanders considerably. They “enjoyed a wider variety of goods and services, greater sources of income, and greater opportunities to develop abilities, and to get jobs than they ever experienced before or, in many instances, since.”
In the [Northern] Marianas the people complained that the only items of clothing available were discarded G.I. uniforms, but in most other places not even this source of clothing was available… [T]he shock of change from the pre-war condition was great... The thriving and prosperous agricultural and industrial enterprises on Saipan, including the major sugar industry, commercial fishing, and many other enterprises, and most of the people, were gone… Not only the businesses and the people, but most of the infrastructure — the roads and causeways, community facilities, electric and water systems, harbor and other facilities — were gone... The physical structure of the former economy had been destroyed. Worse still, the entrepreneurs, capital, managers, supervisors, technicians and almost all of the labor were no longer available. Thus, all of the elements which had conceived, financed, and operated the economic units suddenly disappeared.”
From 1945 until the CNMI economy took off in the mid-1980s, the islands’ main industry was government.
In the early 1970s, “there were 55 businesses in the Northern Marianas employing 673 people,” former CNMI economist Bill Stewart recalled. Wages were low. Not a lot of public services. Not a lot of consumer goods. The roads, according to Stewart, were “pot-holed and were either choked with coral dust during dry periods or with deep, water-filled, bone-shattering, axle-breaking craters…” Not a lot of flights to and from Saipan. The communications system was primitive. Healthcare was provided on a wing and a prayer. Many homes were made of tin and wood. Indoor plumbing was a luxury. Two-thirds of the population received direct food assistance from the feds. It was estimated that 95 percent of the population would be eligible for free or subsidized food “because nearly every…family falls comfortably below the U.S. income standards…” Not a lot of schools. Not a lot of educational opportunities. The crime rate was a serious concern.
Then came the economic boom of the 1980s fueled by Japanese investments and imported labor. But in the wake of the Asian currency crisis, the CNMI economy started declining in 1998. It was only in the past two or so years that the economy finally improved, allowing the CNMI government to collect more revenue, pay for its many outstanding obligations and allot more funding for critical public services.
However, the few federal officials who know what or where the CNMI is believe that the islands are still in the 1990s. “We will not return to the 1990s,” they said.
But they see no problem with returning the islands to the 1970s.
Zaldy Dandan is the long time editor of Marianas Variety on Saipan.