Economic factors or human cost at Petrotrin?

THE EDITOR: Was the closure of the Petrotrin refinery decided solely on economic factors or was the human cost also taken into consideration?

This is a question coming, in various forms, from many quarters. The unstated premise is that economic considerations are antithetical to people’s well-being. Yet the exact opposite is true. When decisions are not based on economic principles, the entire society becomes worse off.

Think of all the revelations which have been coming to light about Petrotrin since the planned closure was announced. These range from bad investments, mismanagement of equipment and human resources, wages out of line with productivity, all underlain by corrupt practices.

If economic principles had been applied to Petrotrin, as would have been the case under private ownership, none of this would have happened, or at least not to the extent it did.

Now suppose the Government had decided to take on the “human cost” in deciding to revamp Petrotrin. This would have been no less than a call for all citizens who do not work at Petrotrin to pay the salaries of its employees, since all such monies would come out of the Treasury. And this applies to every state-owned company.

Adhering to market principles, on the other hand, means that companies which lose money will shut down and companies which make money are able to more efficiently utilise the resources, human and otherwise, which are then freed to go into more productive sectors. As a result, every able citizen will be rewarded according to their productivity.

Those who recommend ignoring the laws of economics need only look eight miles off our coast to see the human devastation wrought from that approach.

ELTON SINGH, Couva