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MaltaToday 30 October 2022

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15 ANALYSIS maltatoday | SUNDAY • 30 OCTOBER 2022 taxes or painful spending cuts. But Malta's success is also the result of a model where increased social spending was made conditional on econom- ic growth, triggered by sane labour market policies to in- crease female employment, but also by endless construction and exploitation of migrant labour. Ironically it's the same model questioned by the fi- nance minister himself when he warned that: "If we adopt the same recipe, in the morn- ing, rather than being stuck for one hour in traffic, we will be stuck for one-and-a-half or two hours; the tourism sector will invest in hotels that will re- main empty, and this will apply to other sectors eventually." Caruana's quandary It is here that Clyde Caruana is in a quandary. It is thanks to this model that he has enough room to spend his way out of a pandemic and the inflationary effects of war in Europe. For it was during this period of un- precedented growth between 2013 and 2019 that public debt was cut down from 70% of GDP in 2012 to 43% in 2019. Yet Caruana and Abela al- so face the first clear signs of discontent over the social and economic consequences of this growth model. It is here that an ocean still separates words from action. Malta may well be too addicted to its growth model to be in a position to change it in a time of global in- stability. Still, following his wake-up call on the unsustainabili- ty of the current model, one still expected Caruana to give a glimpse of a new one in his budget. Surely the country cannot afford a sudden change in its direction right now at a time of crisis. But a bolder use of fiscal measures, aimed at gradually changing the overall direction, would have been ex- pected. And Labour's aversion to taxation may well be Carua- na's greatest enemy, as it leaves him powerless. For example: in the budget he recognised that traffic is one of the greatest challenges facing the country. But it falls short of addressing this problem, apart from suggesting that some ser- vices are not provided in rush hour. The only exception to the aversion to fiscal pain – even where necessary – is the decision to increase gate fees for landfilling, as recently sug- gested by the European Com- mission. The same logic could be applied to other sectors, in- cluding construction, exploita- tion of groundwater sources, and even traffic. And while the government is right in shielding Maltese families and businesses from the hike in energy prices, it is questionable whether petrol and diesel should be subsidised at the same level as electricity for households. It is positive that white ele- phants like the Gozo tunnel have been shelved, but invest- ment in a mass transport sys- tem – of which no mention was made in the budget – remains crucial, even when its cost might not be as prohibitive with a hybrid of dedicated bus lanes and tinkering with exist- ing infrastructure. Such public goods come at a cost: but socialism is not just about handouts, but also about delivering the public servic- es which make the life of the many better. CONTINUED FROM PAGE 1 The Finance Minister says the party grassroots had been yearning for a more socialist outlook in the wake of the par- ty's move towards the centre of Maltese politics. The word socialist fell out of fashion during Alfred Sant's time as leader in the 1990s as the party attempted to make a clean break with its immediate turbulent past in the 1980s. Sant's new Labour, or third way, was further cemented under the leadership of Joseph Muscat, who insisted the La- bour Party was pro-business and a coalition of moderates and progressives. Flaming red flags were care- fully choreographed out of mass meetings and party conferences as the migration towards the middle ground ditched the socialist worker rhetoric and symbolism. But Caruana is not shy of using the word again and his reference to socialism during the budget speech, and a new red budget case with the Mal- tese national anthem's words, 'strength to the worker,' etched on it, did not go unnoticed within the party structures. "There are many within our grassroots who have been longing for that word to be used; wanting the Labour Party to be more socialist in its out- look," he says in an interview with MaltaToday. He says the budget presented last week was a clear indication of where the party's soul lay with strong measures targeting pensioners and the most vul- nerable families. He says that for a long time, affirming socialist credentials was associated with election defeats. "You lose elections because you do not present clear, concrete ideas that per- suade people and not be- cause you say you are a socialist. I come from a working-class family from Żabbar and I feel part of that class to this very day. I am not ashamed to say in my credo that I harbour that belief (so- cialism)… I don't believe the Labour Party should be ashamed to say it is a social- ist party," Caruana says. He refutes the sug- gestion that by em- phasising the party's socialist credentials he risks shattering the coalition of moderates and progressives Muscat managed to build and which turned out to be a formidable electoral winning card. "After all, this party's foun- dations were built on offering representation to all workers – manual and non-manual workers. And this is etched on the plaque outside our head- quarters. What I always learnt in life is to never forget from where I started," he says with pride. And he is willing to push his credo within the party struc- tures and from the govern- ment benches. "I am one of many in the party… This is what I believe in and once I do so, I will continue working for it." Caruana insists that be- ing a socialist may have been associated in the past with grabbing oth- er people's wealth to give it to others. "The notion was robbing Peter to pay Paul. But being a socialist means creat- ing wealth and using it to sup- port those who are most in need but also empha- sising fairness and justice by ensuring that everyone is do- ing their part." INTERVIEW MT2 "There are many within our grassroots who have been longing for that word to be used; wanting the Labour Party to be more socialist in its outlook."

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