Why did Burnham’s economic preferences for African Guyanese fail?

During the Emancipation Commemoration activities, African Guyanese spokespersons bemoaned the economic condition of their community as an unbroken legacy from the plantocracy’s efforts after Aug 1, 1838 to stymie their economic independence. However, in eliding the efforts of Forbes Burnham between 1964 and 1992, to improve their economic fortunes, they miss learning from that lesson of history.
In 1964, Prime Minister Forbes Burnham was bequeathed an economy shaped by colonial interests, in which African Guyanese constituted ninety-per cent of the public service and armed forces, from which Indians had been deliberately excluded by the colonial power. Portuguese dominated those business niches outside the dominant colonial sugar, Bauxite and “Bookers Guiana”, while Indian and Chinese Guyanese filled the crevices. Indians had entered mainstream retailing in Georgetown after their rural start with milk.
In Bauxite, however, the 8000 African Guyanese workforce, that had been ethnically cleansed of Indian Guyanese the same year, earned wages double that of the 17,000 mostly Indian field sugar workers.
Indians had created their major economic niche in rice, where production had reached 275,000 tons, becoming their largest employer. However, after 1965, the ruling PNC decreed all paddy be sold cheaply to the Government and the milled rice then exported at much higher prices. The huge 118% implicit tax on rice farmers crippled the industry, which by 1985 shrunk to 95,000 tons.
Examining the PNC’s 1972-76 development plan, present UG Chancellor J.E. Greene concluded, “The crucial factor in terms of patronage is the shift in the proportion of government expenditure away from the Indian farmer into the pockets of the African wage earner.”
In the sugar industry, after “profit sharing” was arbitrated in 1968, workers began receiving an annual “back pay/bonus”. In 1974, however, when sugar prices spiked, the PNC imposed a levy on profits, scooping off $256M by 1975, and US$1.5 billion by 2003. Neither the workers received their share of profits (60%) nor the industry their 40% for reinvestment in field and factory. Sugar was crippled even as the money skimmed off was to be used for hydro power and a host of light manufacturing ventures employing African Guyanese.
The Police were augmented by an Army, National Service and Peoples’ Militia to absorb the bulk of unemployed African Guyanese youths. By 1976, according to Prof Ken Danns, Guyana had “Disciplined Forces” with a combined strength of 21,000, up from 2631 in 1965.
According to the Latin American Bureau, “The intake into all of the disciplined services is 90% black, reflecting the widespread violation of entrance requirements exercised by leaders of the ruling party.”
Between 1965 and 1981, the Government workforce grew by over 400%, from 27,000 to 124,000, as the Government nationalised and controlled over 80% of the economy. The upper and middle-class supporters of the PNC were empowered through jobs in the bloated public sector (including the nationalized industries), Boards, and Directorships of Government Corporations. “State control …gave to the regime control of the lion’s share of the country’s economic resources to be used for the satisfaction of the patronage claims of its black and coloured supporters.” according to Prof Percy Hintzen.
Housing was another area to transfer wealth to PNC supporters. According to Carl Greenidge, “Some 31 subsidised, low-cost housing schemes were initiated between 1970 and 1980…The estimated costs were some $500M. In addition…several housing schemes, including North Ruimveldt, Meadow Brook, and Lodge Backlands, were developed by the CH&PA.” There were also several schemes in rural areas for PNC supporters, such as De Kendren, Crane, Wisroc. They were all African Guyanese-dominated: Indian Guyanese had to “squat”.
The PNC instituted an External Trade Bureau (ETB) to control importation of all goods, distributed through the “Knowledge Sharing Institute” (KSI) – most located in African-Guyanese-dominated areas. These destroyed private importation and the “shop-keeping”/retail sector.
Co-operatives were the vehicle for transforming the “small” African Guyanese man into a “real man”. The newly established Co-op Bank provided loans while the Ministry of Co-ops provided land, implements, seeds and technical help. The Guyana Marketing Corporation, Chaired by ASCRIA’s Eusi Kwayana, provided markets. Co-ops paid no taxes on profits. The MMA in Reg 5, which opened up 54,000 acres for rice and cash crops, pointedly distributed lands to African Guyanese to counter the Indian-dominated Black Bush Polder.
Yet, a 1992 Household Income and Expenditure Survey (HIES) showed that, overall, Poverty rates for Indian Guyanese was 33.7%; African Guyanese 43% and Mixed Guyanese 44.7%.
What happened to Burnham’s economic empowerment of African Guyanese?