So, let me get this right – in 2004 the Cayman Islands suffered severe damage to both home and business alike, thanks to Hurricane Ivan.
There was not one person on this little island that was not affected in one form or another.
We all suffered – if not through direct physical loss of home, car, business – then through emotional anguish, as we were forced to take 10 giant steps backward in the hurricane game of Mother May I.
We were banished to an existence without the most-basic necessities such as lights and running water for what seemed like an eternity.
We all did this – at least those of us that remained on island.
During this time, Cayman returned to the community that it once was, before we were inundated with people from various cross-sections of culture, creed and patriotism.
We talked to each other again, we shared our food and water, we stopped to look at the flowers (if not only because seeing one was a joyful moment and fortified our faith that we were on our way to restoration.)
Now, fast forward to the present day.
There are still homes without roofs, insurance companies that have not settled claims, businesses that will never again open their doors.
We have an 800-person capacity in hotels and condos – as opposed to our standard 5,000.
Our supermarkets have not fully opened all of their stores, and restaurants are only now slowing getting back in the game.
So tell me, how is it possible that the powers that be behind our only, sole, solitary, singular, lone electrical company – good ol’ Caribbean Utilities Company – would feel it justifiable to implement a gradual rate increase to recoup their losses as a result of the hurricane?
Last I checked, there was no cost-of-living salary increase mandated by government, and yet insurance on home and cars has doubled (do not get me started on that).
We are still trying to survive on the basic allowances that we have in a country where gas prices jump daily and there are always new bills pouring through the mailbox.
Let’s examine what would happen if every company felt the need to do this:
Say the local fast-food restaurant owner calculated that he has lost about 300 burger sales per day, every day since Ivan. At about $3 per burger, he would say he lost $25,200 +/- in just one month.
Now, say he had to remain closed for reasons ranging from lack of electricity or water to structural repairs for a period of six months.
That’s $151,200 in losses.
Now he feels that he needs to recoup that money, because Ivan was not his fault and he has a hefty repair bill and his insurance has gone up. He needs that money.
So he implements a one-year plan to recoup his lost burger cash. He will raise the price on his burger.
If he works back from $151,200 for the year, and basing his calculations on the same 300 burgers per day (plus a little interest), he could come to about $1.75 that he would need to tack on to the $3 price in order to continue to do business and get his money back.
Now tell me: Would this fast-food joint go out of business for trying to sell burgers (no fries, no drink) for $4.75? Of course. No other fast-food chain on the island would be doing it, thereby securing business as the lower-priced place to eat. See what competition can do for you?
That is just burger talk – imagine if everywhere, businesses felt the urge to increase their prices just so that the burn of Ivan did not reflect so badly on their books.
We’d have $25 haircuts (for men and kids), $5 per minute on local phone calls and who knows what else.
Of course, I am exaggerating, but I think you get the gist of what I am saying.
What happens to the little businessman who cannot reopen his doors because he lost everything and was not insured? He invested his life savings and now all is lost.
What about the poor farmer who relied on the sale of home-grown fruits and veggies? The rains have held back and the costs of irrigation with city water may be too heavy a burden. Who will buy local produce that has been hiked to accommodate the changes of post-Ivan Cayman?
This is the tragic risk of living in the Caribbean.
You buy insurance to hedge your risk in the event that something – like a category 4.5 (I still call it a 5) actually happens. You collect your insurance (if you can) and move on, pick up the pieces and get over it.
It is unfortunate that CUC feels that it is entitled to regain its losses by subjecting the suffering people of Cayman to price hikes, when no one else can justify this.
I hope their contract ends sooner than later. It is obvious they are in it for the money, however, as was seen with the end of other well-known monopolies in Cayman, more is better and certainly competition can keep the providers honest.
Go ahead, CUC: Take what you can for as long as you can. We are beaten and bruised and vulnerable – for now.
But come 2012, when we may have more options for our measly dollars, this will be remembered.
Name withheld by request