by Francis X. Hezel, SJ
1974 (MC #) Economics
The 100,000 citizens of the Trust Territory of the Pacific are sprinkled throughout several lsland chains that range for 3,000 miles from east to west. They speak nine distinct languages besides the smattering of Spanish, German, and Japanese that some picked up under earlier colonial administrations. The strong regionalism in the Trust Territory that is the product of geographical and cultural forces has not yet been neutralized by the daily jet service that links the major islands in the six administrative districts nor by the Territory-wide Congress of Micronesia that has met yearly since 1965. With a total land mass of only 600 sq. miles and little in the way of natural resources, the Trust Territory faces enormous problems as it ponders its political and economic future.
But Micronesia's chief problem is not its scant resources or its poverty–as most Asians would understand the word. It has been decades since anyone has been known to die of hunger in Micronesia. "The real poverty in Micronesia," as a Jesuit priest recently wrote, "is its wealth." Ten years ago one would see an occasional Honda scooter; now the roads are crowded with Datsuns–and lately Fords. Ebeye, an island of barely one-tenth of a sq. mile, boasts about 140 automobiles today. Air conditioned supermarkets are blossoming everywhere and the rest of the life-style is changing to match. The average salary of the government employee was $2,600 last year, well above the average of any other island group in the Pacific except for Hawaii and Guam (both American possessions).
This new-found affluence can be traced back to the early 1960's when the US Administration adopted a new policy towards Micronesia. The period of "benign neglect" that had characterized its relationship with these islands since the end of World War II was halted. The flow of dollars began as the US stepped up its yearly subsidy from $7 million in 1962 to $70 million last year. The lions share of the budget went into educational and health services, construction of public buildings and airfields, and recently into water, power and sewerage facilities for the major islands. One of the most notable effects of expansion of the infrastructure was the multiplication of government jobs within a burgeoning bureaucracy. From $2.5 million in 1961 the total wages paid to government-employed Micronesians has swelled to more than $20 million today. Meanwhile, little was done to stimulate local productivity. The result is that the Trust Territory's total export value last year was $205 million–about the same as it had been in 1961–while the value of imports jumped from $4.5 million to $26 million in the same period of time. In ten years Micronesia has moved from a subsistence economy to a parasitic one that draws on a large US subsidy to sustain it. The beer that flows freely on weekends and the frozen chicken sold in those supermarkets are the tell-tale signs of an artificial prosperity that is supported by an expensive government bureaucracy.
Wages in the government sector are hopelessly out of line with earnings in the private sector. While an elementary school principal draws a monthly paycheck for $400, the copra-cutter may sell three or four bags of copra at $3 per bag and the small fisherman might net $60 a month from his catch. Two years ago the average government salary was a full eight times as much as the average earnings of a copra producer. Under these circumstances, it is extremely difficult to interest capable persons in commercial fishing, agriculture, and other productive activities that would most benefit the economic development of Micronesia. Government employment with its high wages is infinitely more attractive than small scale fishing or farming with its high risks and low returns. Foreign industries have balked more than once at the high cost of labor in the Trust Territory in comparison with most other Asian countries. Even the Trust Territory government has lately had to contract foreign labor from Korea, Okinawa and the Philippines to cut down on its own construction costs. In the meantime, the islands are preparing for the tourism boom that holds the last real hope for a viable economy.
Even if the monetary rewards in commercial fishing and agriculture were larger, there is another reason why most young men show contempt for these means of livelihood–their education. An occupational preference study of high school students in the Trust Territory last year reveals that any job associated with village subsistence life–such as farming, fishing, handicraft work, etc.–ranked close to the bottom of the list. White collar jobs are regarded as universally more desirable by high school graduates, even those who have had considerable vocational training: and most feel that "overall occupations" are beneath their dignity. This hints at another serious concern in Micronesia now–the uprooting effect that schools have on young people in the village. It is likely that relatively few of the 1,200 boys and girls who will graduate from high school this year will return to their village to live and work. They will be where the jobs are; and if they can't find employment, the boys will drive taxis around the main towns. After all, it is the towns where young people find a "slice of the action." even if there are no jobs available. And there is every indication that jobs will be in short supply 1975 when the number of high school graduates each year will be almost double what it is now.
One hears loud rumblings about political independence for the Trust Territory despite the fact that the life-style of an ever greater number of Micronesians seems to be out of joint with the economic realities here. As one person put it, "We are indulging a champagne taste on a beer-drinker's budget." The tragedy is that the political aspirations for full self-government are surfacing at just that time when the desire for an escalated standard of living appears to be putting self-reliance well out of the reach of Micronesia. Spiraling wages and the costly building program that is going on now strengthens the Territory's dependence on the flow of dollars from the US. Micronesians now faces a difficult choice: money or independence. Frequently a villager, when asked for his opinion or the political status questions wall express a strong preference for continued affiliation with the US because he looks to America to support the schools, hospitals, and ship service between islands. Young Micronesians who have recently returned from college often are militantly pro-independence, but their protests tend to become muted as they settle down to enjoy the comforts that a good government salary can provide. The sympathetic outsider might wish that Micronesian could be spared this dilemma it faces– that it could retain its present standard of living and also enjoy the dignity and pride that come from full independence. But deep inside he knows that these are not the terms on which world powers bargain with lesser countries. And even if they were, would such apparently favorable conditions reduce Micronesia to the status of a "beggar nation" and nullify the sense of national pride that is to be gained from independence?
In view of the lopsided development that has taken place in the Trust Territory, one wonders whether the islands might better be called a colony in the making rather than a developing country.