Defeating Michael Ashcroft... by Godfrey Smith

Posted by:flashpoint 12/7/2009 2:00:00 PM

To defeat Ashcroft, you have to take him out completely. Otherwise, he will just keep coming back. Anything else is just an expensive game of charades.

Defeating Michael Ashcroft

I confess I was never totally committed to the Belize-Guatemala negotiations between 1998 and 2008.

I hated the fact that as a government we were deploying scarce brain power and resources, reacting to an agenda set by Guatemala.

Don’t get me wrong, jetting around first class, being received by an entourage of perky premium service girls and dining at Smith and Wollensky’s are not experiences lightly to be scoffed at.

But after ten years the Belizean public hardly benefitted since the Guatemalan claim to Belize had not progressed much toward any lasting solution.

The moment of epiphany came as I lounged idly in the lobby of the Fairfax Hotel waiting for the next session of useless talks and watching members of the Guatemalan delegation bedecked in their suits, traipsing in one behind the next through the revolving hotel door, clutching their Macy’s shopping bags. 

Maintaining the claim had valuable perks for these ageing grandees of the Comisión de Belice. They looked like the kind of tight-fisted conservative civil servants who would save their per diem to take back home rather than spending it with reckless abandon in some dive on a wild night out in Foggy Bottom.

In any national campaign or fight in which Belize’s dwindling public funds will be engaged in a protracted way, questions should be asked before we commit resources away from our static development agenda.

Why take a decision that will lead to protracted war? What is hoped to be achieved? How will this benefit Belize? Who will pay for it? And as an extra double golden bonus question: Who will enjoy the perks?

By nationalizing Telemedia on August 24th 2009, the highly profitable telecoms company assumed to be controlled by Lord Ashcroft, the PM knew he was committing the human and financial resources of the country to a protracted legal fight.

To the “why” came the answer that a financial predator was using the legal cloak of a contract to extort taxpayer’s money and avoid taxation and regulation, binding a little Third World country into a kind of new age slavery.

Even if that is a good political justification for a country with a billion dollar economy to marshal its resources against the private resources of a billionaire, the more critical question is: Can what is hoped to be achieved, be achieved?

The nationalization, said the PM, would end “the debilitating waste of government’s energy and resources” deployed in fighting Ashcroft in the courts over the contract.

That is a non-achievable objective. The nationalization has spun a spider’s web of litigation that will ensnare the government for years. The PM at a subsequent press conference conceded this.

The “re-Belizeanization” of Telemedia as an objective would presumably benefit Belizeans by putting them in control of an important national asset.

It is a fact that Belizean businessmen cannot put together the $600 million to buy Telemedia from government, saying nothing about who would want to buy anyway if it’s all tied up in litigation.

The government will be obliged to offer shares to foreign investors none of whom will be inclined to take less than majority shareholding, given all that’s happened with the troubled Telemedia since 2002.

Driving Mr. Ashcroft out of the telecoms industry cannot be the objective since the PM himself asserts that he has resurfaced as majority shareholder in the only other serious telecoms provider.

Neither can hurting him financially be the objective since the government insists he will be compensated at fair market value for the nationalization.

Ashcroft closed his first deal in Belize in 1985 at the age of 39. The late Emory King and Johnny Searle had approached him to help them find investors to buy out the Royal Bank of Canada which wanted to sell its operation for US $5 million.

He got the Belizean businessmen to give him power of attorney to exclusively negotiate, close the deal and take a majority shareholding. By the time he was finished Royal Bank had sold its operation to them for US $1.00.

Michael Ashcroft is rootless and ruthless.  The son of a British civil servant, he often found himself alone in boarding schools, in different countries or else being looked after by other family members; that bred a degree of emotional detachment.

He decided early on that he couldn’t settle for being paid at an hourly rate, a hell of a decision given the fact that his third-rate formal education, lack of family inheritance and youthful insecurity hardly matched his sprawling ambition.

In a global economic recession in which some members of the billionaire’s club lost a zero or two from their global fortunes, Michael Ashcroft did not.

He is unsettlingly, uncannily patient, plays the long game and is a dogged, relentless pursuer.  His approach is methodical, multi-layered, sweeping and sustained. 

Belizeans blindly, ignorantly cheered on their government’s declaration to levy war on Michael Ashcroft without bothering to ask the hard questions; they reacted with their gut rather than their brain – until the chickens start coming home to roost.

When the issue of the $45 million owed to the British Caribbean Bank by the nationalized Telemedia surfaced, people started asking whether that would have to be paid by taxpayers and whether parliamentary approval was first needed to take on that debt.

The truth is that the government committed taxpayer’s money to a protracted politico-legal fight with a billionaire British parliamentarian with deep ties to the next British government, without having a clearly defined and achievable objective.

In protracted battles in which opponents are roughly evenly matched, a truce is sometimes declared to save money, time and resources; the initial fit of egotistical pique that precipitated the battle having succumbed to the reality of the pointlessness of it.

Rupert Murdoch, global media mogul and a man a few billions richer than Ashcroft, settled with him to avoid protracted costly litigation. But Murdoch was playing with his own money. 

The politicians who have led Belize into a war with Ashcroft are not playing with their own money; it’s taxpayer’s money.

The PM may count it a political victory that during his tenure he didn’t pay back. But ultimately it will be a financial loss to taxpayers; while the lawyers enjoy the perks of the ill-conceived legal war.

If the objective is to protect the national interest then so let it be. Be like Putin against Khodorkovsky in Russia or Mugabe against the white landowners in Zimbabwe or Chavez against the banks and oil companies in Venezuela. In these places there is no going to court to fight against nationalization because the courts are controlled by the state.  Let the end game be certain.

To defeat an enemy like Ashcroft, you have to go all the way. The PM cried ‘havoc’ and let slip the dogs of war when he should have harkened to less known but more relevant: “Do not cry havoc where you should but hunt with modest warrant.”

To defeat Ashcroft, you have to take him out completely.  Otherwise, he will keep coming back.  Anything else is just an expensive game of charades.