Famously, the history of Jersey can be hung on a framework of successive industries.

Distant-water fishing, privateering, cider orchards, knitting, oysters, shipbuilding, farming, tourism and financial services have each played their part in making this a prosperous community. History’s headline-making stories, however, can overshadow less sensational historical information and, as far as we are concerned, tales of the good times have tended to obscure the bad.

The truth is that the Island has in the past endured periods of financial difficulty, so we should not jump to the conclusion that our present problems, revolving around public sector deficits, are the first economic trials that Jersey people have ever faced.

Nor, therefore, should we imagine that we are progressing into an economic dead-end from which it will be impossible to retreat. It is nevertheless essential that we are fully realistic about the reasons for the deficits which loom before us. Understanding how they have come to be a threat is the foundation on which we can build effective solutions.

There can be no doubt that government has a habit of spending too much and allowing profligacy to run out of control, with ever-increasing revenue budgets having played their part in creating the emerging gaps in our finances – in particular the structural deficits that loom in the far from distant future. In addition, paradoxical decisions such as the one which led to £20 million in savings being ploughed back into new projects argue that there has been a critical lack of realism at the highest political levels.

In spite of this, present difficulties can also be attributed to factors almost entirely beyond our control. We have been obliged to change – and change radically – the way our financial services industry operates, reducing the revenues it produces and shifting a greater share of the tax burden onto individuals who have long been accustomed to a more favourable fiscal regime.

The practical effects of our relationship with the outside world have been adverse enough, but they also highlight a painful fact for a community so proud of its individuality and its ability to regulate its own affairs. We are not alone in this world and, like it or not, outside forces can and will intervene and then make a tremendous difference to the way in which we regulate our affairs.

Thanks to entrepreneurial spirit rather than political leadership, Jersey has always in the past survived hardship to thrive again. It can do so again, though in this modern era the entrepreneurs are unlikely to engineer resurgence by themselves. They must have the support and wise leadership of a political machine willing to take tough decisions courageously without an eye on instant popularity.