With a grain of piquant salt - High Inflation – the silent killer
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By Bhaskar Dasgupta,






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    But guess what? There is very little foreign exchange to pay for food imports. Who can provide food aid? The western governments and institutions could, but they are Enemy Number #1 on Robert Mugabe's list. No fuel either, no equipment and no nothing! So the industrial capital stock is slowly rusting to a halt. What is the response of his economic advisors? They try to ban inflation. King Canute is not dead folks! Think of yourself as a Zimbabwean school teacher or a member of the previously flourishing middle class - a middle class member whose earnings are generally fixed on years on end with no bonus and a tiny salary increase. If you have that sort of incoming salary, it is tough even with small inflation. If you have a situation where prices are under hyper-inflation and *doubling* every week or so, then you do not need to be Stephen Hawking to realise how quickly you will run out of your disposable salary, your accumulated savings and finally your assets, like your ancestral property, house or your pension.

     

    And when you end up in a situation where your salary is just enough for two days out of an entire month, what do you do then as a middle class man? A dark joke of old Soviet times gives you the answer: "they pretend to pay us for working, we pretend to work for the pay they are pretending to pay". So you have a choice of either doing 2-3 jobs, do something illegal, become a criminal or simply leave the country. In this case, Zimbabweans have taken the last option. What's left? Nothing much actually.

     

    Like an anorexic patient, after finishing off the fat, the locusts in the ruling ZANU PF party and Robert Mugabe's goons have now started eating into the muscle itself, leaving the patient bony. He even asked for a loan from China. China, who is not at all squeamish about lending to all and sundry, turned him down. And for all the ills, Mugabe blames Tony Blair, USA, and everybody else outside the country. What is even worse is that this hyper-inflation has impacts on the neighbours. South Africa is one of the great white (if you excuse the pun) shining hopes of the African continent, a country which dealt with a very bad historical apartheid card with maturity and peace. A country with sky high moral authority and to whom people look upon as a trend setter and moral compass. A country which has a gigantic task ahead to bring its black majority up the curve. A country which cannot afford to have any kind of macro-economic problems, because any problems will blow up the very delicately balanced racial bargain. Hmmm, very nice! No, actually not very nice.

     

    Let me quote Thabo Mbeki, President of South Africa, who said the following in an interview to the Financial Times of April 3rd, 2007. "President Mugabe and the leadership of Zanu-PF believe that they are running a democratic country. That's why you have an elected opposition, that's why it's possible for the opposition to run municipal governments in Harare and Bulawayo. You might question whether these elections are genuinely free and fair.... But we have to get the Zimbabweans to a position that they do have elections that are genuinely free and fair." I have to admit that I winced reading this. This is a President of South Africa speaking? But why am I surprised? This same man believed once that cucumber oil (or something like that) would cure AIDS. An election opposition whose leader had his skull cracked open, all opposition press muzzled if not burnt out! The municipal townships which have been eviscerated by the Zanu PF goons and President Mbeki are wondering about free and fair elections? Is he on the same planet as us?

     

    The way Zimbabwe is imploding, is impacting South Africa as well. Not only economically, but also the fact that it has to support three million additional Zimbabweans. The last time a migration of this magnitude happened, war broke out and a new country was born (Bangladesh). Old man Hemmingway said it all, and it typifies Zimbabwe. "The first panacea for a misguided nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists."

     

    All this to be taken with a grain of piquant salt!

     




    AUTHOR: Bhaskar Dasgupta

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