Forget the fiscal policies, it’s the politics stupid!

By Everett Scott



WHEN the only serious commitment among the ruling elite is to personal enrichment regardless of the negative impact on the wealth-creating capacity of

the economy, it really doesn’t matter very much what new fiscal and monetary policies are periodically announced.


All the pseudo-intellectuals pontificating about the latest monetary, fiscal and supposed economic turnaround strategies would do well to remember that the fundamental purpose of any economy is the creation of wealth.


For as long as the productive base continues to be destroyed and the prime purpose of the ruling elite — not just the political elite — is personal enrichment the broad mass of the population will continue to suffer ever more marginalisation.


The ruling elite knows very well that it is only through market distortions of the thoroughly distorted economic system that they have created their personal journeys to further self-enrichment.


Their wealth is not the result of entrepreneurial talents, professional qualifications or talent diligently applied, but rather through the application of the strategy of reaping where they did not sow, and “wheeling and dealing” inside the corridors of power and influence.


The fuel problem only exists for the mass of ordinary Zimbabweans. It is an opportunity, not a problem, to those of the elite who have supplanted the traditional multinational operators in the fuel supply business. Why resolve the problem when to do so would kill the goose that lays the golden egg?


For the ordinary Zimbabwean prevailing shortages are a problem but for the elite they are merely opportunities to be exploited. This is why, under the present political dispensation any so-called “economic turnaround” strategy is doomed.


Inflation is not the “number one enemy”, but destruction of the country’s productive capacity. And we all know what has caused that to happen.


What hope do we have when our supposed economic saviour still believes he can defeat the fundamental forces of the market?


Does Gideon Gono not yet understand that parallel markets exist because of shortages?


If he truly wants to eliminate all the various parallel markets then he must address the issue of supply.


When Zimbabwe earns enough foreign currency, when it grows enough maize, when it meets its fuel needs, etc then, and only then, will the parallel markets disappear.


He might also note that all the distortions in the economy were created by ridiculous differentials in the price of fuel.


The price of foreign currency, among others, only exacerbates the problem of parallel markets. To seriously tackle these fundamental distortions would deprive all the wheelers and dealers of their ability to get ever richer.


One suspects that Gono’s verbosity merely disguises his knowledge of these simple truths.


One suspects that he too knows what really needs to be done. As mentioned in recently published letters: “It’s politics, stupid!”


* Everett Scott writes from Harare.