Thursday, January 10, 2008

Killing Elephants for Food

Despite my wife’s furtive glances, frowns and pokes I continued to probe our driver’s thoughts on the Zimbabwe economy. He related at the dire situations in the countryside with the lack of food, black market gasoline (none available at gas stations), high inflation (unknown, but estimated at from 50,000% to 120,000% PER YEAR) and high unemployment (80%+). His comments on his president were telling, “President Robert Mugabe did some good things when he first took over in 1980 but it has gone downhill from there and today is catastrophic.”

Mugabe was the Maoist leader who led the opposition to the white-dominated Rhodesian government during the Bush War from 1965-1979. He has ruled the country since taking over in 1980 and renaming it Zimbabwe. At the time Rhodesia was referred to as the “bread basket of Africa.” We met a number of refugees in Brazil in the late 70s and early 80s who fled there when Mugabe took over. They loved the country but had deep reservations about its future under Mugabe. From what we saw during our couple of days in the country, they were right.

One of the first things that Mugabe did was to expropriate virtually all of the land in the countryside, redistributing it to friends, colleagues and the landless. He also greatly increased taxes and began to run a cronyism-based economy. When the farm economy collapsed and prices rose, he implemented wage and price controls. What little was left of the economy quickly disintegrated. He is back to expropriating property he had given/sold when he took over in 1980.

One of our guides on our safari in South Africa was born in Zimbabwe, where his parents purchased a farm in 1980 from the government. They lost the farm through expropriation this past year.

Having lived through inflation that ran as high as 2,000% per year in Brazil in the early 1980s, I learned of its devastating impact upon everyone but especially the working class and poor. Paychecks were quickly turned into food and other necessities, often the same day. But, I wasn’t prepared for the impact of 100,000%+ inflation. During the worst of Weinmar Germany’s infamous inflation in 1923, a precursor to their collapse, when its inflation rate topped out at 32,400%.

We had prepaid for everything (hotel, meals, tours, etc) in the USA, having been warned not to use credit cards in the country. I nearly fainted when I was presented for our bill for our drinks and some laundry of ZB$22,088,363 when we checked out of the hotel. At the official exchange rate of ZB$30,000/US$ that was going to cost me $733. Fortunately, at the free market rate I only paid $22.

Betinha and I walked into a small town near the falls. At their only grocery store, the shelves were virtually bare. Bottles of shampoo and other non-necessities were lined up one deep and spaced out along the shelves. In the rice section (a basic staple) we saw perhaps 100 bags of small 2 kg. bags of rice for sale. I snapped the photo on the right, showing a 2 kg (4.4 pounds) bag of rice for ZB$7,800,000. With the largest bill being a ZB$100,000, that one bag would have taken 78 such bills. At the official exchange rate which most locals would have to use, that one bag of rice would cost US$260!

Several times we passed by the main bank in town and always saw a line stretching out the door of people trying to get their money out. Gas was last sold in the town nine months prior to our visit. Cars and trucks either had to make their way across the borders into neighboring countries or to buy it at highly inflated prices from backyard sellers of contraband product.

We were told that the situation around Victoria Falls was much better than the rest of the country because of all of the tourist dollars, euros and rands that were flowing into that area. The rest of the country was really dire, although I didn’t want to try to imagine that.

After returning to South Africa we learned that Mugabe had ordered the killing of 5,000 elephants by his army, to be used to feed people. Those who can, have left the country. Estimates are that 3 to 4 million out of its prior population of 13 million have already fled, mostly to South Africa. Many go on foot where their biggest concern is falling prey to the many lions in the bush. You’d have to be really desperate to make that trek.

It disturbs me greatly to see situations like what we witnessed in Zimbabwe. When the rule of law and property rights break down, the law of the jungle emerges and the lions like Mugabe rule, the rest of the country lives in a life of fear, hunger and terror.

Tomorrow’s blog will hopefully be more uplifting.

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