Published on December 30, 2007
It is worrisome that the Reserve Bank Governor has continued to boast that the cash situation in Zimbabwe is under control. The “interview” he had with the Herald during the week is a clear sign that he lives in another world.
Dr. Tafataona Mahoso, a prominent academic, media expert and Executive Chairman of the Media and Information Commission (MIC) has said “the so-called "cash-crunch" which Zimbabwe has been experiencing since mid-November 2007 is so mystified and so over-simplified as to defy commonsense.” Writing in his weekly column in the Sunday Mail of December 30, 2007, he said “the reasons for this mystification and its persistence are not difficult to explain.” Referring to the Reserve Bank Governor Gideon Gono as the head of the “corporate aristocracy” who dominates the speculative economy in Zimbabwe , as it is anywhere else in the world.
Mahoso aptly said the corporate aristocracy is “a tiny minority who do not have to be elected to hold a corporate office or enjoy their corporate power. The armies of managers and technocrats on whom (Gono depends) to impose and mystify their power also don’t have to stand for election and re-election.”
He wrote that Gono’s “explanations of what happened to the people’s money and the people’s economy in late 2007 do not have to make sense. (He) can afford to pass the blame on to someone else, especially someone who has to face the people and get elected. It is up to the people and their democratically elected Government to make sense of what happened, why it happened at this time and what they must do about their economy and those they have entrusted with transforming and running it.
Yet the so-called "cash crunch" of November and December 2007 was the most deadly of all the economic hitches which Zimbabwe has faced since its latest war with imperialism started in the year 2000. Its timing meant that it was intended to "kill several birds with one stone".He observed that the cash shortage was meant to:
- Influence and tarnish Zimbabwe ’s triumphant appearance at the EU-Africa Summit in Lisbon in early December 2007.
- Target the Million Men and Women March organised before the EU-Africa Summit, so that lack of liquidity would make it impossible to move anything and anyone; and the war veterans themselves would be so disgruntled that they would have no motivation to move, let alone mobilise others.
- Target the Extraordinary Congress of the ruling party ZANU PF and to scuttle the nomination of President Mugabe as the party’s presidential candidate for 2008.
- Demoralise all the resettled farmers right at the peak of the planting season, so that no services, no inputs, no labour could be paid for and, therefore, not much planting would take place until the rains were almost completely gone.
Mahoso said that there was absolutely no need to blame the "cash crunch" on cash barons and baronesses because the economic activities demanding liquidity at the time were so easily perceived and pretty obvious as to be foreseeable: the planting season, the Christmas season and the influx of Zimbabwean migrant workers coming home from the SADC region and from overseas, preparations for the 2008 elections, preparations for the ZANU PF Extraordinary Congress and increases in the number of tourists visiting Zimbabwe.
He further highlighted that ”these factors were all in addition to the rising prices of goods and services themselves. Above all, the "cash crunch" was meant to attack the morale of the ordinary citizen by making it impossible for families to hold their traditional reunions and exchanges of goods and visits which usually serve as a send-off for everyone going into the new year.”
Relating to the RBZ-induced cash shortage crisis to the Western-inspired regime agenda, Mahoso identified the current inflationary spiral as a feature of well institutionalized and internalized instrument of economic warfare against the Government of Zimbabwe. This agenda was well crystallized by the remarks former US ambassador, Christopher Dell, when he said that the government will go down through the unstoppable inflationary pressures.
He lamented about the media that glorify managers and technocrats in the corporate and financial sector, publicising prizes and awards they receive or give one another, without scrutinising the actual performance of those given the awards or the motives and character of those organisations giving them.
Therefore the media have accepted explanations of the economy from these technocrats which would normally not be accepted from anyone else.Prominent among these award honourees is Gideon Gono, who recently received a European Marketing Research Centre (EMRC) (Africa Award) “for the role he is playing in instilling discipline in the financial sector and his efforts in turning around the country's economy”.He wondered why the RBZ would adopt a wait and see attitude during what Mahoso considered as a well-timed "cash crunch" in November-December 2007.
To him this was totally unacceptable, if the Press and the ordinary citizens of Zimbabwe understood the relationship between security and liquidity.Mahoso indicated that “money is not only the visible and visualized embodiment of the value of a people’s labour and assets; it is also an instrument of control. In a capitalist economy the power to determine liquidity is more important than the army and the police combined.
As the author of ‘After Theory’ (Terry Eagleton, previously Professor of English Literature at Oxford University and now Professor of Cultural Theory at the University of Manchester), tried to explain, money is a key component of structural power:"The intersecting command of money, time and space forms a substantial nexus of social power which should never be ignored. Those who define the material practices, forms and meanings of money, time or space [also] fix basic rules of the social game. Money has no meaning which is independent of time and space."
The MIC chief said that “because liquidity means the means by which to manipulate and move the factors of productive power in a capitalist society, a cash shortage of the magnitude Zimbabwe was subjected to in late 2007 is far worse then any industrial stay-away or "final push" ever organised by the "regime change" forces in this country since 1997. In the former stay-aways, patriotic citizens could choose not to participate. In a cash shortage, everyone is forced to stay away from what they normally do in order to line up and wait for the little cash.”
He easily explained the triggers for the cash shortage: the Reserve Bank of Zimbabwe cut its cash allocations to commercial banks by 50 percent at the very same time that demand for cash was escalating and the providers of goods and services were hiking prices, against Government policy but with encouragement from the RBZ since it has been against price controls and is the major driver of the foreign currency parallel market. The RBZ pays the highest exchange rate for forex for its quasi-fiscal activities (QFA). The media expert attacked Gono by saying that the explanations of the cash shortage which Gono offered the public on national radio and TV on December 19, 2007 were the least convincing of all his previously televised explanations because of the following reasons he identified:
The RBZ since July 2007 has been in the habit of attacking as uninformed those policymakers and policy analysts it does not agree with. Our understanding of this attack is that the policymakers and analysts did not do research which would enable them to formulate informed policies and to anticipate problems rather than react to them. Yet the so-called cash shortage would not have required complicated research to anticipate. Why did the RBZ not anticipate it? Why did it adopt a wait-and-see approach?
The idea that the RBZ knew exactly who the cash barons were who were violating the laws of this country and committing treason by sabotaging the economy was also puzzling. This was because when pressed to reveal the cash barons, Gono said he would reveal them only to the relevant Parliamentary Portfolio Committee. But that committee is not a prosecuting authority. Why should the alleged names be released only to them?
In his last Monetary Policy Review Statement, on October 1, 2007, before the "cash crunch", the Governor of the Reserve Bank of Zimbabwe had criticised Zimbabweans for their negative attitude towards the very same people he now denounces as cash barons. He said Zimbabweans should learn to accept what he called "rich people". But how exactly do these rich people differ from those the RBZ sought to protect from the price blitz and those "cash barons" the RBZ now blames for the cash crunch?
For openly exposing Gono’s dereliction of duty (i.e. willful, through negligence or culpable inefficiency, failure to perform one's expected duties), one hopes and trusts that Tafataona Mahoso does not become a target of vilification and victimization. This has happened to those who have differed with Gono.
By now, Gono would have simply resigned. Need anyone say more from what Mahoso has said. Mahoso is such a good natured and humble man and abodes no ill for anyone, despite the fact that one can sometimes find his views are not agreeable. In any case, do all his views have to find a home in everyone?
On this one, we must take a serious sober reflection.
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