Daily Dispatch Callous ignorance in high places
WHEN told her subjects were starving and had no bread, Marie Antoinette’s infamously said: “Let them eat cake”. That ugly, selfish and insensitive comment pales into insignificance when compared to the breathtaking disregard and calculated contempt the political elite, the affluent and the politically connected showed in recent Whatsapp comments exposed by the Sunday Times this past weekend.
A Whatsapp discussion on South Africa’s downgrade to junk status by a group considered President Jacob Zuma’s inner circle – including Water and Sanitation Minister Nomvula Mokonyane, SAA chair Dudu Myeni, Black Business Council president Danisa Baloyi and Zuma’s son, Edward – exposed a spectacular ignorance combined with shocking insensitivity to the plight of the most vulnerable.
“Who really cares. Many South Africans don’t have billions on the stock exchange,” commented Baloyi.
To make matters worse, many hours prior to Zuma’s firing the former finance minister Pravin Gordhan, Edward Zuma reportedly commented on the same group chat: “That one is definitely going, Rand or not, he is gone.”
On the back of Zuma’s decision, the rand indeed tumbled, some R86-billion was wiped off banking stocks and two ratings agencies downgraded South Africa to junk status. If the third rating agency follows suit economic punters are predicting a recession to end all recessions.
Yes, the wealthy and middle class may suffer some losses. But history shows that recessions hit the poorest hardest. Unemployment increases and the ability of a broke state to look after its growing vulnerable population decreases.
With junk status, our ability to service our current massive debt decreases as does our ability to borrow more. As economic growth slows to snail pace, the tax base shrinks. How, if we cannot borrow money, do we build infrastructure, provide health services, provide social grants and pay our bloated public service?
Having engraved this doomsday epitaph on South Africa’s gravestone Myeni, Baloyi, Mokonyane and the Zuma family giggle manically at our plight while tapping out their contempt for the nation on their smartphones.
It may not be quite so funny when the chickens come home to roost, as they inevitably do.
Junk status is basically a rating agency telling lenders that your credit rating is so poor no one should lend you money. For some big funds it is even viewed as illegal to do so.
Having moved Gordhan out because he takes his fiduciary duty seriously and blocked the nuclear deal, Zuma may find his actions result in the deal being unfundable. Who after all, would be reckless enough to lend a junk-rated country trillions for a dodgy deal?
It should also be borne in mind that some months after Zuma recklessly fired the last proper finance minister, Nhlanhla Nene, the Public Investment Corporation – which invests the pensions of hundreds of thousands of government employees – lost more than R100-billion as a direct result.
ANC cadres deployed in the public service may not find the situation as remotely funny as the economically ignorant inner circle do.
With his actions, Zuma has ensured the poor will get poorer, inequality will grow and the marginalised will be further sidelined.
As Baloyi puts it: Who really cares? Clearly our leadership does not.