vigilant TV

The Washington Post reports on the effect of governmnent price controls and farmland “redistribution” in Zimbabwe. Farmers and producers are now required to sell food for less than what it costs to make, so they have either stopped
producing food, or are trying to skirt the rules to sell it at a realistic price. Businesses can no longer afford to employ people. Farmland that was taken from white farmers who were supposedly profiteering now lies dormant because the new owners have neither the skill nor resources to grow crops. Written authorization is required for manufacturing new products. As a result of all this, more than half the population is starving. President Mugabe blames the disaster on Western capitalists.

Unemployment is near 70 percent. The stock market has crashed. Inflation is officially 144 percent but really much higher, while wages are relatively stagnant in a country where most people earn less than $1 a day. Zimbabwe’s $500 bill—worth $9 U.S. at the official rate, or about 30 cents on the street—is known as the Ferrari, because it goes so fast. The economy is shrinking 10 percent a year, even though the retail and housing sectors are booming, people with money are racing to spend it before it loses value. Mugabe has said the fuel crisis is giving him “stomachaches and headaches.” The latest joke here is that Zimbabweans have the world’s highest IQs: I queue for gas, I queue for bread, I queue for sugar.

The food shortage facing Zimbabwe is no joke. The United Nations estimates that 6.7 million of the country’s 12 million people are at risk of starvation. The government has a monopoly on grain imports to Zimbabwe, but it is desperately short of foreign currency, so it is now drastically short of food. Its land redistribution scheme drove much of the nation’s agricultural expertise into exile and handed much of the nation’s fertile soil to Mugabe allies who have no farming experience or poor farmers who have no access to seeds or fertilizer. This is expected to wipe out as much as half of next year’s harvest. Mugabe’s price controls on maize and other staples are making the problem worse; many farmers say that even if they weren’t facing a drought, they wouldn’t want to plant crops they would have to sell at a loss.

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Mugabe tends to blame his country’s current problems on drought, Western colonialism and capitalism, peppering speeches with attacks on greedy entrepreneurs, ruthless markets and the forces of globalization. For too long, he says, rich nations have exploited poorer nations and dictated their economic policies.

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Charles Zambe, a shopkeeper in Harare, got a taste of the new economy last month when police charged him with “profiteering.” His crime: selling a 5-kilogram bag of maize for 350 Zimbabwean dollars. The official price was supposed to be 150, but Zambe had bought the bag for 320. His profiteering amounted to 2 or 3 American cents. Still, his maize stocks were confiscated, and he was fined 5,000 Zimbabwean dollars.

– Washington Post, Mugabe’s ‘Surreal’ Policies Ravage Zimbabwe Economy: Unemployment and Inflation Soar, Food Shortage Acute.