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| Zimbabwe headed to Civil War? |
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| Sunday, 13 April 2008 | ||||||
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Zimbabwe under Robert Mugabe's rule seems like a train-wreck that never ends. And like any good wanna-be dictator, it looks like he won't let something like an election end his rule. The UK Independent suggests Mugabe is preparing a para-military police force to conduct election "re-counts" in parts of the country loyal to his opposition. Full Story at the Independent Zimbabwe's recent failure is a testament to everything that can go wrong with government economic intervention.
Stealing from the Rich: Making Everyone Poor
To begin with, his plan to re-distribute agricultural wealth from the rich to the poor only resulted in a massive famine. Military forces evicted established farm-owners and gave control of the land to people who had no prior knowledge of agricultural sciences or farm business administration. Even if they could have managed the farm system, they had no entrepreneurial capital with which to acquire seeds, pay for water & fertilizer, or hire help.
That Sounds Expensive, Print more Money!
Mugabe, still believing that prosperity can be legislated, sought to print large sums of money to educate the new farmers & provide the productive resources they needed to succeed. This, of course, did not put food back on the shelves but it did create massive hyper-inflation of about 4,500% a year. Now everyone could be a millionare! Of course, this just means a dozen eggs cost a billion Zimbabwe dollars. (Yeah, they actually call them dollars.)
Prices are Too High, Government should "do something"
And do something they did! In June of last year, Robert Mugabe instituted a series of price controls, effectively limiting the price anyone could charge for a list of goods. Rather than end inflation, this just made the shortages worse. Since the same number of goods came to market, just at cheaper prices, they were purchased even quicker than before. Many times, they would just be purchased by speculators who were willing to take the legal risk of re-selling the goods at its "real price" in the underground economy.
Setting the stage for civil war
Of course, its not surprising that the people would want to vote against him after this ride they've been stuck on. Mugabe has forgotten yet another one of history & economics most important lessons: The people may let you steal their wealth, but when forced to choose between starvation and revolution, they will choose revolution. I would like to say that Civil War in Zimbabwe is avoidable, but petty tyrants like Mugabe can rarely be reasoned with.
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