Bond Notes: Our refusal to learn from history

The study of history has a moral purpose, so we are told. It is believed that studying history can create better citizens in a free society. At least this is the shared belief among authors of history books. I am sure the government of Zimbabwe shares this belief too. At one point, they wanted to make the study of history compulsory. In any case, why would anyone read history books, if not to learn from them?

With the way history keeps repeating itself, you would be forgiven for thinking, we are a generation that does not study history anymore. But that’s far from the truth. History books are being sold in their thousands. Political biographies and memoirs are best sellers in today’s cut throat book industry. Yet, the saying that ‘we’ve learn from history that we never learn from history’ is still true.

Where then are we erring as today’s generation? Is it because we do not think historically? Do we pause and consider historical lessons from our past when making decisions? Are we not sleep walking right into the horrible traps of yesterday?

Bond Notes: The return of Gideon Gono’s printing press

Why does our very own Central Bank refuse to learn from our past? What gives Reserve Bank Governor Mangudya the arrogance to disregard everyone and the lessons from our recent history? Why does he refuse to listen to people telling him that Bond Notes will be bad for our country? Does he not know that our wounds are still fresh? People lost their pension, their life’s savings through the actions of a bandit governor in cohorts with his president.

Well, some people will say, I am jumping the gun. Some will ask, how do I know that Mangudya will be as careless as Gideon Gono and run the printing press non-stop? I say to those people, some of us have discerning eyes. Eyes that can look into history and discern the future. Let me explain. It is not just about the person of Mangudya, I hear he is quite an honourable man. But this is about the environment he is operating in. Even more honourable governors like Kombo Moyana were forced to print money to finance the DRC war and to pay a lump sum to war veterans. Money that was unbudgeted for.Today’s conditions are similar to the conditions Gideon Gono found himself in. Have we forgotten about the cash shortages and the long bank queues in 2004? The farm mechanisation scheme and many other government programmes that were financed through the printing of money?

If people are that forgetful then I contend that it is our revolutionary duty to sound the alarm bells and remind them. We can tell where we are going by looking at our actions historically. Now dear reader let me walk you through how I came to the conclusion that the days of Gono are returning.

The fact that the government of Zimbabwe is broke is no secret. Our expenditure is higher than our revenue. We have a budget deficit that no one is willing to fund. Yes, not even China and Russia our all-weather friends are willing to chime in. Just because they are our friends it doesn’t mean they are stupid. We have a history of not repaying loans. Seriously, who would throw their money into a bottomless pit like the Zimbabwean government?

Let me digress for a moment and tell you about my friend, whom I will call Mr X to hide his identity. Mr X used to come to me when he needed a bit of financial help. He would say I will repay you on such and such a date without fail. Every time I wanted to believe him, but every time it was an armed struggle to get my money back. He would give excuse after excuse. After a while our friendship seized to involve financial matters. I had learned my lesson. Fool me once shame on you, fool me twice shame on you, but fool me thrice shame on me. The best predictor of the future is the past. If you do not repay your debts as a nation, no sane country will be willing to extend credit to you in the future.

We know that the minister of finance has been seeking audience with international financial institutions such as the International Monetary Fund (IMF), the World Bank (WB) and the African Development Bank (AFDB), seeking re-engagement and further budgetary assistance. These institutions too, have learned that we do not repay our debts. Thus before they can extend any further assistance they have given our government certain conditions it must fulfil. Among these conditions, the government is expected to cut expenditure, repay its loans and improve the business environment so as to attract foreign direct investment and grow government revenue. Quite simple and logical conditions if you ask me. We did not need outsiders to tell us these things.

Basically these international institutions were calling a return to Tendai Biti’s prudent philosophy, eat what you kill. Biti told us that the size of our dinner was determined by the size of our hunt. He implored us to hunt big if we wanted a big dinner. But I guess, common sense is not that common in a government run by Zanu PF. They expect to eat elephants whilst they go about hunting rats. Let me tell them, here and now, economics is not a voodoo science. Money simply does not grow on trees. You cannot spend money that you do not have. Why can’t this government not learn from its citizens? You don’t see ordinary civil servants driving Bentleys or building mansions. They stay in their lane, living their lives within their means.

But our government cannot stay in its lane. That is why it reversed the expenditure cutting measures introduced by the finance minister during the Mid-Year Fiscal Policy Review. The measures were reversed as fast as they had been introduced. Sensible policies if you ask me asi ndirichiiwo zvangu panyama yehuku (but who am I in the greater scheme of things). I believe it is not hard to cut government expenditure in Zimbabwe. All it requires is seriousness, something that our government lacks. The civil service is filled with thousands of ghost workers. Members of the ruling party being paid for doing nothing. The government is bloated, full of useless ministries, which are only good at draining the national fiscus. Unnecessary travel expenditure by the executive arm of government can be cut without any negative repercussions on the economy. But in Mugabe’s administration political considerations take precedence over the well-being of the state.

The failure to cut our expenditure and to secure any bailout assistance from the international financial institutions is quite instructive. How will this broke government meet its expenditure bill? The fact that the tax base continues to shrink does not help matters. The budget deficit can only get worse and worse.

That only leaves one conclusion, the days of Gideon Gono are upon us again. The expenditure bill can only be financed by the printing of money. As we speak, at Fidelity Printers, they are busy oiling the printing press. Zanu PF big wigs are smiling from ear to ear. The return of their cash cow is now imminent and we all know it.

Brace yourself Zimbabwe, we have been through this before. Under Gideon Gono the printing press ran 24/7. Churning out worthless paper which they called bearer’s cheques. Under Mangudya the printing press will churn out the same worthless paper, but with a different name. Welcome to Bond Notes.

Our leaders have proven beyond any doubt that they suffer from fatal delusions. They think that they are immune to the lessons and laws of history. Gideon Gono once tried without success to write new laws of economics. He defied existing laws of economics. Laws that were put to test by history and refined by time. He reaped nothing but hyperinflation.

Governor Mangudya, perhaps your plan is to make business graduates put their academic training to better use. I know for sure, when the black market re-emerges they will be trading currencies instead of the usual juice cards. But that too is a plan in futility.

Cry my beloved country. Cry the land of my forefathers. Why do you refuse to learn from your own history?