The capturing of eskom was on the cards for too long.
This is the same strategy they employ for land reform. They know that land cannot be expropriated without compensation. So, they keep the land debate within the “no compensation” frame to generate continuous controversy, thus ensuring there can never be a way forward.
OK, but if the primary issue is policy, and not the ownership of the SARB, why do liberals and right-wingers oppose nationalisation? The answer is they don’t. They just disagree so the conversation remains about ownership to divert attention away from policy.
Now, some are arguing that the SARB should be nationalised. The thing is even if that happened but the policy stayed the same, it would make no difference. On the flip side, changing the policy even with the Bank still in private hands would make all the difference.
You see, under the SARB’s inflation-targeting regime, inflation has a number (3-6%), but unemployment can be at any level. So, if maintaining inflation within the target range means unemployment rises to 60%, so be it. Just as long as it doesn’t “accelerate” too fast.
Policymakers try their best to conceal that the SARB’s inflation-targeting approach means deliberately inhibiting full employment. They spin it in another way. They portray inflation-targeting as solely concerned with inflation and indifferent to unemployment.
For instance, in 2011, Trevor Manuel said South Africa’s labour laws were hampering the creation of employment. Today this narrative is repeated religiously by “experts” and questioning it is blasphemous. The objective is to divert attention away from the SARB’s policies.
Now, policymakers know that intentionally aiming for less-than-full employment is politically toxic. So, to shield the SARB from scrutiny, a narrative was created to blame the move away from pursuing full employment on the labour market and not the SARB’s policies.
It’s been generally accepted since the ’50s that when inflation rises, unemployment falls (Phillips Curve) and that low inflation ias linked higher unemployment. The Reserve Bank’s economists understand this, so they sacrifice the people to “protect the value of the rand”.
The SARB’s economists adopted inflation-targeting because they believed that keeping unemployment low would cause inflation to not just remain high but to keep rising. This idea is called the “non-accelerating inflation rate of unemployment” or NAIRU.
In simple terms, for the past 24 years, South Africa, through the Reserve Bank, has been deliberately aiming to keep large swathes of the population unemployed to “keep prices stable”. The high unemployment is not a byproduct of the SARB’s policies, it’s the entire goal.
Basically, in 2000, the SARB was tasked with controlling inflation. Everyone understands this today. What is less spoken about, though, is that when it introduced this policy, South Africa simultaneously adopted another: intentionally aiming for less than full employment.
In February 2000, six months after Tito Mboweni became Governor of the Reserve Bank, South Africa adopted an inflation-targeting monetary policy. The goal was to keep inflation between 3% and 6% and MAINTAIN a high unemployment rate.
A short thread about the main reason South Africa’s unemployment rate is so high and why it cannot be fixed🧵🧵
After Cyril Ramaphosa is removed, we should consider a 24 hour economy
When JSC said Zondo is not fit for CJ position....they said JSC has no appointing powers it just recommends to the President, the President will appoint , this JSC process is a waste of state resources " today 😅😅🤣 it's a different story
Am I the only one who will miss the Olympics?🥹
Why SABC don't play such documentaries like this at list once a week
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