Death of a currency, rebirth of an economy

The Zimbabwe dollar is dead and no-one is there to mourn it. Faced with an inflation rate described with double-digit exponentials, the country resorted to the least evil solution the precarious government could come up with: bury the currency.

Other hyperinflation episodes had been tackled with a variety of policies, including the famous "shock therapy" that entailed transforming the economy into a free market overnight. Obviously this option wasn't on the table in Harare. A dictator still in power with a loyal police and military cannot be made to accept sweeping reform. Incidentally, abandoning the national currency resulted in a remarkably great arrangement: three separate currencies can today be used in Zimbabwe, shielding the economy from the danger of a single foreign collapse (unless contagion sets in).

Today, Zimbabwean hyperinflation is over and its central bank has lost all its inflationary powers. It is a godsend to monetarists. Watch Zimbabwe, it might be the story of an economic miracle brought by the demise of a berserk central banking authority.

Clock ticking for Mugabe?

He may be losing his grip on the armed forces. Unlike ordinary opposition-supporting Zimbabweans, who have been brutalized by the tyrant for years, these guys have GUNS.

I expressed almost no hope for change when presidential elections were held in the country: it could never be a fair ballot and there was no credible way of making the outcome count in case of an opposition victory. This time round there's nothing to pin our hopes up against, except a more civilized dictatorship.

Yes, I expect a military coup to occur should the army not receive a LOT of government money to silence their woes. It probably won't result in a democracy, but anything's better than Mugabe. At some point the system cracks, and we may be approaching the breaking point.

The case for intervention

Often opinions we agree with come from the most unexpected politicians. Nick Clegg, leader of the UK Liberal Democrats, puts forward an interesting case for developing and implementing the "Responsibility to Protect" doctrine, citing Burma and Zimbabwe as examples. His credo is as follows:

He said there should be strict rules governing military interventions - that it be based on a just cause, have the right intention, always be a last resort, sanctioned by a legitimate authority, be "proportional" and "must have a reasonable chance of success".

The concept of fixing a situation that has been deliberately left to degenerate, or has been wilfully created by a psychotic government is surely appealing to all those apalled by the plight of the Burmese, the Zimbabweans and other nations struggling with heartless rulers. However, one must tread carefully or we'll end up with the usual Lib-Dem inapplicable mishmash.

R2P, as it is conventionally referred to, has rarely been applied in practice because it is quite vague in its definition. Furthermore, the case for intervention rests on several assumptions:

1. We can discern just causes
2. Intentions actually count
3. We kno when we've reached the last limit
4. The UN is qualified (or able to) decide on the matter
5. Interventions won't be botched up.

Abstract notions of limit, intention and just cause aside, the United Nations is in no position to deliver any judgement on any matter requiring what one could colloquially define virile attributes; the cross-vetoes and internal lobbying by countries of dubious reputation are a recipe for inaction.

In my opinion, the case for intervention in another country's affairs is an extreme action and is to be carried out with preision and minimal invasion. The situation must be the consequence of direct actions of a governing group first. If we can identify who's giving the orders, we know which tumor to cut out. Secondly, there must be a solid societal basis (i.e. a working democratic/ruling process) that would re-build a governing structure should the current one be decapitated. Thirdly, no destruction should be involved save for the essential.

Therefore, unlike Mr Clegg, I believe there is a strong case to intervene in Zimbabwe by decapitating the very senior tiers of government, Zanu PF party, army, secret services and the police. Lack of regional support is a handicap but not an obstacle, as a stucture for replacing the brutes is in place and the gears are somewhat oiled. It needs be a surgical come-and-go, not a full-scale invasion with live footage, marches and fanfares.

If we want to develop R2P, we should shift its focus to the following questions:

1. Can we pinpoint the cause of the negligence/brutality? Is it brutality or lingering tribal conflict?
   
2. Is there a social and political infrastructure to avoid a power vacuum?
3. Is there a credible alternative leadership supported by the majority of the population?
4. Is there a genuine desire among the country's nationals to be free from brutality (not necessarily the ruling party?)
5. Can the intervention avoid civilian suffering and general destruction?

These questions answered, the case for Zimbabwe and Burma is clear.

Mugabe stripped of honorary degree

The University of Massachussets rescinded the 1988 award, on the grounds that

“In the two decades that have passed since the honorary degree was awarded, Robert Mugabe has pursued policies and taken actions that are antithetical to the values and beliefs of the University of Massachusetts,” President Wilson said. “I must recommend that we sever the connection that was formed when Robert Mugabe appeared to be a force for positive change in Africa. Today, that promise no longer exists.”

Earlier this year I remarked that Mugabe will not go peacefully as the outcome of the election got clearer. My fears have sadly materialized, with brutality escalating and the bloodthirsty monster still in the top seat. And we are just as powerless. Where's the United Nations and its eagerness to defend human rights now?

China recalls death cargo, and how responsible markets could have prevented the stalemate

After days of stalemate China has finally backed down and recalled its weapons shipment to Zimbabwe. The story is fetched from the English edition of Al-Jazeera.

Kudos to the dockers trade unions in South Africa for refusing to unload the crates of oppression that Mugabe so fondly wanted. However regular that shipment may have been on paper, the use to which it would be put was so outrageously clear no-one selling those weapons could expect his hands to be clean of innocent Zimbabwean blood.

Commenting on the shipment at a regular foreign ministry press briefing in Beijing, spokeswoman Jiang Yu said the decision had been taken by the Chinese company involved to recall the vessel.

She said the shipment was completely legal and fell within the established norms of international trade.

"In the field of conventional weapons, we have trade relations with some countries. These are consistent with our laws and with Security Council resolutions and China's international obligations," Jiang said.

"We have been very responsible and cautious with regards to weapons exports."

I can say nothing with respect to the obligations, norms and agreements. What amazes me is that someone would actually decide to take an order from a butcher AFTER an election he was clearly losing. Chinese weapons enterprises seem to combine blindness and the most wicked business spirit in a very efficient manner, making the phrase "business is business" sound eerily disturbing.

I may be accused of double standards. On one hand we have the manufacturer's duty to turn a profit (i.e. sell to whoever buys) and the blindness of the free market. On the other we have the concern for the life of innocent Zimbabweans and the clear indication of a butcher's desire to cling to power at any cost. I wish to analyze this situation in the light of a market failure due to the west's inaction and a lack of market transparency.

Mugabe should have been expected to order more firepower, since his own people were turning against him en masse. A transparent international weapons market would have recorded the assassin's bid for weapons and China's willingness to supply them. All the concerned West should have done then (to put their money where their mouth is) was outbid Zimbabwe for any weapons shipment they laid their eyes on.

The end result could have been the impossibility for Zimbabwe to bid against the economic might of the West (unless some rich thug was willing to buy the weapons for Zimbabwe), a weapons supply shortage causing a rise in prices thereby bankrupting many paramilitary organizations or thuggish governments relying on cheap armaments. A weapons stock exchange maybe, like the system we use for oil supplies?

Although I recognize this is no long-term solution, the market does hold a temporary answer to such crises. In the long-term we should all strive for thugs not to be elected to government in the first place and for democratic means to be the sole way of settling issues of government and representation.

Just a hope for now.