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Cius
Executive Member
- Joined
- Jan 20, 2009
- Messages
- 8,348
This storm has been building since Zuma took office. The debt climbed as he had government borrow against the overspend. Now that we are at the edge of the junk status cliff and we can't really borrow any more + all the chickens are coming home to roost from the years of looting the ANC has two options.
Option 1: Cut spending. Only real way to do this is to cut headcount or cut salaries. There is little else they can cut
Option 2: Print money and collapse the economy
Option 3: Default on debt
Option 1 is the right answer but they do not have the political will to make this happen as I see it. That leaves the two death options of 2 and 3. Ace clearly wants to head to option 2. Either way we are pretty much screwed. There is a solution to this crises but Ramaphosa can't do what has to be done as if he does the other faction in the ANC will use it to take him down due to how unpopular it is. They will know they are taking power at that point of essentially a failed state but they won't care provided they can remain rich. If Ramphosa can somehow get rid of key Zuma allies fast and then do the painful step perhaps there is a chance. Still, not sure how they will dig themselves out of this as it requires them doing several things they have never been able to do (live within a budget, manage competently, solve SOE financial crises, and most of all face down the unions).
Option 1: Cut spending. Only real way to do this is to cut headcount or cut salaries. There is little else they can cut
Option 2: Print money and collapse the economy
Option 3: Default on debt
Option 1 is the right answer but they do not have the political will to make this happen as I see it. That leaves the two death options of 2 and 3. Ace clearly wants to head to option 2. Either way we are pretty much screwed. There is a solution to this crises but Ramaphosa can't do what has to be done as if he does the other faction in the ANC will use it to take him down due to how unpopular it is. They will know they are taking power at that point of essentially a failed state but they won't care provided they can remain rich. If Ramphosa can somehow get rid of key Zuma allies fast and then do the painful step perhaps there is a chance. Still, not sure how they will dig themselves out of this as it requires them doing several things they have never been able to do (live within a budget, manage competently, solve SOE financial crises, and most of all face down the unions).
