When, in 2010, some of us opposed the new Katiba, we were called names. Conservertives. Undemocratic.
Now, sloooooooooooooooooowly, the chickens are coming home to roost. Kenya is grinding into a financial abyss.
You see, a country is basically a business. It must have INCOME and EXPENDITURE. If these are unbalanced too much, the country ecomes bankrupt.
The problem with the New Katiba, which the likes of Michuki and Karume spotted from the word go, is that IT IS HEAVY ON EXPENDITURE AND VERY LIGHT ON INCOME GENERATION. It was written by activists who had the mindset that the government is an enemy, and must be âexploitedâ.
Thus, the Katiba talks of free education, free health care, and also creates an unsustainable political bureacracy that easily rivals that of the US, which has about 350 million people. To illustrate, Kenya today has only about 100 less MPs and Senators than the US, and just about 5 less governors despite having just 40 million people. We are the most over-represented people on earth - by the greediest reps on earth!
(And for the record, NOTHING IS FREE in developed countries like the US, Britain, and France. Not education, not health, nothing! Thereâs no free lunch anywhere anyway - somebody always pays)
Now, the situation is becoming bizarre, with Parliament and the Judiciary trying to outdo each other on ways to order Treasury how to spend taxpayers money.
Just today, teachers won an order that will increase recurrent expenditure by about Sh5 billion a month. A month ago another court ordered TSC to pay retirees about 42 billion. Other courts have awarded unsustainable pay rises to other cadres.
Parliament, on its part is saying that, uni graduates should not be forced to pay their HELB loans. The Govt is being required to even buy âfreeâ sanitary towels for students (makes you wonder, is the role of the parent in copulating?) Very populist and misguided. Nobody, for example, is saying where HELB will get the money to lend future students.
Any economist will tell you this is a recipe for disaster. For one, PAYING RECURRENT BILLS FOR THE POPULACE USING THE EXCHEQUER FUNDS is downright stupid. IT TAKES AWAY MONEY FROM INFRASTRUCTURE, WHICH IS WHAT THE PEOPLE NEED (Example: A sugarcane/cabbage/maize farmer does not need any government to pay Sh4,000 per year for their child in primary school; they need cheaper fertiliser, better roads, elec etc. to make themselves competitive and make millions!)
As judges and politicians continue to raid the Treasury, it seems lost to them that their stupidity will simply hurt ALL OF US. Excess liquidity simply promotes inflation - you can bet the price of meat will rise as soon as the teachers/soldiers/nurses/policemen etc etc all get their raises - thats exactly what happened to Zimbabwe.
I, SADLY, PREDICT THAT THE KENYAN ECONOMY WILL COLLAPSE IN THE NEXT TWO YEARS, AND WE WILL ONCE AGAIN BE IN THE CLUTCHES OF THE WORLD BANK AND THE IMF (to their credit, they have already warned that Kenya is on a slippery slope as far as borrowing to meet reccurrent expenditure is concerned).
You think am scare-mongering?
Then ask yourself why THE SHILLING HAS LOST ABOUT 15 PER CENT OF ITS VALUE SINCE JANUARY.
No, itâs not tourism (al Shabaab existed last year, right?)
THE REAL CAUSE IS THE FLIGHT OF DOLLARS FROM THE COUNTRY. Many foreign investors aare starting to see that the economy is headed south, and they are taking their funds with them.
Thatâs why, incidentally, the NSE is in a slow-meltdown.
IN FACT, THE ONLY THING HOLDING UP THE SHILLING ARE THE DIASPORA DOLLARS - when that inflow starts drying up, shit will hit the fan (Ktalkers, better be more respectful to Kabuda)
Donât say you were not warned.