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Corruption still protects Zanu-PF leadership
John Robertson
April 08, 2009

http://www.thezimbabwetimes.com/?p=14848

Now that Zimbabwe should be moving forwards quickly, but isn't, a long-standing theory is gaining ground: Zimbabwe has not been overwhelmed by economic mismanagement as much as it has by corruption.

Deliberately chosen corrupt practices that were cultivated to ward off, deflect or neutralise threats to Zanu-PF's power base appear to be still in place and still very much in force.

Many of these would be automatically defined as corruption in more normal societies, but Zimbabwe's inveterate politicians see them as the legitimate exercise of their legitimate right to use their power to retain power.

But, while demanding recognition for releasing the Zimbabwe's population from colonial oppression, for years they have shown complete indifference to accusations that they became much more severe oppressors. To them, their past efforts gave them an absolute right to be leaders in perpetuity and this entitled them to ensure their political survival by any means necessary.

At independence, the leadership professed the highest ideals, which they formalised in a Leadership Code, and the same leaders made much of the inviolate civil rights they conferred upon the population. However, they soon began to display a severe disinclination to be subject to equitable distribution of wealth constraints and equally reluctant to recognise the rights of others.

As the party hierarchy became progressively more deeply implicated in questionable activities, unwritten provisos became apparent: in the exercise of their own rights, the officials were answerable to nobody, and if a challenge seemed likely to undermine their absolute power, the challengers should expect to be ruthlessly put down.

The activities in which the politically well connected could engage with impunity soon attracted increasing numbers of opportunists. Claiming equal rights to privileges because of their contributions to the liberation struggle or their close ties to party officials, they looked for ways to exploit the party's considerable authority.

At first, their numbers were manageable and so were their demands. They were soon linked to various financial transfer mechanisms and most appeared to be content with the recognition and their shares of the rewards.

But their successes attracted more contenders, generating the need for more rewards. Politicians who could manipulate financial matters were pressured to see that claimants' demands were met and their successes developed into claims that all loyal supporters deserved equally generous treatment. Transfer procedures evolved into entitlements and the corruption was institutionalised.

All those who could exploit their political influence aimed to become financially secure. Their hopes were that they would never have to actually work again, but those who appeared to have succeeded bred envy and greed in others. Zanu-PF had to keep looking for new expropriation possibilities to satisfy rising demands.

Allocations of rationed foreign exchange, backed by import licences, were given to many favoured individuals, while others were authorised to charge for the use of their rubber-stamps as businesses were forced to comply with some contrived regulation. Government contracts and valued sinecures were given to others, but as taxpayers were being taxed to "diminishing returns" limits, the party had to keep thinking up other schemes to bring in more revenue or to collect it sooner.

Early in this process, the party increased taxes, duties, fees, levies and licence charges in their efforts to keep pace, and it also drew heavily on donor support. However, it soon had to devise new ways to increase its revenue stream, so it chose to skim from corporate and personal incomes and savings to close the widening gap.

Taxes on profits earned were converted into advance payments on expected profits and penalties for inaccurate profits forecasting were imposed, but hidden and more pernicious taxes took effect through exchange controls and the imposition of exchange rates that had no bearing on market rates,

When decisions to interfere directly in the setting of interest rates were applied, the party launched its campaign to blatantly confiscate the nation's savings. By paying interest at a tiny fraction of the rising inflation rate, they stripped away the bulk of the capital held by banks, pension funds and savings institution. They spent the capital on which development depended.

But when the import allocations that had sustained thousands of privileged people were brought to an end, these people responded with demands that Zanu-PF keep its promises of free land. When it was launched, the land reform programme became the most disruptive of the wealth transfer processes and it brought the most destructive forces to bear on production.

What followed was the confiscation and reallocation of commercial farmland, but what actually happened was the asset-stripping and looting of the premises of more than 4 000 farming companies and the premises of their 350 000 employees. The land itself has produced very little ever since, which is why Zimbabwe has had to import food every year since the start of the Land Reform Programme.

When vital tax and export revenues also became casualties of land reform, new rounds of increases in taxes, fees, licence charges and levies started, and government became a much more aggressive tax collector. But these were Zimbabwe dollar sums and when things got really tough, more Zimbabwe dollars were simply printed. The far more serious problem was foreign exchange.

For senior members of the hierarchy, the problem was easily solved: they were given the privilege of highly attractive exchange rates. When ordinary citizens were paying a billion Zimbabwe dollars for a loaf of bread, senior party officials could buy a US dollar for Z$30 000. So, to them, a brand new duty-free luxury motorcar could be bought for the price of two loaves of bread.

Economic policy changes are desperately and urgently needed to restore investment, production, trade and employment, and to establish stable exchange and interest rates.

However, examined against this backdrop of deeply entrenched corruption, the reasons for the determination of incumbent politicians to hold onto their privileges and not to be held to account for their obscene wealth become a little clearer.

And so, too, do their attempts to slow the process of change.

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