Fallacy price corrections

HARARE - A istaken belief is gathering currency, particularly within government circles, that Zimbabwe’s worsening economic crisis — which has recently seen the economy plunge into deflation — is more a correction of prices than a sign of a shrinking economy.

According to this school of thought, the country is not experiencing deflation — even as official data shows otherwise — but rather going through a necessary price correction which has been caused by, among other things, the depreciation of the South African rand and overall increased market competition.

With due respect to those who believe this twisted logic, it really is snake oil science, à la the embarrassing narrative of the “diesel n’anga” of a few years ago.

As if to debunk this fallacy itself, the government this weekend hiked aggressively consultation fees for general medical practitioners, by 100 percent in some cases, with the new fees applying with immediate effect.

According to the government notice, initial consultations at general practitioners’ rooms is now $35, up from $20, while subsequent consultation at the rooms for the same illness will be $30, up from $15.

Subsequent consultations at hospitals or nursing homes per day is now $40, up from $20.

Doctor’s consultation fees are also now $60 for weekend visits and $70 for night visits, while expecting mothers will pay $35 for initial antenatal visits — while subsequent visits and post-natal visits will cost $30. Similarly, visits to paediatricians will cost $120, up from $100. Without doubt, while these increases have the net effect of making medical care in Zimbabwe among the highest in the world, they reflect the reality of our economy and expose the fallacy of impending price corrections. The government knows this and all Zimbabweans know it as well.

This is why the government must ditch its futile ostrich-like tendencies and heed the many voices of reason, including organised business, that are urging it to deal with the realities of our worsening economic crisis rationally. With the carnage within commerce and industry escalating at a rapid pace, the Confederation of Zimbabwe Industries{CZI} added its voice last week to growing calls for political dialogue in the country as the only solution to Zimbabwe’s deepening economic crisis.

Msipa told subscriber-based financial news provider Business Live on Thursday that the only “way out of our situation is a political solution”. The CZI said everyone should do their job while politicians must swallow their pride and industry must work on economic solutions to save the country from collapse.

The question is, will the ginormous egos who lord over us listen to these voices of reason or take us down with them because they don’t want to be told by lesser mortals that the emperor has no clothes?

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