Big Saturday Read: How does Mugabe prevail despite failure?
The Zimbabwe Stock Exchange (ZSE), the market where shares of listed companies are traded currently resembles an oasis in a vast desert. Traders call it a bull market, on account of the demand for shares and high share prices all of which suggest high levels of optimism in the market. The opposite, which they call a bear market, is characterised by general levels of pessimism and low demand in shares on the market. The ZSE presents what at first sight seems like an enigma. In a country whose economy is literally in the doldrums, its stock market is experiencing a boom. The pessimism in the economy is not matched by the optimism in its stock market. What exactly is going on?
Economists think the current state of the ZSE is simply because investors are seeking refuge in corporate stocks in light of the massive uncertainty on the currency markets. They are unable to withdraw their funds from banks and there is a serious risk of waking up the next day and being told their bank balances are worth less than half their previous day’s value. Since 2009, when Zimbabwe officially adopted a multi-currency regime, the USD has been the currency of choice. However, last year, the government introduced a pseudo-currency, the bond note, ostensibly as an export incentive. The government said it was equal to the USD. It was an ambitious project but one that lacked economic sense. It was bound to collapse and it has. In recent weeks, the value of the bond note has crashed drastically against the USD. Money depends on trust and no one trusted the bond note. Now that the market has run out of USDs, the fear is that bank balances are now worth far less than is reflected on the statements. It’s better to invest in other assets that can hold value. Some, including President Mugabe’s own family members are buying high value assets like foreign properties and super cars. They will store value as the bond economy collapses. Others are investing in shares on the stock market, hence the apparent boom which has little to do with how well the companies are actually doing. In metaphorical terms, the ZSE is a mirage in the desert. You think the economy is doing well but the reality is that it remains in the doldrums.
Economists say the current bull run is not without precedent. Ten years ago, when Zimbabwe was on the cusp of the notorious hyperinflation era which peaked at 500 million percent in 2008, the ZSE experienced a similar bull run. Then, like now, keen to protect their savings, investors sought asylum in the stock market. The ZSE boomed as the economy collapsed. A few years earlier, as Zimbabwe’s old currency experienced a steep decline, some banks literally turned money into bricks – buying millions of building bricks partly as a cover against the Zimbabwe dollar’s depreciation. For students studying the paradoxes of the stock market and the economy, Zimbabwe and its ZSE present a fascinating case study. The economy is in decline, industrial activity is at an all time low, production levels are extremely poor, but the country’s stock market is experiencing a boom. The 2007 precedent worries economic watchers – they have seen it all. After that ZSE bull run, 2008 was the most terrible year in post-independence economic history. Many fear the current bull run could the harbinger of worse things to come.
As usual, for Mugabe, there is always someone else to blame. He never takes responsibility. His favourite scapegoat is Western sanctions, although on this occasion he has decided to switch tactics and blame internal rivals for the current economic woes. Upon his return from a $10 million trip to the UN where he had an entourage of 70 including family members, Mugabe chose to blame some of his allies of backstabbing him. He accused them of generating shortages of basic commodities and price rises in order to cause a revolt against his rule. Calling them “Judas Iscariots” the issue quickly and predictably took a factional turn. In recent weeks, Mugabe has been aiming most of his shots at his subordinate, Emmerson Mnangagwa and his political faction, Lacoste. The Judas charge was arguably aimed in that direction. Other ministers have incredibly blamed social media for the economic woes. They are quick to claim credit or make grand announcements of phantom mega-deals but never take responsibility.
What is plain to rational observers is that Zimbabwe’s economic challenges are down to an inept, corrupt and extravagant leadership, which has an insatiable appetite for spending what it does not have. The current issue of the Africa Report reveals that Zimbabwe is one of the top ten borrowers in Africa so far this year. Almost all other borrowers in the top ten borrowed for major infrastructure projects. Only Zimbabwe borrowed in order to pay outstanding debts. For the Zimbabwean taxpayer who must shoulder the cost, it’s a never ending cycle of borrowing. Zimbabwe could have qualified for better debt resolution terms a few years ago but as usual, pride stood in the way. The government did not want the country to be designated as a Highly Indebted Poor Country (HIPC), notwithstanding the fact that according to economic indicators it is. It is highly indebted, it is poor and it desperately needs assistance. Internally, by using treasury bills (TBs) and bond notes, the government has been mopping up the remaining USDs in the market. For quite some time, government has abused TBs to source money from the banking sector. To fund spending, the government simply sold TBs to banks in exchange for USDs. It also paid its debts to local creditors like Meikles through TBs. Through these TBs, government was already creating new money long before the bond notes came into circulation.
Ordinarily, there is nothing wrong with using TBs. All governments around the world issue TBs to raise finance. To investors, they provide a secure form of investment and for regulatory purposes it is necessary in some sectors for businesses to hold such instruments on their books. The problem is that in the case of Zimbabwe the government knows no limits when it comes to borrowing and spending, which leads to abuse of this facility. Between 2009 and 2013, Tendai Biti, the Finance Minister was famously frugal and ran a tight ship. “We must only eat what we kill” he used to say time and time again, reminding his colleagues in government and civil servants that it was economically imprudent for Zimbabwe to spend what it did not have. Biti’s stance did not make him or his party (the MDC-T at the time) popular with the civil servants who demanded more money in wages and bonuses. He could easily have taken the populist route to ingratiate himself and his party with the voters. But he chose the hard but honest route.
By contrast, his successor Patrick Chinamasa, has had a more difficult time. He is weaker in the face of his powerful boss, Mugabe with whom he cannot disagree. He has tried his hand at international reengagement, but he has looked more and more helpless as each day passes. He has had to contend with a boss whose approach to economics is driven not by any sound policies but by populism. When two years ago, Chinamasa took the unpopular but bold move to cancel civil servants’ annual bonuses, his proposal was publicly and embarrassingly shot down by Mugabe. The challenge of resolving Zimbabwe’s economic challenges, which are growing by the day is clearly beyond Mugabe and his lieutenants. They might get more loans to pay loans, but that is akin to closing one hole and opening up another because there is no broader plan to solve the challenges. They are completely clueless and there is no hope in economic recovery under their charge. None whatsoever.
But they survive …
In any other country, a leader in Mugabe’s position would be under immense pressure. They would be fighting for their political lives because their chances of success in elections would be next to nil. In fact, in some countries where leaders take responsibility for their actions, the leadership would have done the honourable thing and thrown in the towel. There is no chance of that ever happening in Zimbabwe. Resignation or honour aren’t words that exist in their vocabulary. Instead, listening to Mugabe and his ministers one gets the sense that they are not worried at all about the next election in 2018. Not even after none of the outlandish promises they made in 2013 have been met. If anything, they are boisterous and confident of retaining office after the election. Long before the election has been announced, they carry themselves with the swagger and arrogance of persons who are assured of victory.
Instead, it is among opposition where there’s a sense of trepidation. It’s worse among members of the public, some of whom already seem to have thrown in the towel long before the election has even begun. They are sure that there is no hope for salvation from ZANU PF and they know 5 more years would be a disaster, but they are also despondent about the electoral process, which they believe is rigged and they are also lacking confidence in the opposition. In the nearly 20 years since the MDC became ZANU PF’s stiffest opposition, the levels of pessimism have never been this low. Yet ZANU PF has never been this divided and weak. It is ZANU PF that benefits from the pessimism. Its supporters always show up come election time. Fighting public pessimism is probably the opposition’s greatest fight in this election. To get people off their seats to go and register to vote requires a huge dose of optimism. This motivation and mobilisation is not yet evident within the opposition circles. Instead, it is ZANU PF which seems to be busier in organising its people to go and register.
There are, of course, many reasons why despite the clear failure described in the first part of this BSR, Mugabe continues to exude confidence as the 2018 elections loom.
Using all strategies and tactics, from persuasion to coercion, ZANU PF is a mean machine when it comes to mobilisation. They have the experience but they also benefit greatly from control of state machinery. The administrative structures across the country are virtually ZANU PF structures. The traditional leaders malleable since the colonial times serve the interests of ZANU PF. The current Presidential Youth Interface rallies, which have drawn thousands in the midst of severe economic times are indicative of ZANU PF’s ability to mobilise, using both fair and foul means. It does not matter that they use foul means – the optics conveyed by those huge rallies have an impact on the rest of the voting population and observers. It will be very hard to convince election observers or judges in the courts that Mugabe and ZANU PF are rigging when they are able to command such huge numbers at their rallies. The opposition has spent much of its time squabbling or criticising ZANU PF politics, instead of carrying out their own mobilisation efforts. It’s important to demonstrate that they too can mobilise huge numbers.
Control of the election machinery
Mugabe controls the election machinery, from the electoral laws to the institutions that run elections. ZEC is supposed to be an independent institution but it generally follows government directives. It lacks the courage to defend its interests. At one point when it had no money to fund its operations, the ZEC Chair defended government for underfunding ZEC, citing financial challenges. It was thought the new Constitution would usher a new dispensation, but ZEC has resorted to type. It is unreliable and untrustworthy as an election-management body. In 2008, it became clear that he who controls the counting of votes is king. The 6 weeks spent counting votes were arguably spent manipulating the votes. Mugabe still controls this counting machine. The opposition has to invest in ensuring that it has eyes and ears in the counting machinery and that 2008 is never repeated again. Waiting patiently for 6 weeks for results was a gross failure to defend the vote.
Mugabe can change the rules of the game at will. Through the Presidential Powers (Temporary Measures) Act, Mugabe controls the law making process and has used this draconian piece of legislation to change electoral rules ahead of elections. In 2013, Mugabe controversially amended the Electoral Law using the Presidential Powers Act much to the consternation of his rivals. Even SADC’s intervention was rendered useless. In recent weeks, he has also used the same legislation to promulgate voter registration dates and to amend the Electoral Law, all of which is unlawful because the legislation is unconstitutional. A provision of the Electoral Act still gives the Minister of Justice vast powers to interfere with the electoral process, thereby undermining ZEC’s constitutional authority. With the electoral machinery virtually under his thumb, Mugabe is able to do as he pleases.
Few nations in the world would go through Zimbabwe’s experience without some revolt or at least the threat of it. Faced with a new problem, Zimbabweans shrug, complain that things are getting worse and find means around the problem. Zimbabweans have an incredible, almost super-human capacity to adjust and take whatever nonsense government dishes out to them. The analogy of a frog in boiling water probably provides an apt description of the Zimbabwean nation. If you place a frog in boiling water, it will probably jump out on account of the heat. But if you place it in cold water and heat the water gradually, the frog will simply adjust until it’s too late. It won’t know of the danger until it’s been cooked. As Zimbabweans we adjust to every new level of difficulty, just like the frog in water that’s being heated. Each time the temperature is raised, we adjust and feel better, until the temperature is raised again and we adjust yet again. One day we will not know because we would have been cooked. Mugabe remains in control because we Zimbabweans adjust and accept the worst he has to offer.
For all his weaknesses, and there are many, Mugabe retains a core support base that is completely loyal to him. These foot-soldiers do his bidding, mobilising others to support him and his party. Despite his shortcomings, Mugabe still carries a message that resonates with a lot of people across the continent and in the non-Western world. He’s a master at articulating Third World problems and railing against the Western policies which hurt the rest of the world. Black Africans who remember the colonial experience might disagree with him on other issues, but they give him credit for standing up for the rights of formerly colonised. His stance on land in Zimbabwe divides opinion across the world, but the beneficiaries of land redistribution are grateful to him. By many accounts, the world is still to get over its inequalities, many of them based on race. The resurgence of the right in world politics means messages from the likes of Mugabe still make sense to a lot of people who face racial discrimination around the world. Young Zimbabweans growing up in an age where race and colour are becoming more relevant than before are easily attracted to the rhetoric expressed by Mugabe. Indeed, there are young people, born after independence who are attracted to Mugabe’s rhetoric on race and black empowerment. This might not make sense to some people, but it makes sense to his supporters. To this extent, Mugabe’s continued relevance is a reflection of the failure of the global political and economic system to deal with issues of racial discrimination and past grievances.
Mugabe understands the demographic dynamics of Zimbabwe very well and his electoral strategy has always been based on the majority rural population. With nearly 70% of the population in the rural areas, Mugabe makes sure he gets the maximum possible support from the rural communities. He uses a cocktail of strategies, from manipulating traditional leadership structures and deploying more voter registration facilities in rural areas to using instruments of coercion and implementing policies that are biased towards the interests of the rural majority. With a largely agrarian economy in the rural areas, Mugabe habitually doles out gifts and trinkets to rural farmers through his Presidential Inputs Scheme. The land reform programme served to strengthen the rural base. Since the farmers lack property rights, their occupation is always under threat and at risk, which makes them beholden to Mugabe and ZANU PF. I already addressed how the rural bias can be overcome in last week's BSR.
Mugabe uses violence, especially in the rural areas and he has boasted about it in the past. Although he has learnt to be more subtle in recent years, its because voters are simply reminded of the violent machinery. The threat of violence is as bad and effective as the physical violence itself. The fear which was planted by the violence of the past remains an important tool in manipulating electoral opinion. It is particularly used in the rural areas where the majority resides. In my work on the Panopticon Effect, I have previously explained how the notion that voters are being watched and the threat of punishment are effective tools in influencing voters, especially in rural areas.
Over the 37 years that he has ruled Zimbabwe, Mugabe has created a system of patronage that serves him well. Once appointed to Cabinet or senior public office, it’s usually a job for life. Two of his current Ministers, Emmerson Mnangagwa and Sydney Sekeramayi have been in government since 1980. The chief of police has been in office for nearly 25 years. The Registrar General has held office for more than 30 years as has the head of the civil service. They are all his appointees and they serve at his pleasure. Ministers and senior public officers accused of corruption are generally protected from prosecution. They pay back with unstinting loyalty. For these people, Mugabe must remain in power as long as they are eating.
Divide and rule
Mugabe’s long reign as leader of Zimbabwe is helped by the fact that he has managed to maintain exclusive control of the ZANU PF leadership. To do this Mugabe has used the divide and rule strategy to keep his internal rivals at bay. Although his own party is undergoing serious ructions, he retains complete control. Throughout his career, Mugabe has always played one faction against the other. If you read newspapers from the 1990s, they are replete with stories of factions vying to succeed Mugabe. He has outlived many of those who have been named as potential successors, like the witty lawyer, Eddison Zvobgo. He might even outlive the two remaining contenders, Mnangagwa and Sekeramayi. He generates conflicts between rivals, keeping them under threat of expulsion from the gravy train, thereby earning their loyalty. This ensures that when he goes to elections, they are all fighting to outdo each other and show him their loyalty. In the end, he is the ultimate winner.
If Mugabe has controlled the electoral machinery with an iron fist and thwarted the opposition at every turn, the opposition itself has also been its worst enemy. From the highs of the early 2000s, the main opposition split into warring factions over the past 18 years causing much acrimony and confusion. The 2008 election was a great opportunity to defeat ZANU PF, but the split in the opposition meant Tsvangirai was unable to win an outright majority. Several parliamentary seats were lost to ZANU PF simply because the opposition votes were split between candidates of rival factions.
Many Zimbabweans seem to agree that Mugabe must go, but they don’t agree on who must replace him. In the past year alone, not less than 5 candidates have declared their intentions to contest Mugabe in next year’s elections, adding to a host of existing candidates. The opposition has been hopelessly divided and current efforts to build a grand coalition have yet to bear fruit. The launch of the MDC Alliance was warmly received but it soon led to squabbles in the main opposition party. Still there are other parties which remain outside that coalition, raising prospects of more than one opposition coalition in next year’s elections, which would be self-defeating.
The indifferent majority
Like Mugabe and ZANU PF, Tsvangirai and his party have a core group of unyielding loyalists who will stand with them come rain or sunshine. However, there is also a significant group in the middle which seems to be indifferent to and uninspired by both. But the relationship between this group and the opposition is complicated. They dislike ZANU PF and have some residual sympathy for the opposition, but they are also frustrated by the opposition. Some complain that the opposition has mimicked ZANU PF and that it presents no real alternative. Unlike die-hard ZANU PF supporters, these multitudes in the middle do not bother to vote.
Those who support Mugabe tend to vote whereas those who oppose him are ambivalent about voting. The difference is that those who support Mugabe take part in elections whereas those who would probably not vote for him tend to stay away. This leaves Mugabe at an advantage. The corollary is that if more of his opponents participated in elections, he would probably struggle. This is why the opposition must encourage eligible persons to register as voters and to actually vote. While opposition party rallies also have thousands, the fear has always been that many of them are not registered to vote and therefore are not eligible to vote. The indifferent majority must understand that there is truth in the old adage, that a people gets the government it deserves. If they are indifferent and they don’t bother to take part, then they will have to live with Mugabe’s rule.
Structures and machinery of the state
Mugabe and his party enjoy the vast advantages of incumbency. They not only have access to state resources, which they use for political campaigns but they also use their position to extort financial and material assistance from businesses. When Zimbabwe got a loan facility from Brazil, Grace Mugabe went around the country donating the goods and equipment at ZANU PF rallies. The Presidential Inputs Scheme for rural farmers is provided under the banner of ZANU PF. Vehicles and fuel from the CMED, the state-owned entity are used for ZANU PF rallies and campaigns. The coercive apparatus of the state – army, police, prisons – are all deployed to support Mugabe and ZANU PF. The whole state machinery is turned into Mugabe and ZANU PF’s campaign machinery.
The decision of Kenya’s Supreme Court to invalidate the presidential election in that country set an important precedent on the continent. But there is no hope of that happening in Zimbabwe under the present judiciary. Kenya reformed its judiciary beyond changing the Constitution. Zimbabwe changed the Constitution but kept the same old judges. In 2013, Tsvangirai’s petition was withdrawn because it would only have served the purpose of legitimising a flawed election. Both the filing and withdrawal were strategic decisions, the first to fulfill a legal process and the latter as a protest against an unfair and biased system. While the judiciary is supposed to be the neutral arbiter in electoral disputes, the record of Zimbabwe’s judiciary in election-related matters leaves a lot to be desired. When opposition parties sought the voters’ roll in 2013, the courts made decisions that effectively gave electoral authorities large room to avoid compliance. When opposition candidates asked the courts for permission to open the ballot boxes after the election, they were also thwarted. With control of the judiciary and the law enforcement authorities, Mugabe controls the institutions that are supposed to bring him and his allies to account. These weaknesses have encouraged a culture of impunity.
Handiendi – I won’t go
Mugabe retains power because he simply refuses to go and the system that he has created makes sure he does not lose power. In March 2008, Mugabe lost to his bitter rival Tsvangirai. But it was only a battle, not the war itself. The system made sure he did not lose the war. It took six weeks before ZEC, the electoral authority, declared the result of the presidential election. Critics suspect the inordinate delay was used to manipulate the results, helping Mugabe to get a second bite of the cherry by denying Tsvangirai an outright victory. In the end, the results presented required the top two candidates to go to a run-off election.
However, the run-up to that run-off election was marred by gross acts of violence, blamed mostly on Mugabe’s backers and perpetrated against Tsvangirai’s supporters. The military and war veterans were allegedly involved in the political violence which led to Tsvangirai’s withdrawal a few days before the election. The system had protected Mugabe’s rule, which is why he prevailed in the end and retained his presidency in the coalition government that followed.
The events of 2008 have had lasting effects on the psyche of the Zimbabwean electorate. Fear of political violence remains endemic especially in rural areas where the majority of voters reside. Rural voters are constantly reminded of the dire consequences awaiting those who dare to oppose Mugabe. The events of 2008 also depleted whatever hope that people had that Mugabe could ever be removed from power. Such people have never bothered to take part in elections again.
It is not unusual for Zimbabweans to have to answer the question from foreigners why a 93 year old whose rule has caused so much suffering and despair in a once promising country is still in charge. It's an embarrassing question. The short answer is Mugabe controls the system, a system that serves him extremely well. It is a system that does not allow him to lose. But there are also many other important factors that account for his long reign and which is why, dishearteningly for many people, he is still regarded as a key contender in the 2018 elections at the age of 94. This is despite the fact that he has failed to meet the promises of the last elections. The economy is in serious decline. Under his charge Zimbabwe has gone from being one of the most promising African countries to one of the poorest and most desperate. There is a lot of suffering in Zimbabwe, yet some have him as a favourite in the 2018 elections. Pessimism is the opposition's greatest enemy. It will defeat them long before Mugabe does, unless urgent measures are taken. The squabbling in the opposition does not help matters. The opposition has to inspire more people to register and to go out and vote. Mugabe will make sure his supporters are registered. He won’t mind the indifferent majority – he has done well without them. It is the opposition that must turn the indifferent majority into voters and there is need to inject some inspiration into its politics.