FW: [DEBATE] : Zalk on ratings agency and the developmental state
okhela at iafrica.com
Tue Feb 12 17:51:07 GMT 2008
The topic has come up on this list, not so long ago, postulating
evidence of the "return to Keynesian" economics in South Africa. (I may have
it wrong because I am writing from the gut without checking out details to
the facts.) The question is whether the door is not being bolted after the
horses have scooted. Granted, much can be achieved by fiscal policy almost
overnight. Surprises can be taken out of the magician's hat, for example
taxes increase for the rich and get cut big time for the poor. With the
country running a fiscal surplus something more than BIG is possible.
However before we let run with our excitement a point, as an aside,
needs mention: the reliability of these rating agencies uberhaupt. It
appears they are not that independent from the credit institutions as may
seem. There were comments recently that they gave greater ratings to
institutions merely to stimulate sales stock or other financial instruments.
This even though the ratings agencies knew not everything was honkie dorrie.
These ratings agencies in any case failed dismally in prefiguring the
sub-prime lending crisis. Maybe they are thus more on the right track in
that they are now propagating neoliberalism "lite", in the light of the
current credit crisis sweeping all major stock exchanges and financial
institutions. So maybe its thinkable that they are speaking in
"developmental state" mode given these recent happenings they surely must be
Other things that could happen are for example raising tariffs and
protecting internal industry and especially with regard to the often talked
but nothing done about the so-called beneficiation plans for raw materials
before export. Finally a government bent on a developmental course could
implement stringent exchange control.
But all such things happening overnight imply a new government and a
near revolution. After more than a decade of ANC government the tracks seem
firmly7 laid. Who knows how they have been straight jacketed in their
current path. Think of all the years gone by in which the neoliberal "heavy"
took its course while we ran into a consumer boomed by the gravy train and
the masses treated like dregs and getting poorer and more frustrated by the
And besides, the horses have bolted. All our major companies have run
off and listed themselves on the London Stock Exchange!
Subject: [DEBATE] : Zalk on ratings agency and the developmental state
The curious incident of the ratings agency and the developmental state by
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