Wednesday, January 26, 2010
Fuel Market Infiltrated by Mafia-type behaviour Rejoice Ngwenya,
When Bill Gates writes new software, or Steve Jobs spends sleepless nights to make a new product, the proceeds of their sweat are not meant to build dip tanks in Zimbabwe. If Richard Branson had taken the wrong turn in life to be a social trade unionist whose miserable life revolved around ‘common good’, there would be one less airline in the world.
Ideologically speaking, had I had been born in a free country like Botswana, United States or South Africa, I would probably be a ruthless, take-no-prisoner capitalist. Even though, I still want to be termed and perceived a capitalist. I harbour no shame in being associated with the ‘C’ word. In fact, in a hopelessly under-developed and politically repressed country like Zimbabwe where I was born and live, my life revolves around three P’s: people, politics and profits. My life’s pursuit is anything that offers me maximum profit. I have a deep seated resentment for exploits that attract overheads without a disproportionately higher return. When I give, my hope is that the receiver will be inspired by that to give is when one has, and to have one has to expend some form of energy or another.
Capitalism is not a taboo in my world, because without people manipulating factors of production for the sole purpose of profit, life is meaningless. Materialism is not a sin. If you have no materials, you are likely to disgrace your neighbour with your crude nakedness. This becomes a violation of her rights. Indecent exposure attracts the full wrath of the law. When you offend the law, it may drag you to the bottom rung of illegitimacy. Why would I want to exist a life below the poverty datum line? In any case, the PDL is repulsive because it reminds me of how man’s lack of ambition makes him depend on the benevolence of the capitalist. Those who continue to refer to this line as a basis for negotiating minimum existence are driven by feudal mentality of dependency. While we liberals are busy thinking about how best to exploit the free market ideology to make our lives comfortable, socialists conspire to increase the numbers on the side of political plunder in the diabolic name of ‘equality’ through expropriation of our private property, private companies, trademarks and assets. There is therefore shame on the side of socialist and honour on the side of those who freely produce to advance the cause of civilisation.
But there are those whose fragile ideological emotions have been fractured by false allegations that liberalism and capitalism are the sole causes of world poverty and human misery. These ‘vulnerable’ beings choose to inflict pain upon themselves by shying away from reality. Wikipedia says “there is, however, little controversy that private ownership of the means of production, creation of goods or services for profit in a market, and prices and wages are elements of capitalism.” We liberals are driven by a selfish desire to excel, then the community, in the process, benefits. When Bill Gates writes new software, or Steve Jobs spends sleepless nights to make a new product, the proceeds of their sweat are not meant to build dip tanks in Zimbabwe. In selfish pursuits to make more profits for themselves and their children, the downstream benefit of this capitalist behaviour is not increased poverty in the world but changes the matrix of global of information technology. If Richard Branson had taken the wrong turn in life to be a social trade unionist whose miserable life revolved around ‘common good’, there would be one less airline in the world.
South African academic P. J. Haasbroek refers to three values of capitalism as individualism, rationalism and materialism. This perspective is in unison with Wikipedia that “There is, however, little controversy that private ownership of the means of production, creation of goods or services for profit in a market, and prices and wages are elements of capitalism.” Such prophetic statements strike fear and trepidation in the hearts of pretenders, the band of fundamentalist, holier-than-thou purveyors of poverty who pontificate about the compatibility of poverty and spiritual purity. Their gospel of ‘profit is evil’ is dispensed with vigour to insulate own actions from public scrutiny as they lavish the comforts of liberal innovation under the cover of darkness. They remind me of a political party called ZANU-PF that has adopted poverty as an instrument to further repression by antagonising capitalist liberals in pursuit of votes. This whole charade of indigenisation is a smokescreen of legalised plunder. They give capitalism a bad name.
And yet sometimes we free market capitalists bring unwarranted negative attention to ourselves. Take the petrol and diesel market in Zimbabwe, as an example. I know that in the pursuit of legitimate profit, the association of petroleum suppliers tries hard to protect the interests of its members by balancing undue pressure brought by ‘unstable’ global oil prices. A rational excuse is that continued conflicting roles of the State through the moribund National Oil Company of Zimbabwe in itself introduces a factor of price instability. As I have always insisted, the Government of Zimbabwe should expend energy in policy making that nurtures free competition, not competing against its citizens. The business of government is good governance not bad business. However, my observation is that the noble business of supplying fuel in Zimbabwe has been infiltrated and now replete with opportunistic co-conspirators who connive to defeat the very motive of free markets – unfettered competition. Their cartelistic tendencies are a bad excuse of hiding behind ‘association’ numbers to cover up failure to innovate cost-control and efficiency. When a liberal capitalist uses an association to enhance profit margins and merely passes on costs to the consumer as an excuse for sustainability, he joins the world of Mafia that benefits from reckless risk and intimidation.
Only three weeks ago, I could buy one litre of diesel for US$1.15, but in a short space of time, crude capitalism has overshadowed good judgement to position diesel at USD$1.30. I have no qualms whatsoever with profit, but as Wikipedia explains how “a cartel is a formal agreement among competing firms”, collusion is a sign of weakness, not entrepreneurship. Instead of staring life in the face to compete and offer consumers the best price out efficiency, Zimbabwe fuel suppliers toss and turn in beds to contrive ways of conniving to collaborate in primitive, near feudal of what I term ‘laziteering’. Just like drug lords whose bottom line is driven by someone else’s misfortune, Zimbabwe fuel suppliers profit from employing idle minds to merely pass on costs to consumers. Laziteers are not liberal capitalist but buck passers. On any other day, laziteers would pass as genuine capitalists, but as the mist clears, a criminal gang of egotistical bigots is exposed for what they are worth.
To sit down and conspire to fix prices distorts the free market. This is outright criminal behaviour. The fear of competition is the beginning of laziteer mentality. This interferes with my consumer freedom because of its impact on general price levels. Lack of freedom is not surprising because Zimbabwe is likened to a giant prison. Justice is selectively applied and laws are skewed towards ZANU-PF, where greed is institutionalised in the false ideology of indigenisation. This is why I like it when the electronic dictionary explains that ‘cartels are inherently unstable, as the behaviour of members of a cartel is an example of a prisoner’s dilemma’. Says ‘father of capitalism’ Adam Smith: People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices. It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. Wikipedia also brings in a dimension of oligopoly: “Oligopolistic competition can give rise to a wide range of different outcomes. In some situations, the firms may employ restrictive trade practices to raise prices and restrict production in much the same way as a monopoly.”
I however continuously guard my criticism of liberal capitalists, not so much driven by compassion for the poor as the fear that I could exercise collective retributive justice on the innocent entrepreneur. The enemy is not profit, but reckless profiteering without innovation. Poverty alleviation is not a science in pursuit of human equality but a quest for equal opportunity. Argue all you want that petroleum suppliers in Zimbabwe are a vital cog in the wheel of economic development. My point really is to put the spot light on price fixing and laziteer criminal collusion.
Mr. Ngwenya is President of Coalition for Market Solutions and an affiliate of AfricanLiberty.org