South Africa’s economy: Are we


South Africa’s economy: Are we just frogs in boiling water?

As South Africa’s economy reaches boiling point, have we been lulled into submission by the slow and gradual increase in the temperature?

South Africa’s economy: Are we


This week seasoned hedge fund investor Seth Klarman compared investors to ‘frogs in boiling water’.

Klarman criticised the US central bank for slashing rates and flooding the financial system with money since the beginning of the COVID-19 pandemic, arguing that the central bank’s moves have made it difficult to gauge the health of the US economy.

The letter was quoted in the Financial Times of London. “With so much stimulus being deployed, trying to figure out if the economy is in recession is like trying to assess if you had a fever after you just took a large dose of aspirin,” he wrote.

“But as with frogs in water that is slowly being heated to a boil, investors are being conditioned not to recognise the danger.”

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As South Africans, are we now officially also like frogs, sitting in a pot on the stove, with the water reaching boiling point but because we have been lulled into submission by the cunningly slow and gradual increase in the temperature we have just not noticed?

When load shedding was first introduced in January 2008, South Africa was a very different country. Thabo Mbeki was still President, and the recently fired Vice President Jacob Zuma was waiting in the wings having been elected as ANC president only one month before in Polokwane. At the time, it seemed like we were on the edge of a precipice. And then electricity cuts?! Surely that doesn’t happen in fast-growing middle-income countries like ours?

Of course, we were on the edge of the precipice, and we fell into it – just as we fell into countless precipices following that, ever lower and darker and colder with less power.

Apologies for the mixed metaphors, but the pot of water was also starting to heat up. Of course, South Africans noticed, the damage was plain to see in the value of the Rand, the unemployment, the urban decay, the ongoing degradation of public services which we came to expect, and the increasingly extreme, outlandish, and extravagant exposes of gross corruption and mass-scale theft.

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This week on Twitter ex DA aspirant spin doctor Ryan Coetzee made the point that ‘the combination of load shedding, vaccine failure and tax hike is really quite explosive. It will be interesting to see how the middle class explodes. Strongly worded tweets? Civil disobedience? General tax avoidance? Emigration? Or suck it up, resigned and resentful?’

2020 was perhaps the biggest tipping point of all. All of the menial gains in job creation and economic growth since those days of the Polokwane conference and the first loadshedding have, according to the World Bank, been erased. The economy is drowning in debt at the same time as businesses are being strangled by a pandemic.

We are right back, economically, where we were – and yet the country is so much further behind as the conditions which have resulted in this situation have meant that South Africans are now almost incapable of doing anything to stop the inexorably increasing temperature in the pot we find ourselves.

“Africans are the most subservient people on earth when faced with force, intimidation, power. Africa, all said and done, is a place where we grovel before leaders”. So wrote Kenyan whistleblower John Githongo in 1994.

South Africans cannot even resent and fight against our leadership anymore. If there is one thing worse than venal corruption, it is assumed competence and tacit acquiescence.

Once again, we are lulled into a sense of submission as the water gets ever hotter and that much harder to escape from.