Anti-Inflation Curbs on Prices Create Havoc for Zimbabwe [liberal economics in action]

New York Times ^ | July 4, 2007 | MICHAEL WINES

[68skylark]

JOHANNESBURG, July 3 — Zimbabwe’s week-old campaign to quell its rampant inflation by forcing merchants to lower prices is edging the nation close to chaos, some economists and merchants say.

As the police and a pro-government youth militia swept into shops and factories, threatening arrest and worse unless prices were rolled back, staple foods vanished from store shelves and some merchants reported huge losses. News reports said that some shopkeepers who had refused to lower prices had been beaten by the youth militia, known as the Green Bombers for the color of their fatigues.

In interviews, merchants said that crowds of people were following the police and militia from shop to shop to buy goods at the government-ordered prices.

“People are losing millions and millions and millions of dollars,” said one merchant in Bulawayo, referring to the Zimbabwean currency, which is becoming worthless given the nation’s inflation, the world’s highest. “Everyone is now running out of stock, and not being able to replace it.”

Because the government has threatened to seize any business that does not sell goods at the advertised price, the merchant said he was keeping his shop open, but with virtually nothing on the shelves.

Economists said that the price rollbacks were unsustainable and that shops and manufacturers would soon shut down and lay off workers rather than produce goods at a loss.

“You can’t buy eggs or bread or things of that sort,” said John Robertson, an economic consultant in Harare, the capital. “Suppliers can’t supply them at a price that allows retailers to make a profit.”

“It’s pretty chaotic,” he added. “But I think the impact will be worse if it stays in place.”

Zimbabwe’s annual inflation rate was last reported to be 4,500 percent in May, a figure the government has yet to confirm....

[68skylark]

This is what the economy of our country will look like if the left ever gets to implement it's full economic plan. Business is bad. Profits are evil. The government is here to take care of the poor.

[bill1952]

>campaign to quell its rampant inflation by forcing merchants to lower prices

LOL! Oh, this is going to take awhile hehehehahahahahehehehahahaha - hours later - hehehahahehehahahehe

LOL! Thats it, we will force you to lower prices by act of law! Yep, works every time HAHAhahahahahehehe BAHWAhahahaha

Wait, what is this? Where are the goods?! HAHAHAHAhehehehe! Oh Lord, I've got to get out of here. :)

[Robert357]

Interesting.....An article that looks at the economic policy of a corrupt government pandering to the people.

I wonder if the NY Times will ever consider the economic results of Democratic Health Care policy proposals? Nah....

[Blue_Ridge_Mtn_Geek]

The economic version of, “The beatings will continue until morale improves.”

[lilylangtree]

Oh, Mugabe, keep it up. You’re doing such wonders to your country. (sarc)

[Billthedrill]

Socialism is free stuff for everybody. Until the stuff runs out.