1990’s South Africa

The focus on reducing inflation and privatising held through South Africa's change of government in 1994. The new government under Mandela, heady with their long-fought freedom from apartheid, was immediately instructed through privatisation and debt restructuring. Rather than imposing taxes on companies that had become wealthy during apartheid, the new government was pressured to privatise remaining state firms so as to be seen 'open for business' to the international community. Though desperate to support the poor populous, the government was instructed to carefully avoid any legislation or even public comments that could be construed as marxist or statist; this was to avoid another stock crash as such was seen after the ratification of the Freedom Charter of 1990.

Morals were clearly not at issue as former apartheid officials and businessmen of the de Klerck era blocked land and asset redistribution, separated and autonomized the central banks, and were guaranteed pensions and investments profits. Simultaneously the new government was held to call for the huge debts that had formerly brutalised and subjugated the population. Discouraged from social spending, aid, and government sponsored job-creation, the quality of life in South Africa actually declined during Mandela's reign. Sadly, his successor Mbeki took IMF and international advice to increase the Chicago style reforms, that MORE of the same was needed before the situation would improve.

Lesson Learned: Dictators and tyrants had nothing to fear economically from losing power, as the international financial community would not focus on accountability in terms of WHO amassed massive debt, but on using that debt to manipulate a country as in the Washington Consensus. Privatisation and free trade reform were more important than social spending for people who had died and fought for their freedom - as the argument went, the free market would do the best job of improving their lives...

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