Inflation in Zimbabwe is legendary. People talking about the economy actually use words like “sextillion” and “quadrillion” — fortunately we’re only still at trillions.
Newsweek snagged an interview with the man responsible for printing up all the money, Gideon Gono. Among his arguments: If printing up money weren’t a path to survival and propserity, why are so many developed economies now going down this route? Touché. And he makes some statements about the bind he’s in that both Ben Bernanke and Alan Greenspan would probably make, if they could speak with total candor:
Do you have constant security?
It’s elaborate. It’s an occupational hazard. If you ask Bernanke or Greenspan, it’s the same, but it just differs in intensity. If you raise the interest rate you’ll be friends of people who have access to money. If you lower the interest rate, you’ll be the darling of borrowers, but pensioners will curse you to hell. It’s never about popularity. At all times you are definitely hurting some people in the economy.
What do you think of your many critics?
I have been in the trenches during every moment of survival for my country. Any central bank governor is of necessity. When things go bad, we governors are the fall guys. No other governor in the world has had to deal with the kind of inflation levels that I deal with, no other governor has to come up with the gymnastics and strategy for the survival of his country. But let me say that in my bank resides the cutting edge of the country. I’m privileged to be the leader of that team.
No matter what you think of his course of actions, you have to admit he’s probably right. It’s easy for society to cast guys like Alan Greenspan and Ben Bernanke as scapegoats, but come on. We’re all to blame, both for our personal behaviour, and our politicians (who, since we put them into office, are really a reflection of ourselves). In Zimbabwe, the hyperinflation is something we can point to, but the fact that the country is ruled by a violent, capricious dictator is the real cause of their problems. And yes, no matter what path he chose, in terms of monetary policy, he’d be screwing somebody over.
(via Marginal Revolution)