Unemployment and Debt Rise as a Made in the USA Crisis Goes Global
By Danny Schechter
Johannesburg: There was lots of skepticism when I came to South Africa two years ago to show my film IN DEBT WE TRUST. While my critique of consumer debt resonated, the film’s forecast of a financial crisis didn’t. Their economy seemed to be doing well and it was hard to tell a society that tends to look inward that they would be affected by a financial crisis in America, l0,000 miles away.
Most believed it would pass them by.
It hasn’t. A year ago, the International Monetary Fund warned that 200,000 people would be affected. People living on $2 a day might end up surviving on $1 or not surviving at all. These victims around the world are mostly not part of the US debate or our media coverage. The faces and stories of these victims are as conspicuous by their absence as have been stories of the one million families that had their homes foreclosed upon in the last quarter.
As if South Africa doesn’t have enough problems — the AIDS pandemic, massive poverty, and simmering unrest, the Finance Minister yesterday discussed the impact that the global economic crisis is having. There’s been a loss of 500,000 jobs and a fall off of taxes and an increase in expenditures.
The projected deficit will soar with a shortfall doubling to 7.6% of GDP. The government has to cut costs; that will mean a further cutback in social services at the very time of growing protests against service failures and neglect of the poor. South Africa will now be forced to go deeper into debt, to borrow more money
Thank you Wall Street — although most of the media I saw here did not blame forces/financial criminals in the USA for causing this financial cancer. Perhaps they are too far away for most polilticans and pundits here to see the connection. I did read about a big South African bank that got stuck with sleazy subprime losses sold by US firms but that is not being raised in connection with this emerging economic catastrophe.
They even have their own Ponzi schemers here. The government has issued arrest warrants for two scammers pushing phony investments in AIDS drugs. Several big companies are being prosecuted for pice fixing on commodities like bread and paraffin or healting oil.
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