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Post by jakaswanga on Aug 4, 2013 10:03:39 GMT 3
You got me interest in that German history, but you also lost me. I don't know what that study of yours is meant for ... actually I developed a mechanism to block my ears way back in Std 6, and I had a great history teacher. But I always wondered, "so you say Vasco Da Gama reached East cost 1497 (or whenever that was ... which I remember was the only question I knew for fact I got correct in CPE ) ... so what if he did? Does history ever draw lessons for the future? Sorry ... if we can, lets stay with Country's and their potential for bankruptcy. Brother Mank,Catch up with me on this thread jukwaa.proboards.com/thread/8607/africa-copy-germany-economics-stay where I state my case, and underwrite my pitch! I hope by the Austrian School, Fimbo meant where Ludwig Erhad came from, intellectually speaking that is. Erhad is the man of the post-world-war II wirtschaftswunder, or the miraculous regeneration of {F} Germany after the Fuhrer's Third Reich was laid to ash! In this thread then we can go back to the pertinent and insistent reminders of bad-boy Njakip!. NB: Have you heard Fin-Sec Rotich has gone back to [analogue] the old pre-devolution payroll? But he has paid digital salaries! --That is by treaury payrolls, devolution never happened, layers of government just increased! A technical hitch I suppose, as soft-ware failed on the first run! It makes me think a bankruptcy can also be caused by a technical hitch, like a cyber-attack by an enemy on the financial vital systems!? not so?
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Post by mank on Aug 4, 2013 22:00:45 GMT 3
You got me interest in that German history, but you also lost me. I don't know what that study of yours is meant for ... actually I developed a mechanism to block my ears way back in Std 6, and I had a great history teacher. But I always wondered, "so you say Vasco Da Gama reached East cost 1497 (or whenever that was ... which I remember was the only question I knew for fact I got correct in CPE ) ... so what if he did? Does history ever draw lessons for the future? Sorry ... if we can, lets stay with Country's and their potential for bankruptcy. Brother Mank,Catch up with me on this thread jukwaa.proboards.com/thread/8607/africa-copy-germany-economics-stay where I state my case, and underwrite my pitch! Brother Jakaswanga, I did a cursory check on that thread, and I see you are laps and laps ahead. I will see how much catch up I can do. Still it feels like I will be doing my very able std 6 history teacher a disservice -the teacher I refused to listen to, even when he almost spoke in tongues recounting the events of the 2nd world war - you could have imagined he was actually there observing every detail. I hope by the Austrian School, Fimbo meant where Ludwig Erhad came from, intellectually speaking that is. Erhad is the man of the post-world-war II wirtschaftswunder, or the miraculous regeneration of {F} Germany after the Fuhrer's Third Reich was laid to ash! In this thread then we can go back to the pertinent and insistent reminders of bad-boy Njakip!. Indeed amigo. I hope we still have Njakip with us. NB: Have you heard Fin-Sec Rotich has gone back to [analogue] the old pre-devolution payroll? But he has paid digital salaries! --That is by treaury payrolls, devolution never happened, layers of government just increased! A technical hitch I suppose, as soft-ware failed on the first run! It makes me think a bankruptcy can also be caused by a technical hitch, like a cyber-attack by an enemy on the financial vital systems!? not so? I have not done the responsible thing, to understand how our double-decker government is actually functioning. I have done with the little headlines here and there, about governors fighting with DCs and the two houses fighting for supremacy. So I am challenged to catch up on the matter of how the finance docket treats devolution. Leads to the reads that gave you the impression you post would be instructive. On the 2nd issue, the digital payment, I find it really really troubling! If that true, then the Fin-Sec is cutting out Delarue and doing the printing by himself. Digital currency does not even have the face value of a valueless currency - there is some value in the paper, even the NZR that I would see being rained on the side of the road in Bukavu. You can use valueless paper notes as lighting fuel for your charcoal ... what can you do with digital currency if it loses the power to buy? Fimbo might tell us that Fin-Sec has some control of how much to print, guided by the capacity of the Kenyan economy. I would wish for that control too. The question is, who is asserting that control, and what exactly is the control. You just elevated my concerns several times more. Over to Njakip.
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Post by OtishOtish on Aug 5, 2013 0:44:18 GMT 3
Mank:
From what I see as economic-planning-by-confusion, anything is possible. But if that were to happen or even get close to happening, I believe Kenya would hand over the only kind of sovereignty that really matters---economic. IMF and WB would bail out the country but then insist on running it, with tough consequences for average Kenyans. But do Kenyans really care? I doubt it. All in all, I expect Kenya to continue stumbling along without a great deal changing for the average Kenyan.
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fimbo
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Post by fimbo on Aug 5, 2013 18:01:10 GMT 3
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fimbo
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Post by fimbo on Aug 5, 2013 18:21:42 GMT 3
Otishotish,
Commenting (let alone daring to even appear to offer advice) directly on the Kenyan is fraught with peril.
I have no idea what is going on in the heads of the public faces running that debacle, or the unseen powers behind the curtain.
As you are aware, paying for services by printing is routine for Kenya, how the administration can manage to bungle so badly speaks for itself.
Seems they are handling the country the same way they have handled ICC case.
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fimbo
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Post by fimbo on Aug 5, 2013 18:59:11 GMT 3
And now, how about the original question/point and it other implied questions: Whither the Kenyan economy? Is it economic-planning-by-confusion? Will taxpayers in my other country have to contribute to saving Kenya from bankruptcy? Otishotish, I notice, with frustration, that you all seem to side step with question of how the government's debts were incurred in the first place. Was the bulk of them incurred on projects you have supported? I mean did you support any of these: free primary education (teachers), devolution, a more intelligent parliament, peace and stability (military), health care (doctors and nurses)? Do you think this government has the political wherewithal to implement expensive projects that are not widely supported? If the answer is negative. The to you question: is it economic-planning-by-confusion? I reply it is rather economic implementation-by-confusion?
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Post by OtishOtish on Aug 5, 2013 19:51:48 GMT 3
The caveat here is failure to pay local debt. Foreign debts are another story. Why that "caveat"?
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Post by OtishOtish on Aug 5, 2013 19:52:28 GMT 3
I have no idea what is going on in the heads of the public faces running that debacle, Not much, as far as I can tell.
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Post by OtishOtish on Aug 5, 2013 20:15:15 GMT 3
And now, how about the original question/point and it other implied questions: Whither the Kenyan economy? Is it economic-planning-by-confusion? Will taxpayers in my other country have to contribute to saving Kenya from bankruptcy? Otishotish, I notice, with frustration, that you all seem to side step with question of how the government's debts were incurred in the first place. Was the bulk of them incurred on projects you have supported? I mean did you support any of these: free primary education (teachers), devolution, a more intelligent parliament, peace and stability (military), health care (doctors and nurses)? Do you think this government has the political wherewithal to implement expensive projects that are not widely supported? If the answer is negative. The to you question: is it economic-planning-by-confusion? I reply it is rather economic implementation-by-confusion? Friend Fimbo: Does the why really matter? As an individual, I could borrow money (e.g. on my credit card) for many worthy purposes, but whenever I borrow, I only borrow on the basis of what I can afford to pay back. I also don't go by my children's opinions when making financial plans for the household. To me, planning means taking into account needs, priorities, affordability, etc. Your implicit argument seems to be that if it is something the people support, then the government should go ahead and borrow or print in order to satisfy the public. That doesn't strike me as a good way to plan for a national economy; sometimes governments should make tough and unpopular decisions when taking into account the long-term interests of the nation. (Look at Thatcher, for example.) Note that this is not the same as saying that the things on your list are not worthy causes. But even if we agree that all those are good purposes for unlimited borrowing/printing, the question then arises as to whether GoK uses the money wisely: Every Kenyan president has in his time declared free education; how more free could it get? Public health care in Kenya is a disaster. The military (see Mt. Elgon etc.) poses a grave danger to the security of Kenyans. Etc. So it is not implementation-by-confusion vs. planning-by-confusion: it would seem that implementation-by-confusion exists as a follow-up to planning-by-confusion. I keep hearing that Vision 2030 will lift Kenya into "middle-income" status. But do the plans really match the words? Incidentally, when you think of the possible effects of borrowing via printing, it should not be limited to just GoK. The private sector also needs to be taken into account. For example, what would the effect be on banks and how would that effect migrate into the rest of the economy? On your list: some of those things get a lot of financing from the outside world, which is why GoK has been in a panic over a Sh. 180 billion "shortfall from donors". A "more intelligent parliament"? In Kenya? That one is very funny; Kenyans do not elect their MPs on the basis of intelligence, performance, integrity, .... or anything else sensible.
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fimbo
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Post by fimbo on Aug 5, 2013 21:41:19 GMT 3
I was responding to the question of whether GOK can unilaterally ran the amok the printing press.
They may try to do it(unlike your household, these caretakers have no scruples), but if we have any checks and balances to speak of, they will face public resistance and backlash.
If the public displays willful blindness when they are enjoying the services, they cannot turn around and cry foul when the payments become due.
The Sh. 180 billion "shortfall from donors", if it exists, should only 'negatively" affect the amount of dollars, not shillings, in the economy. If that was the case, then we would expect shortages in imported goods such as oil which have to be paid for with foreign currency.
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fimbo
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Post by fimbo on Aug 5, 2013 21:47:58 GMT 3
The caveat here is failure to pay local debt. Foreign debts are another story. Why that "caveat"? We do not have a printing press for foreign currency. Or to get Mank exited, DelaRue does not print Dollars, Yuan, Yen, Pounds or Euros. To get your hands on one of those, you have to export something.
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Post by mank on Aug 6, 2013 2:41:06 GMT 3
Fimbo, now that it is clear that you are standing up I would be surprised if Otish were not kicking you in the teeth. Himself. We do not have a printing press for foreign currency. Or to get Mank exited, Good, I just got excited DelaRue does not print Dollars, Yuan, Yen, Pounds or Euros. To get your hands on one of those, you have to export something. Certainly! That is why if Kenya chooses DeLarue as its source of wealth, the Ksh will continue to water down ... and those with Dollars, Yuan, Yen, Pounds or Euros will continue to get disinterested in it ... ultimately only the helpless Wanjiku will get sucked of her sweat and blood through inflation tax in the domestic economy and exclusion in the global economy. As you say, as long as DeLarue is in business, there can always be paper to "pay" Wanjiku, but with every transaction the buying power of Wanjiku's Ksh diminishes. Imagine being paid in terms of something people habitually leave in hips by the roadside! Do you really believe that a country that pays in something like that has the ability to pay? And if with that pay a mwananchi cannot afford inputs of production so s/he can export something, how on earth does s/he get its hands on Dollars, Yuan, Yen, Pounds or Euros? Remember the only way to get those is by exporting something? And now, how about the original question/point and it other implied questions: Whither the Kenyan economy? Is it economic-planning-by-confusion? Will taxpayers in my other country have to contribute to saving Kenya from bankruptcy? Otishotish, I notice, with frustration, that you all seem to side step with question of how the government's debts were incurred in the first place. Was the bulk of them incurred on projects you have supported? I mean did you support any of these: free primary education (teachers), devolution, a more intelligent parliament, peace and stability (military), health care (doctors and nurses)? Do you think this government has the political wherewithal to implement expensive projects that are not widely supported? If the answer is negative. The to you question: is it economic-planning-by-confusion? I reply it is rather economic implementation-by-confusion? Earlier on, someone said that he was contributing from a Positive Economics perspective, not the Normative. Oh, that was Fimbo! The title of this thread asks, "Can a Country like Kenya go Bankrupt?" Positive economics dictate that one answer with arguments for "Yes, it can", or "No, it cannot." But you seem to have changed hats, and now are the politician answering the question "should government print or not?" We know for sure governments don't have to water down their currencies with printing to be able to finance valuable projects. Its about smart government ... but I catch myself getting pulled into your politics, and that's really not the topic of this thread.
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Post by OtishOtish on Aug 6, 2013 3:06:23 GMT 3
Mank:
To me, the essence of the original posting was clear enough, and it raised serious questions worthy of discussion. The direction in which your friend, fimbo, apparently wishes to take it would boil down to no more than intellectual self-pleasure, at best. At my age, I no longer indulge in that sort of activity, in any form. So I will bow out of this one.
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Post by nok on Aug 6, 2013 16:56:57 GMT 3
Can Kenya go bankrupt ? Yes it can.
Bankruptcy can be God given.
We have a Jubilee year, a Jubilee Government and in the Thora there is something called the Jubilee cycle ( Take Note of; Sabbatical cycle) and the laws of release.
Or why not file a chapter 7 Bankruptcy. If one can recall, in the last american campaign Barrack vs Romney, Romney (the so hyped up business mogul from Utah) once talked about the economic advantage of Bankruptcy and if he were to decide, he would have let GM go that way; Well he was heavily criticised esp in Detroit and it's environs. Today Detroit is....I wonder what Romney would say.
I think one benefit of Bankruptcy for kenya is that it could be a herb against corruption !!
Another benefit would be teach the kenyan moral psyche something about austerity
......just like what fasting does to the religious souls of believers; be it during Ramadhan or pre-Easter non flesh eating Catholic rituals.
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Post by mank on Aug 6, 2013 17:58:10 GMT 3
Can Kenya go bankrupt ? Yes it can. Bankruptcy can be God given. We have a Jubilee year, a Jubilee Government and in the Thora there is something called the Jubilee cycle ( Take Note of; Sabbatical cycle) and the laws of release. Or why not file a chapter 7 Bankruptcy. If one can recall, in the last american campaign Barrack vs Romney, Romney (the so hyped up business mogul from Utah) once talked about the economic advantage of Bankruptcy and if he were to decide, he would have let GM go that way; Well he was heavily criticised esp in Detroit and it's environs. Today Detroit is....I wonder what Romney would say. I think one benefit of Bankruptcy for kenya is that it could be a herb against corruption !! Another benefit would be teach the kenyan moral psyche something about austerity ......just like what fasting does to the religious souls of believers; be it during Ramadhan or pre-Easter non flesh eating Catholic rituals. NOK, When I read yours and rethink Fimbo's arguments I see two concepts with a blurry borderline. I think being bankrupt is not one and same with filing for bankruptcy. A bankrupt country does not have to file for bankruptcy ... I doubt there is even any institution for countries to file bankruptcy with. But that's not to say countries can't be bankrupt. Pray there is some genius in our government finance that we are unaware of.
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Post by nok on Aug 6, 2013 18:51:47 GMT 3
Can Kenya go bankrupt ? Yes it can. Bankruptcy can be God given. We have a Jubilee year, a Jubilee Government and in the Thora there is something called the Jubilee cycle ( Take Note of; Sabbatical cycle) and the laws of release. Or why not file a chapter 7 Bankruptcy. If one can recall, in the last american campaign Barrack vs Romney, Romney (the so hyped up business mogul from Utah) once talked about the economic advantage of Bankruptcy and if he were to decide, he would have let GM go that way; Well he was heavily criticised esp in Detroit and it's environs. Today Detroit is....I wonder what Romney would say. I think one benefit of Bankruptcy for kenya is that it could be a herb against corruption !! Another benefit would be teach the kenyan moral psyche something about austerity ......just like what fasting does to the religious souls of believers; be it during Ramadhan or pre-Easter non flesh eating Catholic rituals. NOK, When I read yours and rethink Fimbo's arguments I see two concepts with a blurry borderline. I think being bankrupt is not one and same with filing for bankruptcy. A bankrupt country does not have to file for bankruptcy ... I doubt there is even any institution for countries to file bankruptcy with. But that's not to say countries can't be bankrupt. Pray there is some genius in our government finance that we are unaware of. Mank go easy on me. I added a pinch of salt to the realities that may soon hit the country with 48 countries. Found this artikel in the web www.spiegel.de/international/business/the-ghost-of-argentina-what-happens-when-countries-go-bankrupt-a-588419-2.htmlAre we sure that we cannot file Bankruptcy at the doors of Goldmann-Sachs ? Which debt is higher ; domestic or external ? is it worse to have a higher external debt ? or is debt just that ?
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Post by jakaswanga on Aug 6, 2013 21:16:40 GMT 3
MANK WROTE This thread is a nuclear reactor melt-down, only you do not know it yet! Because in the end, Mank, we will have to discuss contingency measures in the event of an actual bankruptcy of the Kenyan State! ---God forbiD it escalate that far! but back to the basic punch-line of this thread ---as I quoted above: Let us first agree then, in the main, to find the above explanation sufficient to explain the demise of Detroit. I can then add to substantiate the declining tax-base thus, that, while all these [factors you mentioned] happened, one crucial factor stayed the same, Detroit did not 'invent' a new industry to replace the old and aging --them gradually becoming obsolete as technology revolutionised production elsewhere. She remained a golden town even as the goldmine depleted and would-be miners moved further afield to search elsewhere. She was no longer competitive industrially or in whatever else she used to to for upkeep. ---But continued to offer competitive retirement (rofl)schemes, and competitive salaries to bareaucraties running a dying world. So, let us ask, in which ways Kenya could be duplicating Detroit as an economic entity? and in which ways are we buffered from those misfortunes, either because we are smarter, or merely because though we are an economic entity too, we are different in that crucial aspect of being a state, capable of ---see Fimbo-- 'Delaruering' our way out of any mess! Comparing these two ''balance sheets'' then, we can reach a temporary truce with Rotich and his treasury! May be we can then prove Kenya can not go bankrupt, and we go to sleep in peace. Trusting in the printing press! 1. How competitive are the retirement benefits the 10th Parliament Mpigs voted for themselves? ---And Moi, Kibaki, Raila Kalonzo send off packages? Are they Detroitian? 2. How expansive is the Kenyan tax-base ... with statistics like 40% youth unemployment? Prospects of expansion? 3. How large is our public sector wage bill, in comparison to the actual work-done, and efficiency rate of our economy? 4. How much revenue do we waste --eg by corruption? white-elephant projects? 5. What % of our budget do we spend on R&D, to develop new solutions for old problems? or train new skills to do the same? 6. What natural resources do we have which we can mortgage to get some credit life-line to limp on? 7. etc etc Detroit can of course dissappear from history and become a ruin like Carthago or some other such abandoned city like the famous ones of the Aztecs in Latin America, overrun by jungle nowadays. But Kenya, or countries, has no such option of total population displacement. Civil war may be a more realistic option of rebirth, as the bankruptcy is explained simpy by the incompetence of ONE PARTICULAR CLASS IN CAPTAINCY. A change in captaincy, may just be the wonder drug! NB: Amigo, I think we should move to look at the debt portfolio of Kenya now. How much we owe [both ways] both private borrowers and the state, and to whom do we owe which interest rates, and at what would be penalties of default? Well, Our Fimbo here says no worries about the domestic creditors! Kiboko yao ni Delarouex NB2: In the last years of the stuporic presidency of Boris Yeltsin, the Russian state was still fulfilling her obligations to the locals. Paying things like salaries and retirement allowances which the old people had worked for all their lives. Problem was this: The prices in the general economy had become market rates, but the state scale of remunerations was still soviet.Say 300 roubles had been, Under Gorbachov and before Yegor Gaidar's shock therapy, more than a reasonable monthly retirement allowance for an ex-colonel of the red army who had fought his way from the Urals to Berlin. Now, the state still paid that 300 'uncorrected' roubles, but the apartment had been privatised and the rent was now 3000 roubles per month, market conforming! For 300 roubles, one got half a loaf of bread. Theoritically then, the state was meeting her obligations locally. In practice, this was a silly joke, and the red army had to prevent private speculators who had bought these apartments by loans granted by banks catering for the pension funds of these tenants, from evicting them out of their abodes.The Oligarchs had not only hijacked the life-savings of these people, but they were using those savings to buy the properties of those people on the cheap, and iflating their prices, then using the new law to evict them. That was the invicible hand of the market, Adam Smith upside down! This was the economic mess that brought forward Vladimir Putin, soon to be supreme dictator of Russia! Yes, no state can run out of money to pay her local debts/obligations, but a state can run of of making economic sense, and essentially must then perish. For nature hates a vacuum, and a vacuum regime, does must go! Always.
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Post by jakaswanga on Aug 6, 2013 21:36:10 GMT 3
All of you have provided juicy examples of failed states, dictatorships (military or otherwise), klepto-cracies, where the public accounts/assets are indistinguishable from your favorite dictator's petty cash. I dare you to name one even bankruptcy in even [semi] working democracy. The caveat here is failure to pay local debt. Foreign debts are another story. I am going to look for my original article on Greece I remember doing on Jukwaa about a year ago. Malta which sunk the other day is too small to mention ---though her economy, thanks to a bloated artificial banking sector was bigger than Kenya's! Iceland too went bust ---her population is smaller than Kisumu's, thought her GDP at its banking bubble peak was bigger than South Africa's! But it is Italy that will shock you. It is a top ten economy in the world, but it recently became a German colony to save itself from bankruptcy! The truth is a man like Zuckenberg of Facebook can easily buy off all Kenyan state debts. That is to say, Rotich's problems are small change! Greece has 10M people. The first package of her bail-out I think was 10 billion euros. IMF loan to Kenya which was a great shot was a mere 105 Million dollars. Kenya has 40M people. Wuothi eka ine! In this range of figures, when people like Rotich head a treasury which can not run a payroll of a few hundred million Kenya shillings, there are some questions you do not want to ask yourself as an African. ---Got to spare yourself some pain!
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Post by jakaswanga on Aug 6, 2013 21:53:26 GMT 3
Brother Mank, NB: Have you heard Fin-Sec Rotich has gone back to [analogue] the old pre-devolution payroll? But he has paid digital salaries! --That is by treaury payrolls, devolution never happened, layers of government just increased! A technical hitch I suppose, as soft-ware failed on the first run! It makes me think a bankruptcy can also be caused by a technical hitch, like a cyber-attack by an enemy on the financial vital systems!? not so? I have not done the responsible thing, to understand how our double-decker government is actually functioning. I have done with the little headlines here and there, about governors fighting with DCs and the two houses fighting for supremacy. So I am challenged to catch up on the matter of how the finance docket treats devolution. Leads to the reads that gave you the impression you post would be instructive. On the 2nd issue, the digital payment, I find it really really troubling! If that true, then the Fin-Sec is cutting out Delarue and doing the printing by himself. Digital currency does not even have the face value of a valueless currency - there is some value in the paper, even the NZR that I would see being rained on the side of the road in Bukavu. You can use valueless paper notes as lighting fuel for your charcoal ... what can you do with digital currency if it loses the power to buy? Fimbo might tell us that Fin-Sec has some control of how much to print, guided by the capacity of the Kenyan economy. I would wish for that control too. The question is, who is asserting that control, and what exactly is the control. You just elevated my concerns several times more. Over to Njakip. www.standardmedia.co.ke/?articleID=2000090015&story_title=redeployment-to-blame-for-pay-delay-says-cabinet-secretary-for-devolution-ann-waiguru&pageNo=1 www.standardmedia.co.ke/?articleID=2000090077&story_title=treasury-releases-sh2bn-for-mp-s-car-grantsOuru Kenyatta collapsed the ministries to 18, but the payrol now used is of 44 ministries. There were thus no redundancies, no downsizing! ---life security of tenure for civil servants no doubt! And the same Kenyatta is yap-yapping about abominable public wage bill. Consequence is guys gonna get fired, or salaries gonna go down. Jesus Christ Rotich, you eating cake and having it at the same time? for how long!? You feel me, AMigo Mank! Damnnn. It is you who said: DOUBLE-DEKKER government! bETWEEN NURSES AND DOCTORS KITTY, AND CAR GRANTS, WHICH IS THE PRIORITY? mPigS, because they can impeach Rotich!
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Post by mank on Aug 7, 2013 3:18:42 GMT 3
NOK, When I read yours and rethink Fimbo's arguments I see two concepts with a blurry borderline. I think being bankrupt is not one and same with filing for bankruptcy. A bankrupt country does not have to file for bankruptcy ... I doubt there is even any institution for countries to file bankruptcy with. But that's not to say countries can't be bankrupt. Pray there is some genius in our government finance that we are unaware of. Buddy NOK, don't read any attack. Its a sincere distinction of the two concepts that seem to be at play in the discussion. There in, even Fimbo's thoughts could probably reconcile with other thoughts in the thread (except where he's the politician justifying a DeLarue economy, of course). You have done well with that pinch of salt. When I read the postings by that Historian and Teacher (I think of his latest as I jot this), I am more alarmed by the prospects of national bankruptcy than I was when I started this thread. He brings out too many signs that we may already be there! Any you know it is the season of financial strife among nations all across the world. Are we sure that we cannot file Bankruptcy at the doors of Goldmann-Sachs ? I am not sure about that. I think the equivalent of filing for a bankruptcy, for a national government, is the act of going out to other countries, banks and/or businesses, begging. The idea of filing bankruptcy is so as to be let free of the obligation to pay debts - so unless Goldmann-Sachs was the main debtor, it would not help to file bankruptcy with them. Which raises an interesting thought with relation to any situation where filing bankruptcy with Goldmann-Sachs is an option: Golman-Sachs would then appoint a receiver under bankruptcy, as the custodian of the country's assets - what are a country's assets? I think that would be land and other capital assets, and people. That model points to situations of submissive slavery. Go easy on me amigo, I am just imagining things here, and there might be other ways of thinking about it. Which debt is higher ; domestic or external ? is it worse to have a higher external debt ? or is debt just that ? The distinction between these two has more to do with the options the country has in dealing with either. As Fimbo has told us, the good government of His Excellency can print as much of the domestic currency as it wishes. So if one Ksh. 1 billion is due for payment locally, and only half of that is available, then the good government can just order the printing of another half, and hence be in a position to pay the nominal Ksh. 1 billion at the value of 0.5 billion (at the value of money prior to this paper print). In that event the government has stolen from the people. As for foreign debts, because as Fimbo would again tell us the government cannot print foreign currencies, it cannot rob foreign creditors in the same way it robs domestic creditors. While it can continue to rob its citizens through the printing so it continues to pay the citizens only part of their due real pay (and reserve the rest for buying foreign currency - till it kills its currency), a MORE EFFICIENT way to rob citizens for such a purpose is: (1) To introduce crazy taxes and fees on property and income (which seems to be an immediate danger in our situation), (2) Nationalize private accounts so there is no distinction between whats owned by individuals and business and what is government's - in that case what you considered your's in the bank becomes available to the government for use to pay international debt! The SPIEGEL Staff article has that here:
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Post by mank on Aug 7, 2013 7:09:30 GMT 3
MANK WROTEThis thread is a nuclear reactor melt-down, only you do not know it yet! Because in the end, Mank, we will have to discuss contingency measures in the event of an actual bankruptcy of the Kenyan State! ---God forbiD it escalate that far! but back to the basic punch-line of this thread ---as I quoted above: Let us first agree then, in the main, to find the above explanation sufficient to explain the demise of Detroit. I can then add to substantiate the declining tax-base thus, that, while all these [factors you mentioned] happened, one crucial factor stayed the same, Detroit did not 'invent' a new industry to replace the old and aging --them gradually becoming obsolete as technology revolutionised production elsewhere. She remained a golden town even as the goldmine depleted and would-be miners moved further afield to search elsewhere. She was no longer competitive industrially or in whatever else she used to to for upkeep. ---But continued to offer competitive retirement (rofl)schemes, and competitive salaries to bareaucraties running a dying world. So, let us ask, in which ways Kenya could be duplicating Detroit as an economic entity? and in which ways are we buffered from those misfortunes, either because we are smarter, or merely because though we are an economic entity too, we are different in that crucial aspect of being a state, capable of ---see Fimbo-- 'Delaruering' our way out of any mess! Pray we are blessed with enough of that stuff they say is beneath our land. We need new resources that not even we knew we had - so the commitments we have lined up can be serviced! But those resources, if they exist, are not becoming accessible fast enough - the purpose of this thread is not alarmist, but anyone awake must wonder why payment of salaries should be delayed. We have agreed on the sufficiency of the excerpt you requoted as an explanation of Detroit's demise. We are also of the same thought, that Kenya faces a real possibility (if its not there already) of a Detroit situation (with the necessary caveats of practical distinctions of a country from a City, in that same situation). But I think Kenya gets to that situation from a different direction ... a real STOOP AID one! Where Detroit's budgetary imbalance arose because the city remained committed to fat retiree packages even while its revenue permanently declined, Kenya aggressively increased her commitment to fat retiree packages in a poor state. With Kenya's unemployment rate hovering between 40% and 50% and GDP per capita just around $400 for eons (to be fair the latter metric has about doubled since 2002), Kenya has seemed more keen on committing to paying more to the big fish than at engineering a solution for the multitudes that think about where the next meal will come from with as much vigor as the lucky few of the world devote to the question whether the next real estate purchase should be in Kuala Lumpur or New York. Now there is Moi in retirement, being paid a retirement package very comparable to that of Bill Clinton in the US. Apparently Kibaki outdoes both of them. Then we have a battalion of do-nothing Mpigs (I have to confirm, but the last I heard is that every Kenyan Mpig is entitled to retirement benefits ... please tell me its not so!) I won't repeat it all, but I have wondered whether there was any productivity foreseen with the new layers of government that we created. Since we asked for the increase, we should all have been ready to allocate our resources to fit - but no, our representatives must be treated like royalty; they have no shame using illustrations from US to justify their loot. Comparing these two ''balance sheets'' then, we can reach a temporary truce with Rotich and his treasury! May be we can then prove Kenya can not go bankrupt, and we go to sleep in peace. Trusting in the printing press! 1. How competitive are the retirement benefits the 10th Parliament Mpigs voted for themselves? ---And Moi, Kibaki, Raila Kalonzo send off packages? Are they Detroitian? 2. How expansive is the Kenyan tax-base ... with statistics like 40% youth unemployment? Prospects of expansion? 3. How large is our public sector wage bill, in comparison to the actual work-done, and efficiency rate of our economy? 4. How much revenue do we waste --eg by corruption? white-elephant projects? 5. What % of our budget do we spend on R&D, to develop new solutions for old problems? or train new skills to do the same? 6. What natural resources do we have which we can mortgage to get some credit life-line to limp on? 7. etc etc Amigo Jakaswanga, I see you pushing for a major paper here. But I agree. Let's see what we can find out on these topics and others that may be informative on this topic. ... NB: Amigo, I think we should move to look at the debt portfolio of Kenya now. How much we owe [both ways] both private borrowers and the state, and to whom do we owe which interest rates, and at what would be penalties of default? Agreed. Lets add that to the topics of interest. Even Fimbo must be converted by now!
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Post by nok on Aug 7, 2013 10:28:30 GMT 3
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Post by jakaswanga on Aug 7, 2013 21:05:54 GMT 3
All of you have provided juicy examples of failed states, dictatorships (military or otherwise), klepto-cracies, where the public accounts/assets are indistinguishable from your favorite dictator's petty cash. I dare you to name one even bankruptcy in even [semi] working democracy. The caveat here is failure to pay local debt. Foreign debts are another story. I am going to look for my original article on Greece I remember doing on Jukwaa about a year ago. Malta CYPRUS it was which sunk the other day is too small to mention ---though her economy, thanks to a bloated artificial banking sector was bigger than Kenya's! Iceland too went bust ---her population is smaller than Kisumu's, thought her GDP at its banking bubble peak was bigger than South Africa's! But it is Italy that will shock you. It is a top ten economy in the world, but it recently became a German colony to save itself from bankruptcy! The truth is a man like Zuckenberg of Facebook can easily buy off all Kenyan state debts. That is to say, Rotich's problems are small change! Greece has 10M people. The first package of her bail-out I think was 10 billion euros. IMF loan to Kenya which was a great shot was a mere 105 Million dollars. Kenya has 40M people. Wuothi eka ine! In this range of figures, when people like Rotich head a treasury which can not run a payroll of a few hundred million Kenya shillings, there are some questions you do not want to ask yourself as an African. ---Got to spare yourself some pain! www.bbc.co.uk/news/business-22506385
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Post by jakaswanga on Aug 7, 2013 21:24:16 GMT 3
Even Fimbo must be converted by now! Brother Mank, And yet I feel that, were Fimbo to narrow down his caveats some more, and close down some 'loop-holes' ---add those nuances you are so in love with, we might still read from the same page. You Know I am not entirely against a controlled printing and controlled inflation -- if the purpose is entirely to fund 'productive means', and the specific case of a consumer capital good called MASS HOUSING. yOU know, like a national slums upgrade scheme --so that Ngomongo looks like Jeri-Jerusalem with running water, and say 10 million 3-bedroom units are built in 5 years. Nairobi absorbing 2M and rest 8 the other cities and munispalities of the republic. ---You know like the housing reconstruction of Germany after the total and carpet bombardment of the second world war. But to pay for retirement perks --tax free to all Kenyan Mps; to pay for giant lorry-size prados for every civil servant, to pay for window-shopping trips to far China by 300 Pigs ! No! then the option can go to hell! together with the Mpigs!
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Post by mank on Aug 7, 2013 22:27:03 GMT 3
Even Fimbo must be converted by now! Brother Mank, And yet I feel that, were Fimbo to narrow down his caveats some more, and close down some 'loop-holes' ---add those nuances you are so in love with, we might still read from the same page. You Know I am not entirely against a controlled printing and controlled inflation -- if the purpose is entirely to fund 'productive means', and the specific case of a consumer capital good called MASS HOUSING. yOU know, like a national slums upgrade scheme --so that Ngomongo looks like Jeri-Jerusalem with running water, and say 10 million 3-bedroom units are built in 5 years. Nairobi absorbing 2M and rest 8 the other cities and munispalities of the republic. ---You know like the housing reconstruction of Germany after the total and carpet bombardment of the second world war. But to pay for retirement perks --tax free to all Kenyan Mps; to pay for giant lorry-size prados for every civil servant, to pay for window-shopping trips to far China by 300 Pigs ! No! then the option can go to hell! together with the Mpigs! Absolutely Brother Jakaswanga, I have continued to see Fimbo's in a different light, except for the complications his politician side left us with. But it is the productivity of our borrowing we must demand. I look forward to digging some info that you wisely wanted us to address on this topic. Unfortunately I have been slammed by what seems to be a flu, and rendered near a vegetable. I will be up at some point.
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