The decision to print more money represents a clear and present danger to the Liberian economy and its people! (Re- “House Approve Printing of Additional Money”- Daily Observer:)
When a government prints more money without a corresponding increase in its economic output, it unleashes hyperinflation And correspondingly hyperinflation debases your currency!Here’s a MEMO to economically glib Liberian Lawmakers: We all know that you [Senators and Representatives] think money grows on trees and you have the power to “issue currency” (Article 34-d) out of thin air….
But at whose expense, should you “issue currency”—and out of thin air! Printing more money out of thin air and without a corresponding increase in your economic output also mean that you’re appropriating other people’s life savings unfairly!
And here’s why:
A]. because with more money in circulation, prices of goods and services will definitely skyrocket! B]. many people life savings would not be enough to buy a loaf of bread to feed their families or buy access to Speaker Tyler’s office! And C]. for all practical purposes, the Liberian people would’ve been robbed, big time by the folly of their leaders!
But the Liberian government won’t be the first to have pilfered negligently their people’s money, it has happened elsewhere in Africa. Let’s look to Mugabe in Zimbabwe for a case study.
In 2007, President-for-life, Robert Mugabe of Zimbabwe, ordered his Central Bank Governor to print an additional Z$1 trillion to pay for civil servants and soldiers’ salaries that were hiked by 600% and 900% respectively! Of course that made Zimbabwean soldiers and civil servants millionaires and zillionaires, but again at whose expense?
Every Zimbabwean, poor and rich, saw the value of their money vanish because of hyperinflation! People needed a wheelbarrow full of money (Zimbabwean Dollar) just to buy a loaf of bread! Today, the Zimbabwean dollar is useless and worthless! Many business owners do NOT accept Zimbabwean dollars– instead, U.S. dollars today is official currency in Zimbabwe.
What lesson must we learn from Zimbabwe? Don’t print more money, if you can’t back it back it up. Why? Because the most insidious way to destroy a country is to destroy its currency (John Maynard Keynes)
File photo; Liberia Central Bank building /www.africanews.com