As South Africans we’ve become experts at begging, borrowing and stealing – and we are totally immune to the key issue of sustainability.
Like so many of us, I can rattle off all the woes associated with the crime rate (or lack of credible information to allow us to grapple with it) and donor fatigue (I mean how many times do you have to dip into your pocket to support everything from car guards to orphaned children).
But how many times do I – and my fellow South Africans – reflect on how we are drowning in debt. Believe it or not, according to statisticians, we are one of the most highly borrowed nations in the world.
As I was again debating the Greek bailout and fact that a Grexit is now unlikely, I had to wonder at how much similar principles apply in households or even small companies right here. With fuel and electricity tariffs and the drought driving up the prices of staples like food, travel and clothing, inflation is likely to breach the Reserve Bank’s 3 to 6 percent band, making interest rate hikes both in coming months and at the end of the year a strong possibility. As our economists sharpen their pencils to comment on the ramifications, our wallets will get thinner. But will we stop borrowing – or will financial institutions reign back on seemingly irresponsible marketing of loans that can cause unimaginable anguish?
According to an SMS that landed yesterday, I have been pre-approved to buy another new car (their words not mine). That’s just over a year since I bought my last one and shouldered repayments that I confess bite into my monthly disposable income. Apparently, the same goes for my husband who received his notification a few hours later – at about the same time I was opening yet another exciting letter from the company that finances my car. It informed me that I’d miraculously qualified for a substantial personal loan yet again.
The only snag is that ‘terms and conditions apply. But sadly, those terms and conditions apply differently depending on which side you’re on. For financiers, it’s about flogging the willing horses who cannot resist the temptations of swanky vehicles and upwardly mobile devices like tablets and cell phones.
Oooops, sorry, you buy those from cell phone service providers who load the costs and then spread them out as nice chunks over two years. Just try and buy an iPhone for cash as I did. Unless I was prepared to join a waiting list at Apple’s iStore, I was expected to pay an extra R2 000 at Edgars (to cover the fact that they needed to recover their money through interest free account repayments which I never intended to take on) or sign up for yet another contract that I didn’t need.
Our finance companies pay lip service to empowerment and happily dish out the loans that actually ensure that South Africans cannot rise above the mire. The loan sharks that apparently contributed to the massive anger that spilled over into the Marikana tragedy are still plying their trade to already over borrowed mining families still residing in shacks alongside Lonmin.
A debt recovery company that imposed garnishing orders at one of the mines had its wings clipped in court – but the most disturbing thing of all was that lady who was celebrating the victory said nothing about a lesson learnt about borrowing. It was more about relief from the burden of paying back.
I would go as far as suggesting that our wealthy banks should be forced to commit a portion of their profits not just to charity initiatives but to debt counselling bodies that can reach out to those caught in the crippling debt trap that is not only a guarantee of hard times for by far the majority of households but also is now feeding the desperation that is resulting in unrealistically high wage demands and unemployment – and by default rising crime.
Back in the day when my mother had a tiny grey Beetle and filled it with R10 per week to take us to school, the household budget was neatly divided into four bank packets and we were told that it was unacceptable to live beyond one’s means. We had no maid to pick up after us and my first high heels were a treat for which I diligently saved. What a grounding in a world that is blinded by brands and labels, technology and a greed versus need approach.
The reality is that times are going to get tighter and both consumers and company owners are going to have to accept that the good old values of the past will pay dividends for the lucky few who truly understand that sustainability has more to do with good common sense than over investing in a future for which they have not planned.