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It’s the end of the world as we know it, and I feel fine

25th November 2016

By: Riaan de Lange

  

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The words in the headline are the recurring lyrics of the American rock band REM’s song, and are an apt encapsulation of my feelings in the aftermath of what has been called Brexit Part II, the seemingly unanticipated results of the US Presidential election.

A few days after the election, on the evening of November 14, if you had gazed into the sky, you would have been excused for thinking the end is nigh – for a supermoon, a full moon at its perigee, or the closest point to earth at 356 510 km during the lunar orbit, was in all its splendour. It was described as “undeniably beautiful” by the US National Aeronautics and Space Administration. In fact, it was the brightest supermoon in almost 69 years and that the full moon will not come this close to earth again until November 25, 2034 – if you plan to be around, then diarise that date.

On that evening, my thoughts turned to the US, where, with some irony, President-elect Donald Trump had campaigned to stop immigration to the US and to even deport about three-million immigrants. Many a ‘celebrity’ had vowed to emigrate from the US should a Trump Presidency become reality. Well, it is scheduled to become just that on January 20, 2017.

In case you were wondering, the majority of these ‘celebrities’ said they would move to Canada. It is not apparent what the Canadians did to deserve an influx of US ‘celebrities’. The Canadians are most certainly not savouring the prospect of the ‘celebrities’’ arrival on their shores. But South Africans should not despair; they should keep an eye out for actor Samuel L Jackson, the second-highest-paid all-time box office star, with over $4.7-billion in gross box office earnings. He said of Trump on December 8, 2015: “If that motherf**** becomes President, I will move . . . to South Africa.”

If anything, 2016 is turning into quite the year of the underdog, or is it the year of the unanticipated or unexpected? It all arguably started on May 2, when Leicester City won the English Premier Soccer League (PSL) championship at odds of 2 000 to 1, which has subsequently seen the perpetuation of the successful run of the underdog. If ever you could time-travel – going back to the future – and intend to seriously profit on your return, well, place that bet. Bookmakers Paddy Power revealed that a £5 treble bet on Leicester City winning the English PSL championship, the UK leaving the European Union (EU) and Trump becoming US President would have won you £15-million. The odds of all three events happening were 3 000 000 to 1. According to Paddy Power, more than 70 punters put money on Brexit and a Trump victory double, but no one staked any money on all three. People wagered heavily on Brexit and Trump, with bookmakers in the UK taking around £150-million in bets on the US Presidential election outcome, which made it the biggest political event in gambling history.

It has only been a short while since Americans elected Trump, on November 9, as the forty-fifth President of the US. The way Americans express the date is 11/9, which, many observers have remarked, is the reverse of 9/11, the September 11, 2001, terrorist attacks. Some even argue that 11/9 is equal to 9/11 in terms of magnitude, disruption and shock. Trump’s win, which some Americans have described as the most devastating day in the country’s history, has also been called many other things: a pivotal moment, a popular political uprising, an uprising of the disenfranchised, the people’s victory, the rise of nationalism and an anti-establishment course of action, besides others.

As with Brexit, the US Presidential election produced an outcome that was not expected by the political establishment and the privileged. Their dreams have been shattered. Having, over the years, and nauseatingly so, been subjected to incessant lectures by the British and the Americans on the superiority of their system of democracy, which ensures equality for all through the ‘one person, one vote’ principle, I can only say that the British and the Americans do not seem to appreciate it when the shoe is on the other foot. In both instances, a second vote is being demanded. This makes me question the foundations of their supposed democracy. How can protests immediately after a democratic election be seen as an act of democracy? There is a definite reluctance in the UK – and its overseas territories – and now in the US to accept the outcome of a democratic election. Why is that so? It is as if the majority are now being regarded as stupid. But, in the words of American social critic George Carlin, “never underestimate the power of stupid people in large groups”. The thing is, while these people might well not be a bother, or even considered to be out of touch, they do become just that if they do not share the perceptions and beliefs of the establishment.

American writer and academic Tobias Stone believes that the world is now on a path that will lead to a period of destruction, something which people apparently neither realise nor anticipate. This is because they are only looking at the present, not the past or the future. They are also only looking immediately around them, not at how events connect globally. Further, most people do not read, challenge or hear opposing views. You make up your mind and, yes, you can differ from popular opinion.

But let us return to recent events. What a turbulent 138 days it has been in the northern hemisphere, where, on June 24, the UK and Gibraltar – the former’s overseas territory – decided to leave the European Union and, on November 9, the US elected a new President. This could be the beginning of a series of upsets, with general elections scheduled in eight of the 28 EU member countries over the next 12 months. Charismatic, populist leaders could conceivably take office in these countries. Elections have been scheduled in Austria and Italy on December 4; in the Netherlands on March 15, 2017; in France on May 7, 2017; in Serbia in May 2017; in Norway on September 11, 2017; in Germany during September or October 2017; and in the Czech Republic in October 2017.

But instead of engaging in speculation, let us deal with a little more certainty, such as where this all leaves South Africa. On April 21, 2015, Trump tweeted: “As I have long been saying, South Africa is a total – and very dangerous – mess. Just watch the evening news (when not talking weather).” According to https://www.enca.com, in a 2013 tweet, he described South Africa as “a crime-ridden mess just waiting to explode”. Even though President Jacob Zuma has extended his congratulations to Trump on his election, this gesture is expected to have very little sway.

But it is not only South Africa that Trump has displayed little, if any, fondness for; he apparently feels the same about the rest of the African continent. According to http://www.businesslive.co.za, in 2013‚ when President Barack Obama was on a State visit to Africa and pledged $7-billion to support the building of reliable electric power grids in sub-Saharan Africa‚ Trump tweeted: “Every penny of the $7-billion going to Africa as per Obama will be stolen – corruption is rampant!”

For South Africans, in particular, Trump’s Presidency may have some very, very negative consequences, particularly for the country’s heavily indebted consumers. Add to this the fact that Trump’s party – the Republicans – now commands both the US House of Representatives and the US Senate, which Obama did not. With precious little known as far as economic policy is concerned, this can only contribute to compounding the uncertainty that prevails in South Africa’s financial market. At its worst, South Africa’s status as a ‘safe emerging’ market could see investors head elsewhere. According to Debt Rescue CEO Neil Roets: “There is nothing that markets hate more than uncertainty and the Trump victory will have a substantially negative effect on international markets, which will in short order manifest themselves in our marketplace.” He foresees “a bigger problem than the US election outcome was – the announcement by ratings agency Moody’s that South Africa’s big four banks will see a rise in problem loans in the next 12 to 18 months as the economy struggles to grow”.

As for preferential merchandised market access, not much has been said of the recently renewed African Growth and Opportunity Act, or Agoa. Any amendment to it would be detrimental to – read disastrous for – South Africa’s interests.

What concerns me greatly is that, following Brexit and the American Presidential election, the new leaders in both the UK and the US have not contacted South Africa. It is quite telling which countries, or country heads, have been contacted. Let us shatter another myth: South Africa simply does not feature – it does not matter – at all in this new world order.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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