During the 1992 presidential election campaign in the US, James Carville, political strategist for Bill Clinton, then a candidate, coined the phrase “It’s the economy, stupid!” Carville was denouncing President George HW Bush in the midst of an economic recession. At the time, Bush was considered to be out of touch with reality. So, Carville was echoing the significance of the economy to political administration at any given point.
Even 21 years later, since the last time Bill was in office, the Americans still use the mantra every election year and buttress the need for all US presidential aspirants to speak more on the economy because it is all that matters to them. To bring it home, a new World Economic Forum report recently laid bare the real risks that engulf Botswana’s economy. According to the report, Botswana’s economy is confronted by five main severe risks – employment and livelihood crisis, collapse or lack of social security systems, widespread youth disillusionment, prolonged economic stagnation and debt crisis in larger economies.
It says the Executive Opinion Survey part of the report “presents the top five risks for each of the 124 economies surveyed by the World Economic Forum’s Executive Opinion Survey (EOS) between May and September 2021”. The WEF says this is based on responses from over 12,000 leaders surveyed.
As the report explains, a global risk is the possibility of the occurrence of an event or condition that could cause significant negative impact for several countries or industries. The WEF notes that for purposes of the report, the scope is over the next 10 years. Whereas Bill Clinton defeated George HW Bush to become the 42nd President of the US from 20 January 1993 to 20 January 2001, when this particular slogan was coined, his strategist became popular. However, the word “economy” has often been replaced by several others as and when commentators want to pass a point across. Other observers have always attributed economic challenges to the leadership, with slogans like “It’s the leader, stupid!”
To argue this point, in their 1995 study, Barry Posner and Jim Kouzes stated: “The entire economic system is based on trust; it is not based on the price-earnings ratio or income statements or many other rational concepts we talk about. It’s based on whether we believe in the numbers and the people who are supplying them.” For Botswana, if current signs are anything to go by, it seems things are headed for the worst. This is because the WEF report is compounded by a United Nations report released in November 2021 titled “Botswana: Common Country Analysis (CCA) 2020.”
The UN report stated that although Botswana had transformed from being one of the world’s poorest countries at independence, by the early 2000s, it managed to be a middle-income economy but it remains one of the top 10 unequal countries in the world. “The government’s focus has rightly shifted toward the non-mining sector,” it said. “However, the government’s revised budget for 2020/21 is 16 percent less than originally envisioned, suggesting that the country will have to do more (including achieve the SDGs) with fewer financial resources.”
The UN report noted that poverty and inequality were rampant in Botswana. “Botswana continues to struggle with high levels of poverty and inequality,” it said, adding that unemployment was 23.2 percent in Q1 2020 “and is higher among women than men”. It observed that “the rate will likely increase due to the impact of the COVID-19 pandemic”.
Despite preaching the need for economic transformation soon after the 2019 general elections, President Mokgweetsi Masisi still has more ground to cover but time is not on his side any more. Masisi promised to deliver a knowledge based economy that would transform the country from being resource-based and to unlock opportunities to for the youth to harness the digital economy.
However, as it recently emerged, the government is anticipating a P7 billion budget deficit in a time of devastating effects of COVID-19. If Bill Clinton’s campaign was to serve as a guide, it would evoke Carville’s words, “It’s the economy, stupid!”