Many years ago I had the privilege to visit the Dark Continent, specifically the country of Zimbabwe in the midst of their darkest time. This was an experience that changed my perspective on the world in many profound ways. It grew my understanding of what true poverty looked like. What true beauty there is in the sub-Saharan landscape and wildlife. What real unprocessed meat tastes like… best T-bone steak I have ever eaten! It also gave me a unique perspective of how fragile economic systems can be and the devastation that hyperinflation can cause.
This kind of inflation is something that I pray no one else will ever experience. If it can happen in a place that was known as the “breadbasket of Africa,” than it can happen anywhere. When we arrived in Zimbabwe the exchange rate was 33,000 Zimbabwe dollars to 1 USD. Five of us each ate a 4-course meal in a very fancy restaurant, complete with huge T-bone steaks all around, for $1.2 million. That’s right, I have eaten a million dollar meal… high roller! In reality it was about a $35 US meal. We were in the country for about a month and in that time the exchange rate went from 33,000 to nearly 44,000 to 1 USD. That means in the span of a month a $100 bill became worth the equivalent of $75. Any kind of wealth in that situation was an illusion. You can’t save up for anything when your money loses a 1/4 of its value every month. For those who aren’t aware, there was a time not so long ago that it was 2 USD for every 1 Zimbabwe dollar.
After Zimbabwe got its independence in 1980 the country slowly started to experience an economic slip, but it was minimal for 20 years. Beginning in the late 90’s the farms, the backbone of the economy, were taken by force and given to those politically aligned with the government. This was an attempt to redistribute the financial wealth from the white colonials to the black Africans who had served the regime during the revolution. As a result, much of the fertile farm land was neglected or intentionally destroyed and eight years, later in 2009, Zimbabwe abandoned their currency. For the later part of this period it became impossible to track the inflation rate. The last rate given in late-2008 put the month-to-month (not year-to-year) inflation rate at 79.6 billion percent. The exchange rate was 100,000,000,000,000,000,000,000,000,000,000 (10 followed by 31 zeros) to 1 USD. If you can get your head around those kind of numbers you are better than most of us. The government was printing money, putting it into circulation, and then having to replace it with larger denominations every few months. Giving you some real perspective that we can all grasp, if you made $8 million dollars in that economy, inside of one month that $8 million dollars would be worth less than 1/100th of a penny.
A Lesson for All
I don’t write this to scare anyone, but knowledge is power. This is a travesty, which for most of us, happened in our lifetime and we heard basically nothing about it in the Western world. Those who don’t know history are doomed to repeat it. Isn’t this something we should all know about?