Fat cats get fatter

Newspaper headlines in South Africa these days report on spiraling inflation, and warn that interest rates could be raised yet again. I've lost count of the number of times our Reserve Bank has hiked interest rates, and it's beginning to take its toll. There are also reports of record numbers of South Africans defaulting on house, car and other payments. Even the banks have started changing their tune -- for example, First National Bank has launched a major advertising campaign offering tips on saving money, and explaining that they're getting tougher on granting credit.

But it's not bad for everybody. Yesterday's Business Times lead with the following headline: "SA's dollar-millionaire club gets bigger, faster". The story explains that the growth in the number of South Africans with wealth of over a million US dollars was greater than the global average. In South Africa there are now almost 14% more dollar millionaires than there were this time last year. The global average was a 6% increase in dollar millionaires.

In fact the biggest growth in dollar millionaires was in the Middle East, and there are significantly more millionaires in South America too. And lest you think our continent is being left out, South African millionaires weren't the only ones doing well.  This year there are 10% more dollar millionaires in Africa than there were last year.

That might all be wonderful news, except for the fact that in Africa, unlike almost everywhere else in the world, poverty is increasing, and intensifying. In an era where governments and international organisations have set the goal of halving poverty by 2015, that is shocking. It's shocking that between 1990 and 2004, the number of Africans living on less than 1 US dollar a day increased by 20%. But it's worse than that. The number living on less than 50 US cents a day rose by a third during the same period. That means that in sub-Saharan Africa there are now over 121 million people trying to survive on less than 50 US cents a day. At the current exchange rate, that's the equivalent of about 4 South African rands a day.

Now all this is happening while economies are growing. The rich are getting richer, and the poor, poorer. Economies are growing, but unemployment is increasing. Clearly something is very wrong.

I'm not an economist and don't have easy answers, but surely we have to question the political and economic leadership of our countries and continent. We also have to look to ourselves. How have we allowed this to happen? In South Africa, are those of us in the middle classes so caught up in the pursuit of material wealth, the latest clothes, and the flashiest cars, that we have been prepared to ignore the increasing misery of our fellow citizens? What can and should we be doing to turn this around?

To give a picture of just how insane this is, the Sunday Times article also mentions that among the ultra-rich -- those worth more than 30-million US dollars, the biggest increase was in Latin America, followed by Africa.

Now let's get real. How much money does any one person need? Let's say, it's fine and acceptable to do well and be comfortable, and let's be very accommodating and say it's not excessive to have $1 million US dollars. But over $30 million? What do you do with money like that? You can only sleep in 1 bed at night, eat so many meals, drink so much fine wine. What do you do with the rest? What is the point?

Especially when your fellow citizens are spending every waking hour trying to scrape together enough money for just one daily meal.