Economics is a lie manufactured to benefit the powerful

Economics and its sibling 'Price' will forever never make no sense to me. It is one thing to try and pretend to be smart by gobbling all the economic theory and then try to explain why things are so unaffordable in Country A and much cheaper in Country B. But my head says economics is bogus like its father politics.

Is it a coincidence that countries with superior political power also enjoy better living standards and conditions?

One would find comfort in economics and its theories if one day The Gambia would be economically stronger than Austria, for example. The Gambia has all the negativity associated with developing and underdeveloped countries.

If one looks at the strength of the currency in terms of what its units can buy rather than on exchange rate, then my argument will make sense.

A basic VW Golf 7 costs over R300k in South Africa but it is only CHF17k in Switzerland. This basically means that one needs 320,000 units of South African money to buy this car, whereas a Swiss needs a mere 170000 units of Swiss francs for the same thing.

Other people would say that we don't produce any cars. We at least provide input materials to build the car and also assemble a few models in Uitenhage. But Switzerland has zero contribution to the car manufacturing industry, at face value at least. Just like Germany, they would claim intellectual property for tyres and windscreens.

The curse begins with pricing mechanisms for raw materials (or minerals) in the international economic system. How can it be possible that the price of gold, platinum or coal be the same all over the world? Why don't producers of minerals set the price but consumers? England and other countries determine the price of minerals while they haven't even a single mine.

A mining company based in Zambia's Copperbelt Region has to watch TV or read newspapers to know how much his produce will cost. How one justify a uniform price for copper when mining conditions in Zambia and Chile aren't the same? Also, Niger has open cast mines where gold can be picked at just under 300 metres. In South Africa, the deepest gold mine goes down for five thousand metres. Yet, the price is still the same.

The question is: who benefits from price fixing of raw materials in the world? The answer is simple, the politically powerful countries.

The countries in the North use pricing fixing mechanisms to control input costs for their thriving manufacturing and tertiary sectors. In this way, prices of goods/ services in those countries tend to be reasonable and citizens are given a better chance to life. The affordability doesn't come from exchange rate movements per say, but from the structure of global economics.

Politically weaker states are home to the majority of minerals and have zero capacity to produce capital and or consumable goods. They are then compelled to import goods from abroad. This is good for producers because they make profits in perpetuity by either selling goods at high prices and or relocating some of the production to the markets (also called foreign direct investment). It doesn't matter what strategy they use, the weaker countries will never escape their underdevelopment since they exist to support the well-being of developed countries.

Then the smart ones start to talk about a 'resource curse' - overdependence on a single mineral, agricultural product or oil to generate income. But this is by design and less so about bad economic decisions made by individual countries. For as long as the developed nations get their raw materials for different industries, they aren't bothered for as long as no one threatens their economic interests.

Who said colonialism ended in the world?
Organisations like the Brettonwoods (WB and IMF) and the WTO aren't even looking at changing the status quo but they are more interested in deepening the crisis. Weak nations are forced to open their borders for foreign competition and international scavengers to come and exploit their wealth in exchange for political problems and corruption.

At the end of the day, the present economic thinking favours developed and powerful countries. The exchange rate is a facade that is used to conceal the rot and lopsided nature of global economics.

How on earth can a basic house cost more than 2 million rands in South Africa when the exchange rate has little or nothing to do with the global economy? This is another problem. The local economy is a mirror image of the global one, it is about creating advantages for some at the expense of others. In any way, citizens of Europe will always find South Africa cheaper because the economy is structured to benefit them.

The next move is to dismantle the structure of the global economy and finance to facilitate the development of poorer nations. Current economics is all about maintaining the old structures created by VOCs like the United East India Company and the British East India Company.

Now you may have to understand why land reform and economic transformation will never materialise in South Africa. Failing which, we will be bombed for wanting to challenge the power of rogue states.

Please call me an economic illiterate, and thereafter tell me why you are erudite on the subject.