SA Inc now has 90 days to make its story of “reform” more convincing, and credible. It might seem for many pessimistic pundits to be a three-month wait for a slow-motion train wreck — the inevitable ratings downgrade by Moody’s Investors Service. Many might hope that the “brothers from Manhattan”, as Patrick Bond refers to them, will exercise mercy. They are certainly not known for that.

From a fiscal perspective, which is what the ratings agencies will be following closely before the February budget, it is important to consider one of the metrics Moody’s will be looking at — the debt-to-GDP ratio. In my view the growth of the numerator has to be closely linked to whatever improvements we envisage in the denominator. This is the crux of the matter. Without a clear growth strategy, with wide buy-in and credible design, piling on more debt in the hope of growth through demand improvements, or more aggressive cutbacks in spending, may — as Naomi Klein has suggested — “kill the pa...

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