When in debt the wise thing to do is to stop spending, not ask for more time

Thursday April 29 2021

Author: Daniel K Kalinaki. PHOTO/FILE.

By Daniel K. Kalinaki

I was a young graduate student in London many, many years ago, when I was first introduced to the magic of the credit card.

Some background is important. I had grown up in the primitive days of 1980s Uganda when even our best and brightest minds considered barter trade a viable commercial strategy; the days when the uber rich walked around with briefcases filled with cheque books and travellers cheques. 

The petty bourgeoisie, on the other hand, had long grown distrustful of formal financial institutions. It was never clear which liberation movement soldiers would move in and liberate one’s money from one’s pocket at a roadblock, or when a currency conversion would obliterate fortunes overnight. So they kept their money in folds cut into their mattresses.

When they had to move capital they did so on foot — or more accurately— in their socks. There were many stories of weather-beaten fellows turning up in shops selling expensive wares and boring the disinterested tellers with endless inquiries only to drop knee and then reveal a sock stretched taut by bundles of cash.

Then I get to London and discover this magic piece of plastic. It was smaller than the passport and the folded-cardboard A5 driving permits we got those days. The magical thing about the ka-card was that you did not need to have any money in your pocket, or even in your life. You went to a shop, picked out the items you wanted, handed the plastic amulet to the shopkeeper who then put it in a device, slid something across it and then handed you a receipt, plus your goods. Just. Like. That.

With this plastic amulet on me, I was invincible. It felt as if few trinkets, objets d’art and other manufactured wares were beyond my reach. And I didn’t have to pay a penny! 


The magic spell wore off a few weeks later when I received a letter in the mail from my bank. The ka-plastic thing, it turned out, did not have any magic at all but was, in fact, a curse. Every time I had handed it over to a merchant to do their voodoo, the spirits had sent some message to someone in my bank who kept a tally. What the bank was doing all along was lending me money which they now expected me to pay.

I checked the statement carefully and saw the large amount due: £4,355. Impossible! I said. When had I spent that much money? But the statement also had a detailed section where every penny and pound, every pint and pizza had been chalked up and carefully tallied. Forget magic; I was out of money and out of luck, and now had to find a real job to pay off the debt.

I was reminded of this nightmare this week by revelations that Finance Minister Matia Kasaija intends to approach the people Uganda owes money to ask for more time to repay them because – apparently – he is expecting some ka money.

How did we go from having our debt written off in 2000 to owing billions of dollars that we cannot pay off two decades later? The answer, as I learnt that many years ago, is by a small pint here, a small pizza there. Or in the case of Uganda, a capacity-building loan here, another there to bring all stakeholders on-board or mainstream gender in this livestock project or that livelihoods programme. For much of it there is little or nothing to show.

On the day Kasaija promised to tell the landlords that the rent is likely to be late, there was a story in the papers about his ministry presenting a request to Parliament for billions to give each new Member of Parliament Shs200 million each to buy a new car.

The money pales in comparison to the billions of dollars we owe, but those billions started out as a million here, three there. I will tell you for free; the only way to get out of a debt hole is to stop digging and start paying back. 

Asking creditors for more time while continuing to blow money does not reduce the debt but often only makes it bigger. That young graduate student had to get off the pint (temporarily, I hasten to add), pull up his (empty) socks, and get a job to pay off the loans. Sadly, it looks like Matia et al have decided to pass the buck, literally, to future generations. Shameful. 

Mr Kalinaki is a journalist and  poor man’s freedom fighter. 
write2kalinaki@gmail.com; @Kalinaki