WORLDVIEW: RW Johnson has been spot on – so what’s coming next?

In trying to understand South Africa's turbulence, yesterday I sought guidance from RW Johnson's masterpiece. Because the predictions he made in How Long Will SA Survive have been incredibly accurate. For instance, in May 2015 Johnson suggested it would take two years for SA's debt rating to drop to junk status. It has taken 23 months.

The next big fork in the road is when SA's fiscal cliff is breached and the IMF becomes the lender of last resort – a point where commercial borrowers are no longer prepared to loan the money except at an unaffordable price. This reality started coming home on Tuesday when SA Revenue confirmed 2017 tax year collections down R30bn on what had been budgeted for in the national accounts, a massive hole for an economy of SA's size.

Johnson predicted this slide. In the final chapter of his must-read book he writes: "The country is set up for a huge and obvious failure. This, sadly, has got to take place. Ever since 1994, SA has lived in a sort of dream world in which it was possible to believe six impossible things before breakfast. Everywhere there was a huge amount of pretending."

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