A ligkaribe Article - economic costs of infidelity

this is an article of mine that appeared in Mmgei newspaper of Friday 8th September 2006.

On Wednesday evening I happened to catch some of a midnight program on marriage problems on one of the local radio stations. It happened to be dealing with one major relationship issue of our day and age. The question of infidelity? As such I was inspired to write this article as a response to all those people out there who ignorantly engage in this behaviour without prior calculation of the costs and consequences of their actions. I propose to ignore the moral and social issues of this topic (which never make any headway anyway in this argument) but at this juncture to only focus on the economic consequences, of infidelity. In this day and age we find it is often only the fool who talks of love without talking of economics, we find that often were we think love exists the ugly monster of money issues has reared its head and the results are usually in the least a sad story of life’s woes or at worst another statistic of murder suicide cases, another case file for the law enforcement department.

Firstly I would like us to consider that marriage is a contract between two individuals, a binding contract. In any type of economic contract there are expectations of both parties that have to be met. Immediately the one party fails to deliver on this the other party will be aggrieved, and chances are they will sue for breach of contract. Immediately a third party is brought into the equation without the consent or prior consultation (this is very important) consent and prior consultation of the other party then a new contract has to be written. It is easy at this juncture for one party to claim that the paradigms of the contract have shifted and as such the contract must either be re – written or simply cancelled as the old contract is no longer binding.

The contract of marriage serves as a protection tool for two people in society who have taken the bold and responsible step, to forsake all others and to simply, well commit their well-being and economic success to the hands of one other individual. As such the marriage contract serves two dual purposes it keeps out undesirable elements to the set–up and at the same time it keeps in desirable elements. The moment it fails to keep out undesirables, chances are it will likely fail in its mandate to keep in desirables. I will not expand much on this read in between the lines if you have two cents worth a brain.

I digress however I would like to state at this juncture that marriage contracts, are an agreement between two individuals, as such the human element can never be ignored. Chances are whenever one party is not playing their part and bringing to the table their share of the agreement, there will not be success. We can not run away from the fact that, in an age were economic hardships are paramount; one will look at most issues from an economic point of view. In the past the Shona people would say to the young bride “andi ende” ( I will not leave), the Tswana will say “ mona kisilepe” the Ndebele will say “ umendo awuthunyelwa gundwane” in this type of set up, there were structures that ensured that one of the parties, would not sue for breach of contract no matter the circumstances, these measures were put there in respect of the fact that they needed to be there to begin with, if women were as infinitely patient and forgiving as is often assumed it would not have been necessary to go to such lengths.

Currently, the old set – up were women relied on men economically and financially no longer exists, women are able to provide for themselves, as such they also face the same financial and economic responsibilities that previously were common only to men. In any decision these responsibilities and economic considerations will come into play. In a world were we are all struggling, were we are all competing for the same scarce resources, (economists say economics is the problem of distributing scarce resources among different needs and wants), one will evaluate the ability of the marriage contract in letting them succeed in this type of competition. As with the free market economy. Individuals are in completion all the time. Completion for, scarce jobs, for funds from financial sources, for land, for recognition, for acceptance and for success to name a few. All these are scarce resources; all are difficult to obtain but are directly related to the well being of individuals in our society. In a marriage set – up the assumption is that the two parties combine their efforts, talents and resources (being i.e. time, money and effort) in order to attract and best obtain these scarce resources in a tough competitive environment. So what does this mean when one party decides instead to divert some of their resources (being i.e. time, money and effort) to another destination outside the current marriage set – up? Basically what impact will this have on their ability to deliver on the marriage contract? One way or the other they will under deliver and the most likely decision is that the other party will no longer find it economically worth their while to continue in the marriage. In other words infidelity is more often than not a deal breaker in most contracts of marriage. They may either decide to stick it out which means that the greater burden is now upon them to maintain the balance and cover up for the missing resources, or they will want to also divert their resources, or to completely pull out of the contract. None of these options represent the most efficient and economically advantageous e use of scarce resources.

Which brings me to the concluding point; the costs of infidelity far out weigh the benefits. As such infidelity is not a sound economic decision, neither is it intelligent or good business sense. What are the costs? The long-term costs are that infidelity may result in divorce, that means the marriage will be negated, and the assets divided between the two parties, it means also that the assets of the company, (the family) will be affected. The negative impact on the children of this marriage may also mean that they are affected in their ability to continue to build upon what their forerunners have enacted, and as such the long-term viability of the marriage and the family dynasty is under threat.

In the balance sheet of the marriage, infidelity represents a liability, a long-term liability that may never be amortised, a liability that draws on the lifeblood of the marriage that is the main assets of the marriage (the people), or in other words its share capital investment. It is a constant reduction to the distributable reserves, until a time when we may encounter a situation of negative distributable reserves. It is an endless daily expense in the income statement that will continually reduce the marriages profitability.

It represents the kind of cost that must be accompanied by a note to the balance sheets, a note to explain to any reader of the financial statements the materiality of this particular cost, and to allow the reader to judge for themselves the effect it will have on the overall health of the marriage empire. It is further more an expense that requires a conflict of interest to the shareholders. it requires a qualified statement by any auditors of the marriage partnership . A qualified statement to warn the shareholders of the possible unhealthy condition of the marriage, the danger of it continuing to be operated as a marriage, the possibility of the financial statements being a misrepresentation of the true state of the marriage, the qualification that the auditors are unable to agree that the statements give a true and fair view of the marriage. In the balance sheet of marriage infidelity in my view requires a qualified opinion that indicates, that the institution is possibly in danger of collapse and should not be allowed to continue.

“Without qualifying our opinion we draw attention to note A to the financial statements. The marriage is currently undergoing a situation of infidelity from one or both parties. The ultimate outcome of the matter cannot presently be determined, and no provision for any liability that may result has been made in the financial statements. Without qualifying our opinion we draw attention to note Z in the financial statements. The marriage incurred a net loss of xxx during the year ended … and as of date the current liabilities exceed current assets by xxx and its total liabilities exceed total assets by xxx. These factors along with other matters as set forth in notes raise substantial doubt that the marriage partnership will be able to continue as a going concern.”
NB: For more information on audit opinions please contact the esteemed Dr. Kitindi, Head of department Accounting and Finance at Faculty of Business, University of Botswana.

On a more serious note I challenge everyone to honestly assess their marriage balance sheets and determine if they can honestly give an unqualified opinion of their marriages!