Clem Sunter

To be a true Economic Freedom Fighter

2013-07-26 15:00

Clem Sunter

Following Chris Moerdyk's insightful piece earlier this week warning us not to underestimate Julius Malema, I am adding my penny's worth. I agree with him that the EFF could pose a serious election threat to the ANC next year providing they get properly organised. They could even force the ANC to go into a coalition with the DA which is not such a bad idea.

Right with the problem, wrong with the solution

I have written several articles about Julius, congratulating him on being the first person to highlight the anger of young people in this country when confronted with an economy that is overly concentrated in the hands of the few and which provides them with no real prospects of bettering themselves in life. However, I have also condemned the solution he offers to the problem, which is greater state control and confiscation of assets on a scale that could precipitate civil war. The latest EFF manifesto implies the takeover by government of all land, mines, banks and other businesses of strategic import with no compensation at all. As an act of revenge, it may appeal to the marginalised and excluded citizens in our society. Yet, it will not create one extra job, let alone five million jobs by 2020.

Misleadingly EFF spokesmen have likened their policy to state-directed capitalism in China, South Korea and Brazil. I doubt whether any of them have been to the Central Party School outside Beijing which is the intellectual centre of the Chinese Communist Party. I have and there is no doubt that the spiritual leader of the party is now Deng and not Mao. He taught them to retreat from the economy as a party and allow enough room for the international and local entrepreneurs to move in and create wealth for themselves as well as for the nation. China was ranked the 100th economy in the world in 1978; it is now second to America. Companies like Samsung and the car manufacturers are not state-owned in South Korea. Many of the mines in Brazil have local and overseas investors possessing a controlling interest.

Not even Cuba now qualifies for the EFF model as it is gradually opening up its economy to free enterprise and doing much better as a result. No, the only parallels I can think of to what the EFF is proposing is Venezuela and North Korea whose leader happens to be a chubby 30-year-old with a love affair for military garb. Those two countries also share another plank of the EFF agenda which is to be screechingly anti-imperialistic for which you should read anti-Western. Of course, several African nations have also followed the North Korean road to isolated ruin.

True economic freedom

So what is the solution given Malema's correct analysis of the problem? Quite simply, it involves Jacob Zuma resetting the target for 2020. Instead of talking about creating five million jobs by that date, he should be saying we are going to create one million new enterprises by then - in other words one million new entrepreneurs with the freedom to do their own thing within an open, inclusive economy. If each of them hires on average four people, you have five million new jobs.

That is promoting economic freedom in my sense of the phrase. Concentration of economic power in the hands of the state is the exact opposite. It is amazing that the penny has not dropped for any political party since none of them are championing small business. Meanwhile, very few captains of industry are helping to expand the space and provide support for entrepreneurs. Educational institutions have not woken up to the fact that the game of work has changed and, as such, they are still educating their students for the job market that existed 50 years ago. Business banking does not cover the township entrepreneurs who now want to make it into the mainstream economy but do not have the assets or monthly salary to offer as security. The NDP hardly makes mention of the critical role entrepreneurs will play in the future of our country. The intelligentsia turn up their noses at the profit motive.

The bottom line is that we need a more decentralised economy, not one that exchanges private concentration of business which we have today for a public version. Ownership of wealth must be more widely spread, because the opportunity to create it is more widely available. This cannot happen as a result of the trickle-down effect of capitalism. It needs to be negotiated through an Economic Codesa and it requires economic freedom fighters of the highest calibre to implement. So please, Cyril and company, offer hope to the young people of South Africa that something tangible is being done to improve their chances. Otherwise, an Arab Spring awaits us. Don't discount how social media can turn a fledgling movement into a major political force in a matter of months. Such momentum could lead to defections of prominent figures with like-minded, left-wing views from other parties to the EFF.

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Read more on:    da  |  anc  |  eff  |  julius malema

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