Guest Column

Shared economic growth is the only way to go

2017-04-23 06:17

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Phillip Dexter

Poverty, inequality and unemployment, as well as disease, skills and access to services, are still determined, to a large degree, by the patterns of ownership and power created under colonialism, slavery and apartheid, and are reproduced through the capitalist system and the neoliberal ideology that dominates thinking at a number of levels in government and business.

The call for radical economic transformation has therefore rightly been made, but is defined in various ways and with different emphasis, prompting the question:

What is radical economic transformation? It appears that, for some, it is any accumulation of wealth by black people, whether by theft, corruption, patronage, fraud or tender rigging.

This is hardly surprising – the capitalist economy inherited from apartheid has scarcely been transformed and continues to reproduce poverty, inequality, unemployment and uneven development.

This means the system is rigged against black people in general and against women, youth and people who are differently abled in particular.


Most black people are also aware that all historical accumulation of wealth by white people took place thanks to colonial theft and plunder, slavery and racial capitalism, and by ignoring the human rights of workers.

In such circumstances, it is hardly surprising that many people feel that accumulation by any means necessary is acceptable.

But can we, as revolutionaries, democrats and patriots, accept this logic? Obviously not. This would lead us to further corruption, theft, lawlessness and possibly civil war.

So what is to be done?

The movement growing in the country that is correctly mobilising against corruption and theft by those in government must be supported, but this will only resolve some immediate issues and not stop the rot.

If we are to rid ourselves of this culture bequeathed to us by the racists, colonialists and slavers of the past, we must also radically change the system.

Some believe that needs to be a socialist transformation, but not everyone would agree with that.

The radical reforms that are needed should be made into a minimum programme that workers, the poor and the black middle class could put forward to be supported by all South Africans.

Radical economic transformation can be described as processes and actions that lead to a qualitative and quantitative change in patterns of economic ownership, employment and opportunities on a sustainable basis, favouring the historically disadvantaged and their descendants.

Radical economic transformation should create more jobs and better jobs, higher growth and more equitably shared growth.

The majority of the wealth should be in the hands of the majority of the people, in equitable, fair and just race, class, gender and disability terms.

While government has made strides in addressing poverty and basic services, the evidence overwhelmingly shows that these policies and programmes do not go far enough to ensure that we live in a society that gives life and meaning to our Constitution.

What is needed, therefore, are policies that ensure:

- The speedy transfer of land to those who are landless;

- The creation of jobs for those who are unemployed;

- The closing of the earnings or wage gap;

- The transfer of skills and capabilities to those who do not have them;

- The creation of ownership opportunities in enterprises at various levels in the economy; and

- A far greater and wider social safety net.

Some examples of the way things could be done differently are as follows:

1. Instead of considering dispossession, all land could be taken back by government and leased to those who use it. A limit should be set for private use.

2. Our country needs far more people to deliver services, and the housing and infrastructure backlog alone could employ most of the unemployed.

Government needs to set up a housing fund through the Post Office bank and encourage saving and investment in this, through tax and other incentives, to fund the 2.5 million homes we need, and it must ensure they are built within 10 years.

3. Government needs to ensure that a target for the wage or earnings gap is set – for example, 10 to one – and measure progress towards this over a fixed period.

4. All education from preschool to university should be paid for by the state.

Those who earn, for example, R250 000 a year should be expected to contribute to their children’s fees on a progressive sliding scale.

All companies should be obliged to give a place to one intern for every 10 people they employ.

5. All new enterprises set up should be made to create an ownership opportunity for their workers, and black workers should receive a further ownership opportunity of twice the amount of white workers.

All existing businesses must commit to the same principle and work towards this target over a five-year period.

6. The basic income grant must be implemented, and social grants and pensions must be increased.

A compensation grant must also be created to ensure that those who were discriminated against in the past are given the redress they deserve.

This could be given in a number of ways – as a monthly payment, as a tax incentive or a combination of both.

No doubt, these ideas will be criticised, but they are an attempt at promoting a discussion.

Others will have many more and better ideas.

It is now long overdue for an economic summit to take place and for a new social compact to be negotiated to ensure that the shared growth we need happens.

Any person who argues that it can’t be done is simply of no value to the debate. We either do this, or face untold negative consequences.

Dexter is a member of the ANC

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