Once upon a time it used to be that finance ministers around the world took considerable pride in seeking to balance their national books. They tried to minimize debt, and sought to build positive cash balances in order to provide for infrastructural growth and resilience and to put aside sufficient cash reserves for future possible calamities so that their countries would not be at the mercy of unfriendly neighbours when times got tough.
The first, the prime, indeed the sole role and duty of any government is that of national defense of its borders and citizens. This can take different forms but consists mainly of a standing or reserve military force ready and able to defend against external aggressors or infiltrators; an internal force ready and able to preserve law and order within its borders; and a competent civil service working purely for the betterment of the intellectual and economic environment of the country in order that trade and commerce can flourish enough to provide the wealth and well-being of the nation.
It is this fundamental concept which escapes most people, not least our present government in South Africa.
Without a proficient army the country is vulnerable to armed invasion from its neighbours. Without effective policing agencies the country is vulnerable to illegal immigration, crime and loss of economic and social structure and confidence. Without an honest and qualified civil service (which includes those who would wish to exercise political direction over the country as a whole) the country is subject to economic decay and decline in its infrastructure, thereby handicapping the wealth-generating capacity of its citizens.
This much is self evident if largely forgotten or ignored.
It is also self evident that, in a secular society such as ours, the collection and disbursement of the necessary funds from and on behalf of the populace to enable the above national defense is as close as a sacred trust as is possible outside of a theocracy.
That trust positively requires that the government exercises total diligence and probity in all its actions without exception. This includes a complete commitment to transparency, accountability and the maximum efficiency of its policies and spending.
So how does this bear on the recent national budget as delivered by Pravin Gordhan and the ANC?
Charles Dickens expressed it well with Mr. Micawber’s observation (in David Copperfield): “Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”
The ANC is living beyond South Africa’s means. Consumer taxes aside, the country has a very small tax base. Yet the ANC continues to contribute significantly to the cost of living in its endless and relentless exploitation of its tax sources in order to fund its unrestricted spending and gross inefficiencies in that spending. Under the current taxation and economic models it is clearly untenable for a mere ten per cent or so of the natural and commercial population to fund in excess of fifty-something million people (assuming you believe the results of the last census) of South Africa. It is equally untenable when one considers that a significantly large proportion of South Africa’s economy lies outside the formal sector, meaning that not only are there huge numbers of individuals and business enterprises beyond the reach of the taxman but also there is an inherent culture within South Africa’s citizenry of the avoidance and outright evasion of tax responsibility (see my previous article on News24 “Re-Thinking Taxation” - http://www.news24.com/MyNews24/Re-Thinking-Taxation-20130107).
Yet Mr. Gordhan continues to bang away at the same old inefficient, loophole-riddled taxation strategies and tactics that do little except enhance the size and power of his ever growing fiefdom. It is in the interests of the ANC to maintain a confused and confusing system of revenue collection into central funds which permits inefficiencies and corruption; it is not in the interests of South Africa in general and South African business people in particular. It is like the old ball-under-the-cup con; watch the ball, ladies and gentlemen, watch it move; where is the ball, where has it gone, where will it go, nobody knows.
The ANC courts civil unrest, sooner or later, with its constant increases to the already high cost of living for each individual South African. The so-called ‘sin’ taxes, the ever-mounting fuel taxes and regulation of the energy sector; these and other measures contribute directly and indirectly to inflation and a cost of living which puts even basic lifestyles beyond the reach of many, if not most, of the population of this country.
Inflation is the result of greed, nothing else. It is, therefore, the height of lunacy when a national government, charged with the defense and well-being of its citizens, conspires to add significantly to the burden of inflation suffered by those who have entrusted it to protect them from such excesses.
So, ANC, concentrate on your primary role – defend your country and its people; honour your contract with the people of South Africa.
If you can’t fix the little, obvious, solvable problems – the corruption, the crime, the poor road and public transport systems, absenteeism in the public service, the unwillingness to apply accountability for errant public servants, the ostentatious and extravagant expenditures and excesses of those who purportedly serve the country – then you cannot hope, in a month of Sundays, to fix the bigger problems such as rights for this group or that group, or charity for those starving or displaced elsewhere in the world.
Much as it would like to think otherwise, the ANC has been temporarily granted the privilege to govern this country on behalf of its people. And although there may not be much evidence to suggest otherwise at this point, that grant by the South African electorate did not include a license to demand and expect the taxpayer to fund every little whim, desire, political or economic fashion or fad willy-nilly. We want you to be responsible; we want you not to run our lives for us but we do want you to create an environment where we can make a small profit from our daily lives, feel safe on our streets and in our homes and where we can enjoy the fruits of our labour according to our needs and abilities without undue let or hindrance from those who are supposed to serve us. Give us the means to strengthen and empower ourselves – not by diktat but by releasing us from your from your self-appointed and downright wicked greed and self-importance.
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