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Lukhona Mnguni
 
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Patrice Motsepe's pledge to the poor poses a threat for business transformation

06 February 2013, 07:30

There are potentially no grounds to find any problem with the pledge made by the Motsepes to donate half of their family income to the Motsepe Foundation for purposes of funding charity ventures. This is so because the capitalistic world has branded capitalists as people who are not as giving and are always after self-wealth accumulation. Any move that is contrary to this capitalistic order is largely met with praise and branded to be magnanimous and hugely philanthropic. The minute we attach these labels we begin to glorify the establishment of capitalism in its current form, whereby a few accumulate wealth whilst exploiting the majority (through poor wages, living conditions, environmental degradation and other phenomenon). This act of charity, though it has become accepted as necessary in this capitalistic order, entrenches a mindset that the poor are deservedly at the mercy of those who have billions to distribute at their will, if and when it pleases them.

Motsepe described this move to join the Billionaires’ Pledge started by Bill Gates and Warren Buffett in the United States of America (USA); as a “recognition that people in my position, and me in particular, have a huge responsibility to South Africans who are less fortunate – those who are unemployed, poor and marginalised – and to make a humble contribution to improve their lives and living conditions”. Motsepe is amongst the world’s 500 richest people, which makes him part of the global elite in a planet that has over seven billion people. Oxfam International has recently warned, in its report The cost of inequality: how wealth and income extremes hurt us all, that “extreme wealth and income is not only unethical it is also economically inefficient, politically corrosive, socially divisive and environmentally destructive”. The same report also noted, “the richest one per cent has increased its income by 60 per cent in the last 20 years with the financial crisis accelerating rather than slowing the process”. Finally, Oxfam noted that the $240 billion net income in 2012 of the richest 100 billionaires would be enough to make extreme poverty history four times over. These seemingly shocking revelations are in line with much of the discoveries done by the United Nations Development Programme when researching issues of wealth and income inequalities.

Motsepe made his announcement in the same week that a study by some researchers from the University of Cape Town’s African Food Security Unit Network revealed that “more than 12 million South Africans go to bed hungry everyday”. Accompanying this report was a statistic from the UN Food and Agricultural Organisation that, 870 million people worldwide are chronically undernourished, 234 million of them living in sub-Saharan Africa. The desperation to solve these dire realities of our society makes us gladly accept the crumbs that flow from the table of those who have a seat in the table of capitalism. It is also a well-known fact that in development studies, the efficacy of aid, donations, corporate social investment and many related initiatives intended for the poor, has often received mixed reactions. Whilst the involvement of the private sector is important in assisting government to build infrastructure and facilities that enable poor people to develop themselves, such involvement has not addressed the core problem – which is the structure of how the economy is owned. A flooding of pledges, such as that of Motsepe from other rich families, including those whose wealth was founded and built through colonialism and apartheid, will make us South Africans lose focus on the serious discussion that should be occupying us: wealth and land redistribution. A bold move from all these billionaires would be the transfer of 50% of their assets to the ownership of community trusts. The problem in this world is not that there are not enough resources to feed the poor, or that the poor require favours from the super rich, the problem is that we have allowed – for far too long – the pervasiveness of wrong economics.

 Some prefer to label Patrice Motsepe as an Oppenheimer project and invention. According to an article carried in the Business Day (31/01/13), Patrice Motsepe is the founder and chairperson of JSE-listed mining group African Rainbow Minerals (ARM), of which he owns 41.26% of it through the Motsepe-owned African Rainbow Minerals & Exploration Investments.  The wealth of ARM is generated from mining interests that range from Platinum Group Metals to Coal, to interests in Harmony Gold, some Copper operations and Ferrous Metals which all form part of a massive business operation with “a market capitalization of R43 billion”. To the South African public he is well known as the owner of the PSL football club, Mamelodi Sundowns. In recent years he has growingly become known for his role in funding the ANC through buying a seat in Zuma’s table repeatedly at R500 000 and sponsoring conferences and other needs of members of the tripartite alliance such as COSATU and the SACP. The Motsepes also own Sizani-Thusanang Helpmekaar, which own s55% of the Ubuntu-Botho Investments, which in turn has a 10.76% shareholder stake in Sanlam.

Motsepe is obviously one of the people who have benefited the most from what started as Black Economic Empowerment, which some authors such as Moeletsi Mbeki trace to pre-1994 when majorly Afrikaner owned entities roped in some black people into their boards to gain some legitimacy and a foot in the to be ruling party – the ANC. What should have been expected is for those benefiting from BEE to play an activist role that seeks to transform the companies they are involved in; especially those in the mining industry, which had a brutal legacy towards black people throughout the years of colonialism and apartheid. Motsepe chairs an ARM board of 14 individuals made up of four black males, eight white males and two black females. 6-8 on race and 12-2 on gender. Harmony Gold, a company that ARM has shares in, has recently threatened to lay off 6000 workers, no word to reverse this from Motsepe (the magnanimous, socialist capitalist). I then suppose that, Motsepe’s operations will put people out of work and the Motsepe Foundation will play hero and rescue these people from their reality of poverty that would soon confront them. How has Motsepe transformed living conditions of mineworkers in his mines, their wages and mandatory community projects?

This Billionaires’ Pledge is largely welcomed by the public, but it is not the solution to the underlying problems of structural ownership of the economy. We need to move towards a decentralized ownership of the economy. It would be tragic if other families with serious wealth interests in this country such as those owning Anglo American, Lonmin, Impala Platinum, Xstrata, Anglo Gold Ashanti etc were to pledge half of their family incomes. Such a move would invariably be used to make a moral argument for an immoral and soulless system of capitalism and further thwart any ambitions for a more radical approach of redistribution of wealth in this country. Whilst we may say kudos to the Motsepe family, we must also be aware of the potential danger they pose to our developmental path, especially those who are “economic freedom fighters”.

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