Free trade is not Jesus Christ the Saviour
2017-01-20 08:49
“Jesus
Christ is free trade and free trade is Jesus Christ.”
So
declared Dr Bowring, an English economist, in the middle of the 19th
century when people were enjoying cheap imports.
Bowring’s
belief in free trade was heavily criticised by Karl Marx who accused him of
ignoring the fact that cheap imports were decimating workers in England. Marx
argued that workers would eventually not afford cheap products, the very cause
of their unemployment and exploitation. Competition was driving wages down.
Exactly
169 years ago, this month, Marx delivered a speech at the Democratic Association
in Brussels arguing that free trade was destructive. “It breaks up old
nationalities and carries the antagonisms between proletariat and bourgeoisie
to the uttermost point,” he said.
He
said free trade would quicken a socialist revolution. “In this revolutionary
sense alone, gentlemen, I am in favour of free trade,” he concluded
sarcastically.
Of
course, a socialist revolution of the type Marx envisaged never happened and
doesn’t look like it’s about to happen anywhere in the world. Nowhere in the
world do workers think of themselves as owners and managers of the means of
production. And one doubts if South African Communist Party leaders like Blade
Nzimande, Solly Mapaila and Jeremy Cronin are preparing South African workers
for such eventuality.
A
brilliant analyst whose impractical revolutionary solutions or predictions
never saw the light of day, Marx had a point about free trade. South African
poultry farm workers started 2017 on a tragic note. Thousands have been laid
off and more could be retrenched if our government’s trade deals with the
European Union and other trading partners that give us cheap imported chicken are
not reviewed.
The
South African poultry industry has to compete with producers who dump cheap chicken
into the market. The solution, however, is not to resort to protectionist
measures envisaged by the likes of US President Donald Trump. The solution lies
in competent management of trade deals.
Chinese
Premier Xi Jinping, a senior communist party leader, has told the World
Economic Forum that global commerce must be allowed to flourish.
“China
stands on its own conditions and experience. We inherit wisdom from the Chinese
civilisation, learning widely from the strengths of both East and West. We
defend our way but are not rigid,” he said.
“We
learn but do not copy from others. We formulate our own development path
through continuous experimentations . . . No country should put its own way on
the pedestal as the only way.”
Our
poultry farm workers are in trouble. Several steps must be taken to rescue them
and their families in ways that show our understanding of the workings of the global
economy and our ability to, as Xi puts it, “stand on our own condition and
experience”.
First,
government must raise its aptitude in trade negotiations to balance the
imperative for free trade with the need to grow the domestic industry.
Second,
government and governing party officials must stop labelling big business as “white
monopoly capital” that is the enemy of the people. Instead, they must work as partners
to re-industrialise the country. Poor business-government relations make
nonsense of any talk of re-industrialisation and global competitiveness.
Third,
there is a need to invest in trust between government, business and labour. Any
of the three who regard the other as the enemy is naive.
Fourth,
government must heighten its sense of South Africa’s national interests when it
bargains with other countries on trade matters. It should neither be awed by
China nor bullied by the US.
Fifth,
government and business should always work together in search for global market
opportunities that could spawn new industries and strengthen existing ones. I
recently learned of the establishment of Exotic Leather South Africa, a great initiative
to promote South Africa’s exotic leather industry. Sadly, about 80 percent of
our exotic leather from ostrich and crocodile is exported raw to manufacturers
who make high-end products for brands such as Louis Vuitton and Prada. Very
little is beneficiated in South Africa.
Sixth,
government, business and labour should learn from past mistakes. The textile
industry was killed, resulting in the layoff of hundreds of thousands of
workers because of poor planning ahead of the lowering of import tariffs. South
African workers could not compete with Chinese cheap labour that was churning
out cheap exports. Similarly, the steel industry is teetering on the brink of
collapse because of cheap imports.
Seventh,
everything should be done to prevent worsening of the jobless bloodbath in all
sectors of the economy. With more than 50 percent of the youth unemployed,
including many who have never worked and are unemployable, nobody knows what
kind of revolution is awaiting us. It may not be a socialist revolution as
envisaged by Marx, but it could take other forms.
Finally,
we must keep in mind that free trade is not Jesus Christ the saviour, and Jesus
Christ is not free trade. Our poultry farm workers know this very well.
- Follow Mpumelelo Mkhabela on Twitter.
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