A Betrayal of Values

2013-10-30 05:57

The near to unanimous support in South Africa’s parliament for tightening BEE legislation implies both a collapse in values within the official opposition, the Democratic Alliance - and portends a further assault on the freedom and independence of the South African private economy.

The passage of this legislation means that an already predatory and openly racist state enterprise is to increase its grip over business and the economy, have a freer hand in engineering distortions in the distribution of resources and be at ever greater liberty to coerce outcomes to its liking. None of these augur well for the nation’s future.

In fact economic disaster and a failed state loom ever larger as possibilities.

It’s the Economy, Stupid (Bill Clinton)

To justify the logic against enhancing (or for that matter, having adopted in the first place) “BEE”, let us be clear on three things.

1. Without a vibrant and successful economy, our nation has no future. This is common knowledge.

2. Less recognised, but every bit as true is the fact that our economy has hopelessly underperformed since the inception of the new South Africa - even allowing for the financial crisis. Other developing economies have performed immeasurably better despite our “flavor of the month” status during the nineties and the heady days of the mid 2000’s, when we rarely achieved even a 5% rate of growth. In the meanwhile, other developing economies unencumbered to the same extent by union pressures, BEE demands, affirmative action constraints and punitive labour laws to skew their people resources - grew much faster. Nigeria – from being a very distant second some years back - is now destined to overtake South Africa as the largest economy in Africa within a decade or so. Angola is growing even faster still.

3. Our levels of unemployment - buffered only by a small and fragile tax base – are obscene by world standards and a clear indicator of a nation going bust.

Diagnosing the Problems

So how could BEE - and for that matter Affirmative Action, its close cousin – have contributed to our woes?

In a nutshell they both – in tandem with punitive labour legislation and a strong trade union movement - undermine the creation of value and wealth in order to protect sectional interests, which in turn causes damage to the nation's economic health and curtails opportunities for jobs and employment.

Only business - and most certainly no government of the calibre of ours - can create value.  And business in turn requires stability and access to flexible productive resources such as labour and enterprise. So does it not make only sense to encourage business to function efficiently?

We have not heeded these economic principles and at every right turn in the road have turned left. We see it today in both local and international economic indicators. Like education, our economy has been woefully and consistently mismanaged.

So - What About the “Greater Good”?

Some like to argue that political and economic distortions of the past warrant such tampering by way of corrective restitution - but they omit basic economic truths such as the need for economic growth; labour flexibility and the necessity for global investment. They also ignore the reality of globalisation.

Instead they cling to doctrines that have been discredited the world over and allow the values of 20th century socialism and the Stalinist state to prevail. The lessons of last century have been ignored.

Nothing has been done to create a successful political-economic model for this nation despite the scope offered by a rapidly shrinking world rich in economic opportunity. Instead, the ruling ANC's cognitive void has been enthusiastically filled by trade union and communist doctrines, placing power in the hands of a culturally bereft and economically incompetent elite.

Quo Vadis?

Until the national ethos shifts from emphasizing equality of outcomes; abandons the notion of entitlement to what others have earned through their own work and ingenuity; and fostering a coercive state to force predetermined and costly outcomes, there can be no realistic prospect for sustained economic upliftment or long term stability.

Indeed, the reverse is true.

No progress is likely until we have a sea change in the nation's values. These include equality of opportunity as enshrined in good universal education rather than meaningless equal “outcomes”; individual sovereignty and the freedom to act and perform according to ones conscience and economic motives in a law abiding society; a strong work ethic; and intelligent government. Neither is progress likely until the vacuous equality-at-all-costs cop out is abandoned and replaced with calls to work hard and take personal responsibility.

The abrogation of such values by politicians in the Democratic Alliance who should know better and their capitulation to the prospect of a few increased votes in 2014 is a serious setback to democracy. Their actions send a message of despair to all who have banked on a principled political opposition in the short term and better future for all in the long run.

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