The Case of the Rupert & Co. Billions Vs The State

2014-10-08 16:05

I recently stumbled upon an article on Timeslive which tried (in vain, really) to detail the top five white and top five black richest people in the country and their “politics”. What stayed with me after reading that article was a sense of innocent surprise at just how rich some people are in this country and how that wealth is predominantly centred around a specific group of people: white, male and old. Soon after that surprise, a sense of mild disgust followed when I thought about how poor this country is and how wide the gap is between the rich and the poor.

Of course, we all know how the wealth of the country is owned and enjoyed by a small few (much like in the dark days of Apartheid) and this is still a huge elephant in the room; we’re all “free” buuut we can’t all participate actively in the economy. Basically. However, it is quite scandalous that a puny group of 8 people (Johan Rupert, Nicky Oppenheimer, Christo Wiese, Patrice Motsepe, Koos Bekker, Allan Gray, Stephen Saad and Desmond Sacco) can have R284 Billion in assets amongst themselves, which is close to a quarter of what the entire fiscal budget of South Africa for 2014 is. Do we not see anything wrong with this?

Don’t get me wrong; I’m not against rich people. But R82 Billion for one person in assets is simply ludicrous.

Perhaps when one considers the gloomy picture of our country, the riches of this select few become even more disgraceful. In the recent report by Stats SA on Poverty Trends in SA it was stated that while poverty levels in the country have been declining steadily since 2006, roughly 23 million people (about 45.5% of the total population) still live in poverty. The report also asserts that the “richest 20% of the population account for over 61% of consumption in 2011”. Meanwhile, the bottom 20% only enjoy a paltry 4.3%. This is evidence of the ever-widening gap between the rich and the poor. Of course, these are merely statistics- nothing but percentages and figures. The reality of the masses of the country is one of poor education, inadequate health care, poor infrastructure and ineptitude by some of our leaders when it comes to basic service delivery.

While this is going on, we have a small group of our fellow citizens who enjoy the majority of resources from this resourceful country of ours. These eight gentlemen and their families own everything and live a superbly rosy life.

Perhaps let’s go back to the heading of this blog piece: how could the state use the money that these bigwigs are sitting on if, say, they could give half of their wealth to the state. But before we do that, let’s try and understand why we should even be thinking about taking some of their wealth (hypothetically, at least).

The first reason is one that has already been stated above: it’s simply ridiculous for eight people to be worth close to a quarter of the South African entire fiscal budget. Secondly, I am of the firm view that even if these rich brothers of ours would waive half of their wealth, it wouldn’t make any difference to their lives. Thirdly, there are philosophical reasons to consider. Imagine South Africa as a small, compact village with a 100 people who all depended on resources produced by this village. Using all and any tools of philosophy, it can never be morally right for, say, two individuals in the village to have everything while the rest live in abject poverty.

Of course, before we start with our “budget”, I am expecting some people to raise an argument about how these gentlemen have toiled and worked oh-so-hard to get where they are and how they deserve all their assets. I think deep down we all know that this wealth is a legacy from Apartheid. We cannot pretend to have forgotten about the cheap labour that these rich families have extracted from black reserves. We cannot begin to forget how these companies got tenders and contracts from the Apartheid regime (these people are the real-McCoy tenderpreneurs) for goods and services during the years of oppression. Basically, it cannot be said that these are the most hardworking individuals who got their money without cheap labour, free land (remember 1913?) and without shamelessly milking the country of its most valuable resources (think: gold). So they owe us, as a country, at least some of their assets, no?

So let’s see. What can we do with R125 Billion (half of R284 Billion) that will help the country as a whole? Of course, it must be spent on sustainable projects that will have a long-lasting, impactful difference. Firstly, I’d use R20 billion on the three new universities to fund their capital and operational needs for the next ten years (Minister Blade Nzimande’s estimates). Next, I’d use R24 billion on NSFAS bursaries (not loans) for the next three years (the 2014 allocation was about R8 billion) and then leave R15 billion for infrastructural development of schools and colleges (the 2014 allocation was about R34 Billion) and R5 billion to buy study aids like textbooks and calculators. (The Department of Higher Education and Training’s estimate).

As it turns out, we have R61 billion left. Next up is Health. We can use about R8 billion on the development on health infrastructure (this year, the allocation was R7.7 Billion). R8 billion can be set aside for the education, recruitment and retention of health practitioners like nurses and doctors and other specialists (1.2 Billion was set aside for doctors’ contracts in 2014). About R10 billion can be used for medicine and advanced research. The rest of the R35 billion of our hypothetical budget can be used on specific projects around housing, transport development, small business development (strictly small business) and water and sanitation.

Dreams. Just dreams.

But perhaps there are lessons from all of this. Firstly, it is not inconceivable for the rich to give their wealth. Philanthropists Bill Gates and Warren Buffet both started a campaign (called the Giving Pledge) where they invited fellow billionaires to each contribute half of their wealth to the poor. Buffet was once ranked the richest man in the world and donated 99% of his vast wealth to charity. Secondly, it cannot be the case that we just accept that fellow mortal humans can amass ridiculous amounts of wealth at the expense of their fellow man. It must bother us a little, at the very least.

Notwithstanding all the above, we do need to appreciate that life’s problems won’t just disappear because a few extremely rich people throw money at them. What we have is a fundamental, structural problem that the political gains of 1994 failed to remedy: we still have a system, inherited from Apartheid, that allows a minority group in society to flourish while closing out the majority (black people and women) from active participation in the economy. This system is wrought with cronyism, corruption and racism. Perhaps, it is this system that must be blamed, not the rich people. Perhaps we need to shift our focus from the petty squabbles in parliament and realise that it is this white, monopoly capital system that must be overhauled for the betterment of the broad masses of our people.

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