Just Us and Venezuela

As we approach the decade mark since the start of the great recession all countries are now in recovery, well, all but two that is: economically devastated Venezuela and yup, you guessed it, South Africa. As of, well now, along with Venezuela we are the only economy (out of more than 200!) in recession.

First off, this means that any excuses about a slow global economy for our our limited growth are null and void. Second, although they are major contributors, Zuma and the Guptas are not the sole cause.

I'm sure most people know that there is trouble in Venezuela, but probably not the extent. In 1998 Hugo Chavez and his United Socialist Party took over the government, and as with all socialist projects things were wonderful at first, with the poor suddenly having access to housing, healthcare and education amongst other things. But socialists live on borrowed time and things quickly turned south. In 2016 Venezeula's GDP dropped more that 18% and inflation rose to 500%. Today the people of the once most prosperous state in South America are starving. The shops are empty and when they do have food lines stretch for hundreds of metres outside the store and around the block. And to make matters worse, Chavez' successor, Nicolas Maduro just used a bogus election to take control of all branches of government to further oppress the people.

So now you're thinking, "But Venezuela is nothing like South Africa?" You'll be surprised at the similarities:

• Venezuela's economy is completely oil based, so when the oil price collapsed several years ago, so did their economy. Our economy is heavily reliant on the mining sector and so when there is trouble in the mining industry, as there has been in recent years, the whole economy suffers. Fortunately, unlike Venezuela, we are not completely a one-trick-pony.
• When oil prices were high the Venezuelan government used the money for extensive social spending. When the oil price dropped they decided to keep spending and so put themselves into a debt crisis. Our government also does an unhealthy amount of social spending and it is putting us in debt. Yes many people have a better quality of life courtesy of the government purse, but if you feed the people today with tomorrow's bread, tomorrow the people will starve.
• The United Socialist Party of Venezuela came to and maintains power not on sound policy and economic principles, but on populist rhetoric and Robin Hood economics. That is the same way the ANC maintains power. Free housing, free electricity, grants and government handouts: people are far more likely to believe according to what pleases the ear than what is true. They don't realise that the magic well of free stuff will eventually run dry.
• Finally, and most importantly, the power in Venezuela is too concentrated. The government does far more than it should ever need to do, even by mainstream centre-left standards today. This is the root of the crisis. In South Africa the government also does far more than it has the right to do. It can't handle all the responsibilities it has taken upon itself, but it is yet seeking more. And worse yet, power within the government is becoming more centralised, with the Zupta faction now controlling the national assembly, the NPA, the judiciary, the public protector and many other institutions. We are on dangerous ground.

I honestly don't think we will reach the point Venezuela has. Even though we are heading in the same direction we are going slower and have sharper breaks in the form of power and influential moderates, who stand up against wannabe dictators. But we can't sit back and relax. Our country is in deep trouble. Unlike Venezuela, we have diagnosed our problems (at least some of them) early. Now we must be quick to act as well.

Another One Bites the Dust

We always knew Public Protector Busisiwe Mkwebane was a Gupta appointee despite her rather pathetic efforts to appear nonpartisan, but finally she has flown her colours out in the open. Of course what I am referring to is her findings released last week regarding Absa and the Reserve Bank. The subject of Mkwebane's investigation was an apartheid era bailout of now Absa-owned Bankorp, but her findings ventured many miles from that mandate.

The core finding is that Absa should pay back the R1.125 billion it benefited from the 1985 bailout of Bankorp. I am all for holding accountable those who have unduly benefited from situations like this, but the shareholders who would be punished today are not the same shareholders who benefited during the apartheid era bailout and takeover. Thus it would be unfair to punish the current shareholders and by now, 3 decades later, it is impossible to track down the actual benefactors, rendering Mkwebane's investigation a waste of time, as the likes of Mbeki, Manuel, Gordhan and Madonsela already knew.

It is not, however, just the wasting of time and resources by our state institutions that we are worried about. The major problem is the capture of yet another chapter 9 institution, especially one so symbolically named the Public Protector. Mkwebane had already revealed her Gupta allegiance by having the office's televisions switched to ANN7 and insinuating that the leaked Gupta emails were fake, but now she is chasing after the first bank that closed the Gupta accounts. Also note that this is in light of a questionable relationship with Gupta-associated, Bell-Pottinger-linked Andile Mngxitama and the Black First Land First movement as well as the fact that Gupta-linked figures have condemned, or even talked publicly about the report, especially the other, more controversial part we are yet to discuss.

Before we get to the climax of this story we need to ask why the public protector is chasing a controversial, almost irrecoverable R1 billion and ignoring the R700 billion stolen by the ANC in the last 20 years. To be short, this simply reeks of favouring special interests.

Finally, we get to the crux of the matter. The public protector has no right to recommend changes to the constitution. Simple as that. Mkwebane completely overstepped the mark when she recommended parliament amend the constitution to change the mandate of the Reserve Bank. First, this is nowhere close to what she was asked to investigate, and second, she would not have the mandate to make the those recommendations even if she was asked. Yet we have these ridiculous findings playing right into the vague, unintepretable radical economic transformation rhetoric, designed purely to draw attention away from state capture.

So in the end, what we have, amongst other things, is another ploy to draw attention away from the Guptas and state capture. But it has, in fact, drawn a whole lot of attention to the capture of yet another state institution, the office of the public protector.

Smoke and Mirrors

South Africa is sitting on a precipice. Not since at least the early 90's, more probably the 1950's have we been so close to falling to a certain doom (noting that in the 50's we did fall.) It seems the ordinary folk of our beloved nation fail to comprehend the precariousness of our position. State capture is far more serious than most believe, in fact, academics have described the related events as a 'soft coup'. We are becoming more and more a dictatorship, a monarchy disguised as a democracy. Yet despite the dire situation we find ourselves in, with a moral-less ruling party, rampant corruption and one family slowly taking control of all our supposedly democratic institutions, far too much of our time, attention and media coverage is devoted to a non-issue: race.

Do not mistake me, I do not refute that this is a sensitive issue, nor seek to undermine the gross injustices of our past, but today's racial issues are but squabbles among siblings compared to the world war of apartheid. Take for example the Helen Zille Twitter row. I can only imagine that great struggle icons like Oliver Tambo and Walter Sisulu, who fought real racism and oppression, would be turning in their graves to see the reaction of their once great organisation to a couple of vague remarks that at a push could branded insensitive. It is frankly ridiculous that Zille's tweets have received exponentially more attention than situations that are actually going to have a real impact on the lives of ordinary South Africans, like the appointment of Gupta-servant Brian Molefe to parliament, or the Gupta take over of the SABC, or Eskom, or who knows how many other state institutions. It's simply a matter of priorities, and ours are all mixed up.

So why do we harp on about race then? Why does every unsavoury interaction between individuals with racial differences become a racist event? Why are hours of conversation time on 702 and other radio stations devoted to discussing this, the least of our worries as a nation? First, like I said, race is a sensitive topic, so racialised news is sensationalist. It grabs our attention and makes us angry. For some reason we want to be angry. It is an unhealthy fetish. The second reason is far more dangerous and builds on the sensationalism of the first: that is that it is a powerful distraction. It is a powerful distraction for Zuma, while he plunges the country into crisis. It is a powerful distraction for the Guptas whilst they systematically take control of our state institutions. It is a powerful distraction for the ANC while it buys time to find a solution to it's lack of moral leadership. It is a powerful tool in diverting our attention from the real dangers we face as a country.

What is most worrying is that people still buy this narrative, despite it having been exposed, most notably through the Bell Pottinger revelations. It reveals a great flaw in our human nature, that we are more likely to believe what we want to be true than what is actually true. It lays bare our inability to think critically and illustrates the lack of access many have to opposing view points. The crisis we need to solve as a country is not a race crisis. It is an education crisis. It is an unemployment crisis. It is a state-capture crisis. It is a governmental over-reach crisis. And ultimately, it is a freedom crisis.

Maimane's not so Big Moment

I am amazed, but not particularly surprised, that the Helen Zille tweet row has carried on for as long as it has, and that so few sensible voices have been prominent in the debate. I've had many thoughts on the issue since my post last week. These are a few.

First off, Zille needs berating for her own foolishness, not because what she said was wrong, but because someone with her experience in both politics and journalism should have foreseen the reaction to her tweets. She knows better than most how the racial propaganda war works in South Africa and has been a victim of it enough to have anticipated her moral lynching.

Zille's moment of naivety, however, by no means justifies the manufactured outrage from those who think only in terms of black and white. The dominant argument remains that Zille defended colonialism and thereby offended millions of South Africans who suffered because of it. It's even gotten to the point where the Black First Land First movement has decided to lay racism charges against her. I believe I sufficiently established the ridiculousness of these claims in my last article, but in case you were still in doubt I will further elaborate.

The now infamous tweet series started with a reference to how Singapore achieved major development by building off what the colonists left behind. The whole idea was how South Africa could emulate that, so the argument was never racial nor a defense of colonialism from the start, but merely about how to achieve development. One should not be surprised, however, at the racialist vultures who were hovering, waiting for any misrepresentable statement to cry racist over. Contrary to one popular argument, Zille did not say that there were good aspects of colonialism. She said that there were good aspects to the legacy of colonialism i.e. what we are left with because of colonialism. One can perfectly reasonably call colonialism abhorrent and evil and simultaneously suggest that there are consequences of colonialism that we can exploit to improve the lives of the people.

To sum it up in one question, Do you believe running water is a good thing, that written language is a good thing, democracy, electricity, modern travel? If yes, then you agree with Mrs Zille. The ANC agrees with her, the EFF, even Black First Land First agree with her. In fact, the ANC's own idea of the Developmental State is the same principle Zille was arguing.

Now, significantly, Zille's tweets are supposedly sufficient reason for her to be axed as premier of the Western Cape. We've already established why this is not the case, but let us try to convince Mmusi Maimane of this too. Apparently this is Maimane's chance to step out of Zille's shadow and show that he is the true leader of the DA by beheading his mentor and predecessor. Of course, this is a tempting opportunity, but it would cost him his integrity. Hopefully Mmusi will not fall into the trap baited by his enemies. So for many it is a question of whether Mmusi Maimane will man up and show that he is the true leader of the DA or stay in the shadow of Zille, but really the question is whether he will give up his integrity for cheap political points.

Storm in a Teacup

In the midst of a political disaster zone, with the social grants crisis reaching it's climax, xenophobia emerging from the dark crevices of society and more corrupt and incompetent so-called politicians being nominated to and defended in parliament, the media, politicians and opinionists of our beloved country decided to release all of hell's fury on Helen Zille in light of some, well, pretty uncontroversial tweets.

This is what the most prominent of the tweets said:

"For those claiming legacy of colonialism was ONLY negative, think of our independent judiciary, transport infrastructure, piped water etc."

Of course what this means is that colonialism was a great thing and we should go back to the days of apartheid, so the hysteria of our radio personalities and twitterati is completely justified. Except that's not at all what she said. Let's break down her argument (luckily she made it in a tweet, so there is not that much analysing to do):

These are the premises:

• Colonialism brought development to Africa, for example, an independent judiciary, transport infrastructure and piped water.
• These examples of development are good things.

This leads her to the conclusion that:

• Some aspects of the colonial legacy are good.

No sober minded person could refute the premises, and the conclusion follows directly from them and so one cannot deny that either. Yet almost every analyst has twisted her statement to portray  her as a racist, pro-apartheid colonialism-defender. Even her own party has distanced itself from her. To refute these claims let's look at what she does not do:

• Justify the oppression under colonial rule.
• Justify land theft or slavery or any other negative aspects assosciated with colonialism.
• Justify colonialism at all, or even give an opinion on whether it was good or bad as a whole.
• Praise colonists.
• Even mention apartheid! Yet Zille, an anti-apartheid activist back in the day, is being accused of being pro-apartheid.
• Say anything racist, unless you believe facts can be racist, but even then it's a far stretch.

Acknowledging that some good came out of colonialism does not imply that colonialism as a whole is good. And she has made this known. My favourite argument by these hysterical Zille-phobes is the analogy with Nazism. "So if there are good things that come out of things that are, on the whole bad," one might say, "then there were good things about Nazism too!" Actually yes. The Nazis brought an end to the great depression. Do you then mean to imply that the end of the great depression was a bad thing? The notion is utterly ridiculous. The end of the great depression was a good, whether or not the Nazis killed 6 million Jews. Furthermore it does not justify the holocaust or any of the other evil acts perpetrated by the Nazis, just as saying that the development brought about by colonialism is good does not justify the evil done under that ideology.

Absolutism. The idea that if something or someone is part bad they must be all bad. That is what it boils down to. It is a fallacy, but it has become very prominent in the world today, especially between opposing ends of the political spectrum. Look at Donald Trump for example. According to InfoWars he can do nothing wrong, but according to CNN he can do nothing right. But the fact is, that whether you support him or not, you can, and should, acknowledge that he does both good and bad. And it is the same with almost everything.

My biggest worry with this matter is that people don't have the ability to think for themselves. Many latch on to what Fikile Mbalula or Eusebius McKaiser say and take that as the truth without analysing the story themselves. And it is this lack of critical thinking that keeps corrupt and incompetent leaders like Jacob Zuma and Bathabile Dlamini in power. Hopefully more and more of us can learn to think critically, to create a better South Africa.

Preparing for the Budget Speech

It's a good thing that Pravin Gordhan is not one who is easily rattled. At least he doesn't show it if he is. Very few people in any job could be in a more stressful situation than our finance minister is in now. Multiple branches of the ANC are calling for his head, a rumoured potential replacement has been nominated for parliament, and he is preparing for the most important public event on his calendar, the budget speech, which needs to balance powerful conflicting interests.

With the ANC under pressure and policy tide turning toward populism as a release valve on the one hand, and an ailing economy in desperate need of some freedom therapy on the other, Gordhan has his work cut out. He is walking a tight rope. What we want him to say is this: "We are privatising the SOEs, phasing out state welfare and cutting taxes." This would catch the ears of the business world and spark a new era of economic growth. The rand would literally jump in value, but he would certainly lose his job. The ANC Youth League, Women's League and the MKTV would be joined by a host of more conservative ANC structures and members in calling for his head and Zuma would garner more than enough support to bring down the axe. But it's nice to fantacise about a budget that would actually help the economy.

To win back his detractors would require exactly the opposite of what we need. Increase taxes on the wealthy, more welfare and tons of investment in black business. However Gordhan is both intelligent and moral, at least when standing next to many of his ANC comrades, so there is no chance this will happen either. Besides, I doubt he could care less about what Collen Maine and company have to say. No exponents of this line of thinking have ever shown any understanding of economics, or even the ability to predict the consequences of ones actions. Unfortunately these people can say whatever they like, since they are not in a position to make the decisions and so will never be held accountable. No wonder Gordhan ignores them.

What is likely to happen is this: subtle tax increases attempting to raise tax income without driving away investment and subtle spending cuts in an attempt to reduce costs without sending the populists into a state of outrage. This is why he left big issues like income tax and SOEs alone last year and will probably do so again this year while focusing on things like sugar and sin taxes and cutting down on wasteful expenditure.

So I have pretty low expectations for this budget speech. I don't see anything radical happening, for better or worse. Gordhan, for the sake of keeping his job, without ruining the economy, will probably just deliver more of the same. But I hope I'm wrong.