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.

A Symptom of Chronic Stupidity

Free Stuff!

That caught your attention, didn't it? The power of the word "free" is astounding. It always gets us excited even though our most basic intuitions tell us there must be catch. As South Africans we keep falling for this trap, free housing, free electricity, free education and now free health care. When will we realise that nothing is ever free?

Away from the State Capture vs White Monopoly Capital battle which is both capturing and monopolising the headlines, news regarding the progress of the NHI (National Health Insurance) has managed to attract some attention, though certainly not enough. For those who have no idea what I'm talking about, the ANC has big plans to create a national, single payer healthcare system similar to Obamacare, or the UK's NHS. The goal is for it to be implemented by 2025, but it has just popped up in the headlines because a couple of milestones in the planning stage have been hit.

This system spells disaster for our country. I know there are many who admire other countries' national healthcare systems and I know that there are many South Africans who are proponents of the NHI because they want to see universal access to quality health care. The foremost criticism of those who oppose the NHI is that they supposedly don't want such. I will say now that I am completely in favour of universal access to quality health care, and it is for that very reason that I oppose the NHI. I admire the intentions of those who expect it to be a great help to the poor, but the road to hell is paved with good intentions, and I am not interested in living in a socialist hell. The NHI is just another brick in that road.

My biggest concerns are the moral issues regarding a government-administered single-payer health system, but first let's look at the practicalities. In terms of affordability, well, it just isn't affordable. We already have a shrinking economy, too much debt and high taxes. There is simply nowhere to pull the R100 billion from without causing extensive damage to our fragile economy. The immediate response from the short-sighted is "Tax the rich!" but the more we tax tax the rich, the faster they are going to leave sunny, socialist South Africa for greener pastures overseas, further hampering our ability to provide access to quality healthcare. Then we have a problem with lack of resources. We have neither the infrastructure nor the human resources, i.e. doctors, to bring the healthcare standards for everyone up to the standards of the current private sector, so in spite of the huge price tag, the standard of health care will improve only marginally for poor, but take a massive nose-dive for the rich. And no, there is no opt-out option for the NHI. Everyone is part of it. So the net result of this legislation will be a mass exodus of educated, skilled middle-class systems, to countries where they can obtain their own affordable quality healthcare.

One of the reasons healthcare is so expensive is because the healthcare profession is like an exclusive club. There are many, many capable, aspiring doctors who cannot get into medical school because of arbitrary and meaningless selection processes and lack of space, all while Blade Nzimande brags about blocking the building of a private medical school, which could provide us with many more doctors. Then there are also all sorts of unnecessary government restrictions that make access to affordable medicine impossible. Government needs to cut a whole lot of red tape, and the cost of healthcare will come down significantly.

And now to the moral issue. The government simply does not have the right to interfere with private citizens choices regarding healthcare, health insurance or anything related. It does not have the right to steal from the rich to subsidize the poor in this regard. Health care is not a right. Health care is a service and one cannot have the right to the services of another person. A baker can expect to bake for whom he wants to bake and a painter can expect to paint for whom he wants to paint, but doctors and nurses, who invest thousands of hours and hundreds of thousands of rands into their education must provide their services to whom the government dictates? We cannot make slaves of our healthcare professionals any more than we can make slaves of anyone else.

This post is already getting long and I have only just touched on some issues. Please comment if you want more information regarding any of points discussed. In conclusion, it is not more forceful redistribution that we need, but a growing economy, a free economy, that will allow people to access quality healthcare for themselves. Yes, I believe everyone should have access to quality healthcare, but it is not the governments responsibility to provide it.

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.