South Africa at a Tipping Point

Temba Nolutshungu is correct in arguing that “South Africa is at a critical stage of its development.” However, the reasons why our “bright post-1994 future” is “disintegrating around us” are not the reasons he advances and the recommendations he makes likely to get us out of that morass. Indeed, they are more likely to exacerbate inequalities and make the dream of development with equality less and less likely. The fact that other African countries have overtaken South Africa in implementing free market economic policies is the incorrect measure of success unless one is a free market dogmatist. Zambia, Uganda, Kenya, Namibia, and Ghana may have overtaken SA on the economic freedom index but in doing so, they have exaccerbated the gaps between the haves and the have-nots in their society. Namibia, for example, enjoys the dubious honour of being the country second to South Africa, of having the largest component of health care delivered through the private sector in the world. The two tier systems of private health care for the rich and public health care for the rest, as we know so well in South Africa, is hugely inefficient, inequitable, unsustainable, and contrary to the commitment to universal health care coverage being promoted by the World Health Organisation. Life is not better just because there is more opportunity to make a profit – what makes life better is a better quality of life. Ask ordinary Ghanaians if the massive profits flowing in from the extractive industries to the economy are making their lives better and you will hear a resounding NO. High expectations, yes, precisely because of the spurious promises made by free marketeers like Nolutshungu, but no change on the ground in the daily struggles they face to make ends meet. It is somewhat mischievous to imply that “economically emancipating policies” are somehow going to finally dispense with apartheid-era “discriminatory laws and actions.” If anything, the so-called economic emancipation of the new black elite has simply changed the face of the economic exploitation of the black majority – it was black capitalists who left black miners at the Aurora mines starving and destitute while they dragged their heels in paying workers out their entitlements – entitlements which, in Nolutshungu’s perspective, would be impediments to the boss’s freedoms to run the mines as profitably as they could. Nolutshungu promises us “… high economic growth, full employment, significantly reduced poverty, all taking place in a harmonious, cooperative environment” through a set of proposed actions. However, the actions he lists are ones for which there is no reliable evidence. Indeed, there is plenty evidence to the contrary. For example, removing “all barriers to entry into the competitive private provision of goods and services currently supplied by public enterprises” has been the recipe for the fundamental crises in health systems around the world. Colombia, touted as having high rates of health care coverage, has a system which effectively denies poor people access to basic health care needs. The call to let funding “follow the students in government schools on a capitation basis” is disingenuous. South African housing policy post 1994 did exactly the same – through housing subsidies to individuals who would go out to the market to get their houses – advice provided to the State by the World Bank at its free marketeers. Ask any of the estimated 12 million people still waiting for decent homes if Nolutshungu’s advice has been helpful. As much as glassy-eyed ideologues like Nolutshungu proclaim it, the market is not a foolproof mechanism to achieve development – in fact, in most contexts, it is a wholly bad manner to distribute public goods. In particular, the idea that public-private partnerships are a panacea for the crisis in our health system does not address the fundamental drivers of the crisis – precisely the inherent inefficiencies in private provision and the failure to prioritise equity in the system as a whole. Lastly, the notion of “tax exemptions, reduced taxes and removal of restrictive labour laws and regulations” being likely to attract investment and bring about accelerated growth is a widely held fiction that is not based on any evidence. The mantra that labour laws are ‘restrictive’ is simply a tired piece of rhetoric which does not stand up to the even the slimmest of examinations. There is a growing civil society movement that is arguing that we need Tax Justice, not tax exemptions; we need public leadership, not private appropriation; and that the activities of the private sector should not be described as ‘economy-enriching’ but are better characterised entirely geared to private profit. Whether private profit enriches the economy depends on the whether the state plays its developmental role effectively, through, for example, fair and effective taxation, rather than choosing to “stand back and make way for private companies.” It is, indeed, a mystery to me why SANGONET should even entertain such nonsense on its website, since the arguments presented are wholly at odds with the ethos and values of NGO’s and Civil Society. In one thing I agree with Nolutshungu – if we get it right to ensure a state that addresses the needs of “people desperate for shelter, food, work and dignity”, the benefits will, indeed, “be dramatic.” However, it is how we get there that I, along with the People’s Health Movement and millions of other South Africans fundamentally disagree with Nolutshungu’s evidence-free, ideologically-driven and hackneyed solutions. Leslie London, People’s Health Movement