LET’S EM­BRACE THESE P-WORDS

Financial Mail - - BETWEEN THE CHAINS - @Sikonathim mantshantshas@fm.co.za

Those who hold po­lit­i­cal power in SA, and far too many of their sup­port­ers, are still drunk with ro­man­tic ideas about so­cial­ism and com­mu­nism. Even those who pro­claim them­selves as lead­ers of so­ci­ety have bla­tantly re­fused to, or are un­able to, em­brace the real world in which we all live. This is par­tic­u­larly so when it comes to in­ves­ti­gat­ing the best in­stru­ments for de­liv­er­ing that so-elu­sive “bet­ter life for all”.

But it would seem the many op­por­tu­ni­ties to learn and study the best pos­si­ble mech­a­nisms have passed our lot by, un­no­ticed. These es­teemed lead­ers have re­fused to ac­knowl­edge the ben­e­fits of the two im­por­tant terms that can make life com­fort­able and de­liver plenty for their fol­low­ers. “Profit” is the first tenet that the peo­ple must em­brace with great en­thu­si­asm. The sec­ond is “pri­vati­sa­tion”. In the SA con­text at this junc­ture, pri­vati­sa­tion is more ur­gent than ever.

At 44%, the real un­em­ploy­ment rate — which in­cludes what is termed “dis­cour­aged work­seek­ers” — is at cri­sis level. Of course, this num­ber is too em­bar­rass­ing for gov­ern­ment to ac­knowl­edge, so it recog­nises the “of­fi­cial” rate of al­most 28%, which is still much higher than in any com­pa­ra­ble econ­omy.

This stub­bornly high un­em­ploy­ment, which­ever def­i­ni­tion you choose, is a re­sult of the fail­ure of the choices we have made as a peo­ple. Yearly, we throw bil­lions in much-needed re­sources into com­pa­nies that, un­der the con­trol of the state, will never be any­thing other than a waste­ful drain on those re­sources.

Last week we fo­cused on SAA, but that is only one of far too many such com­pa­nies whose job is only to en­rich the con­nected few.

The world is full of great ex­am­ples that are ev­er­ef­fi­cient at free­ing hu­man po­ten­tial. Of the ma­jor eco­nomic sys­tems that have been em­ployed, the best that has de­liv­ered the goods is free-mar­ket cap­i­tal­ism. At the cen­tre of this is pri­vate ini­tia­tive, where the groups of in­di­vid­u­als con­cerned have to each per­form and de­liver ac­cord­ing to their abil­i­ties.

The re­ward for these ef­forts is profit for the pri­vate en­tre­pre­neur, from which he pays taxes to the state to dis­trib­ute ac­cord­ing to the needs of those of lim­ited abil­i­ties or cir­cum­stances.

But the ba­sic and fun­da­men­tal fact of life is that only prof­its pro­vide the tax ben­e­fits to be dis­trib­uted to the poor. No amount of ro­man­tic the­ory about any other sys­tem has proven this re­al­ity a lie.

For “the peo­ple to share”, there must first be some­thing to share. And that some­thing is tax money levied on pri­vate profit. After rack­ing up their an­nual losses, the worst of our state-owned com­pa­nies are them­selves bailed out by tax money. Only profit de­liv­ers.

It should be the duty of ev­ery cit­i­zen — re­gard­less of their eco­nomic sta­tion in life — to pur­sue and em­brace profit. Big and small.

Re­leas­ing po­ten­tial

In the real world, any pro­gres­sive gov­ern­ment’s duty should be to cre­ate a con­ducive en­vi­ron­ment in which to re­lease the po­ten­tial of ev­ery man and woman to pur­sue emo­tional and ma­te­rial suc­cess in ev­ery le­gal way pos­si­ble. And for ev­ery man and woman — col­lec­tively and in­di­vid­u­ally — to em­ploy their agency to the max­i­mum of their abil­i­ties.

The prob­lem, how­ever, with a suc­cess­ful and in­de­pen­dent cit­i­zenry is the in­abil­ity of the state to con­trol it. The power-hun­gry politi­cians we have cho­sen have falsely turned profit and pri­vati­sa­tion into dirty swear words, all for the sake of their own self­ish per­sonal power over the gullible peo­ple.

This is the kind of politi­cian we should never have any­where near the levers of state power. The ser­vant leader should ad­vance the real in­ter­est of the peo­ple with­out cov­et­ing per­sonal fame and power.

It should be the duty of ev­ery cit­i­zen, re­gard­less of eco­nomic sta­tion, to pur­sue and em­brace profit

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