On expropriation, let’s not be glad to settle for half a loaf

What has our burning topic du jour, expropriation without compensation, to do with the price of bread? Or, less obviously, with the cost of bread-making machines?

Clearly, if the EFF’s fantastical policy prescriptions of wholesale property confiscations, state ownership of banks and the destruction of the private sector came to pass, maize and related agri-production would collapse. Bread would have to be imported but, given the burden on the fiscus as sole custodian of all land, how it would be paid for is left unsaid.

But, of course, inconvenient facts and contradictory data are irrelevant in the zealous minds of true believers in a political cause. To fervently believe in impossible things, blind faith and “unbelief” are sign-on requirements.

Back in 1951, US philosopher Eric Hoffer published a masterful book, The True Believer, on this phenomenon, which — facts notwithstanding — has many followers in agririch South Africa. He notes: “All mass movements strive to interpose a fact-proof screen between the faithful and the realities of the world. The true believer cannot be frightened by danger nor disheartened by obstacles, nor baffled by contradictions, because he denies their existence.”

In her book on EFF leader Julius Malema, Fiona Forde first locates her subject, An Inconvenient Youth, in Venezuela, worshipping at the political altar of his hero, Hugo Chávez.

Only last week, on the subject of staple prices, and eight years after the Forde-Malema South American encounter, a rigged presidential poll was called by Chávez’s successor, Nicolás Maduro. He and his late predecessor implemented an EFF-style programme of uncosted giveaways, at war with private production or even basic economics, reducing what was once the richest country in the hemisphere to beggary.

Inflation is recorded at 13 000%, the world’s highest, and prices of basic foods, mostly now imported, double every month. But eventually fact-free economics wearies the truest of believers, and very few bothered even to vote last weekend.

One fed-up Chavista, Carlos Gonzales, 64, who abstained, put a price on his disillusion.

“My monthly pension is only enough to buy one frozen chicken,” he told the poll reporter for The Times of

London.

Cyril Ramaphosa heads a party with no shortage of fervent true believers in EFF

Chávez style populism. But the ANC also houses some economically savvy leaders who inhabit neither a destructive war zone at odds with reality nor the la-la land of magical realism. Both factions emerged with a

“win” from last weekend’s land summit.

In Parliament this week, DA leader Mmusi Maimane commended Ramaphosa for the ANC’s “complete about-turn” on expropriation without compensation, noting that the government “now plans to [implement] it within the confines of the current constitution”.

But this leads, then, to the price of bread-making machines, assuming you either need or can afford one.

Tim Harford — “undercover economist” at the Financial Times, reminded readers recently of an experiment by two pioneers of behavioural economics, Amos Tversky and Itamar Simonson. A company selling bread-making machines doubled its sales with a simple trick: next to a “perfectly adequate” $150 breadmaker, it placed a $250 breadmaker with a “long list of bewildering extra functions”. As he recounts: “Customers think to themselves: ‘I don’t need all that extra nonsense. The cheaper, simpler breadmaker is the better option.’ ” The original breadmaker flew off the shelves.

Harford suggested that UK voters, bewildered by Brexit options, might plump for an easy but damaging outcome.

It’s early days, back here, on how the ANC will square the expropriation circle. But here’s an early question without a clear answer: are we so relieved that our sacred constitution will not be amended that we might buy another means of achieving a lesser, but also undesirable, outcome? Too soon to panic — but certainly not to entirely relax either.

But eventually fact-free economics wearies the truest of believers

Leon is a former DA leader and former South African ambassador to Argentina