It’s the economy, Cyril!
Our business-as-usual approach to economic growth is now outdated
SOUTH Africa’s economy is not growing fast enough to alleviate poverty, and sadly, the governing elites have run out of ideas about how to tackle the economic crisis we find ourselves in.
As if this isn’t painful enough, the government inexplicably increased VAT, adding to the horrific economic indicators that signal one of the worst economic crises we have ever had to face. Because of the euphoria of Ramaphosa’s administration, very few people analysed the brutality of this action.
For the recovery of this economy, the then minister of finance failed to link the VAT increase to the reckless policy uncertainty of the last decade, including the premature implementation of free higher education by the previous president, who used this crucial resolution for political expediency and cheap popularity.
The public were clearly not the only ones shocked at the VAT increase. Cosatu and the SACP as usual were the last to know and seemed to be taken aback that, in the face of 55% of the population living on the bread line, this was the best thing that the government could think of in a pre-election year and pronounce as the ANC’s gift to the starving masses.
Quite frankly, the economic indicators are not looking good. The constant horrific fuel increases are another indicator that underline the pressure that the population is under.
Once you add the VAT increase to this, all the efforts to zero-rate items only help to tinker with the vicious effect this must have on the general population. It’s actually evil that we’ve allowed this to happen. All indicators are obviously the result of 10 years of economic ignorance and neglect by the former Zuma administration.
It is difficult to ignore the heavy price we are all still going to pay for Zuma’s plunder over the last decade. And of course he is none the wiser, still singing and dancing as if nothing was wrong.
It’s time we faced the fact that the ANC seems not to have a concrete plan to reverse Zuma’s painful economic legacy. While we were pinning our hopes on economic growth, it seems all we are good at is seeing the growth targets being revised instead of these being met.
With under 1% growth expected in the foreseeable future, we can forget about making a dent in the unemployment rate, now sitting at almost 28% – another terrible economic indicator that is totally unacceptable.
Meanwhile all the measures that the ANC may have discussed at its Nasrec conference about the so-called economic stimulus are lost in translation as the party faces an election and is forced to enter the fray with an aggressive and agile EFF that has stolen the initiative on land reform from it.
The ANC is wearing the land debate like an ill-fitting suit – it’s clear that it’s not its original idea, as leaders contradict each other about how this policy will be implemented.
It’s actually sad what has happened to the think-tank of the ANC to be led by the EFF on such a major issue.
Will the land expropriation solve the economic trouble that is signalled by yet another horrible indicator – the recession? Or is the economy sounding its own warning shot ahead of the blind implementation of land reform?
Whatever the answer to this is, it’s clear that the ANC has no plan of any significance, but we keep recycling policy positions that have not worked well over the last 24 years.
So, what needs to be done?
It’s sad to conclude that the ANC seems to be running out of ideas to turn this economy around. This does not for a minute suggest that nothing was done over the last 24 years.
Coalition governments may well be the answer to our problems. To hope by some miracle the policies that have been recycled since 1994 will suddenly produce results is truly naive.
The indicators that see our people starve and wallow in unemployment must be taken seriously as a terrible scorecard for the progressive movement, including the moribund SACP and weak Cosatu, both of whom have failed to make their seats at the governing table count. If anything, they made things worse as they cushioned the governing party from a revolt by workers who bear the brunt of most of these indicators.
I don’t have all the answers, but believe that our business-as-usual approach to the growth of our economy has reached its sell-by date. I am watching the Ramaphosa presidency with great interest.
What is needed is fundamental change of the structure of the economy. This will require state activism that is sorely lacking at the moment.
This can happen only with the fundamental change of guard where no one party can keep feeding us recycled economic policy junk. It’s clear that we need a joint effort that will focus on results that are measurable and will result in a truly better life for all.
This can only happen with the change of guard where no one party can keep feeding us recycled economic policy junk