17 February, 2012

Does the Zuma Administration Get It?

by Hussein Solomon

I was about 10 years old when, walking down a street I stopped to admire a luxury sedan. My dad told me that if I wanted it, I would have to work hard at school, do really well at university, get a well-paying job and save for that car of my dreams. So, at an early age I was taught to connect my objectives with the means to get them.

As simple as this is, I do not believe that our government actually understands the connection between objective, means and capacity. Recent newspaper reports suggest that the Zuma administration is enamoured of the Chinese model of a state active in the economy. This model is characterised as `state capitalism’ (leave aside the obvious contradiction in this phrase) and is in line with the government’s notions of being a ‘developmental state’. The government hopes that such an approach would be a catalyst for economic growth, generating a magic five million jobs by 2020.

What are President Zuma, his cabinet ministers and advisers smoking? Do they really believe that China and South Africa are comparable? Let us start with the obvious: China is not a democracy and the state deals harshly with strike action. Can one imagine Zuma taking a harsh line against striking workers when he is reliant on COSATU, amongst other constituencies, to secure a second term? Indeed, right now neither the government nor COSATU boss Zwelinzima Vavi seem able to get striking teachers back into the classrooms in the Eastern Cape.

Second, for the state to play such an interventionist role in the economy suggests that the state has the necessary capacity – human and financial resources. The number of qualified audits government departments have received and the fact that despite being well into the school term, seventy per cent of the country’s public schools lack important workbooks suggest that government lacks the human and technical resources and skill sets to play this more expansive role.

China also emphasised infrastructural development and had the necessary financial resources to back it up. South Africans do not have the savings culture of their Asian counterparts. This raises the question of where the funding for this infrastructural development will come from at a time when the global economy is in the doldrums. Incidentally, the latter point also makes the possibility of creating five million jobs by 2020 extremely unrealistic.

Finally there is the issue of endemic state corruption. A more interventionist state will only create more possibilities for well-connected tenderpreneurs to fleece government coffers (and ultimately South African taxpayers) while the government provides citizens with more rhetoric – pipedreams unconnected to the harsh realities. Unless more rational and realistic thinking takes place in government, and objectives are linked to means and capacity, I fear our slide to the bottom will gather momentum!

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