JAUNDICED EYE
When our leaders proclaim “hope” to be our bounden patriotic duty, one can be assured that the country is really deep in the dwang.
But as South Africa edges closer to economic disaster and an empty fiscus, hope it seems, has become the “must-have” emotion. To be followed, no doubt, by faith, as things get even worse. And charity — international, of course — when they finally collapse.
It was President Cyril Ramaphosa who earlier this year kicked off the hope crusade. In the February state of the nation address, he informed us that “our people … are much more hopeful about a better tomorrow”. And, he assured us, this hope “is not baseless … it is grounded on the progress being made”.
Business is doing its bit to help. On the conference circuit and in inspirational emails to their employees, a number of corporate leaders, like Stephen Koseff of Investec and Adrian Gore of Discovery, are zealous hope peddlers.
Investec's Stephen Koseff says we must be optimistic: “You have to have a can-do attitude. You have to give people hope.”
Discovery's Adrian Gore expounds an entire theory around hope, what is called the optimism paradox. The paradox is “the gap between private hope and public despair” and, apparently, this is an “intriguing idiosyncrasy explained by behavioural economics”.
In the face of this week’s truly awful unemployment figures — youth unemployment nudging 50% — Employment and Labour Minister Thulas Nxesi exhorted South Africans to “not give up hope”. The government had “a number of initiatives” in hand to secure investment and grow employment, he said comfortingly.
Of course, there is nothing innately wrong with all these attempts to kindle hope. Despair can be paralysing and South Africans, manic-depressives that we en bloc are, have been on a deep and prolonged downer, lasting at least a decade. (On the other hand, if the Springboks win the Rugby World Cup at the weekend, national spirits will soar. Sedation will be required.)
But let’s not be simplistic about being optimistic. Hope peddlers can be more dangerous than dope peddlers — entire nations can become addicted to dreams instead of facing up to reality. Common sense, thorough planning and competent execution beat hope, optimism and stout hearts, nine times out of ten.
Some in government get that. As Tito Mboweni said this week, presenting the Medium-Term Budget Policy Statement (MTBPS), “Hope is good but it is not a strategy.”
Unfortunately for us, hope might be all we have. Although Mboweni breezily admits that “the food cupboards are almost bare”, there're few signs of a coherent government strategy to be gleaned from the MTBPS.
Yes, an Integrated Resources Plan will be gazetted, an Infrastructure Fund is being rolled out, Cabinet has instructed the bureaucrats to accelerate their efforts around broadband licensing, and we are drawing lessons from the fast-growing economises of sub-Saharan Africa.
But virtually the only concrete achievement that Mboweni could dredge up was that the visa regime for visitors has been “greatly simplified”. It's an unfortunate example to spotlight, since the only thing it illustrates is the African National Congress government’s propensity to shoot itself in the foot and then perversely let the wound go vrot.
Zuma’s administration imposed onerous visa regulations — in the face of the dire warnings from the travel industry — as far back as 2014. In the course of that year, the new regulations cost SA almost a R1bn in lost direct -spend by tourists.
Shaken, in 2015 the government promised an “urgent review” to rectify the debacle. So, it’s taken the ANC four years to correct an obvious blunder it had made, one which could have been solved at the stroke of a presidential pen.
Oh, I forget. The government also plans to improve the ease of doing business. Not a moment too soon: the World Bank’s annual ease of doing business survey shows that SA has steadily dropped 52 positions over the past 11 years, from a high of 32nd to 84th, out of 190 nations. Again, improving the ease of doing business requires simple policies that are relatively easy to implement but, as usual, there is no action in sight.
To his credit, Mboweni doesn't try to hide the seriousness of the problem. In fact, he seems to take some glee in it.
The national debt, he told Parliament, now exceeds R3 trillion and will rise to R4.5 trillion, at least, in the next three years.
That, says Mboweni, is “a serious position to be in”. Worse, it is “unsustainable”, “clearly, we need to do things differently”, “there is no status quo option!”, and “the consequences of not acting now would be grave”.
Then, as is the ANC’s wont, he outlines no intended response. Any action to address the problem is postponed to next year’s Budget.
On the issues of Eskom, South African Airways (SAA) and other state-owned candidates for bankruptcy, there were only platitudes. “Eskom is a business and should be run that way.” With SAA, “operational and government interventions are required urgently!”, “How long are we going to be on this flight path? Forever? I think not.”
As regards the national disease of non-payment for services, including the e-tolls impasse in Gauteng, the government has decided that the solution is to appeal to our better natures: “I urge the nation to please pay your bills.” No doubt that will bring rolling in the R37bn that was owing to Eskom, as at June 2019, by delinquent users who, nevertheless, remain connected to the grid.
The proposed National Health Service, which the government is pushing ahead with despite “indicative costs” of an extra R33bn a year from 2025/26, rising to R50bn (in 2019 rands) in 2030, drew only a passing mention. The ministers of Finance and Health, and their respective departments, are in “ongoing discussions”, Mboweni said tersely.
A Treasury document attached to the MTBPS was more honest. “However, given the macroeconomic and fiscal outlook, the estimates to roll out NHI that were published in the NHI Green Paper in 2011 and White Paper in 2017 are no longer affordable.”
That’s not to say that Mboweni’s MTBPS was a complete waste of time. He at least provided the opposition with some wonderful ammunition with which to take aim at a bloated and cosseted public service.
He revealed that the average government wage has risen by 66% in the past decade and that 29,000 public servants now earn more than R1m a year. Adjusting for inflation, that’s double the number in 2006/2007 and — since SARS data shows a total of 148,000 taxpayers earning over a million a year — it means that 20% of SA’s rand millionaires work for the state.
It is those statistics that encapsulate the kernel of SA’s problem. The ANC has added massively to the state payroll and these are the people the ANC’s leaders rely on to keep them in office.
For an ANC government to now do what it knows it must — to slash state employment — would be to slit its own throat.
That’s not going to happen. In the meanwhile, all together now: One! Two! Three! Hope!
Follow WSM on Twitter @TheJaundicedEye
Mboweni speech:
http://www.treasury.gov.za/documents/mtbps/2019/speech/speech.pdf
Treasury document:
http://www.treasury.gov.za/documents/mtbps/2019/mtbps/FullMTBPS.pdf
