A great deal of noise is being made about “white monopoly capitalism” and this is quite puzzling as there is no such thing.

By definition a monopoly is a market structure in which you have one supplier. This is as opposed to a monopsony in which there is only one buyer. Economics 101, dear Jacob. 

Monopolies tend to be state-owned or run. For example, a system of justice to be dispensed by the state on behalf of the citizens is a monopoly. We can’t each have our own set of laws. Only the state, through the judiciary, can dispense justice.

The issuing of identity cards, passports, birth and death certificates and so on is necessarily part of a state monopoly as is the raising of military forces. 

Societies based on free market principles develop sophisticated anti-trust legislation which aims to deter economic actors from becoming too powerful in their particular markets thus becoming, or wishing to become, monopolists. 

This reduces competition and enables them to have greater control of their market –whatever it might be – and greater freedom to control prices. All free market economies have such restrictions so as to protect the public from monopolistic abuse.

Another model is the old communist empire, the USSR, in which the state owned everything. It was both a monopoly (the state was the sole supplier) and a monopsony (the state was the sole buyer). In this model there was little or no freedom of choice.

You could shop only at state-owned stores; everyone worked for the state in occupations chosen by the state at wages and salaries determined by the state. You lived in accommodation chosen by and provided by the state.   

History is so replete with examples of the superiority of the market based model over the collectivist structure that it is hardly worth enumerating any of them here. Suffice it to say that there is scant evidence of citizens of market economies escaping to communist paradises. The traffic has always been the other way.

To return to white monopoly capitalism, let us first accept that there are today no racial barriers to entry to the market for goods and services either as suppliers or consumers. South Koreans, Japanese, Indians, Chinese, Indonesians, Philippinos, Africans, Arabs, Hispanics and so on are all participants, both as suppliers and consumers.

Whites in free market economies do not sit about in secret meetings plotting how to deny people of other colours entry to the market. For example, the vast bulk of the world’s finished textiles emanates from Far Eastern economies and is consumed to a large degree in western, multi-racial economies.

It has always been my view that the US sanctions against Cuba, originally by the Kennedy administration, were self-defeating. Surely engagement through trade, exchange of diplomats, competing in sports and exposure to each other’s cultures is a far more effective means of persuading those whom you believe to be on the wrong path than by isolating them?

Writing in the Wall Street Journal while I was a Sloan Fellow at Princeton in 1978 I made this same argument about South Africa, suggesting that the western nations would have greater leverage in persuading the architects of apartheid of the error of their ways if they engaged with them instead of isolating them.

The unification of Germany and the concomitant collapse of Russia’s communist empire was a turning point in world history and, in particular, in the history of economics. This cataclysmic shift was proof, if any was needed, that the vast majority of people prefer freedom to bondage, they wish to able to make their own choices, to have freedom of movement, of speech and of association.

Nations who base their relations on free market principles in a democratic model which protects citizens against abuse are far more likely to prosper than are those based on collectivism in which the state dictates to the citizens where they may live, work, play, travel (or not) and the state owns everything.

As we know, under collectivist systems there is no such concept as private property. Now, as we have seen with the disastrous outcomes inflicted on our neighbour, Zimbabwe, by the senile Mugabe, when private property principles are abandoned society collapses.

From an agricultural powerhouse, admired world-wide, Zimbabwe has deteriorated into a miserable basket case from which millions of its best people have fled, many to South Africa. This was the direct result of the seizure of productive agricultural land from white farmers by the state and the mob which it encouraged. 

Thus unimaginable and ruinous inflation in the billions of percentile was visited upon poor Zimbabwe along with utter destruction of the currency and seemingly irreversible damage to the nation’s infrastructure and, in particular, it agronomy.

Sadly there are today strong hints of Mugabe’s economic insanity in our country with even a respected and usually level headed columnist such as Andile Khumalo of Business Times writing: “Perhaps it (white business rigging BEE deals) is unique to an economy in which the majority of people don’t control the means of production and, even with political power, continue to be tenants on their own land.”

Now come on, Andile, you are an investment manager. Surely you know that the US agronomy is far and away the most dominant in the world, building massive stockpiles annually, while feeding 330m of the most well-fed people in history plus exporting (and donating) billions upon billions worth of food to the rest of the world.  . 

And Andile, old chap, less than 2% of the US workforce is on the land. You are confused between the subsistence model of old tribal and homeland farming and modern scientific, automated and computerised agronomy where a degree in agricultural science rather than a strong back is the first requirement.

And then, of course, these big, sophisticated farming operations are highly technological and capital, not labour, intensive. Believe me, if we follow the Mugabe model and dispossess our modern farmers (many, but by no means all, white) we will be doomed.

Remember too that most farmers are usually indebted to their bankers and must be shrewd managers and sophisticated business people in order to survive.

What is even more disturbing is that one of our greatest South Africans, former Supreme Court Deputy Chief Justice, Dikgang Moseneke, has come out in favour of placing land at the centre of our socio-political problems. This esteemed jurist, whom I admire deeply, seems also unable to remember that the bulk of those who were granted land chose instead to take the money.

It is sad to see such able minds falling for the trap of the land fantasy: just dish out land and all will be solved. What hogwash. As indicated above, in a modern economy it takes less than 2% of the population to work the land so as to feed the people plus give away to the world’s poor and earn billions in exports. 

The other 98% are not idle but for the 6% (in the USA for example) without work either because they do not wish to work, and there are many of this ilk, they live in the wrong area or they are simply unlucky or disabled or they prefer living on welfare. As Matthew wrote: “...you always have the poor with you...”

In order to care for the poor, society must create wealth, a portion of which can be transferred to the less fortunate among us. But here the balance must be found between mercy and the need to foster a work ethic and a sense of personal responsibility for oneself and one’s dependants.

Ronald Reagan, one of America’s finest presidents understood well how wealth was created: “Entrepreneurs and their small enterprises,” he wrote, “are responsible for almost all the economic growth in the United States.”

There is no lack of entrepreneurial talent and desire among South Africans of all races. Everything possible must be done to encourage them and, in particular, the previously disadvantaged among them. They don’t need land. They need skills, opportunities, encouragement and backing. 

Government can help but not this crowd of hustlers now in power. They couldn’t care less about the poor or the ambitious young seeking a break in life to begin climbing the economic ladder. Our president and his cronies seek only personal enrichment combined with immunity for their past transgressions.

Zuma does not rise in the morning to serve the people. He rises strictly to serve his own interests. Without moral, trustworthy and enlightened leadership this nation will continue to flounder and it has nothing to do with the myth of white monopoly capitalism.