It’s the Economy, Stupid

20 July 2015

Note to Editors: The following remarks were made by the DA Leader, Mmusi Maimane MP, at Rhodes University, Grahamstown, at the launch of “How South Africa Works” by Greg Mills and Jeffrey Herbst. 

Good evening,

It’s a great privilege to be able to speak at the launch of this timely book by Greg Mills and Jeffrey Herbst.

The phrase “It’s the Economy, Stupid” was made famous by the campaign strategist, James Carville, during Bill Clinton’s run for the White House in 1992. It has as much application to South Africa right now as it did then in the US at a time of recession.

I could not agree more with the fundamental assertion of How South Africa Works. In order to move forward as a country and realise our great potential, South Africa needs to deal with its biggest problem: unemployment.

Over a third of South Africa’s available workforce are either without employment or have given up seeking work. Of this group, two thirds are young South Africans. 

If we don’t address this problem with the urgency and innovation that is required, our nation will struggle to move forward.

If we don’t address unemployment, we won’t be able to lift people out of poverty, we won’t be able to effect meaningful redress and deal with the high levels of inequality that have resulted in South Africa having the world’s biggest Gini Coefficient. 

Unemployment can only be addressed by a growing economy that creates jobs. And a growing economy that creates jobs is the best way of finally putting our painful past, characterised by poverty, inequality and injustice, to rest so that we can finally move forward.

Like the authors of How South Africa Works, I don’t share the pessimism of some who say that South Africa is becoming a failed state. But I do recognise that we don’t have the luxury of time to get things right and fix our economy so that it creates the jobs required.

South Africa desperately needs the leadership and political will to get our economy growing at rates that can create enough jobs. And that requires government, labour and business all working together to do what is necessary.

But what is ultimately required for this leadership and political will is a change in government. As Greg Mills and Jeffrey Herbst state: “Other parties are important, but if the government and the ruling party is not playing its role, the actions of labour and business inevitably will be stunted.”

The ANC has shown repeatedly that it does not have the political will to lead South Africa towards unlocking the high rates of growth required to create millions of jobs.

The current ANC government has given up on the people of South Africa. Instead of focusing their energy on solving the unemployment crisis, they are caught up in a program of corruption and crony capitalism. For them, it is not about building a better future of opportunities for all.

That is why the Democratic Alliance has committed itself to realising Vision 2029. Vision 2029 paints a picture of what South Africa would be like after 10 years of DA government. A dynamic, vibrant nation that is a beacon of hope for the African continent and the developing world. A nation built on the values of Freedom, Fairness and Opportunity.

Yes, that means that the DA is aiming for national government in 2019. 

We simply have no other choice. We have the political will and the focused leadership to work with labour and business to solve the unemployment problem and get South Africa working.

Our job in the years ahead to 2019 is to show the people of South Africa how we would realise our vision. And that vision is underpinned in the main by a plan for growth and jobs. It’s the economy, stupid!

Our plan for jobs starts with fixing education. We need to make our youth employable.

One of the first priorities of a DA government will be to turn around our failing education system so that we can equip young South Africans to enter the job market with the skills and the confidence to make a success of their lives. That entails getting the basics right.

We will test all teachers and principals to ensure they’re competent. We will make sure that no child progresses through the lower grades without the ability to read. 

At high school level, we will make sure children know about all the options available to them, including the different types of schools they can attend. We’ll let them know which jobs have a shortage of skills, and we’ll encourage them to follow these paths. 

A DA government will ensure that all schools have sufficient desks and textbooks. We will make sure there is adequate scholar transport to get our children safely to school and back.

And once they’ve completed high school, a DA government will help them enter the job market through a range of programmes.

The first of these will be the implementation of a proper Youth Wage Subsidy – a state-funded tax rebate for employers who hire young people. This will allow thousands of young South Africans to get a foot in the jobs door.

After school, it is important that we place more of a focus on vocational training, as well as on our internship and apprenticeship programmes.

We need to ensure that our education system produces the skills required by a growing economy.

But of course, we need a growing economy to create the jobs to employ the young South Africans emerging from a functioning education system.

The DA believes that fostering a culture of entrepreneurship in South Africa and empowering small business is critical in growing the economy. 

We need to reduce the barriers to entry into the economy and make it easier to get businesses off the ground. 

Many small business owners struggle against red tape, ineffective bureaucracy and difficulty in finding start-up capital.

A DA-led government would slash red tape, as we have done in the Western Cape through the Red Tape Reduction Unit, and establish a National Venture Capital Fund to assist start-ups to find funding.

And we would invest in key economic infrastructure, such as ICT and the energy sector, to ensure that our economy has a solid foundation from which to grow.

Energy security is a critical objective for our economy. Instead of investing in a trillion rand nuclear deal that we cannot afford, we need to ramp up investment in renewable energy projects and break Eskom’s monopoly over electricity generation and supply.

The best way to ensure that you remain energy secure is to obtain your energy from a diverse range of sources, because it mitigates against possible disruptions in these sources. This is good for consumers and it’s good for the economy. And foreign investment depends on this kind of certainty.

South Africa must become competitive in the global economy and diversify away from an over- reliance on our resources. We must help the agriculture sector solve the problems it faces and incentivise entrepreneurship in that sector that creates jobs.  And we must solve regulatory issues that disincentivises innovation in the services sector. 

A DA government would build strategic partnerships with key trading partners and make it easier and more cost effective for foreign-owned companies to set up operations in South Africa. 

In order to become a more attractive investment destination we must slash red-tape surrounding the migration laws that prevent skilled foreign nationals from migrating to South Africa, and streamline the processing of applications for work and residence permits.

We also need to do away with punitive exchange controls that deter international investors and relax strict labour laws that drive up costs. The DA believes that workers’ rights should be protected, but that the law needs to incentivize the hiring of more people.

It is not impossible to get South Africa’s economy growing at the rate that will create millions of jobs and move the country forward. But it requires a government that prioritises the economy. And such a government in South Africa can only be one led by the Democratic Alliance.

I thank you.

Issued by the DA, July 20 2015