Be warned: as long as South Africans think that expropriation without compensation is a benign policy or that it might deliver a social good, or that it has no implication for them personally, the policy will retain some measure of credibility.
This is the address I delivered to the Sundays River Citrus Company Foundation gala dinner at Addo 24 August 2019.
Ladies and gentlemen, I work for the IRR – a think-tank established in the 1920s with the singular purpose of defeating racial discrimination and defending the civil rights of all South Africans. It rose to become the most prominent anti-apartheid think tank in the world and perfected the methodology of using expert socio-economic and policy analysis to place pressure on political and business leaders to embrace policies that would ensure South Africa’s stability, prosperity, and success. Its list of past Presidents, extending from Leo Marquard, founding member of the Liberal Party, to Oliver Schreiner, described as ‘the greatest chief justice South African never had’, William Nkomo, founding chairperson of the provisional executive of the ANC youth league, Denis Hurley, Archbishop of Durban who declared from the pulpit that apartheid was ‘blasphemy’, the Reverends Ezekiel Mahabane and Stanley Mokgobo – the latter went on to lead the PAC – and Helen Suzman, the grande dame whose fighting spirit stalks our writings and speeches, stands as a testament to its character. Today, its key strategic objective is to unite South Africa’s moderate majority – black and white – in support of property rights, a market economy, freedom of speech, individual liberty and the rule of law. And there is such a thing as the moderate majority; despite the hate mongering in politics, on Twitter, and in the mainstream media, our polls reveal that a good majority of South Africans respect each other and want to work together to build a great country.
The most important on that list is property rights. Whether it is doctors losing control of their practises or hawkers being dispossessed by the metro police or citizens being told how they may invest their savings – the same principle is at stake. Property rights underpin substantive human liberty in every free and open society – because a government that cannot dispossess its citizens of property cannot oppress them. And property rights further enable the risk-taking entrepreneurial spirit that is necessary to draw the investment needed to rebuild our economy in order to liberate the poor and the unemployed.
Given the threats to our civil rights culture and the parlous present state of our economy, there is no doubt that the rise or fall of South Africa over the next decade, the topic I have been asked to address, will be determined more than anything else by our ability to stem the tide of attacks on property rights so that they might be safeguarded and later extended. All the while remaining mindful that the case for property rights is above all else a moral one – that it is fundamentally unjust to be a society in which millions of families do not own their homes, in which more ten million people do not have jobs, and where the current trajectory of the society denies those millions any realistic prospect of a better life.
You may all be farmers or involved in agriculture, but this is not a question that pertains solely to farmers or farming. From the National Health Insurance (NHI) Bill, to the National Credit Amendment Act, to the threat of prescribed assets – about which President Ramaphosa was unable to give a straight answer in Parliament this week – the Expropriation Bill and the proposed amendment to Section 25 of our Constitution, the principle and the threat are the same – that it is good and right that the State should be able to dispossess people of what they have worked hard for, and to do so with no compensation, because then South Africa will become a better country.
This is not a threat that crept up behind us secretly, quietly, and unseen.
- It has its modern origins in the 2007 attack on the willing-buyer/willing-seller policy at the African National Congress (ANC) conference in Polokwane – which saw the axing of Thabo Mbeki.
- Those attacks in turn informed the contents of the draft Expropriation Bill of 2008.
- This in turn informed the dropping of the Proactive Land Acquisition Strategy in 2010.
- Then came the agriculture green paper of 2011, which forewarned of every risk from land ceilings to EWC – all of which would be drafted into policy and legislation within the next six years.
- A year later came the 20% proposal in the National Development Plan.
- The 50/50 proposal came hot on its heels.
- This was followed by the Land Restitution Amendment Act of 2014 that sought to provoke hundreds of thousands of new land claims without the budget to finance them.
- Thereafter came the Property Valuation Act via which the State sought to lessen that budgetary bind.
- This was followed by the Agri Land Bill that sought to make the State custodian of all agricultural land, as the Green Paper had warned – thereby escaping any budgetary bind at all.
- Then came the Regulation of Land Holdings Bill that would cap farm sizes and force farmers to surrender the surplus.
- This was followed by the proposed amendment to the Constitution.
- And now face the NHI Bill, the credit amendment legislation, and the threat of prescribed assets.
This policy process did not happen in isolation but in parallel with a still continuing campaign of racial nationalist incitement and propaganda; that farmers – many of you who sit before me now – stole the land; are guilty of original sin; evicted a million people from their homes; beat and rape their staff; sabotage land reform; drive up food prices; and, through all of that and more, carry much of the responsibility for the poverty, unemployment, and social tensions that now threaten the future of every South African. As the government moves on doctors and pension fund holders the stigmatisation moves with them to suggest that our expert private medical industry selfishly hoards skills, expertise, and money and that this is the reason why millions of poor people receive substandard care from our failing public hospitals, or that the savings of South Africa’s middle classes lie unutilised – a reflection of your callous indifference to the fate of the poor – and need to be tapped by the government, as the ANC has repeatedly said it intends to do, if poverty and inequality are to be beaten. The purpose of propaganda is stigmatisation, to make the targeted group ‘the other’ – so that society will lose its ability to empathise with you, and so that no-one will come to your defence when you come under violent or legislative attack.
After more than a decade of the above we are reaching the end game via two related legislative and policy processes.
The first of these is the passage of the Expropriation Bill, which, as drafted, will allow the state to seize your assets, from savings and businesses to farms, with or without compensation regardless of any constitutional amendment. The second is the proposed amendment itself which is likely to serve as a backstop, ensuring that any challenge to a future Expropriation Act will fail – in turn ensuring that the provisions of the NHI and credit legislation, and future prescribed asset requirements, as examples, are insulated against constitutional challenges.
Although the danger is there, I don’t think the risk for you – as commercial farmers – is in the main the cliché of the enraged mob pouring over the hill to seize your business. Our polls reveal very little popular desire for land to farm – people in the main want to come to cities where they will find jobs, own their homes, and put their children in good schools in safe neighbourhoods. It is largely because the government has failed to deliver these things that it is hoping to incite emotions around the historical denial of property rights to black people – as a strategy of deflection.
In your case the intention of the government is not to ‘seize the means of production’ – by inciting the mob to pour over the hill – but rather, as my colleague, Russel Lamberti, argues, ‘to regulate those means’ to the advantage of the State and the party – exactly as is now set to happen with doctors, private hospitals, and savings and pension funds. The play is always the same; develop regulatory power over an industry and force businesses in that industry to surrender some of the value they produce.
In the case of agriculture, the play might be something along these lines; put in motion a process that will see the State effectively seize all land as custodian; offer leases to existing property owners; and then start enforcing conditions on the renewal of those leases – such as that you must surrender a proportion of your business or the value its creates. In time, those conditions are then ratcheted upwards, facilitating not a clichéd expropriation but rather what is called a custodial and regulatory taking, as is explicitly provided for in the Expropriation Bill. Miners who offered no substantive resistance when they lost their mineral rights and later actively supported the licencing conditions attached to their operations are the leading case study of what is essentially a rent-seeking enterprise masquerading as an empowerment policy. And the brilliance of it all is that, in each instance, the intended target agrees to enforce the provisions of the policy upon itself. Without the active cooperation and buy in of organised business, the growth- and investment-sapping provisions of BEE could not be enforced. The State will not be able to seize your pensions if pension providers do not subscribe to the policy of prescribed assets. Doctors will only lose their practices if the organised healthcare community agrees to go along, to get along, with the provisions of NHI policy.
But I fear to tell you that the pensions industry and individual funds are doing very little to safeguard the interests of fund-holders. Some funds appear already to have capitulated or succumbed to the temptations of pursuing a strategy of ‘peace in our time’ and in so doing are putting the life savings of their members at great risk. Amongst the medical profession, few seem to appreciate or understand the implications – even as share prices dive and doctors look to leave. We have much experience of these things and we look and think; those poor fools – they are making every mistake, entangling themselves in every snare, and will live to regret their naiveté.
As people invested in agriculture, you will only lose your assets to regulatory and custodial takings if your industry subscribes to the policies underpinning such takings. Refuse to indulge such plans, and focus instead on promoting sensible alternatives, then mass expropriation or custodial takings probably cannot happen – other than by sending the security forces to drive people from their homes in the full glare of the global media and investment community.
You must further understand that the people and organisations eyeing your businesses work to a well-honed set of strategy and tactics. These tactics dictate that you can only advance the revolutionary agenda when it meets with no resistance. When resistance is encountered, stop at once and retreat if it persists – because your revolutionary objective cannot succeed if the target group does not subscribe to it. To revisit the mining example, the South African government has no appetite to seize a mine, take over its functions, pay the staff, and fund its operations – it knows how that will end. Its interest is exclusively to keep the present management on site and then extract, by coercion, what wealth it can from their skills, risk taking, and hard work – but in so doing, of course, greed and incompetence overwhelm and the goose is killed.
Opposing this sort of thing is not a hostile act but simply a pragmatic and sensible matter of pointing out negative consequences and providing better alternatives. In many respects, this is basic politics – win over public opinion and you will dominate the policy climate. As long as South Africans think that expropriation without compensation is a benign policy or that it might deliver a social good, or that it has no implication for them personally, the policy will retain some measure of credibility. Take a lesson from Margaret Thatcher who said that you cannot win the politics until you have won the argument.
This is what the IRR does – it wages and wins public arguments – and has done so throughout its history by practising what it calls battle of ideas theory. The theory holds that the winner of any policy or ideological struggle will be the side that enters the greatest volume of compelling argument into the public domain.
What does that mean in practice?
For more than 18 months, a team of IRR staffers have daily identified every argument made on prominent public platforms in favour of expropriation or in the pursuit of stigmatising commercial farmers, and countered these with reasoned argument, facts, and sound alternatives – in the process producing the great majority of anti-expropriation argument to enter the public domain.
Since inception, that team has placed 668 self-authored opinion pieces in newspapers countering the stigmatisation of commercial farmers, opposing arguments in favour of the expropriation of your property, and demonstrating why all South Africans have an interest in protecting property rights. Their public relations efforts and media statements secured a further 654 media citations. These efforts were in turn buttressed by 1 390 related social media comments. In total, that comes to 4.9 interventions per day on your behalf every day since the ANC agreed to press ahead with the policy of expropriation at its conference in Nasrec in late 2017.
As one example, on the 30th August 2018 in the Financial Times, three days after that newspaper had published an error-ridden, naïve, and misleading editorial about farming and land reform in South Africa, my colleague, Terence Corrigan, published a rebuttal that read, in part, as follows:
With reference to your editorial “Why South Africa needs land reform legislation”… the issue needs rational debate, founded on facts…. Consider the widely-cited distortion of data on South African landholding. Contrary to your editorial, an official audit did not find that “72 per cent of farms and agricultural holdings in SA are owned by whites and 24 per cent by non-whites”, nor that only 4 per cent of the latter are black Africans. The “audit” revealed that assigning a racial identity to ownership was impossible for over two-thirds of rural land (note, too, the information refers to acreage, not farm units, as you imply)…. This is because most is owned by the state, and by companies, trusts and community property associations…. The figures you cite refer only to land held by private individuals, registered at the deeds office (about 31 per cent of the country)… These figures reflect past and current practices. Under colonial and apartheid rule, freehold title was typically denied to Africans. Land they did have access to was held “in trust”, by the state or by traditional leaders. This has continued since 1994. Thus, most of the landholdings to which Africans have “access” — and most land transferred to them via reform initiatives (around 6 per cent of the country’s area) — are not reflected, racially, in the audit…. Such false data support a narrative that land reform has failed to such an extent that only deeply intrusive state power over property rights can succeed — hence the demand for expropriation without compensation. In this lies a great danger. Would it be limited to “unused land, derelict buildings, purely speculative land holdings, or circumstances where occupiers have strong historical rights and title holders do not occupy or use their land”? Possibly. But as yet, the only certainty seems to be that the ruling party is intent on implementing this policy. No firm plans have been advanced, and only vague, non-binding assurances. It is being vigorously promoted by many political leaders and shows every sign of developing a momentum that will be difficult to contain. Indeed, despite President Cyril Ramaphosa’s call for debate, he recently announced his party’s intention to amend the bill of rights to make the state’s right to take property without compensation “more explicit”. And this before mandatory public hearings had been completed. The implications are not encouraging…
That was the most read contribution of its sort on the online platform of the Financial Times on that day.
That media effort was backed up with face-to-face meetings and briefings for investors, policy makers, and politicians. In total, we have delivered 218 such briefings of which 167 were at home and 51 abroad in capitals ranging from Washington to London, Brussels, Berlin, and Tel Aviv. That amounts to one such engagement every second working day for 18 months.
The collective result of the above was to create great pressure on the government to delay and back off on its expropriation plans. The government has without respite, day in and day out, had to counter and fend off expert assessments and analyses of the consequences of expropriation. An official complained at one point that the full time allotted for a press conference abroad was taken up with critical questions about expropriation. Pressure builds change and had this pressure not been exerted I have little doubt that a number of commercial farmers would by now have received expropriation and related notices – which was the intention of the government.
Of course, along the way there are groups and individuals who oppose our efforts – which is very good because it is the first sign that you are starting to win. Unable to counter our analyses with reasoned argument – which we would welcome – they resort to slurs and innuendo, which is again very good because it reveals that they know we are right. We have lived with this throughout our history. Under the former regime, the slurs were about communism in an attempt to associate our work with sympathies for the Soviet Union – which was quite insane as we are arch anti-communists. Today the slurs are about racism in an attempt to associate our work with right-wing sympathies – which is equally insane as our entire history is a case study of opposing racial discrimination. Quite frankly, if you were side-tracked by any of the slurs in the face of the evidence of the volumes of our published opinion, then or now, you have already lost. Consider, too, that present slurs come in the main from people who also subscribe to the view that the relative success of doctors or farmers or pension holders or anyone else for that manner is a result of racism and that the State should therefore be empowered to dispossess them so that poor South Africans might be liberated. Our vision is different; we strive for an industrialised, market-driven and entrepreneur-led, mainly urban economy, built around the sanctity of property rights, in which decades of very high rates of economic growth allow all South Africans to attain a middle class standard of living so that they will be free to accumulate wealth and property and to take decisions about their own lives.
We are often asked why such foolish policy is presented by the government. Surely, we are told, the consequences are self-evident?
Part of the answer to that question is ideological and relates to the thesis of National Democratic Revolution that dominated ANC thinking from the early 1960s and has seen somewhat of a revival since 2007. We have set out its origins and expressions at length in scores of papers and speeches and articles that I advise you to read, and I will not say more about it here other than that the central tenet is that dispossessing the relative elites in society is a path of equality and social justice.
Another part of the answer is the nature, now, of the ANC itself. Racked with infighting, the pragmatists that led that party from 1991 to 2007 have been all but extinguished. In their place are two dominant factions. The first are the corrupt racial nationalists of the Zuma-era and the second are the leftist ideologues of the communist party and South Africa’s more destructive trade unions. Under relentless attack from the former, Mr Ramaphosa, whose own policy positions have demonstrated terribly poor judgement, has sought refuge among the latter and in exchange for which his leftist backers now control much of the Cabinet. Where is the pragmatic middle, you ask? The answer is that it barely exists at all anymore. Therefore at best a long-term stalemate is setting in while at worst one of the two factions will drive the other out, allowing the victorious party unfettered room to make and implement policy. Both, you must understand, have an interest in pursuing expropriation without compensation – the former to loot the proceeds and the latter to nationalise them in pursuit of a socialist utopia.
Meanwhile all of this is occurring against a backdrop where the ANC is dying.
In a recent column I wrote the following: “Forget the 57% headline number from the 2019 election. Our polls suggest that, among matriculants, ANC support was at just under 50%; among degreed graduates, at around 25%; among young people, at around 50%; and that less than half of its votes came from formal urban areas – unlike the EFF and the Democratic Alliance, each of which got well over half its votes from such areas. ANC voter support is now on the wrong side of South Africa’s mega education, demographic, and urbanisation trends.
Worse for the party is that, as its support sinks, it is running out of the money it needs to run the country and sustain the patronage networks that hold the party together. Debt levels have more than doubled over the past decade. The tax-to-GDP take has reached a record all-time high point. The growth rate is a fraction of the budget deficit. The fiscal position is unsalvageable and the ANC in government is probably now set to run out of money within the same 24-month window ahead of the 2024 national election in which it may run out of votes – meaning that the party is now at its most dangerous.
The effect is that the political survival of the ANC is now on the wrong side of four of South Africa’s mega-trends – demographics, urbanisation, education, and finance. Quite possibly the right question to ask now is not ‘what will the ANC do with a future South Africa?’ but rather ‘what will South Africa do without the ANC?’. And when that day is reached you had better be sure that the principles and institutions upon which the success of every free and prosperous society rest – central to which is the sanctity of property rights above all else – are still standing strong because then, in that new dawn, we will be able to build a great country.
I was accused in Durban earlier this week of ‘sounding slightly optimistic’ but I firmly believe that the cause for property rights can be won if the right strategy is pursued. I was very pleased therefore to be invited to address the national convention of Free State Agriculture in Bloemfontein two weeks ago – to explain what such a strategy would entail (you can read that previously published address here).
Our presence on that stage reflected a much improved state of affairs between ourselves and AgriSA following the important and public differences we had in the past. Groups will differ, especially in fraught times such as these, and what matters is how those differences are resolved. There have been numerous, ongoing and very useful engagements between ourselves and all major commercial agricultural unions over recent months which bodes very well for the future of commercial farming. Mr Kriek and the leadership of AgriSA did exactly the right thing, and took a very good stance, and we supported them strongly, in refusing to endorse the flawed presidential land panel report and instead publish an alternative report. In September we will publish our alternative to complement that of AgriSA. No single group will win this but working against each other we are sure to lose. Working together, and exploiting the relative strengths and experiences of a broad front of organisations, each of which occupies a different place in the broader spectrum of things, but all united on the importance of sensible policy, is how we will be successful.
If organised agriculture pursues the strategy set out at Bloemfontein then I think there is every reason to believe that commercial farming in our country has a long and prosperous future – and if that is the case then I have little doubt that the rise of South Africa is assured. But only you can drive this. No one else is going to do it for you. As the recent fiasco around the National Credit Amendment Act shows, the banks cannot even safeguard their own immediate interests – they are not going to safeguard yours. As the National Health Insurance announcement again reveals, the organised business lobby in our country remains ineffective. Western diplomats are strongly opposed to deep entanglements here – they are not coming to help. The mainstream commentariat vacillates between opposing NHI because they have private medical care to endorsing expropriation of farms because they don’t have farms – these are not people you entrust your fate to.
Steve Biko, who faced circumstances far worse than anything you will ever face, said – when confronted with the hopelessness of his own people – that ‘there is nothing more powerful in the hands of the oppressor than the mind of the oppressed’. If I come to your house and accuse you of theft and rape and doing nothing for our country you will take exception – so why do farmers stand for it when the same things are said by politicians or printed in newspapers?
In the end, having briefed hundreds of communities over several years, I have come to think that the answer to that question lies in the entanglement between race and political correctness that silences so many South Africans from speaking out to say what they think is true. The way around that, in your case, is to understand what is true, that the interests of black or white or established or emerging farmers are ultimately the same. I told the audience in Bloemfontein how my colleague, Temba Nolutshungu, remarked some years ago that, having fought so hard for the chance to own property, it was mad how many black people seemed willing to surrender that right to the State.
The IRR maintains, and I advise you to do the same, that the only way to support new commercial farming entrants is via title, cheap financing, and very effective extension services. Those three pillars are the model upon which the success of the South African commercial farming industry was built, and black people, particularly given our country’s history, deserve nothing less than the full benefits of each of those pillars. Beware of attempts at divide and rule. Black, white, established or emerging, you are all farmers – first and foremost – and what happens to farmers will determine what happens to all of you.
Frans Cronje is the CEO of the IRR.
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