A thread that runs through much of South Africa’s discourse about the political economy is that you have to take something from, or hurt, white people in order to benefit black South Africans.
In 2018, when explaining why his party was removing Athol Trollip as Nelson Mandela Bay mayor, EFF leader Julius Malema said:
‘Why? Why not [mayor of DA-led Johannesburg Herman] Mashaba, why not Solly [Msimanga – mayor of DA-led Tshwane]? Because the mayor of DA in PE is a white man. So, these people, when you want to hit them hard – go after a white man. They feel terrible pain, because you have touched a white man.’
Specifically pertaining to the economy, this sentiment often shows itself in rhetoric about redistribution away from white people into the hands of black people. It is a misguided way to go about not only redressing the past but also building an inclusive future in which character and competence are prized.
It is also unnecessarily adversarial and divisive because there are ways to build the wealth and incomes of black people and families that are divorced from race and grounded in basic government policy and competence, free market reforms and cultural adaptation.
The reality of South Africa is that the only way this country is going to become a sane, functional, safe and developed nation is if the black majority become upwardly mobile.
Discussing land reform at the Open Book Festival in 2017, Lauren Royston, a director at the Socio-Economic Rights Institute (SERI), noted:
‘Currently, if you are poor there is only one way to tenure security and that is through the housing subsidy programme. But the programme is plagued with problems such as maladministration and corruption. Even for those who are lucky enough to access the programme, they have a 50% chance of having their title deed registered. Because of the huge backlog in registering title deeds, some properties haven’t even made it onto the deeds registry when owners want to sell.’
Rooting out corruption and maladministration in the registering of properties and strengthening property rights overall will have a profound effect on the wealth-building journey of many black people and families. Home ownership (title deeds) are a reliable base from which family stability, capital accumulation and the ability to access financing for small businesses or side hustles can grow.
In a 2013 paper for Harvard University’s Joint Center for Housing Studies, authors Christopher E. Herbert, Daniel T. McCue and, Rocio Sanchez-Moyano conclude:
‘….. homeownership continues to represent an important opportunity for individuals and families of limited means to accumulate wealth. As such, policies to support homeownership can be justified as a means of alleviating wealth disparities by extending this opportunity to those who are in a position to succeed as owners under the right conditions.’
Closely tied to home ownership is the ability to use your home as collateral to access capital to build a business or for a side hustle. Writing for the Brookings Institute in an article titled, South Africa after Covid 19 – light at the end of a very long tunnel, Wolfgang Fengler, Marie-Francoise Nelly, Benedicte Baduel, and Facundo Cuevas of the World Bank note that if South Africa could have the same self-employment rate of its upper-middle-income peers such as Brazil, Mexico, and Turkey, it would effectively cut the unemployment rate in half.
In my own birthplace of Mthatha in the Eastern Cape, many people who own their homes and have been able to access capital have turned portions of their homes into spazas, laundromats, hair salons and baked-goods shops, which in turn have also provided employment for people as the businesses have grown.
My mother buys chickens every month from a pensioner in her church prayer group who runs a chicken business out of her garage, a business that provides a supplemental income to her pension.
One of the most effective ways in which the wealth of future generations can be built is to leverage the custom of lobola to give young married couples a leg up. The cultural practice of binding families can stay the same but the money itself (from the couple, parents and extended family) could be put into trust accounts or tax-free savings accounts, which young couples could as a means of saving – incrementally adding to the initial sum and realising the power of compounding interest – or draw on to make a sizable down payment on a first home, or even a mix of the two.
Black families regularly band together and raise enormous amounts of money for weddings, funerals, and even the celebration of a young man completing the initiation ritual into manhood – so why not use the same energy to set up family members for financially successful and secure futures?
Sound schooling is the foundation of upward mobility. With so many public schools failing to impart the basics of reading, writing, and arithmetic, many parents are voting with their feet by sending their children to independent schools.
The number of independent schools has doubled since 2000 and now stands at some 1 995, many of which offer relatively low-cost options. Though this kind of choice is currently confined to the middle class, there is a tried and tested way to expand that choice to poorer parents, too. This can be done by redirecting much of the present schooling budget into tax-funded schooling vouchers to be provided to all parents below a certain income level.
Why shouldn’t the children of poor and working class parents be afforded the opportunity to gain a quality education like the children of the middle and upper classes?
While this article is by no means exhaustive, it does show that the discourse in this country around race and (dis)advantage can be misguided, toxic, and unnecessarily divisive. This is because the very things that will alleviate racialised poverty and inequality are dissociated from race and are grounded in freer markets, such as ensuring that people receive their title deeds, implementing other policies that ensure broader home ownership, enabling people to access capital to start businesses, and adapting cultural practices to a culture of saving and investing.
Most South Africans can get behind a vision of the country which will ensure their neighbours of all races are safe, able to put food on the table and are prospering.
Theoretically at least, this vision is very much within our grasp as a nation and can be realised in a relatively short time.
The views of the writer are not necessarily the views of the Daily Friend or the IRR
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