US President Donald Trump has had South Africans at each other’s throats since he accused the country of expropriating land and property without compensation and generally treating certain classes of people “VERY BADLY”.
Clearly he meant blacks were discriminating against whites, and he said the US would cancel $400m a year in funding, primarily for HIV/Aids, while it checked us out.
The resulting uproar here at home has exposed just how brittle the 30 years of post-apartheid reconciliation still is, as left and right and black and white accused each other of triggering Trump’s surprise attack.
But we shouldn’t lose our common sense of proportion. We know while Expropriation Act signed into law by President Cyril Ramaphosa without any warning to his partners in the government of national unity (GNU) is relatively benign, it manifestly opens the way for abuse in the future by bad actors. Still, no-one here is going to take your house away.
The poor the ANC and EFF cynically claim to represent don’t want your house anyway. They want their house.
Trump is his own worst enemy. And America’s, as supporters will find out. He’s done more to usher in a new world order in a fortnight than the Chinese and Russians and Brics bloc have in a decade-and-a-half. He has broken sacred trusts with allies and given new impetus to efforts to diminish the dollar as a global currency.
#FAFO, they say. His day will come. But we can also learn from him the impact of clear ideas shouted loudly on social media — buy Greenland, turn the Gaza Strip into a new Riviera. SA has fallen so far down the global investment chain that hardly anyone asks why any more.
Trump’s harangue will have reminded anyone watching — and the markets were, if the immediate flight from the rand was any guide — that we have a unique approach to running our economy.
After Ramaphosa had posted on X that the act he signed was constitutionally sound, and that an ANC government had never confiscated any land, it was Elon Musk, the world’s richest man, who replied: “Why do you have openly racist ownership laws?”
He’s been told by Ramaphosa that SA would welcome his Starlink satellite internet access system in SA, but black empowerment laws would require him to either create space for black South Africans to own 30% of the service or to fund an “equity equivalent” approved by the cabinet.
Musk is South African by birth, and his tweet is a sort of resumption of the talks Ramaphosa started with him late last year. And, in a way, calling BEE legislation “racist” is a bit much from a kid who grew up in this country without any residual clues that he may recognise the enormous privilege he enjoyed at the cost, at the time, of the majority of our citizens under the grim thumb of apartheid.
But he also has a point. Apartheid is over, and ANC policies are in many respect its last miserable vestiges. So wretched has been ANC management of the economy, so relentless the corruption and the enrichment and the neglect of the poor, that the future of black empowerment is firmly, if not officially, on the table. That’s good.
It is meant to be the centre of what the ANC calls “inclusive growth”, and it’s closely protected by the governing party. But it generates no growth and, judging by the lengthening lines of the poor and unemployed, it is useless as an includer as well.
Ditching BEE would obviously be extremely demanding for an ANC leader. BEE drip-feeds money into the bank accounts that fund the ANC. But the economist and writer Moeletsi Mbeki rightly calls it a creation of the white business elite left standing at the end of white rule — they created a way to enrich a new class of chosen blacks and assumed they would protect the old money behind it all.
But the neat trick back then is now a beast out of control — cynical, insatiable and corrupted.
There’s plenty of redress still to do, but none of it happens without investment.
The ANC stopped Ramaphosa from handing the department of trade, industry & competition to the DA as he formed the GNU after the most recent election, because the department polices the BEE codes.
If we can agree, though, that economic growth is our highest priority and growth is only enabled by investment, Musk is living evidence that BEE is a barrier to our growth. Hardly any foreign investment comes into greenfield projects in SA any more. Local and foreign businesses that are not even considering investing here make no sound, so it is hard to test, empirically, the degree to which BEE is a problem. But anecdotally it absolutely is.
If Ramaphosa really wants to spark growth he could do worse in his state of the nation address in parliament tonight than announce the end of BEE, Trump-style, IN CAPITAL LETTERS, for all new investments in the country, for all the world to see. There’s plenty of redress still to do, but none of it happens without investment. Hold on to state support for black business by all means, only remember — the faster you grow the more taxes you have to pump into that support.
But for goodness sake let’s work out an alternative to BEE. Mbeki knows the answer. “Build entrepreneurs,” he says. “There is no BEE in India, there is no BEE in China. What these countries have done is build new entrepreneurs. We must build new entrepreneurs in SA of whatever race. That’s what should be done instead of building a parasitic class that lives off existing businesses.”
You’d have thought the DA, in opposition, would have run with this simple idea ages ago, but it’s still out there, lonely and unclaimed. Our politicians are scared of enterprise. It’s too risky. People fail. With few exceptions that’s the SA way — live in the past and take no chances.
• Bruce is a former editor of Business Day and the Financial Mail.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.