Letter: Classic liberalism is the way to prosperity - Businesslive

12 January 2022 - Ebrahim Harvey writes that “liberalism in SA … especially in the midst of an unprecedented socio-economic crisis, will have no political future without a strong social justice policy framework” (“The path forward for liberalism in SA”, January 11).

Ebrahim Harvey writes that “liberalism in SA … especially in the midst of an unprecedented socio-economic crisis, will have no political future without a strong social justice policy framework” (“The path forward for liberalism in SA”, January 11).

He wants this to be “posited on a decommercialised and decommodified public service … not subject to the calculus of profit”, and claims the ANC and SACP erred in separating the anti-apartheid struggle from “the struggle against the capitalist economic framework”. He identifies this latter struggle as “the unfinished business” of the liberation movement.

He thus criticises Frans Cronje, myself, and “many other white liberals” for “regarding the ANC as Marxist” when “the ‘Marxism’ of the ANC is largely rhetorical” and what it does “in both word and deed is very far from it”.

This analysis overlooks a host of contrary evidence. The ANC has long been dominated by the SACP, which helped draw up the Freedom Charter as an essential foundation for socialism, endorsed a Soviet-inspired national democratic revolution (NDR) for SA in 1962, and got the ANC to endorse the NDR too, at the Morogoro conference in 1969.

As the SACP repeatedly points out (most recently in a statement issued just this week), the NDR offers the “most direct route to socialism”. The ANC has never distanced itself from this analysis. It has also recommitted itself to the NDR at each of its five-yearly national conferences: from the Mafikeng conference in 1997 to the Nasrec gathering in 2017.

The ANC’s commitment to the NDR is evident not only in word but also in deed. As part of its NDR aim to “eliminate” existing property relations, the ANC has adopted more than 30 laws and policies weakening private property rights. It now seeks to nationalise land and other property under the rubric of state custodianship and/or expropriation without compensation.

The ANC’s other NDR deeds include:

The whittling away of business autonomy via intrusive labour, employment equity, BEE, and competition laws;
The “decommodification” of core goods and services, beginning with private health care and pensions under its National Health Insurance and National Social Security Fund proposals; and
The “delinking” of people from the capitalist economy by expanding their dependence on social grants and public employment.

As the NDR has proceeded, so fixed investment has diminished, economic growth has slowed, unemployment has increased, inequality between the middle class and the jobless millions has worsened, incompetence and corruption have soared, and public debt has spiralled to unprecedented levels.

It is the NDR — not the ANC’s supposed “neoliberalism”  — that explains the escalating socioeconomic crisis in the country. The best way to reverse the situation is not to intensify the ANC’s already destructive anticapitalist struggle, but rather to embrace the benefits of economic freedom in the true sense of the term.

As Canadian think-tank the Fraser Institute has repeatedly shown in its annual Economic Freedom of the World index, the freest countries — those that limit state power, protect property rights and encourage market provision — have GDP per capita roughly 10 times higher than the least free ones, many of which are failed and/or socialist states.

In 2019 the freest countries had average per capita GDP exceeding $50,000, while the equivalent figure in the least free ones was less than $6,000. Extreme poverty ($1.90 a day) afflicted 34% of the population in the least free countries, but only 1% in the most free. In addition, the poorest 10% had average incomes of $14,400 in the freest countries, compared to $1,500 in the least free ones.

Classical liberalism — of the kind the Institute of Race Relations (IRR) advocates — embraces both political and economic freedoms. It protects civil liberties while helping secure rising prosperity for all. It also sees the free market system as a strength to be fostered, not an evil to be overthrown.

Achieving better outcomes for all South Africans is the IRR’s key goal. Unlike Harvey, however, it believes free markets and devolving power to individual citizens provide the best way to achieve that — as plentiful experience from other countries has shown.

Dr Anthea Jeffery
IRR head of policy research

https://www.businesslive.co.za/bd/opinion/letters/2022-01-12-letter-classic-liberalism-is-the-way-to-prosperity/

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