MICHAEL MORRIS: Racial ‘empowerment’ an insult to growing ranks of hungry people - Business Day
Michael Morris
The two things trade, industry & competition minister Parks Tau’s advisers ought to tell him are that empowerment is gravely urgent, but that basing it on race (euphemistically, “historical disadvantage”) is an insult to the swelling ranks of immiserated, hungry people.
If he listened (and they had the courage to tell him the truth in the first place), SA might begin taking its first steps away from the accumulating catastrophe of its failed experiment in social engineering.
Unfortunately, the risk is that Tau’s multibillion-rand Transformation Fund will be patted and prodded into place as yet another feature of the policy edifice blocking SA’s way to success and wellbeing.
Racial “empowerment” has been such a conceptual fixture that many continue to overlook the data and argumentation ranged against it. As colleague Gabriel Crouse wrote last year: “Poor black unemployed people are the most clearly stuck in the shadow of apartheid, a shadow that has grown under BEE. Removing obstacles to investment is the best way to remove the shadow.”
Among other things, he pointed out that “(t)he current, confusing BEE premium system facilitates state capture in procurement, according to the Zondo report. BEE premiums also hurt delivery and economic growth, according to the IMF, World Bank and Harvard’s Growth Lab.”
Once, opposition to BEE was almost universally regarded as revanchist, and its critics unthinkingly dismissed as nostalgics who were out of step with the democratic order. But South Africans have moved on — credible polling (not only our own) shows that high percentages of respondents do not favour overspending in the hope of benefiting someone who is not white, in the hope, in turn, that there might be some benefit to the commonweal.
This steady shift in sentiment is not mysteriously alchemical. Consider that according to Stats SA black unemployment increased from 5.5-million (expanded definition) in 2008 to 11.1-million in 2024. Or that, as my senior colleague, Institute of Race Relations CEO John Endres, has pointed out, gross fixed capital formation (a critical indicator of “money in assets which cannot easily be moved”) has been “going down over time”, and that having reached a post-1994 peak in 2008 of almost 22%, the indicator has slumped to 14.9%.
If so-called empowerment has delivered bling and baubles to the crony class, the pitifully low growth, jobs and fixed capital investment register as a gutting absence across the vast, smoky fringes of our society, where most people still live.
Here, the UN Children’s Fund (Unicef) tells us, 23% of children are classified as living in severe child food poverty. It calculates that 1.5-million SA children — three out of every 10 — are already stunted, meaning that “these children will likely not reach their full growth and developmental potential because of the irreversible physical and cognitive damage caused by persistent nutritional deprivations”. Stunting levels, Unicef said, “have increased 10% since 2008, while the numbers of stunted children have increased by 18%”.
Fellow columnist Hilary Joffe cut to the quick last week in her analysis of Tau’s Transformation Fund: “It's not that there isn’t a problem; just that grandiose plans for a new fund are unlikely to be the solution. The tragedy is that SA’s economy has been growing so horrendously slowly over the past 15 years that many can no longer picture an environment in which entrepreneurship can thrive and deliver jobs, incomes and social mobility for a meaningful number of people.
“Tau might have a better chance of success if he focuses his energies on doing what’s needed to create that environment.”
Morris is head of media at the SA Institute of Race Relations.