COSATU statement on the latest Oxfam Inequality Report

22 January 2019

The recent Oxfam inequality report that shows that the rich are getting richer, while the poor are getting poor is not at all surprising to COSATU. The latest Oxfam report titled “Public Good or Private Wealth”, shows that the wealth of the few rich people has continued to grow, while the poor majority has seen their wealth shrinking.

This is just another reminder of the effect of world capitalism on the poorest people. These statistics are telling us what we know and reminding us of the inequities of a system that condemns hundreds of millions of human beings to lives of brute survival and exposes the hypocrisies of those who benefit from this state of affairs.

This is what the Neoliberal policies were meant to achieve and they are succeeding as the Oxfam numbers show.

What is more surprising is that despite these figures, there are many “leaders” who are still arguing that what we need to solve this economic mess is more neoliberalism and not less of it. The Oxfam figures make it very clear that a country like South Africa cannot build an equitable society that provides people with decent work with neoliberal policies.

This depressing inequality is caused by an unholy alliance between the IMF, the World Bank and local rulers in which economic coherence had been put to one side. This is the most sinister and cynical alliance since the Nazi-Soviet pact.

There is no real commitment to accelerating shared economic growth and in transforming the structures of production and ownership by the most government including the ANC led government.

We can expect more of this if we insist on sticking to macroeconomic policies that do not support economic growth, job creation and poverty eradication on a sustainable basis.

The idea that only the free market is the solution and that the state is the problem and not the solution is what has led us to this situation.

South Africa can only close this growing inequality by ensuring that we have an activist government and a democratic developmental state that is capable of intervening effectively to transform economic relations.

Even the world’s leading evangelists of neoliberalism, the International Monetary Fund conceded that the neoliberal agenda appears to have been somewhat overplayed.

The IMF made it very clear that austerity measures hurt demand and worsen unemployment, while at the same time admitting that capital controls are a viable, and sometimes the only, option to deal with the volatility of capital flows.

This Oxfam Report corroborate our position that the task of fundamental transformation of our economy, the creation of decent work and the provision of basic services to the majority of our people cannot be left to the market forces.

This report is coming out at a time when the members of the global elite are meeting in Davos to reinforce each other’s positions and we can expect nothing to change for the poor majority.

We should not forget that most if not all of the people who annually take the pilgrimage to Davos are steeped in neoliberal ideology that has done so much damage to the poor. They get there and only pay lip service to issues like unemployment, unfair world trade, the misuse of science and ecological ruin.

They do not go there to talk about how capitalism destroys the lives of the poorest people and how the inequalities of this capitalist system are deliberately maintained by their policies. They spend most of their time explaining away poverty as a thing unconnected with the capitalist system and pretending as if capitalism is a supernatural phenomenon.

They do not want to talk about how new technology is imposed with no regard for local economies and with no consideration for the misery it brings to those who are pushed aside by it.

They say nothing about pertinent issues of world trade, the export orientation of Third World economies that takes food from the mouths of the hungry.

They will not focus on the structural mechanisms that have tied Third World economies into such an unfavourable relationship with the rest of the world economy. The IMF and World Bank will not acknowledge that it is their intervention in the poor countries and the ravages of the structural adjustment policies they imposed that have created this inequality.

We support the calls for a wealth tax and radical change in economic policies. It is about time leaders are judged on how they tackle the problems of unemployment, the deepening inequality, and worsening poverty. The toilers and the exploited should not fall for appearances but should demand tangible results from their elected representatives. 

Issued by Sizwe Pamla, National Spokesperson, COSATU, 22 January 2019