Covid-19's South African score is not a cheery tune

William Saunderson-Meyer says while other countries have the elasticity to rebound economically, we don't


The Covid-19 pandemic is orchestrated to the score that “the world will never be the same again”. Yes and no.

At present, humanity sits dazed midst imminent economic ruination and social unravelling. The customary ways of doing things have disconcertingly stalled. Yet, we forget that there’s historically been an almost limitless capacity for human ingenuity to find solutions, to marshal resources, and to mould building blocks from ash.

Already, governments worldwide are pouring billions into recovery efforts and the rebound is likely to be faster than we fear at present. Yes, the economic costs may rival those of the 1930s Great Depression. But in terms of deaths and social destruction, the shadow this pandemic casts is nowhere as scary as that of the 1918-20 Spanish Flu.

The overall effects globally may prove not to be anything as bad as is predicted. It may be a different matter in South Africa.

Even if the optimists turn out to be correct and Covid deaths end up being proportionately lower here than abroad — it is still far too early to know — we’re unlikely to avoid major economic and societal dislocation by piggybacking on international relief efforts. And since we’ve long since squandered our own fiscal resources, there are no emergency reserves.

To start with, there’s just not much spring left in our economic elastic. Any rebound that does happen, is likely to be flabby. The SA growth engine, much like those flawed Spanish locomotives imported by the looting cabals of the Jacob Zuma era, is simply not fit for purpose.

Part of it is a process issue, that of addressing the stupendous scale of government corruption and mismanagement that has taken place. If President Cyril Ramaphosa’s faction of the African National Congress put its mind, rather than its mouth, to the problem, this theoretically could be remedied relatively quickly.

But another part of the problem is structural and that’s not susceptible to quick solutions. The ruination of the economy over the past decade is familiar enough to not need much cataloguing.

There has been a steady national impoverishment, with formal sector jobs being lost and people having to subsist as best they can. Take the textile industry. A dozen years ago it employed more than 200,000 people but has been steadily shrinking since.

Today, we have only 80,000 wage-earning textile workers, compared to 90,000 subsistence-level “waste pickers”, scouring the municipal dumps for recyclable bits and bobs to sell. It makes for a jarring comparison: more South Africans now earn a living picking up scraps of cloth than remain those that weave it.

These are developing nation problems that are not unique to SA. But some of the important reasons why we can’t adequately address them are.

Many of the woes of the textile sector can be laid at the door of the inability of the ANC — paralysingly split between economic pragmatists and ideological hardliners — to adapt. It is a pattern replicated in small manufacturing and every sector where SMMEs can barely keep their heads above water,

Part of the blame lies with the rapacious trading practices of China, the ANC’s cherished comrade. More of the blame lies with the suicidal insistence of Cosatu unionists and SA Communist Party ideologues on a “living wage” that is too high for small companies, which have shut down by the score.

A positive aspect to disaster is that it usually up-ends conventional thinking. The imperative for urgency and improvisation removes the sapping burden of “But Marx says…”, “But Keynes showed…”, and “We’ve always done it this way…”.

That kind of breaking of mental shackles has not happened here, so far. The Small Business Development minister wants to allot support to failing SMMEs according to a geographic and demographic formula. In other words, not according to how badly it is needed or how effective it will be, but according to provincial and racial quotas.

The rescue grants for those small tourism businesses that do not form part of corporate chains — the independent restaurants, resorts, bed and breakfasts, guest houses, lodges, backpackers — will go only to those that meet black empowerment criteria. In other words, whiteys need not apply.

Financial aid to spaza shops will not go to those owned by foreign nationals. Nor will the foreign-owned ones be included in a government-backed scheme to source their goods more cheaply. In a similar vein, the Department of Agriculture will provide financial assistance only to black, coloured and Indian farmers.

All these moves are vulnerable to challenge in the Constitutional Court. As the Democratic Alliance’s John Steenhuisen argues, the different criteria are not only unreasonable but unlawful. “Skin colour of an employer does not determine the true victims of the crisis. What is happening is … a mockery of the president’s pleas for South Africans to unite against a common enemy.”

The constitutionality of these ministerial decisions does not seem to perturb Ramaphosa. By the time that the issue is decided, the funds will long since have been dispersed.

To the ANC, this is a heaven-sent opportunity for some intensive social engineering. It's a moment to reshape the economic landscape to more pleasing racial proportions, not by growing new black businesses but by letting white and foreign ones go to the wall.

But the majority of the population will not remain unscathed. The National Department of Human Settlements wants to “decongest” extremely dense informal settlements to reduce infection rates. Its plans, which are at an “advanced stage”, raise the spectre of moving tens of thousands of people across four provinces. The ANC government calls it “temporary relocation”.

This is the kind of statist insanity last seen when the apartheid regime engaged in large scale transfers of people to get rid of those unsightly “black spots” that were impeding its grand design for the complete separation of the races. Then it was called “forced removals”.

It’s admittedly inconceivable that this plan will ever be implemented. Aside from the government lacking the financial, infrastructural and organisational resources to carry it out, there would be blood in the streets.

Nevertheless, it is instructive that so many surreal fever-dreams survive to see the “new dawn” in Ramaphosa’s administration. It flags that a number of his ministers lack the ability and intellect necessary to steer SA successfully through the existential dangers of the pandemic.

They’re politicians trapped in an imaginary world, dreaming of an impossible one. For the rest of us, it's potentially a nightmare.

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