SA's experiment in two types of govt

William Saunderson-Meyer on the results of the liberal (DA) vs liberation movement (ANC) model when it comes to job creation


A willingness to cut off their noses to spite their faces is one of the perverse outcomes of highly ideological governments. 

Think of Russia’s reckless act of self-harm in invading Ukraine. Or of the African National Congress’ mulish persistence with ideological fixations that have not only failed everywhere they were tried previously, but have been failing in real-time before our very eyes for a couple of dozen years.

South Africa has been for almost two decades the site of a fascinating and unfolding experiment. Politically, it puts to the test how best to govern. Socially and economically, it signals how to continually to adapt policies to deliver the greatest benefit to the greatest number.

This situation, historically unique in South Africa, came about fortuitously when the opposition Democratic Alliance gained complete control of Cape Town in 2006 and of the Western Cape in 2009. That activated a neat opportunity to trial two versions of government.  

On the one hand, there was the Western Cape approach, based loosely on the liberal, social-democratic models of Europe. It started with the significant handicap of being constrained in its options by over-arching national legislation and national government policies based on diametrically different values to those it was trying to advance.

On the other hand, a national government ideologically united with the other eight provinces. Its approach would be based on the tripartite alliance’s socialist manifesto and had as its immediate objective the building of a “developmental state”, à la China.

The results are eye-popping in their implications, if only voters would heed them. Generally, the experiment has proved humiliating for the ANC model.

While all the provinces have experienced economic decline over recent years, the Western Cape has done the best of the bunch. This despite Covid’s blow to tourism, a mainstay of the provincial economy, as well as damage to the wine industry through ill-considered government restrictions on exports and consumption. 

The relative strength of the Western Cape is shown in 2021’s fourth-quarter employment figures, which were released by StatsSA this week. 

Employment is admittedly only one of an array of metrics that one can use to assess the outcomes of South Africa’s inadvertent political experiment, but it is the one that the ANC itself regards as a key performance measure. Remember the catchline on the posters in the first three general elections? Jobs! Jobs! Jobs! And with unemployment having now reached politically explosive levels, President Cyril Ramaphosa has repeatedly stressing that job creation is the government’s first priority. 

StatsSA’s figures show that South Africa’s official unemployment rate, year-on-year is up 2.8% to sit at 35.3%. But by the expanded definition, which includes discouraged work-seekers, it now sits at 46.2%, up 3.6% y-o-y. 

A country with a population of 62m people, by the official, narrow definition South Africa has only 14.5m employed people, versus 7.9m unemployed and 17.4% that are not economically active.

It’s when one drills down into the provinces that the failure of the ANC provinces becomes evident. 

At the official unemployment rate, the Western Cape comes in at 28%, which is 5.5% higher than it was a year ago. Only Limpopo (6.6%) and Mpumalanga (6.7%) took bigger hits. Nevertheless, only the Northern Cape (25%) outperforms the Western Cape, while the others range from 33.9% in Limpopo to 45% in the Eastern Cape.

At the expanded unemployment rate — a statistically less flattering but arguably more accurate measure of economic dislocation — the difference between DA-control and ANC-control becomes particularly stark. 

By this measure, the Western Cape unemployment edges up only slightly higher to 30.4%. Now, not a single ANC province comes close and the Northern Cape, which pipped it at the post on the official measure, trails in at a more realistic 50.1%. 

That undeclared humanitarian disaster zone, the Eastern Cape, is the worst performer at 53.2%. Similarly gloomy are the statistics from Limpopo (52.8%), Mpumalanga (52.4%, North West (49.9%), KwaZulu-Natal (48.7%) and Free State 44.2%.

Testimony to the dead hand of ANC governance is Gauteng. Despite being South Africa’s economic powerhouse, it is a dismal second best to the Western Cape at 44.4%. To state these numbers differently, for every 60 people who cannot get a job in the Western Cape, there are 90 in Gauteng and the Free State and roughly 100 scrabbling for work in the rest of the country.

Also worthy of note is the Western Cape’s labour  participation profile. Not only is it better than any of the other provinces and the national average but it scotches claims of this province being some kind of white enclave. The South African labour participation rate is 55.3% for Africans versus 57% for whites; in the Western Cape that gap is 65.8% for Africans versus 67.7% for whites.

That is a particularly impressive achievement, given that Cape Town has long since usurped Johannesburg as eGoli, the mythical city of gold. The Western Cape each years draws in excess of 80,000 migrants from its impoverished and failing provincial neighbours but still proportionately creates more jobs than its rivals.

These figures are no doubt galling to all of us who aren’t DA supporters or don’t live in the Western Cape. Nevertheless, they should give both ANC leaders and its supporters cause for pause.

In business, a steady decline in customer satisfaction (here, measured in votes) and a failure to achieve the key performance target (here, employment) would result in  a change of strategy or a change of leadership, or eventual bankruptcy. The ANC, however, remains immune to reality.

Oops! There goes another ANC nose...

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