A call for voluntary ‘equalisation’ in SA – Chuck Stephens

Chuck Stephens from the Desmond Tutu Centre for Leadership is a man on a mission – he wants to create a fairer South Africa for all. Stephens put forward the idea of “shrinking the cup”, that landowners should agree to share or give away parts of their farms. And in this article, he goes a step further; not only should farmers consider sharing their land; all South Africans should volunteer to address the large gap between the rich and the poor. He says this gap is a breeding ground for polarisation and is leading to the rise of the ‘Red Tide’ aka the EFF. This may not be something that comfortable South Africans want to hear. It is however true that the gap between the rich and the poor is growing world-wide, prompting “zillionaire” Nick Hanuer to warn that ‘they are coming for us with pitchforks.‘ Stephens has a similar warning for whites in South Africa and he also weighs in on the push from within Democratic Alliance ranks to get rid of Mmusi Maimane. – Linda van Tilburg

To what extent is poverty really deprivation?

By Chuck Stephens*

South Africa is said to have a triple problem of poverty, unemployment and inequality. I think that those three words are intentionally strung backwards. Because inequality breeds unemployment and that sinks people into poverty. Stringing them backwards helps to get affluent people off the hook, it is a kind of decoy.

Inequality means that wealth is concentrated in the hands of relatively few, it is not spread fairly among all citizens. So those who have accumulated a lot of wealth (i.e. capital, land, factories, mines) get to make key decisions – for example, about mechanisation. They decide to use robots on the assembly line to build cars, because robots don’t talk back or go on strike. When land redistribution comes along (in a country of 55 million where 35,000 white farmers own 72% of arable land), they threaten to booby-trap their farms if they are expropriated. They know that it takes more than land to produce food, and that their water pumps, tractors and livestock cannot be expropriated without compensation. So they hold the work force hostage. Twenty-five years later, the Gini coefficient tells us that there is more inequality than there used to be.

The ultimate irony is when whites say that blacks are urbanising fast, and don’t really want to return to the land. The Natives Land Act of 1913 limited blacks to owning land in patches of land along the northern border and the east coast. There were no such patches in the West. You could not call it a checkerboard because only 7% of the surface area was allocated to blacks – who outnumbered whites, even back then. More than 80% of the population in 1913 was non-white. The less-than 20% white population kept control of 93% of the land.

This distorted map was validated by the Group Areas Act of grand apartheid. Here is the way that academic researcher Sampie Terreblanche put it (himself an Afrikaner), in his book Lost in Transformation:

“There is always a close relationship between the rich and the poor. The rich and the poor are two sides of the same systemic coin. Nothing explains this close relationship better than the situation in South Africa during the first seventy year of the twentieth century when whites constituted 20% of the total population, while receiving more than 70% of total income. African constituted almost 70% of the total population, but constantly received less than 20% of the total income – a skewed situation that can be ascribed to the politico-economic system of white political dominance and racial capitalism/corporatism in place in South Africa during that period. In this system both capitalism/corporatism and white political dominance enriched whites undeservedly and impoverished blacks undeservedly…

“In all neoliberal capitalist countries the poor have gotten poorer since the early 1980s, while the rich have gotten richer. When the system of social democratic capitalism was in place in Western countries in the third quarter of the twentieth century, the democratic governments were powerful enough to tame the capitalist/corporatist sector and to bring about an equalisation of income but, when social democratic capitalism was replaced by neoliberal capitalism in the early 1980s, income became much more unequally distributed in all Western countries…

“Over the past eighteen years the Gini coefficient increased from 0.66 to 0.70. The richest ten million South Africans received almost 75% of total income in 2008, while the poorest 25 million received less than 8%…

“If five percentage points of the richest 20% income is transferred with a ‘leaky bucket’ to the poor, the income of the rich would decline by 6%, while the income of the poor would increase by more than 60%, but because of the leaky buckets the advantage to the poor would be smaller. But it cannot be denied that such a redistribution of income – from the top 20% to the lower 50% – would boost the general well-being of South Africans and is unavoidable if we want to create a humane and civilised society in South Africa.”

In spite of the rise of a black middle class in the first 25 years of ANC rule, the proportions are really not changing very fast. Sampie Terreblanche wrote the book quoted above in 2012. The Economic Freedom Fighters were established as a party in 2013, and won 25 seats in the 2014 elections. This rose to 44 seats in the 2019 elections, at the expense of the Democratic Alliance which some would call the champion of neoliberalism.

Sadly, there are a few ‘leaky buckets’ within the EFF and that is predictably going to reduce the advantage to the poor. But if the DA unceremoniously dumps its first black leader then the party of the rich will be shooting itself in the foot. In the USA, the Gini Coefficient has risen from 0.43 in 1990 to 0.49 in 2018. If that is what they mean by “making America great again” then I hope that Bernie Sanders wins, and takes America back to the days of social democratic capitalism.

Whites in South Africa have an unprecedented opportunity in the proposal of a JUBILEE LAND BANK, to “shrink the cup”. In other words, to voluntarily kick-start a process of equalisation. If they do not come out of their enclave proactively, they will see the Red Tide rising. Polarisation is bad for inequality, it will harden so fast that rigor mortis could set in. It is better to “find one another” with some humility and common sense. The Freedom Front Plus may have gained 6 seats in the last elections, but the EFF gained 19 seats. Go figure. EFF’s ‘leaky buckets’ may reduce the gains for the poor, but that trending will continue to eat away at the ANC’s majority. Then what?

Sampie Terreblanche said that South Africa not only has a poverty problem, it also has an opulence problem. To the extent that poverty is really deprivation, whites in South Africa will feel the heat. As John the Baptist put it:

“Who warned you to fly from the retribution that is coming?  But if you are repentant, produce the appropriate fruit…”

Join us on our Journey to Justice – check out www.C4L.org/jubilee-land-bank.

  • Chuck Stephens, Executive Director of the Desmond Tutu Centre for Leadership.