In the debate between capitalism and socialism the ever astute trio from Vestact, Sasha Naryshkine, Byron Lotter and Michael Treherne provide some fascinating facts in favour of capitalism and the benefits of truly free economies that are difficult to argue with. One of South Africa’s more controversial opposition parties, the Economic Freedom Fighters led by Julius Malema believe in policies that strongly align with those of the socialist economic structures of Cuba. It would be concerning if these structures were to be implemented in South Africa for a number of reasons, notably because this system of economy has never proven to be truly successful or enriching. Sasha, Byron, and Michael take Julius’ unwavering views about the pursuit and attainment of economic freedom to task, and present a case that, if anything strongly dilutes the arguments for socialist ambitions to lead South Africa in certain favour of capitalist ideals. The fact is, the numbers add up. – LF
By Sasha Naryshkine, Byron Lotter and Michael Treherne
We have the Economic Freedom Fighters in South Africa, who certainly stir the pot and can been seen as rabble rousers, they are (as per their declaration) inspired by the Cuban July 26 Movement. Really, you can read for yourself, it must be said that the grammar would not have gotten past Byron here -> DECLARATION OF THE ECONOMIC FREEDOM FIGHTERS NATIONAL ASSEMBLY ON WHAT IS TO BE DONE-26 – 27 JULY 2013:
“Cuba remains an inspiration because with a very low GDP per capita income. Cuba is amongst the best countries in terms of healthcare, education, low infant mortality rates, life expectancy and other vital social services. This is a sign that the revolution was about the emancipation of the people, not the enrichment of few individuals who callously and rapaciously redirect State resources for self-enrichment.”
It is not a surprise to me that inside of the Economic Freedom of the World: 2014 Annual Report the countries with the worst economic policies, price controls, disregard for personal and property rights (seizing of private assets), complete price controls, limited access to proper credit markets and lack of trade freedoms find themselves at the bottom of the list. Sound familiar? Check out the bottom of the list, from Chapter one, a snapshot of exhibit 1.2:
The biggest friends of the Venezuelans? The Cubans!!! Who do not even appear on the list, as a result of no work being able to take place in that country. The “independent” research is provided in each country by an organisation or body, in the case of Venezuela it is a crowd by the name of CEDICE – The Center for the Dissemination of Economic Knowledge. Locally, as a measure of these bodies, the Free Market Foundation provides the information. Some of course would argue that the work the FMF does is biased and sits squarely with business.
For comparisons sake, see who is at the top of this list:
Hong Kong comes out tops. You might argue that there are limited political freedoms, comparatively speaking, you’d be right. I read with interest via Bill Bishop’s Sinocism email -> Cultural reflection can improve modern governance: Xi, that Chinese President Xi Jinping said via the state media platform: “the socialist path with Chinese characteristics is determined by cultural and historical factors.” Huh?
I am getting to a point here, and the conclusion will be swift. I was first brought to this economic freedoms via Mark J Perry, who contributes for the South African version of the FMF, who captured two important graphs, the same ones I will reproduce here and add another that I thought was of interest:
Ironically, the more economic freedoms and choices you have, the less the state interferes with the economy and the more liberal they are, the richer everyone in society gets, including the bottom ten percent. Plus life expectancy is raised when you have more economic freedoms.
The conclusion is simple, for me at least. Whilst the noble idea of creating a society that is equal would mean socialist utopia, the truth is that we are individuals with different circumstances, personalities, talents and skills. Buffett is right, the winners of the ovarian lottery (those born into better households) have a far better chance of making it further in life, it matters to whom you are born, it does not mean that is limiting.
It was of course the beloved Nelson Mandela who said: “Education is the most powerful weapon which you can use to change the world.” To achieve economic freedoms you need more accountability for all, less state interference and perhaps the only thing that the EFF and I agree on, a quality education of the highest order, although if the private sector does a better job, then by all means, outsource the entire department of education. Now that would open up a can of worms!
If the EFF really wanted economic freedoms, luxury goods for all and a higher quality of living, they would provide the platform for economic freedoms and not ideas that time and time again have failed. Be more Mauritius and less Venezuela. And in case you had any doubt with regards to economic policies and the will of ordinary people, ask yourself, which direction do the boats with illegal immigrants go, from Cuba to the USA, or the USA to Cuba?
This article originally appeared on Vestact.co.za
