The income indices of the top - 1% and 10% - and lowest earners, and how the top earners are doing better than ever (including 55 000 government worker millionaires), is not surprising. But it begs the (rhetorical) question: how did the country end up here?
Add other indices like economic growth and GDP per capita and the answers, at macroeconomic level, are clearer. The numbers show that we're worse off since 2010 than under apartheid. And this excludes crime rates, institutional function/integrity and qualitative social indices.
Between 1960 (there's no significance to 1960 except convenience) and 1990 the average economic growth rate was around 3.5%. From 1990 to 2010, except for a dip below zero in 2008 (global financial crash), it was 2.5%. Note from the 90s until 2008 SA's growth lagged behind peer group countries who achieved 5% and more off the natural commodities boom (why?).
Since 2010 growth declined from 3% to below 1% for most of the 2010s, excluding the Covid dip and post-Covid recovery.
Yet during this period of the country's worst economic performance, the wealthiest recorded a leap in income and the poorest a drop. Notably it coincided with Zuma's election and ANC corruption, at an estimated cost to the nation of R1 trillion, reaching epidemic levels.
The next important dataset is GDP per capita. From 1960 to 1995 it rose steadily from around US $500 to $4 000, dipped, then rose to $8 000 in 2010. Since then the trend is one of decline.
Interestingly, during apartheid each citizen's (white, brown, black) aggregate share of the economy increased despite, intuitively, one not expecting it because it was concentrated in a few million white hands.
The National Party lifted whites in general and Afrikaners in particular out of poverty. But compared to now, little has changed for the majority poorest who are black. The ANC, willfully, has not done the same for their people except the connected elite. While the rich live large, the poorest and even those who were once comfortable, are struggling.
The data shows 2010 is significant in South Africa's post-1994 history. Zuma, corruption and a gangster state of which the ANC is a lynchpin, rigid economy, anti-business policies maturing, collapsing infrastructure and institutions (NPA, SAPS, regulators etc) are throttling the private sector, entrepreneurship and society in general making growth very difficult if not almost impossible. (Compare the robust economies of peer nations and East Africa.)
2010 was also was the start of political instability and their leaning toward authoritarianism. Everything is connected.
The real rate of growth is the difference between the economic and population rates. With economic growth below 1% for extended periods and lagging population, the country socioeconomically is in decline. Including population growth of presently 1% into economic growth, which generally is not done, and the economy is worse off than it appears.
In 2023 SA experienced, I think, the first practical effects of its serious economic and financial difficulties with Treasury cutting budgets (while public workers received an unfunded increase and the emergency grant too was unbudgeted). But without welfare payments to 27 million people, which is something to be ashamed of and not proud of as Ramaphosa and ANC are, it's likely there will be an uprising - South Africans and the world will see poverty that's largely hidden from view.
While the ANC goes around the globe opportunistically defending victims of conflicts and glows in the adulation, SA's problems are worsening. We're on our own. It's a pity there's no world court that would help us.
Comments
Post a Comment