Sunday 27 August 2017

State Capture and the democracy that was



The topic of Politics is always frowned upon in social circles and people are often reluctant to debate political issues or developments, given our historical political landscape.  I was recently asked not to engage in any political discussions at a social gathering, for fear of offending someone.  In my opinion anyone who feels offended by a political discussion, should engage in some serious self-reflection and re-evaluate their standing and contribution to society. However, and understandably, with a reflection on our political history, these discussions or debates can become awkward, tense, and in extreme circumstances, can turn violent.

I take a strong interest in politics, not because I have an affiliation to a specific political party or movement, or for that matter have some kind of ideological belief, but merely because I feel, as a citizen and taxpayer, we need to keep our politicians (on both sides of the spectrum) ethical and honourable in their duty to society; however difficult or impossible that may be.  Holding our politicians to account is every South African citizen’s moral obligation to ensure they deliver on their promises and to ensure the future of our kids are not compromised.  Social Media has become an extremely effective tool for the purposes of the aforementioned, and is the perfect platform for any reluctant individual to air their views.

This invariably brings me to the subject of State Capture. As any South African, whose eyes are open for a minimum of 10 hours per day, would know, the story of the Guptas make the front page of most newspapers and the leading story on local News channels, almost daily.  The phrase “state capture” describes how an immigrant Indian family, the Guptas, have manoeuvred themselves into a position where they wield control over state-owned companies with their huge procurement budgets, diverting large sums into their own pockets and, by extension, the President, his family and his circle of cronies. While I will not go into extensive detail and bore you to death about this sorry saga, I will attempt to highlight some of the repercussions which affect every South African, as a result of this State Capture. This may shed some light on why I suggest that every South African citizen worth their salt are obliged to hold politicians to account, in whichever way we can.  Suffice it to say, without the involvement of the average citizen and civil society, we expose ourselves to the kind of exploitation and blatant theft witnessed in this State Capture.

State Capture is probably the most controversial and embarrassing of events that had befell South Africa since the days of Apartheid. The daylight robbery of SOEs (State Owned Entities), like Eskom, SAA, SABC, Transnet, PRASA and Denel, brought a whole new level of corruption and white collar crime in this country’s young history. The corruption in the Arms Deal is dwarfed by the scale of corruption in the capture of our state. The figure punted by former Minister of Finance, Pravin Gordhan, in state corruption was around R100 billion, which roughly represents 10% of Government Expenditure. He emphasised that this money could have doubled Social Grants for the 17 million South Africans on Social Welfare. It could have built low cost houses for 5 million families, not to mention the number of schools or hospitals that could have been built. A R100 billion could have made a significant impact to the rate of unemployment through job creation.

The most embarrassing thing about this story is that the perpetrators central to this pilfering are uitlanders from the Indian sub-continent who saw the potential for grand scale larceny through our compromised public officials and a pliable Government administration. They were so enamoured with this potential that they arrogantly set a goal of stealing no less than R10 billion in liquid assets in a set time period. Their South African citizenship is under investigation, but this did not deter them from realising these goals. The corruption and theft extends globally and implicates various multinational corporations doing shady business with the Gupta family, and corrupt government officials.

The impact on ordinary South Africans is far reaching with the most vulnerable in society being affected directly. As mentioned, the 17 million beneficiaries of Social Welfare could have benefited the most, but instead face more controversy around non-payment of their social grants in 2018. Over 30 million people currently live below the poverty line which is more than half of the total population in this country.

The country is currently in a recession, brought about by the ratings downgrades of various State Owned Entities, and subsequently a downgrading in the economy’s investment grade. In the bigger scheme of things this implies that Foreign Direct Investment in South Africa slows down, with the possibility of an outflow of current investments; a case in point, the exit of Ford South Africa.

As a result of the downgrades, and with little or no future investments, the prospect of job creation becomes a non-entity, and thus unemployment increases. The official rate as at June 2017 stood at a mind boggling 27.7%, the highest in 13 years. In numbers, that represents a total of 6.8 million of the employable people in the country. The unofficial rate which includes the number of people giving up looking for work sits at around 37%.

Service Delivery throughout South Africa has deteriorated to the extent that municipalities and local Governments were under siege by gatvol and frustrated residents. The latest audit report for 2016 of 263 Municipalities showed that only 49 country-wide, had clean audits. The total amount of money wasted through corruption was around R16 billion, an increase of a whopping 50% over the previous year.

SOE’s are bankrupt, with Treasury having to consistently bail them out. Public money urgently needed by other Social programs like housing, education and health is being diverted to these SOEs. The latest is SAA where it is alleged the government plans to sell its share in Telkom to keep SAA afloat.

The NDP (National Development Plan) vision for 2030 has been abandoned, as a result of the dire circumstances of our ailing economy. The economic growth forecast for the period 2010 through 2030 is envisioned as best case scenario at 5,4% and worst case scenario at 3,3%. Over the past five years the average growth had already breached the worst case scenario at a measly 1,6% annually. Based on these figures, the expected growth for the next 5 years is an average of only 1,8 to 2,0%. That’s assuming our economy is not downgraded further to junk status, in which case the forecast may be much lower.

Latest reports indicate that 73% of middle class income earners are buckling under extreme debt. The middle class is the spine of the economy and the tax base and a lot of South Africa’s sustainability as a nation depends on this group. This appears to be a direct result of increased expenses on the back of lower annual increases.

As can be seen from the above facts, the people most affected by the shenanigans of State Capture are the poor and the middle class backbone of the economy. Should the situation deteriorate, and the middle class collapses, there is a very strong possibility of becoming another Zimbabwe.
Madiba’s dream of a rainbow nation with the foundation of a prosperous society was stolen by three chubby, head bobbling brothers who are alleged to have racist views of black people in this country.  While trumpeting and promoting the notions of Affirmative Action and BEE, these thieves are secretly racist bigots. Our hard fought after democracy is in danger of becoming an almost well-deserved basket case if all patriotic South Africans don’t stand together and hold our government to account for their actions.


For more information on State Capture, see #Guptaleaks.

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