THE ANC government’s socialist ideology will destroy the economy and the country within the next 3 to 4 years and the final countdown has already begun.
This ideology has been responsible for virtually no economic growth for the past 26 years and the still unlimited increase in the gap between income and the misappropriation of taxpayers’ money of the government that was directly responsible for the rising budget deficits, government debt, greater poverty, famine, unemployment and inequality
Socialism has proven worldwide in the past that it cannot create any economic growth and has been rejected by virtually all the countries that have accepted capitalism as the only system that can create economic growth and prosperity. Even China, which also started walking this path years ago, has grown by an average of 10% per year and even had to cool its economy by lifting all new infrastructure development. China has continued to grow by 6% during the ensuing low economic growth cycles in the world and the general expectation is that the country will grow by between 8% and 9% this year and will become the biggest economic power in the world within the next few years.
After 1994, the ANC decided to transform the economy based on a policy of a National Democratic Revolution stemming from the organisation’s Freedom Charter, which revolved around two divergent views that the “Radical Economic Transformation” could be brought about by measures such as nationalisation, where political control would be transferred into economic power, or via a more liberal path that would have involved the promotion of macroeconomic development and the growth of company earnings.
However, the ANC made the biggest policy mistake of its entire existence when it rejected the only other choice that could create economic growth in favour of “radical economic transformation” as the basis of its future policy. The right choice would have made a dramatic difference to the economic development in South Africa instead of the choice that led to the irreversible destruction of the economy that the country is experiencing today.
The capitalist economic system was not the cause of the severe socio-economic decline before 1994 that forced the economy and the country to its knees, but the policy of separate development of the previous political dispensation. Capitalism today is still the only economic system that can create economic growth as it is based on internationally accepted and most basic economic principles.
The ANC government never understood and accepted that economic growth is created only by the producers, manufacturers, traders, private service providers and others in the various industries on the supply side and private consumption expenditure, capital formation and net exports on the demand side of the economy, as proven every quarter by Statistics SA, which is driven by the profit motive that was the biggest single reason for the destruction of the economy.
The ANC government will therefore have to deregulate the economy as far as possible and limit its interference in the economy to the creation a political and economic environment that will be conducive to the creation of economic growth by the private sector which will also be the only solution to the serious economic and social problems of the country.
