South Africa takes the road to penury, tyranny, and famine

Dalrymple writes that farmers, however efficient,

tend to be heavily indebted, but their debts are performing so long as they produce profitably. Expropriation of their land leaves the banks holding huge unserviced debt, for the new owners, producing much less or nothing at all, have no means to service them. The only way to prevent the banks from collapsing is drastically to increase the money supply and to keep doing so.

One might have hoped that the example of Zimbabwe, with its long border with South Africa to the north and its long stream of refugees to the south,

would have been sufficient warning to South Africa not to embark on any similar policy. After all, the stakes are much greater than they were in Zimbabwe. The population is many times larger than Zimbabwe’s, and vastly more urbanised, so that any last resort to subsistence farming is impossible. There is no south for the population to flee to. South Africa’s is already a much more violent society than Zimbabwe’s ever was, with more severe social problems. A catastrophe could easily ensue.

A fifth of white land in South Africa has already been transferred on the basis of willing seller, willing buyer.

  • Why were the sellers willing to sell when they had been settled for so long? Because the longer-term prospects for them in South Africa are dim; many white farmers have been murdered and the rhetoric towards them has long been of a threatening kind which sooner or later would have to be acted on if the rhetoricians were not to lose face.
  • Have the persons to whom the transfers were made maintained former levels of production? It would be surprising if productivity were not changed for the worse. Large-scale commercial farming is not something that is learned in the twinkling of an eye.

From Marx, Capital, volume 1, chapter 32

Dalrymple notes that commercial farms in South Africa

are heavily indebted to the banks. If the farms were expropriated without compensation, the state, or to whomever the state passed on the farms, would be taking on the liabilities as well as the assets. State farming does not have a very good record anywhere in the world, to put it mildly; and it is unlikely that people could be found to continue farming the land profitably. Either the banks would be obliged to write off enormous debts, with the consequent possibility of collapse, or a Zimbabwe-type inflation would have to come to their rescue. This is without mention of the severe food shortages that would occur. The expropriators are expropriated. The problem is that those in whose name the expropriations take place starve to death afterwards.

The very possibility of expropriation without compensation

will have a devastating effect on production, for who will invest if it is only to be expropriated later? That is one of the reasons why security of property is so important, and the South African parliament has shown that it does not understand this. The spectre of expropriation will encourage more commercial farmers to leave and they will not easily be persuaded to return.

Dalrymple says that expropriation without compensation

is so obviously a bad idea that the wonder is that it has been voted as a possibility, all the more so as there is the experience of South Africa’s northern neighbour to draw upon.

Mere stupidity does not account for the proposal.  When Dalrymple was in South Africa he met prominent members of the African National Congress. He had the impression that they were

positioning themselves much as the Russian oligarchs positioned themselves. It was a question of the division of the spoils in a corporatist state. They would set about disproportionate self-enrichment under cover of the rhetoric of dramatic change after an oppressive past.

Rhetorician of resentment

The ANC’s task now

is to ensure the continued loyalty of the political class. There is no better way of doing this than by arrogating powers of patronage, both to confer and to confiscate property. This can all be done under cover of the rhetoric of resentment; and the policy will be disastrous only if its aim is the betterment of the lot of the population. If its aim is the consolidation of power, at least for a time, it makes perfect sense.

 

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