IN THE wake of all our labour and social unrest, a wide array of "debates" (usually merely a series of emphatic declarations) have sprung up about what to do about the economy. From the left have come a range of angry and almost deranged suggestions, from nationalisation to the outright destruction of the entire economy as it stands, so that a new one can be "built". Its proponents point to Zimbabwe, currently enjoying a revival, forgetting it is on the back of a currency — the US dollar — over whose future Zimbabweans are powerless.
The more moderate suggest an "economic Codesa", so we may repeat in finance what we did in the politics before 1994 — that is, we negotiate our way towards a broad consensus over how we create and distribute wealth in South Africa. Are we to be capitalist or socialist? Does the profit motive survive? The proponents have a point — no successful society exists where such a consensus, however subtle, does not.
But there is no point talking if people are not prepared to move. In a tight situation like this, business acts instinctively and seeks cover in the lee of the state. But the state in South Africa is either dysfunctional or has collapsed. There is nowhere to hide.
For me, and I have written about this a number of times, the answer for business is to arm itself and defend our future. Forget the state. The ANC doesn’t understand the terrors of running companies. They are simply things where money comes from.
My idea belongs to Stephen Mulholland, once editor in chief of this newspaper. In the late 1990s he made a startling proposal that I supported then and still do.
Mulholland suggested that the answer lay in the JSE. If every company on the JSE were to raise its issued capital by 1% and pool it, it would raise, at the current market capitalisation of the JSE, something like R75bn, or, spelled out R75,000,000,000.00. If it did that two years in a row, it would double or more than double, the way the stock market is growing.
No shareholder meeting is required for a 1% capital increase. The market frequently moves by more in a day, and the sun still rises. Mulholland’s idea was that once this huge sum of money was pooled, it would effectively become our Marshall Plan, the project that revived Europe after the Second World War.
Except that this R75bn, or R150bn, would remain exclusively under private control. A sovereign wealth fund of sorts, although no politician would be allowed near it. The pool would be controlled by trustees elected by the listed companies. They would direct it solely towards repairing our broken infrastructure and in creating opportunities for poor people and communities.
Some of this would obviously have to be done in partnership with the state. But not all. There is no reason the money could not fund the building or repair and management of hospitals, say, or provide seed capital to poor people who have no ability to borrow at decent rates from the banks.
When Mulholland made the suggestion, big business was appalled. And now it is often said that too much of the JSE is foreign-owned for such a suggestion to work. But what price a stable society, especially for foreign investors perhaps? After the mining strikes and the ratings downgrades, what is R150bn? Business here feels it is on its own, up Sh#t Creek, as it were, without a paddle. But Mulholland supplied the paddle years ago and no one listened. The new team running the JSE sits on about R7.5-trillion of value. It should use its unique position to bat for the country.
LAST week I wrote about my impending cardiac procedure, an ablation, to kill off the nerves in my heart that were causing it to beat abnormally. I promised Beast Mtawarira, who has the same problem, that I would report back. It has been, so far, an overwhelming success.
I believe Beast has had ablations, but in Cape Town. Can I suggest to him he get in touch with the specialist cardiologist who spent five hours getting me right last Monday? Israel "Pro" Obel and his team at Milpark in Johannesburg were just wonderful. I know it is early days, but I cannot thank them enough for giving me back a taste of normal life.