I THOUGHT the Currie Cup competition ended when the Blue Bulls stopped playing for the season. Apparently not.
There was still another game on Saturday between the Sharks and Western Province. I went to UCT, so you’ll guess where my allegiance lies. I hadn’t realised that Natal was now in the main league. When did they get promoted?
Okay, so the Sharks won convincingly. Why? Because they had a plan, that’s why. I knew they would as soon as they lost to Griquas.
After the All Blacks-Springbok game that produced more than enough red and yellow cards, there was common cause throughout the rugby world that a game played with all 15 players on both sides throughout was better than one without a full team on both sides.
Win or lose, a full fair fight is required. We have to deal with offending players directly, without depleting either side. They should be taken off for the entire game (or more than one game, depending on the severity of the offence), but a substitute should be allowed on so that full strength teams can compete with full strength teams. That’s what the fans come to see.
This is not only true on the sports field. A country’s full economic force cannot be brought to bear if it doesn’t field a full side.
In the real-time global business village that we have to operate in nowadays, competitive advantage is so short-lived that you’ve got no chance if half of your side is sitting on the bench.
South Africa is certainly fielding a depleted side at the moment.
Official unemployment is at 25.6% and the broader measure is at 36.8%. Our projected growth rate will fall woefully short of being able to reverse that. In fact it’s going to get worse. Similar challenges are being faced across the world. In Spain about 26% of the labour force sits idle, in Portugal it’s 17%, in France it’s 11% and the average in Europe is 12%. Youth unemployment percentages are worse than population averages everywhere.
Germany is the exception. With unemployment at 5%-6% it is half the European average. Angela Merkel embraced austerity. Go figure!
No matter how good some data look, you cannot have a jobless economic recovery. There is little solace in soaring stock markets fuelled by easy money for the few, if that wealth creation doesn’t spill over into the real economy and create jobs.
There are a number of structural issues that have to be addressed.
We live too long. In the olden days people literally used to die on the job while they were still happily married and had two children who had both already started working. All of that has changed.
Eighty is the new 60. At 50 you can start a whole new life. At 60 you should start a whole new career. Stop lingering. Stop hanging on to whoever or whatever you used to be. Stop clogging up the system.
Don’t become the chairman after being the CEO, it is just too silly and it stifles growth. Compulsory retirement at age 60, I say, rather than extended employment at the expense of the queuing, probably better educated, youth.
Get out and do something with your money and your wisdom, don’t leave it insulated for 20 years until you finally go. Maybe if everyone worked a little longer, they’d live a little shorter and their money would be taken out of the vault sooner and put back into the productive economy by their kids.
There should be no tax on money passed to your children while you are alive — they are going to spend it (productively or otherwise) in the economy, which will cause the economy to grow profitably and the government will get back more tax in a shorter period of time than it does from an idle bank deposit.
Beyond all the money sterilised by old people (either left decaying in banks which don’t lend it out to young people, or invested in near zero-use assets like holiday homes), there is other "dead" money that goes round and round in unproductive circles between the banks and the central banks, rather eloquently referred to as quantitative easing.
Stop feeding liquidity addicts and release that sterile capital into the economy to build things and create jobs. The time is now.
Unemployment levels are critical, all over the place.
I’m not familiar with the details of the proposed youth subsidy, but in principle, I’m totally for it. It is not a new concept. Examples such as the Youth Guarantee programme in Europe are already working elsewhere. Of course, we must ensure that we don’t go and mess this up now with nepotism, procrastination, corruption, consultant leak or any other of the afflictions which can plague well-meant government spending programmes.
It has become obvious that the main impediments to dealing with unemployment include current labour practices, the red tape you have to fight through just to get something started. South Africa is already losing ground to other African countries on this score. Discerning capital only has allegiance to the future. We’re getting left behind.
The fiscal prudence lecture we got given recently was necessary and overdue — but you can’t cost save your way out of unemployment, you have to spend. We are at risk.
How to be a developed country
CASH has been swishing around the world on a yield-seeking mission for the past few years, trying to find a place to earn a decent living.
Before the financial crisis in 2008, we were filling up the markets with air (just as we are doing again now), but at least some of that exuberance spilt over into emerging markets. After that we had Bernanke-care to keep the money presses running.
Money for emerging markets has been abundant. What have we done with it?
Have we made the most of these good times? Can any countries graduate from the past decade as the class of 2013 that makes it into the developed world?
No, not really, not yet.
Will we ever?
I think it all has to start with a plan, a long-term plan, a plan that may have to survive three election terms. That’s how long it might take for the new accord to take root, to change culture, to be a good habit, to fulfil expectations. So many inspired leaders have not been followed by others capable of seeing their strategies to completion.
So, partnership is vital. We are fortunate in South Africa in that the before, during and after people of our young, clumsy and transforming democracy are all still here. We can co-design the best of all outcomes from the best of all inputs. Although we have a population of 52-million, we’ve been through stuff together, and that means we all know who has to be at the table, to come to terms, to construct an enduring plan.
We will be required to be bound at the hip, old and new, by necessity, by the need to survive intact for the next era of our togetherness. It will take determined and credible leadership to gather the top 200 people (that’s probably all we need) required to hold hands — they’d all fit easily into a school hall. We can no longer simply hope to be greater than the sum of our parts, we have to merge now, to create one nation, accepting differences but submitting to a higher common cause.
Let us lay the ground rules to get South Africa into the developed country graduation class of 2021, say? We’ll have to pass some tests. There remains a lot to do. A plan towards broader economic participation (not BEE, not transfers, participation) will be required to narrow the economic divide which is now close to revolutionary limits.
We have the dubious honour of the highest Gini coefficient in the world. We will need to privatise all but the most essential services. We’ll have to loosen up labour practices. We’ll have to change to an environment that enables new business. Compare the outcomes in Chile (which got this right) and Argentina, which did not.
The common thread among the success stories elsewhere is that the state was the primary driver, behind a leader with a vision — but that vision was embraced and adopted by the private sector. No partnership with business, no deal.
Policies of openness to foreign investment, uncluttered and clearly defined bureaucracy, and simple financial rules and systems have proven to be the right recipe to attract foreign direct investment.
Foreign investment cannot be a substitute for local endeavour, it has to be a partnership which, over time, transfers technology and skills to the local population.
If not, we’ll fight it.
Political tension is a killer for investment. That, and uncertainty over the rules of fair play, are automatic disqualifiers for capital that has choice. You have to play by the rules of the new world order if you want to trade freely in the club. Women should be allowed to drive in Saudi Arabia, I think.
Liberation from oppression has sparked economic revolutions, awakened huge growth, alleviated poverty and softened social unrest. But too often there has been no liberation dividend.
If the promises aren’t fulfilled, if the spoils aren’t spread around, then the disappointment will take a nation back to a place worse than before.
Such is the risk facing our country. The rainbow dream has left a broadly based expectations gap, the liberation dividend has been held close to the chests of the few. The poor are poorer, the rich are richer and no more in number, racism is alive and well. We can only solve it together. Business leadership must be invited into the inner sanctum of government decision making, now.