Ending poverty is our moral obligation: it also makes for good economics

File photo: David Ritchie

File photo: David Ritchie

Published Jul 4, 2017

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One of the rude awakenings I received in first-year university, second only to (negative marking) was to learn in my economics class that rich countries of the West throw away billions of dollars of food out at sea instead of giving it to poor countries or poor people even in their own countries and this was good economics.

An academic from Illinois State University explains this phenomenon this way: “Food producers in America do have excess food. But, they are also businesses. The success of their business depends on consumers purchasing their food. So, when they have excess of that food and it sits around not being bought, they don’t know what to do with it.

“They could toss it, or they could sell it for cheaper than they originally tried to, which means it loses value and they could, of course, give it away, but then people who are buying it would be like, ‘What the eff, I just paid 10 bucks for these corn dogs, and now you’re giving them away?’ So that devalues the brand.

“Every time you sell it for cheaper or give it to some guy free, you devalue the brand. And then nobody with money buys the product and then the stock plummets and then they don’t have a business anymore. And then they don’t even have that food that you are giving them a hard time about throwing away anymore.”

It is this quagmire that got Professor Ismail Serageldin so worked up giving the 9th Nelson Mandela Lecture on Social Justice.

Social justice is the foundation of the modern South Africa. Apartheid was the epitome of social injustice and its overthrow was a great moral victory for freedom, equality and justice.

The two pillars of achieving social justice would be freedom and equality. Society’s assistance to each individual to ensure that they acquire such capabilities becomes itself a human right since it is necessary to exercise the other rights.

Without that, there can be no social justice.

History, however, has moved a different way, almost away from social justice which must serve as the foundation of all countries. There are those in power, who always seek a certainty and simplification that justifies cruelty towards those not like us. They look at the desperation and disorder of the powerless, how it twists the lives of children on the streets of Diepsloot or Alexandra in the same way it does the lives of children in Khayelitsha or Bonteheuwel, the path for them between humiliation and untrammelled fury, how easily they slip into violence and despair.

The response to this should be sympathy and offer of assistance. But no, the response of the powerful to this alternates between a dull complacency and, when the disorder spills out of its prescribed confines, a steady, unthinking application of force via longer prison sentences and a hardening of lines which dooms us all.

In February 2015, Statistics SA released a report on poverty which revealed: 21.7% of South Africans live in extreme poverty, not being able to pay for basic nutritional requirements; 37% of people don’t have enough money to purchase adequate food items and non-food items so they have to sacrifice food to pay for things like transport and airtime; and 53.8% of people can afford enough food and non-food items but fall under the widest definition of poverty in South Africa, surviving on under R779 per month.

In February 2016, France became the first country to penalise shops for chucking out unsold groceries, rather than giving them away.

This is a first step to take us into a country that the great polymath Tagore talked about: “Where the mind is without fear and head is held high, where our nations are no broken into fragments by narrow interests and walls.”

For South Africa, however, the primary point of departure is the heartless and greedy behaviour of major companies that have colluded to make food prices much higher, further taking away from the little that the poor have to buy food essentials.

The ANC knows there is an urgent need to dismantle monopoly practices and structures and the party’s position on this is articulated on its “economic transformation chapter” of its national policy conference discussion documents. “We seek to open up the economy to new players,” the ANC says, “to give black South Africans opportunities in the economy and indeed to help make the economy more dynamic, competitive and inclusive.”

The ANC further states it wants detailed investigation into the underlying structure of the economy to recommend a way to reduce and remove barriers to entry and dismantle monopolistic and oligopolistic structures in certain key sectors.

This is not a new phenomenon. It may have been such seeming inhumane acts that may have led to the great Oliver Goldsmith in 1770 to say: “Ill fares the land, to hastening ills a prey, where wealth accumulates, and men decay.”

Even in the 1700s, the world was already becoming richer and

industrialising but, surprisingly, the more others were getting richer, others were getting deeper into poverty.

Out of the conference, the ANC must rededicate itself to more decisive policies to end poverty now and deal with the other two of the “triple challenge” of unemployment, poverty and inequality.

Diko is an ANC-aligned thought leader and founder of YD Media, a PR firm which seeks to create, improve and expand brand favourability and reputation for its clients.

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