Opinion / 11 January 2020, 1:51pm / William Saunderson-Meyer - Jaundiced Eye
Ah, a new year! That wonderful time of momentarily unbridled optimism and hope.
Except that one knows things have hit a new low when the only time of the year that the country is assured of electricity is during the three-week festive season holiday break.
That's when all industry and construction has shut down, and much of the domestic cooking revolves around the braai fire. It's that time of the year when the most onerous burden on Eskom is to keep the fairy lights flickering on the Christmas tree, which, in any case, are nowadays often solar powered.
It's also a new low for South Africa when President Cyril Ramaphosa's solemn hand-on-heart promise to the nation that there would be no load shedding between December 17 and January 13 had been broken by January 4.
The King Canute-like failure of CR to decree a national power supply is emblematic of the failure of a “command” economy of state-owned enterprises (SOEs).
It also signals the president's general political impotence. Given the rate at which Ramaphosa is at present effecting change, he will have to be president for life to make the necessary impression. We do not have that long.
When the final figures are crunched, 2019 will be shown to have registered close to zero percent growth.
And while analysts are prattling excitedly about growth in 2020 being as much as 1.7%, everyone knows that because of private sector job losses and population growth, South Africa needs at least double that number.
The scale of the problem is shown by the SA Revenue Service (Sars) statistics just released. Sars paints a bleak picture: “Real GDP has grown slower than population growth for five consecutive years, and our current GDP performance on a per capita basis, is the weakest since the 1960s.”
The corporate sector contributed 18% of the tax revenue, but there were about 600000 fewer companies registered in 2017/18, compared with the previous year, and of those registered, only one in four made any taxable profits.
A mere 380 entities pay 57% of the tax collected from companies.
The dependence on the individual taxpayer is enormous, with 38% of government revenue coming from this source. But out of a population of 56m, 3m people pay 97% of personal tax and a minuscule 190000 - earning more than R1m a year - paid 37%.
We know from the government's Medium-Term Budget Policy Statement last year that 29000 public servants now earn more than R1m a year, a figure that has doubled in a decade.
So, the creation of wealth, in both the self-employed and corporate sectors, depends on a comparatively tiny number of people - fewer than 160000 individuals.
Yet, with the destruction of private health care and the expropriation of private property, the government is doing everything it can to alienate this group.
The Professional Provident Society has just surveyed its members, finding that 72% of all professionals would leave if the National Health Insurance Bill is implemented in its current form.
About 40% of the SA Medical Association’s members hold similar sentiments.
That's about the same as the 41% of all health professionals who, in a Solidarity survey, said they were considering emigrating, and of whom, 21% had already taken steps towards doing so.
Even if “only” one in 10 of those contemplating emigration will actually do so in the next two years, the economic effect will be calamitous.
The tax base will shrink, making impossible a system supporting 17.6million social grant recipients, 1.3million public servants, 920 elected national and provincial representatives, about 700 SOEs, 62 Cabinet ministers and deputies, and that single decorative cuckoo at the top of the Christmas tree.
The government will have to either cut out the deadwood or watch the tree topple over.
Perhaps worse, for the hopes of eventual recovery, is that the national knowledge store will be grievously depleted by that scale of emigration. Institutional memory will be irretrievably lost.
Year 2020, the beginning of a new decade. Or maybe just another step on the tripartite alliance's project, heading towards a revolutionary, Pol Pot type of Year Zero.