LUDWIG von Mises could be called the poster daddy of the Austrian School of Economics. He was born in Austria-Hungary (when it was still an empire) in 1881 and lived to the age of 92, when he died in New York in 1973.
He had immigrated to the United States in 1940 and was visiting professor at New York University from 1945 to 1969.
That is a long time ago, but his ideas are alive and well to this day. An institute promoting his thinking is based in the United States, and South Africa has its own Ludwig von Mises Institute. To illustrate, you would not think that someone born in the 19th century would have anything useful to say on South Africa’s Economic Freedom Fighters (EFF,) Julias Malema’s latest attempt to escape obscurity, would you? On the contrary, look at this:
“Men are born unequal and it is precisely their inequality that generates social co-operation and civilization. Equality under the law was not designed to correct the inexorable facts of the universe and to make natural inequality disappear ...
“What those people who ask for equality have in mind, is always an increase in their own power to consume. In endorsing the principle of equality as a political postulate, nobody wants to share his own income with those who have less. When the American wage earner refers to equality, he means that the dividends of the stockholders should be given to him. He does not suggest a curtailment of his own income for the benefit of those 95 per cent of the earth’s population whose income is lower than his.”
That is true not only of the EFF but also, of course, of the ANC, whose policies of “transformation,” “empowerment,” “equity” and “ubuntu” have dropped South Africa on the very slippery slide towards the ditch where failed states end up.
In ANC-speak “transformation” does not mean transforming South Africa from a racist apartheid state to a free and fair state where people have equal rights and equal opportunities, it means transforming South Africa into a racist ANC state, a neo-apartheid state where race classification is as important as it was under apartheid. It also means transforming yours into mine, competence into incompetence, service into looting, success into failure.
In ANC-speak, however well-sounding their definitions, “empowerment” does not mean creating economic opportunities for people who never had them, it means empowering leading ANC members by transferring obscene riches to them and transferring slightly lesser riches to their comrades and cadres while blaming the ever-worsening misery of the masses on apartheid.
In ANC-speak “equity” does not mean that the work place and the places of higher learning will be open to all, that all applicants would be equal or that the opportunities would go to the most deserving candidates. It means that your right to earn a living and pursue happiness will be decided on your skin colour and cadre deployment, irrespective of academic excellence, qualifications and experience.
It means that the A student will not get into medical school but the one who almost failed mathematical literacy will. It means that dunces who have no logical idea of the subject matter not only pass year after year; they become the teachers of the subjects they fail to understand.
In ANC-speak “ubuntu” does not mean that ethics, justice and fairness are good. It means they are bad. It means you do not kick liars and crooks out of Parliament; you kiss, hug and embrace them.
One of the reasons I admire Von Mises is that he famously insisted on speaking the truth, no matter how unfashionable it was. Another is that, as a disciple of the markets, his instincts were almost always true.
I say “almost” because even the good can be driven to the extreme. Von Mises himself would have been shocked, I believe, by the obscene manner in which the bankers and their financial accomplices transferred billions to themselves at the expense of society at large and the poor in particular in the events that led to the economic crisis of 2008 and beyond. Even when they failed disastrously, they still paid themselves lewd bonuses.
My interest in Von Mises and his student and colleague, the Nobel laureate Friedrich von Hayek, took me to an interesting interview on the legal website Acts Online. Written by Ciaran Ryan and posted last month, the interviewer explores the views of attorney S.A. Watson, an associate of the Ludwig von Mises Institute South Africa.
Watson makes a study of the new laws passed in our brave new country and puts them to a test: what does this law mean for individual liberty? Does it free us or not? Does it enslave us?
Well, as we all know, we were liberated in 1994 by the courageous and victorious armies of the ANC. In the ANC narrative the Struggle of the United Democratic Front (UDF) since 1983 was just a side-show and the Nats’ roll-back of apartheid laws in the eighties did not happen. So with the ANC in power and holding a majority of about two-thirds in Parliament, all new laws would liberate us even further, not so?
On the contrary, says Mr Watson. South Africa is on a dangerous road and he believes he can tell the difference: “I grew up in Zimbabwe so have experienced what it is like for a country to collapse.”
And far from being non-racial (the creed of the UDF) everything is racial in ANC South Africa. The legal system is arguably more racial than before 1996 ─ educational enrolment, job opportunities, tenders, grants, water and mining rights, sporting representation, the allocation of pension funds, even charities, race is a criterion for everything. “All businesses today have to be graded based on their racial profile and are penalised or rewarded according to who they contract with. Every day you will see businesses bragging about how well they have implemented these racial laws,” says Watson.
As for the protection guaranteed by our world-renowned Constitution, he believes Government is using the Constitution to cloak its destructive actions with a veneer of legitimacy. The ANC uses the Constitution as a moral basis for infringing rights.
South Africa rates poorly in his liberty test, for reasons including:
- Its military is oversized, over-equipped and it interferes in Africa.
- The healthcare industry is excessively regulated. A doctor, for example, cannot even qualify without doing at least two years labour for the state.
- All educational institutions in South Africa are controlled in some way by the government and there are no significant private universities in the country.
The Government controls every conceivable aspect of commerce through permits, labour laws, competition laws, reporting laws, pricing laws, numerous racial laws and taxes. A Business Licensing Bill has recently been published, which envisages the mandatory licensing of every single business in the country before trade is permitted.
Watson believes many laws in South Africa should be abolished, including:
- The Municipal Systems Act, because it has created mini-mafias.
- The Competition Act, because it is destroying competition.
- The Labour Relations Act, because it creates unemployment.
- The National Energy Act, because it disrupts the energy supply.
As a simple rule of thumb, he says, compare what a law is meant to achieve with its outcome and the chances are good it is exactly the opposite. For instance, the National Energy Regulator is meant to ensure the supply of energy, and the Competition Commission is supposed to promote competition.
Just as the department that enforced apartheid was called “Co-operation and Development.”
A Luta continua.
By Pieter Schoombee