Business Maverick


After the Bell: Why Julius Malema is the mirror image of Donald Trump

After the Bell: Why Julius Malema is the mirror image of Donald Trump
Julius Malema looks on before addressing his supporters during his campaign, ahead of the August 3 local government elections, in Etwatwa, a township near Benoni, South Africa. July 27,2016. REUTERS/Siphiwe Sibeko. Right: US President Donald J Trump (EPA)

Investors do, of course, want certainty. Obvs. What they don’t want is the certainty that someone will come and grab their assets. The notion that you will certainly be hit by a tidal wave does not normally incline one to take a dip in the ocean.

As part of his election campaign, EFF leader Julius Malema stated that his only demand for an alliance with the ANC would be that his deputy, Floyd Shivambu, should be made finance minister. With the ANC now seemingly trailing badly in the polls, the prospect of it allying with the EFF is an increasingly likely — and unpleasant — possibility. So, what would Floyd Shivambu be like as a finance minister? 

One thing we know about Shivambu’s economics is his decadeslong dedication to the idea of nationalisation. This raises an old question: Why does the EFF cling to the idea of nationalisation despite its absence from the economic agenda of nearly every left-wing organisation worldwide (with the exception of economic basket cases like Venezuela)?

This is a curious question, not that different in some ways to the question of why Americans still support Donald Trump in such large numbers. The world looks on aghast, repeating all the obvious points, which are well understood and undisputed by experts, historians, centrist figures, you name it. 

Yet, Maga supporters somehow rationalise these objections away with a brisk wave of the hand. Similarly, EFF supporters flatly ignore advice from neutral figures, experts, other political parties and history. It’s beyond frustrating. If pointing out the absolutely, bleeding obvious doesn’t work, what on earth will? Are we doomed? Are voters in some countries in some situations just so dedicated to their prejudices that no quantity or quality of facts can change their minds?

This is reminiscent of how children behave. As every parent knows, often you will say to a child with an outstretched hand, “Don’t touch that hot plate.” And what do they do? They look you in the eye, consider their options, and you can almost see their minds cranking into gear. They think this awful parent might be right. On the other hand, they want to prove they’re not a child (even though they are a child) and can make up their own minds. Independence, see! They want to show this awful, dictatorial rulemaker how wrong they are, and this overbearing imbecile will be sorry for being so uppity and patronising and know-it-all.

Then they touch the hot plate. And scream in pain. And do they thank you for your warning? Not so much. Entrenched in shame and anger, they claim it wasn’t that hot. Or something. New rationalisations and justifications follow.

This is the way of the world, people. Actions taken out of priggish, pugnacious, arrogant small-mindedness are everywhere. People who commit these actions never make mistakes because when they do, they argue it wasn’t the mistake that caused the bad outcome, it was the bad outcome that caused the mistake. It’s not about the issue at hand (nationalisation in this case); it’s about you. The problem is not the problem. You are the problem.  

Interestingly — I don’t know whether the EFF knows this — nationalisation was never really a part of Marxist thought, if adherence to a philosophical proclivity is the root issue (it isn’t). In a letter to Max von Oppenheim in 1891, Friedrich Engels commented, “Therein precisely lies the rub; for, so long as the propertied classes remain at the helm, nationalisation never abolishes exploitation but merely changes its form — in the French, American or Swiss republics no less than in monarchist Central, and despotic Eastern, Europe.” A very acute observation, I think we can all agree. Sorry. Most of us would agree.

So, now with this prospect of the EFF possibly being part of the government, Malema is being asked what he thinks investors will think of his economic platform. His response is just priceless.

In a recent interview with Bloomberg, Malema said he understood that investors would be worried about nationalisation and expropriation without compensation. However, he argued that what they value more is certainty. 

“What any investor wants is a clear policy as to what the policy is, and not the government speaking in forked tongues. Investors leave politics to politicians because they know they’ll still make money if they know and are assured about security and policy,” he told the interviewer.

This is wrong in so many ways, you have to clap your hand over your mouth to suppress the guffaws. Investors do, of course, want certainty. Obvs. What they don’t want is the certainty that someone will come and grab their assets. If that’s the case, then they certainly won’t want to invest because they will be absolutely sure of the outcome, and that outcome will be bad. The notion that you will certainly be hit by a tidal wave does not normally incline one to take a dip in the ocean. 

I’ve heard ANC representatives argue more or less the same thing. Whenever they do something incredibly stupid, which is quite often these days, they claim that, well, at least it clarifies the situation since certainty is the overriding concern of investors. The proposition is obviously untrue. I’ve always thought of it as a kind of base default argument — the kind of thing you say as a politician when you don’t have anything to say.

A better argument might be, well, the outcome is probably uncertain! You can’t say with absolute certainty that the outcome will be bad, can you now? Look at Botswana, an example Malema uses of where nationalisation worked. As everyone knows, the largest diamond mines in Botswana are jointly owned by Anglo American and the Botswana government. That he uses this as an example of what he calls successful nationalisation shows us exactly how little he knows about Botswana, diamond mining, history and the nature and consequences of expropriation. 

Botswana and Anglo developed the mines together, in partnership, from the start. Many governments do that; it’s called a public-private partnership. But grabbing an existing asset for yourself is different because, as soon as you do that, then the value of every other asset, not just the one you seized, is suddenly in question. Nationalisation is a form of theft. A fundamental underpinning of trust in society is broken, and regaining that trust is very, very hard, no matter how much, in your mind, the grabbing process was justified. Ask any Zimbabwean.

Why does Malema not understand the difference? I could be wrong, but I think his logic works like this: these assets were established through apartheid and, because of apartheid, they were therefore illegitimately owned right from the start because they were born in sin. In some ways, it’s like SA’s land issue. For “us” to retake assets is not intended as an assault on private property necessarily; it is simply an act of justified retribution. It’s not nationalisation, as such. And because it’s not nationalisation really, the well-known arguments against nationalisation as an inevitably disastrous economic issue are moot. 

Later in the interview, Malema sharply criticised National Treasury, which he said was not aligned with SA’s development needs. “It is not controlled from Pretoria,” he said. “It’s controlled from Stellenbosch.” 

Sigh. If only he knew in how many ways that view is wrong. SA’s leading Stellenbosch businesspeople are all very different; they have very different businesses (banking, retail, media, industrial, you name it); they are different ages; some made their money in SA (Michiel Le Roux); some made their money outside of SA (Koos Bekker). 

Crucially, they mostly made their money after apartheid ended, and that, oddly enough, includes Malema’s bête noire, Johann Rupert. When apartheid ended, Richemont was worth about $9-billion; it’s now worth around $90-billion. Some of them don’t live in Stellenbosch. It’s all a kind of convenient fiction.

But in a way, Malema’s ignorance about this all is a clue. It shows us he doesn’t think in concrete terms; he thinks in notions. He cleaves to racial epithets and glib characterisations. He prefers endpoints rather than processes. He tailors the truth to suit his purpose and his audience. He prefers glib simplifications to experienced reality. 

Just like Donald Trump. DM


Comments - Please in order to comment.

  • Geoff Coles says:

    I don’t like Trump though his rival is perhaps worse. Neither do I understand the comparison with Malema, Shivambu and the like, they are ignorant and overtly racist and more.

    • John P says:

      The comparison is summed up in the last paragraph especially the line “He tailors the truth to suit his purpose and his audience”

  • Bob Kuhn says:

    What a load of disengenuos twaddle comparing Trump to malema…..

  • Peter Ward says:

    What woke drivel from Tim Cohen. I don’t think he has a clue regarding the massive differences between Trump and Malema. Mirror images of each other, my foot.
    Clearly he would favour Biden over Trump, so that says it all.

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