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Expropriation without compensation and its discontent

Mzukisi Qobo is head of Wits School of Governance (designate), University of the Witwatersrand.

We should acknowledge that the current social arrangement in South Africa is an outcome of an ugly history of dispossession. It is this social history that enabled the propertied class today – the white minority – to thrive, while creating a vicious cycle of poverty among the black majority.

Land expropriation without compensation has thrown into sharp relief the ideological, racial, and socio-economic divides that still exist in South African society.

Much of the public debate on expropriation is very linear. It considers the consequences that would follow expropriation, with plenty of examples such as Bolivia, Venezuela, and Zimbabwe, among others, often cited as pitfalls we should avoid. What is overlooked are the conditions that have given rise to this nationalistic agitation.

Some analyses have, wrongly, blamed the ANC’s predisposition to land expropriation through constitutional amendments on the Economic Freedom Fighters, suggesting that the ANC is donning the ideological garb of Julius Malema’s troupe. Even without the EFF, any ruling party with social democratic pretensions will be where the ANC is on the land question today, given the stubbornness of social inequalities and landlessness.

In fact, it was back in 2007 when the party expressed its dissatisfaction with the limitations of willing-buyer, willing-seller proposition, and five years later when the EFF was still in its nappies, that the ANC coined the notion of “the second phase of the transition”, framing the Constitution as imposing strictures to transformation. It is erroneous to credit the ANC’s radicalisation to the EFF; rather, this is influenced by the shape of socio-economic inequalities, largely race-based, that we have become inured to. In the quest to protect its traditional constituency and outflank the EFF, the ANC may have moved with speed in a direction it was in any case headed to.

Many of the counterarguments marshalled against the propositions for land expropriation offer neither historical context to the structures of inequitable patterns of land ownership nor viable solutions for addressing deep-seated inequalities and marginalisation of the black majority. Whether they are conscious of it or not, they seek to reinforce the status quo – that life must go on as it is.

Major historical texts on South Africa’s economic history, from the works of AP Cartwright’s Paved with Gold, to Monica Wilson and Leonard Thompson’s Oxford History of South Africa, Charles Feinstein’s Economic History of South Africa, to the more recent works by Sampie Terreblanche on inequality in South Africa and Martin Meredith’s book on Diamonds, Gold and War, have all underlined land dispossession and conquest as the basis of the evolution of modern South Africa.

Denial of human dignity, destruction of human spirit, and wastage of talent were the seeds upon which the current propertied class reaped its wealth generationally.

The French thinker and anarchist philosopher, Joseph-Pierre Proudhon, had long observed that property is theft, and this is no more so than in the South African case, where property relations remain marked by acute inequalities – essentially between the propertied and the propertyless.

By propertied class I refer here not just to anyone who possesses a title deed or has a shelter over their heads, but those who by virtue of their skin colour were favoured through legislation to acquire productive land at the expense of the disposed black majority. They were able to use this asset over time as a leverage for wealth creation – to get ahead materially, to afford the comforts of life, to take their children to better schools, to build social resilience and to bequeath material legacy for future generations of their kin. The experience of the black majority was the complete opposite.

Property in the form of land that is utilised for productive activities has historically been an important basis for wealth creation among white South Africans. Earlier Randlords such as Joseph Benjamin Robinson, Lionel Phillips, Max Michaelis, Sammy Marks, Thomas Cullinan, Alfred Beit, and Cecil John Rhodes, among others, understood the importance of land ownership to accumulate wealth and as a bequest for future generations. This is also why the Boer Republics granted exclusive Burghers rights to the Boers who were on the margins of economic ownership before the creation of the Union of South Africa in 1910.

A critical element of Burghers’ rights was ownership of potentially productive land, not just a title deed on any fallow ground. Any Afrikaner aged 16 to 60 could exercise the Burghers right at will. All they had to do was to hop onto a horse and ride on a chosen field for a period of about an hour – or until they got tired – along a vertical axis, and repeat the exercise for another hour on a horizontal axis, and that would define their Bhurgher’s portion.

Much later, after the promulgation of the Native Land Act in 1913, this group would be among the largest landowners in the idyllic and most productive rural parts of the country, where they would engage in commercial agriculture with the state betting on their success, pumping them with subsidies, feting them with financial assistance, and creating market linkages for them. Black South Africans were an invisible lot, except appendages to the white-owned economy and to minister to the needs of this agriculture class and the English capital in the mining sector. They could not even augment their wages as capital to open business in the lucrative urban centres as they were prevented from doing so by laws such as the Urban Areas Act.

The major divide in South Africa today continues to be between the propertied and the propertyless social groups, with their position in the social hierarchy largely defined by race, and as a factor of apartheid’s social legacy. There is, in between, a layer of the middle class, a fickle group that could easily fall into the poverty side of the divide if they were to miss their monthly pay cheques. They are largely at the mercy of creditors. Their assets are not of such quality that they can leverage them for wealth accumulation on a sustained basis. Even among the enterprising among them, accessing capital from banks or development finance institutions is an uphill battle. They don’t have sufficient social capital to call upon to generate sufficient collateral to contribute a skin in the investment game.

The conditions of the poor and the working class are even worse. Despite the simplistic equation of the Peruvian economist, Hernando De Soto, who wrote in his book, The Mystery of Capital, that title deeds are a ticket out of poverty, title deeds do not inoculate against poverty; they are not not sufficient, although necessary, for wealth creation. Rather, it is high quality assets that can be leveraged for wealth creation. These are in the form of equity, productive land, decent housing, and financial security.

This is not to suggest that title deeds are not important, but they are not by any stretch sufficient to address the structural conditions of poverty and inequality in society. A home, protected by a title deed, is an assured shelter against caprices of authority or those who could exercise might to snatch it away. As Hannah Arendt points out in her book, Human Condition, a private property is a place to safeguard privacy and intimacy in the private space. It is this that property rights in the modern times primarily seek to protect.

The primary reason why expropriation is not a sound instrument is that watering down property rights by amending the Constitution could leave the door open for arbitrariness and unbridled tyranny over the private, four-walled, intimate space, both today and in the future. This is is disempowering. As Arendt warned, expropriation may not end with the withering away of the wealth of the propertied minority, but could lead to “the abolition of property in the sense of a tangible, worldly place of one’s own”. This would not only devalue assets, but also make investment a very risky gamble, and in the long run render the position of the poor worse off.

Rather than simply resisting calls for expropriation, the debate on land reform should awaken us to the urgency of resolving skewed property relations in South Africa. We should be preoccupied more with means and strategies to extend access to property for the greatest number of citizens who are asset poor. If the black majority has access to means of wealth accumulation or to assets they can bequeath as a security to future generations they may turn out to be ardent defenders of property rights. Currently they consider themselves as not having much to lose.

As a starting point we should acknowledge that the current social arrangement in South Africa is an outcome of an ugly history of dispossession. It is this social history that enabled the propertied class today – the white minority – to thrive, while on the other hand creating a vicious cycle of poverty among the black majority.

Our major focus should be on how best to address these social inequalities, finding ways to construct a genuine and shared platform to drive long-term social and economic change where the historically excluded groups can be key participants in the economy and, failing which, to propose more radical doses of driving transformation short of expropriation and without compromising policy and regulatory certainty.

We should be talking more about how to improve the human condition of the black majority rather than fixating on assuaging the fears of the wealthy and propertied few. DM


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