"It's a material world!" - shrilled Madonna in her 1980s anthem as Reaganomics and Thatcherism transformed the Anglo-American economic model and triggered an economic tsunami that swept across the globe, reshaping economies from Estonia to New Zealand. 

 

The unashamed adulation of individualism and free enterprise brought such obvious and tangible benefits to the wider public in the countries where it became a formal creed that even the hardened Left noticed – especially in the Communist states east of the Iron Curtain. Unsurprisingly, but to their credit, the ANC laid the foundations of a well-functioning enterprise economy when they came into office in South Africa in 1994.

 

But thirteen years on, something has clearly gone wrong in this country as crony capitalism and rampant materialism have, hand in hand, rotted our society. Capitalism, as practiced by our BEE millionaires, has nothing to do with the underlying meritocracy of Reaganomics or Thatcherism. Our shallow materialism, as a result, carries with it a whiff of frivolity and recklessness associated with undeserved wealth.

 

The endemic symptoms of this disease are there for everyone to see. SUVs and iPods are the benchmark by which our youth judge their success. Hard work, duty and integrity are no longer considered the golden touchstone of character. And crime, another by-product of the social changes involved, as my newsletter last week pointed out, has reached exorbitant levels. For not only wealth brings temptation: so does poverty.

 

President Mbeki was right this week when he lamented this sad state of affairs on the radio and rightly spoke of the need to rekindle a spirit of Ubuntu. Whilst I do not doubt his obvious sincerity, I do not think one should refrain from asking why we are faced with a meltdown in general ethics. The free market model has not, in itself, failed South Africa.

 

What has really failed us is the ‘South African free market model’ – with its obvious distortions and inherent vacuities. Whilst the ANC in government has conceptually accepted the wisdom of fundamental aspects of the free market economy, it has shown scant consideration of the essential features of capitalism, let alone the moral and social values which underpin it. 

 

This is a dangerous disjuncture which has lead to multiple contradictions in a government committed to, as President Mbeki eloquently put it, the "broad family of ideas that might be called Left." In practice, this has led to some truly bizarre policy outcomes.

 

The Finance Minister rightly said a few years back that people should not become dependent on social grants and should seek work. Yet it is the crippling rigidity of the labour market legislation that his government enacted which makes it onerous for work seekers to gain access to steady jobs or any jobs at all.

 

This heart and head split in government thinking is again expressed in its reluctance to develop standard anti-trust and a pro-competition legislation to break the grip of our private and public cartels and monopolies on our economy.

 

The consequences are painful for all who participate in this ‘free market’. Our bank charges, for example, are amongst the highest in the world. What incentive is there for poor people to place their money into bank accounts? Yet without banking facilities, people do not have access to loans to purchase property or start their own small businesses. These are the prerequisites of a functioning market economy, from Chile to New Zealand to Estonia. The tiny Baltic republic, incidentally, has one of the lowest rates of taxation in the world.

 

As a dogged believer in the free market, I believe wealth creation is a morally neutral activity. It is what one does with it that is important. Many in the ANC have clearly twisted the fundamentals of the free market model to suit the needs of its real constituency – the lucky elite few in its own ranks at the expense of the unlucky masses.

 

To measure the real success of our own free market model in practice, we need to look at our General Well Being (GWB), to snatch a phrase from Britain's Conservative leader David Cameron, as well as our Gross Domestic Product (GDP). Implied here is the classic tension between macro and micro-economics.

 

On another – and equally important – level it implies one’s sense of belonging to society, participation in civic society, health and spiritual wholeness.

 

The ANC has, there is no doubt, managed to keep the appearances of a growing economy. The substance of this growth on the ground, however, is as vacuous for many as the ruling party’s repetitive election promises. For without a basis in meritocracy, hard work, integrity and genuine individualism, the South African free market model will never eradicate poverty and despair or make a visible dent on unemployment and crime.

 

And Madonna, as much as we still enjoy your talent, you were wrong – this is not just a "material world!"

 

Yours sincerely 

 

Prince Mangosuthu Buthelezi MP