How to Fund a National Health Insurance Scheme

The DDF (Direct Democracy Forum) have blithely aimed to initiate a National Health Insurance Scheme for South Africa, based on a monthly deduction of R600 from their proposed UBI/BIG (Universal Basic Income/Basic Income Grant). The DDF have been avoiding the issue of how that would work, money-wise, largely because they did not know, with any certainty, what spend was needed.

Some research along with an independent source (Compare Guru) puts that spend at 8.8% of the GDP.

The arithmetic for that is as follows:

Assume a GDP of R3 Trillion.

The SA’s health spend is said to be 8.8% of the GDP = R3 Trillion X 8.8% = R264 Billion (includes public and private resourced health care).

Assume a Citizenry of 35 Million each getting a UBI/BIG, from which is deducted R600 per month and paid over to the NHIS.

So contributions from the UBI = R600 X 35 Million per month X 12 (for a year) = R252 Billion.

The point being that the R252 Billion contributions from the UBI/BIG are in the ballpark for the national health spend of R264 Billion.

The conclusion is that a NHIS funded from a UBI/BIG is doable.

We believed that was the case but it is nice to have some numbers with which to back it up.

See DDF Health Care Policies

The Third Economy

Jeremy Rifkin’s works, in particular ‘The End of Work’ and ‘The Zero Marginal Cost Society’ have had the world talking because they are a take on a very real problem, the decline of the (non-specialist) labour market which together with burgeoning population predicts huge proportions of the world’s populations facing unemployment and poverty while an ever diminishing proportion of specialists (the elite) are stunningly successful and affluent, all the time while capitalist productivity rises and demand falls. In short they are arguing that Capitalism will become the victim of its own success and end up producing large volumes of goods for which there are few markets and (presumably) capitalism will eventually implode.

Rifkin imagines that the employment slack will be taken up by the rise of a third economy (the first and second being the public sector and the private sector economies). This third being largely a social economy or a ‘social commons’, servicing diverse community needs through non-profit non government organisations powered largely by a low-paid, oft-times voluntary and probably relatively unskilled workforce. Rifkin imagines that the third economy will service the social needs of society which are not being met by a shrinking public sector economy, which is under constant budget constraints, nor being met by a disinterested private sector economy for which there is little profit in public service. Rifkin also envisages much shorter working weeks with more workers earning lower weekly wages, to try and help take up the employment slack.

Writing here in 1995, Lance A Compa, then of Cornell University, notes that in addition to the reduced working hours, Rifkin proposes a social wage funded by a value added tax (VAT) (in the USA) but excluding vat on basic necessities, along with defence spending budget cuts. Aronowitz and DiFazio in their book ‘The Jobless Future’ also propose reduced working hours but with more progressive income taxes instead of a VAT, along with a host of other measures, many of them in support of social welfare type expenditure along with infrastructure spends to help take up labour slack.

According to Compa, both books imply “a willing turn toward a shared genteel poverty”. However, Compa does not seem to share Rifkin’s nor Aronowitz and DiFazio’s sense of gloom regarding employment, and instead argues that history and the current experience suggests “that there is still plenty of work to be done and plenty of people wanting to work”. In short he is suggesting that while the mix of supply and demand for work is changing, it is not evaporating.

The Direct Democracy Forum (see DDF) have a slightly different take on these problems, agreeing in part with Rifkin et al’s perceptions, on the one hand, and in part with Compa’s contrary view, on the other.

We agree that three separate economies are emerging, the already existing public sector and formal private sector economies and a third economy that we would categorise as an informal private sector economy, an alternative to the formal sector economy of the Fortune 500 corporates and their ilk. We imagine this economy as being a merging of the formal and the commons economies of Rifkin’s imagining, but definitely not a second class economy of genteel poverty as Compa interpreted Rifkin et al to imply.

We do not believe a social wage will work as an adequate motivation for employment (as demonstrated by the failed Finnish so-called Basic Income Grant experiment), rather we see the need for a UBI or BIG (Universal Basic Income or Basic Income Grant) which, being universal and unconditional, goes to every adult citizen in an economy. We believe that an adequate UBI/BIG will to a large extent pay for the basic needs of most recipients. Those needs which cannot be met by a UBI/BIG we believe will motivate folk to trade with others in their communities and in this ‘third economy’, for mutual profit. Some may be content to seek low income service positions in NGOs and other service organisations but nothing will stop the more ambitious from exercising their entrepreneurial skills to rise above a mere survival level.

The DDF anticipate there could be significant movement between the formal and informal economies, of skills and labour and finance, as members of all three economies interact and move between the economies, as and when circumstances allow or dictate. So the DDF don’t see a rigid stratification where the ‘have-nots’ cannot or may not enter into the domains of the ‘haves’. Nor do we envisage the opposite.

Rather we see a more fluid society with movement between the different economies occurring more or less on a voluntary basis. Because whichever economy one occupies, the basic needs of everyone could be met from the UBI/BIG, there would be less importance attached to which economy one occupies at any point in time, and less stigma attached to not being a part of a formal economy if one is part of the informal third economy. That is not to say that one should lack ambition, just that it would not be a question of life or death, or survival or poverty, so much as to how one can move up (or down) in society, either within the economy one occupies or between economies, so as to improve one’s circumstances.

The question of how to pay for this UBI/BIG leads us to the topic of tax reform. A UBI/BIG in most economies would exceed the GDP. So, if one were to tax the GDP to pay for a UBI/BIG, that would be the same as having a higher tax than one earns, say a 120% tax on income. Clearly that would not work.

Before we look at an alternative to income tax, think of how iniquitous income tax is. What the tax authorities say, is, if you succeed, if you earn a wage or salary (you are one of the employed and therefore a success when compared to the unemployed), or if you trade at a profit (you are a success compared to those who trade at a loss), we will take from you, a part of that wage, salary or profit. Generally, the goal is to collect 30% or more of one’s income (or the GDP) in taxes. However, if you fail (do not earn an income or declare a real or concocted taxable loss,) you get off scot free, or tax free.

So what is the alternative? Both Rifkin and Aronowitz and DiFazio suggest that we add more and more complex taxes, when we should at least be trying to simplify taxes and make the collection process less complex and less expensive, even if we cannot actually reduce the taxes themselves. The DDF believe that is too complex and too costly and also believe they have a more effective and more economical alternative solution.

The DDF has a core policy to replace income tax and all other taxes, direct or indirect, with a Total Economic Activity Levy or TEAL. TEAL levies all the funds flowing through an economy’s banking system. In South Africa, where we have a good idea of what that amounts to, a ½% levy on all the transactions debited or credited to one’s bank account in all the bank accounts in the land, would collect about 30% of the GDP. This in effect reduces one’s tax payments from 30% or so of one’s income and profits, to 1% of one’s income or 1% of all of one’s trading activities (½% on all debits and ½% on all credits in your bank accounts). This presumes that you spend all that you earn. By comparison, banks in South Africa can charge more than ½% on all transactions for bank fees.

The DDF think TEAL is a far more equitable system than income and profits tax. Some of the advantages of TEAL are:

  • 1) All will pay the same low ½% TEAL.
  • 2) TEAL effectively works like a progressive tax, thus the more active you are in the economy the more TEAL you pay in absolute terms.
  • 3) TEAL is uncompromising and unconditional – all persons active in the economy’s banking system pay TEAL, so there are none who get away scot free (or tax free).
  • 4) TEAL broadens the tax base from the narrow GDP tax base to a much broader tax base, encompassing all economic activity in the economy. In South Africa this broader tax base is, on average, some 30 times the value of the GDP.
  • 5) TEAL can be thought of more as a rent that everyone pays rather than a tax that only some pay.
  • 6) The cost of collecting and administering TEAL is estimated to be some 10% of the costs of administering the conventional tax systems.
  • 7) The savings from implementing TEAL would more than pay for the costs of implementing and running a Senate, drawn from the streets rather than from a political party base, thus broadening and strengthening the reach of democracy at little or no extra cost.
  • 8) TEAL makes a UBI/BIG fiscally possible.

So how does TEAL make a UBI/BIG possible?

In South Africa’s economy, a 2.165% TEAL on all the economic activity, as measured by the flow of funds through the banking system, will pay for;

  • 1) the fiscus
  • 2) a moderately significant UBI/BIG
    • including funding for a National Health Insurance scheme,
  • 3) an Advancement Grant
    • to pay for Tertiary Education or any other advancement initiatives,
  • 4) help seed a Sovereign Wealth Fund.
  • 5) A UBI would effectively be an investment in the demand side of the economy, stimulating both the demand side and the supply side of the economy and both the formal and informal economies.

We believe the above makes TEAL an eminently more desirable alternative to income and profits taxes and makes a UBI/BIG and an informal third economy a viable and preferable alternative to genteel poverty in a social commons.

The Power of Direct Democracy.

On 17th March 1992, “White South Africa” voted overwhelmingly in a Referendum, to scrap apartheid and to negotiate a new inclusive constitution. In a turnout of 85 % of the registered voters, 69% voted for the proposed negotiations (ie to scrap apartheid) and 31% voted against the proposal.

We believe that this reflected the overwhelming sentiment of the majority of the white population which had prevailed for decades, probably ever since the introduction of apartheid following the 1948 general elections, which delivered a parliamentary majority to white South African nationalists.

On 25th May 2018 the Irish people voted overwhelmingly in a Referendum, to scrap the eighth amendment to the Irish constitution, which in a referendum in 1983, driven largely by the Catholic Church in the guise of a visit to Ireland by the Pope, largely banned abortion in Ireland under most circumstances. This time around, some 35 years later, in a 64% turnout, 66% voted in favour of scrapping the eighth amendment and 34% voted against the proposal.

As part of the Irish ballot, the question was asked for how long had the sentiment expressed in the vote cast existed. Many answered, for decades.

And then, of course, there was Brexit! Yet another example of the will of the people expressed in an act of direct democracy in 2016 which went counter to the wishes, expectations and hopes of the establishment.

The point of this is to illustrate the power of voters exerted in the direct expression of their democratic will by means of a referendum, by the application of direct democracy. Few parliamentary elections generate such high voter turnout and fewer still deliver parliamentary results which express the will of the people so directly and so accurately and very few parliamentary elections deliver such landslide results, except in totalitarian stares where opposition opinion is excluded from the process.

Without the application of the will of the people expressed in acts of direct democracy, apartheid in South Africa and the almost blanket ban on abortion in Ireland and Britain’s membership of the EU, could well have continued ad nauseum.

What these three examples ably demonstrate is that the world’s parliamentary systems are not always aligned with the wishes of their voters so much as being aligned with the will of the prevailing establishment.  This does need to change, here in South Africa, and elsewhere.

Then of course there was the recent US Presidential elections where the will of the people (a substantial absolute majority for Hillary Clinton) was ignored by the establishment in favour of President Donald Trump. It may be argued that the one candidate is no better than the other, but in that instance it was clearly shown that the will of the people was not expressed in the election results.

It can and will be argued that direct democracy also demonstrates the fickleness of the voter population.  But we would argue that it is perfectly legitimate for a voter population to try out a particular political strategy or process and when finding the strategy or process to be wanting, to ditch it.  That is not being fickle, that is being responsible. 

The establishment are largely in fear of direct democracy because they fear populist government and they are less able to control the outcomes of political sentiment expressed by direct democracy, than by influencing the party political system, by various means, including but not limited to the buying of political favour in political parties.

The Direct Democracy Forum’s sentiment is illustrated by the proposed application of direct democracy in the DDF’s proposed SENATE and MUNICIPAL FORUMS and in the use of referendums to resolve political deadlocks, much like occurred in South Africa in the apartheid years and in Ireland since 1983 and in Britain since the 1970s.

Finland’s Basic Income experiment fails

Finland’s Basic Income failure is something that every advocate for a Basic Income Grant (BIG) or Universal Basic Income (UBI) needs to contextualise.

https://www.usatoday.com/story/news/nation-now/2018/04/25/finland-basic-income-685-fails/549087002/?utm_source=feedblitz&utm_medium=FeedBlitzRss&utm_campaign=usatodaycomworld-topstories

There are elements of the Finnish exercise that indicate that Finland’s experiment was more about the dole or unemployment benefits than about a BIG or UBI. In fact, Finland did not give everyone a basic income of $685, they randomly selected 2000 unemployed (and probably unemployable) Fins, and paid them $685 per month and then concluded that a basic income was unaffordable and did not achieve any social goals. Being paid because you are not working is a dole. A BIG or UBI system is where a population is universally and unconditionally paid whether working or not. The Finnish experiment was apparently motivated by the expectation that the 2000 unemployed would then go out and find low paid employment thus filling a gap in the labour market, an expectation that was never fulfilled. None the less, even if that had worked, even if the benefit was extended to all unemployed Fins or to the Finnish population as a whole, it could probably be argued that their tax system could not to bear it.

These conclusions are not unexpected for that sort of exercise:

First, when a BIG / UBI is applied universally to an entire community, there are long term benefits to the community members and the community as a whole, which can justify the high cost of a BIG / UBI. These benefits will never be apparent from a randomly selected and widely dispersed small population assessed in the short term, as with the Finnish experiment. The selected Finnish population was not representative of any universal and unconditionally selected population receiving a BIG or UBI.

Second, a BIG/UBI is costly and beyond the scope of any conventional tax system to fund. The exercises done by the Direct Democracy Forum (DDF) (see Teal, The Big Picture), presumed a Gross Domestic Product (GDP) of R2.8Trillion. The DDF hypothesized a BIG of R2.1 Trillion for a BIG of R5000 per month for 35 million adult South Africans. In that exercise the BIG was almost the size of the GDP.

Most economies target tax levels at about 30% of the GDP. The BIG in that context is 2.5 times the tax burden for that size of economy. The tax (R0.84T) + BIG (R2.1T) would total R2.94T, a sum bigger than the entire GDP of R2.8T. You clearly cannot extract more tax from a GDP than the GDP permits.

If Finland’s situation is anything like South Africa’s, the Fins are correct. Using a conventional tax system (taxing the GDP) cannot pay for a Basic Income of $685 per month. Nor can South Africa afford a R5000 per month BIG if reliant on a conventional tax system. What is missing here is a tax system that can accommodate the needs of a BIG. Here TEAL (Total Economic Activity Levy) comes into its own.

Instead of taxing income and profit, Teal levies the economic activity represented by the flow of money through the banking system. This is typically, in SA, about thirty times the GDP, so a R3T GDP represents a cash flow of 30 times and more through the banking system.  The arithmetic is GDP x 30 x 2 x 1.37 where every Rand is both deposited and withdrawn (the x 2) and an additional 37% is drawn on and paid into the same bank and therefore is not included in interbank settlements (the 1.37) which amounts to R246.6T on a GDP of R3T.  

What this levy amounts to is paying a rent for the privilege of playing in the country’s economy. If you are a large player the rent is large, if a small player, the rent is small, but everyone pays the rent, irrespective of who you are or what your game is or how much your profits or losses are. This broadens the tax base. In an example set in South Africa, instead of a tax base of a R2.8T GDP, the tax base is R230T of the broader economy. So the rate of tax or levy can be slashed from about 30% of the GDP to ½% of the broader economy, and achieve the same result.

Applying the same principle (levying the entire broader economy instead of taxing the GDP) one is able to collect the R2.1T needed for a BIG with a 1.25% levy on the broader economy (see Teal, The Big Picture). Suddenly a BIG or UBI becomes attainable.

Then there is the political context of the Finish experiment. The NY Time’s analysis (see the link below) suggests that when the Fins started the experiment the government was somewhat liberal. Then Finland was hit by recession, and a more conservative government came to power whose main platform was cutting expenditure. Bye bye Basic Income experiment!

According to the NY Times, the reasons why the Finnish Basic Income experiment failed are are set out here (see https://nyti.ms/2tiI1bA)

Fortunately the Finnish experiment, however inadequate it is for a BIG / UBI, is not the only BIG / UBI experiment and discussion under way in the world, and far from being definitive, it will merely be a footnote to the art of misdirection on the topic.

Our conclusion from this is that to take the failure of the so-called Finnish Basic Income experiment as an indication of the impossibility of a BIG or UBI, is to be misled by an experiment which was not about a BIG or UBI at all, but about a dole, The two (a dole or a BIG / UBI) are not comparable and the Finnish failure, far from discouraging the DDF from its BIG / UBI objective, merely strengthens the DDF resolve to see the introduction of TEAL and an affordable Basic Income Grant or Universal Basic Income in South Africa. Further, the collective benefits arising from investing R1.75 Billion in the demand side of the South African economy every month, will more than justify collecting that money with a 1.25% levy (TEAL) on the broader economy.

DDF SENATE PROPOSALS VINDICATED

There is a saying that all will come to those who wait. Being proactive I am not sure I agree with the sentiment. But recently something happened illustrating it’s relevance.

Some 60 years back in the 1960s, when I was about 15, I was pondering how a political process whereby a political fringe had managed to capture a perfectly adequate dual house parliamentary system and impose a largely unwelcome and undesirable system (the apartheid system) on the masses of the population of a country (SA), could have come about. From that came a proposal for an upper house of parliament (I called it a house of censure) which was drawn from the streets rather than the political establishment, and through which all legislation and regulation must be passed for approval. Of course I was 15 or so, and nothing came of it beyond it being a proposal.

Over the years, the proposal became more sophisticated and concrete and I stopped calling the house one of censure, and identified it as a Senate.

In the 1990s, when the CODESA was in process I submitted my Senate proposal to CODESA l and ll, as many did. The proposal was ignored. I happened at the time to be living across the road from Mac Maharaj, then the ANC’s spin doctor. I challenged him on the fact that my proposal had not even been acknowledged. He stood on the other side of his gate and held his hand about chest high above the ground and said, what did I expect them to do with a pile of proposals that high. The inference being that CODESA was a farce and was merely a vehicle to impose the opinions of the few on the many and is merely a sop to consultation. I learned this form of consultation is typical of the ANC.

Time moved on. In 2012 the Direct Democracy Forum was formed using TEAL and the Senate proposals as the foundation of DDF policies. These policies have since been added to by a Basic Income Grant and a Sovereign Wealth Fund (amongst other policies).

Now in 2018, I read an article published June 2016 in the Guardian’s long read series, by David Van Reybrouck titled “Why elections are bad for democracy” arguing very persuasively that representative democracy and elected politicians are failing us, their constituents, where “common interest lose out to short term and party interests”, and where “winning the next election has become more important than fulfilling the promises made in the last”, and that in it’s place was needed something like “the central principle of Athenian democracy, drafting by lot, or sortition”, where those drafted were immersed in the details of every legislative and regulatory proposal and so could vote from an informed position on the issues. Thus ” a cross-section of society that is informed can act more coherently than an entire society that is uninformed”.

How does that vindicate the DDF Senate policies? It does so because sortition describes exactly what the DDF Senate policy is about.

It is significant that sortition is being used more and more to resolve issues that party-political electioneering and periodic visits to voting stations have been unable to resolve. This has occurred “in the US, Australia and the Netherlands” and most innovatively in Ireland. In December 2012, a constitutional convention began, drawing on “33 elected politicians and 66 citizens, drafted by lot, from both Ireland and Northern Ireland” .. who .. “met one weekend per month for more than a year”.

In this, the Irish approach, the convention drew up proposals to go before parliament. In the DDF approach, the Senate would be required to approve or reject legislation or regulation emanating from Parliament or Cabinet. So one is doing it one way, the other is doing it the other way. But the same essential principle is being applied. Get the approval of ordinary opinion, first or last in the process, but getting that approval is essential, which ever way you do it.

I believe all of this vindicates the DDF’s Senate policy and proposals and although it is a 60 year old story for me, the story still has some chapters to be written. Those chapters cover implementing a sortition Senate and the many more chapters thereafter where sortition builds a better South Africa for all.

A Basic Income Grants discussion.

I recently listened to a podcast (Upstream podcasts) in 2 parts on a UBI (Universal Basic Income) which I found really interesting. The podcasts are available here (1) and here (2). If you have difficulty listening to podcasts, you can download the transcripts in pdf format for both podcasts from here,.

What interested me most was the almost universal consensus that 1) UBI or BIGs (Basic Income Grants) were desirable and productive, and 2) where implemented (in pilot schemes & etc) the beneficiaries, their progeny and the communities they were a part of all benefited, and few if any recipients abused the system. So there is a multiplier effect.

I contacted the producers of the podcasts with a view to setting up a dialogue from which I hoped we all could benefit, but was disappointed to find that my contribution showing how capitalism can pay for a UBI was not well received. The producers seemed to feel that using a system which they clearly wished to see the back of, would compromise their ideals for a post-capitalist society. I don’t think this is a very constructive position but instead regard using capitalism to fund a UBI as a step in the right direction, thus tackling the disparity of wealth between the haves and have nots and more importantly, tackling the lack of economic opportunity for the have nots, and who knows where that can lead. But the producers felt that a dialogue on that basis, as they put it, (we) would be talking to cross-purposes. So, instead of having a dialogue from which, perhaps, we all could benefit, we have nothing much at all beyond our separate but ironically similar goals.

Be that as it may, the podcasts are awesome.

Much more disappointing for me was the response of two South African institutions to my approaches. One is the Studies in Poverty and Inequality Institute (SPII), and South Africa’s main opposition party, the Democratic Alliance (DA).

The SPII were said to be promoting a Basic Income Grant. When I approached them I found they had a project devoted to a BIG with a dedicated manager and BIG committee, this according to their web site and correspondence and conversations I had with their staff. In the end it seemed that their interest in a BIG was limited to a SADC context rather than a South African context. In any event, when I approached them I was met by an unwillingness to engage on the topic of a BIG.

It may be significant that their present web-site (which may still be under development) has no mention that I could find of a Basic Income Grant. Perhaps they have given it up as a bad idea and perhaps that was why they were unwilling to address the topic of a BIG with me. But the SPII are not saying anything to me on that topic.

I also approached the Democratic Alliance suggesting I had policies that would almost certainly guarantee the DA a substantial win in the upcoming 2019 general elections. I was referred to a member of the DA specialising in policy matters. He indicated two things to me. One was a scepticism of the claim that the throughput of money in the South African banking system was anything like an average of 30 times the GDP and that it could bear a ½% levy in place of the 30% or so taxation of the GDP, although he did admit it would be a game-changer if this was so. He also stated that in the run-up to the 2014 general elections, the DA had approached residents of SOWETO who indicated that they did not think a BIG was a good idea. That then, was my time to be sceptical.

The DA’s policy specialist also suggested that I should obtain (for the DA?) written proof from the SA Reserve Bank that such a relationship exists between the GDP and the money flowing through SA’s banking system. My unspoken response to that was that the DA should do their own homework as the DDF and the TEAL Foundation had already done theirs. See here for some information on DDF and TEAL findings.

Never the less, I did and will continue to approach the SARB even though they are reluctant to release any information on the topic beyond what they publish, which is not very much. They claim proprietary rights to information of national importance, which I dispute absolutely. Perhaps I have to brandish the freedom of information act (I think we have such an act) under their noses to get any real satisfaction. Perhaps not.

From time to time I encounter detractors from the idea of a UBI/BIG (the “you can’t give away something for nothing” brigade and the “everyone will stop working” brigade and the “how do we pay for it in our corrupt society” brigade) but they usually walk away from an encounter with me a lot more thoughtful about the prospect of a UBI/BIG. Once you get past those knee-jerk reactions, folk generally seem more amenable to the idea.

So, far from finding possible allies willing to share knowledge and experiences on the topic of a UBI or BIG, I found folk and institutions who, whether for ideological reasons (in the case of the podcast producers) or perhaps for political reasons (was I encroaching on SPII’s and the DA’s turf and in the DA’s view was I not also being a political upstart?), viewed my assertions that I knew how to pay for a UBI or BIG pretty much with indifference.

I find all of that quite astonishing.

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The President’s Keepers

The President’s Keepers by Jacques Pauw, investigative journalist extraordinaire, could be sub titled Wading Through Sewerage. South Africa owes Mr Pauw and extraordinary debt of gratitude for placing his knowledge of the president’s keepers at our disposal. His assertion that if you cannot afford or cannot obtain a hard copy or an e-book copy of The President’s Keepers, you should read a pdf copy, many of which abound on the internet, until you can buy a legitimate copy, is just about the best advice any South African can give to any other South African. Needless to say the book’s publishers and distributors do not share that sentiment but our sentiment is with Mr Pauw’s. If you are a South African, this is essential reading.

Mr Pauw observes in his introduction “Zuma and his small band have managed not only to capture our law enforcement agencies – put their pals in charge, make cases disappear, dismantle structures that worked effectively – but also use these institutions to eliminate their opponents through trumped up charges and harassment.

The whistleblowers came to me (Pauw) because they felt that things had gone horribly wrong and that maybe, just maybe, a book like this (The Presidents Keepers) would make a difference.”

I am sure Mr Pauw has received many higher accolades from much more exalted sources than the Direct Democracy F, but our accolade is simply to say that, yes, your book has made a difference, a huge difference, and we owe you an everlasting debt of gratitude for your contribution and for the risks taken in order make that difference.

In eighteen chapters, each one leaving the reader with a greater sense of disgust and revulsion, we are led through the machinations of an absolutely corrupt administration that has made a mockery of every element of good governance observed throughout the rest of the civilised world, and in the process spent, wasted and probably stolen billions of Rands of taxpayers’ money.

Here are some of the bad guys: Of course there is Jacob Gedleyihlekisa (the one who laughs while grinding his enemies) Zuma, M Mpshe, N Jiba, L Mrwebi, S Abrahams, R Mdluli, B Ntlemeza, A Fraser, T Moyane, the Guptas, Molefe, D v Rooyen, M Gigaba, J Radebe, D Mahlobo, M Hulley (J.Z’s attorney), P Mokotedi, to name a few.

Here are some of the Heroes who stood against the Zumerites: A Dramat, J van Loggerenberg, I Pillayt, Glynnis Breytenbach, Johan Booysen, Nhlanhla Nene, Pravin Gordhan, Thuli Madonsela, Judges F Legodi and W Hughes, M Nxasana, R McBride, Paul O’Sullivan, S Sibiya. With the exception of the judges, these persons for the most part were hounded and persecuted by the bad guys for challenging their corrupt practices.

The lists go on. Names well known in South Africa through media reporting of their conflicts and expanded on in The President’s Keepers.

There are many more bad guys and many more heroes (many anonymous whistleblowers, for instance) because the corruption is endless and mind blowing. If you want to know more about it, get a copy of The President’s Keepers and read it. My own experience was that I had to step back at the end of each chapter and take a break from wading through sewerage, and by the time I had finished the book, I had to again step back, for at least a week, before I even attempted to assimilate properly what was related, let alone comment on it.

If, as we were, you were aghast at the revelations of The State Capture report by the then Public Protector Thuli Madonsela, you will be shocked and revolted by the revelations of The President’s Keepers, and the sooner you and all others in South Africa read it, the better it will be for South Africa, because this has to end.

And how will it all end? Many ANC stalwarts are trying to avoid the fallout and the blame, and to cleanse the ANC of guilt, and while we do not wish to tar all in the ANC with the same brush, the ANC enabled it’s leadership and thus are complicit in the most disgusting series of acts of treason (there is no better word to describe their crimes) that only the total annihilation of the ANC in the 2019 general elections and the bringing to account of all those implicated in these crimes, will appease South Africa’s need for justice.

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TEAL – The Big Picture

TEAL: The Big Picture:

Direct Democracy Forum (DDF) Policies are heavily reliant on TEAL as an alternative way to tax an economy. We argue that we would rather tax the whole economy with very small levies than tax a small segment of the economy very heavily. The outcomes in terms of tax paid are very similar but the spread (of the burden) is very different.

TEAL will enable the funding not only of the conventional tax burden but also the funding of a Basic Income Grant and an Advancement Grant. The advancement grant is split into two components, the actual advancement grant and a left-behind grant, the latter to compensate all those who will have already missed the advancement grant per se. 

Not wishing to get too carried away without taking stock, this page summarises these applications and their cost, based on a very conservative estimation of the expected GDP for 2017.

TEAL is based on the GDP and it’s relationship with what we call the Total Economic Activity.

First, the flow of money through the banking system is about 30 times the GDP (see here).  If you have any doubt about this, the Payment Association of SA (PASA) estimated in or before 2017, that R350 Billion is settled EACH DAY through the National Payment System. That amounts to some R1 Trillion every three days.

Second, each Rand Passing through the banking system represents both a deposit and a withdrawal in and out of the banking system. We call this the doubling effect.

We expect the GDP for 2017 to be in the region of R2.8 Trillion. The flow of money through the banking system should be thirty times that amount 2.8 X 30 = R84 Trillion and the doubling effect would put the Tealable amount at R168 Trillion.

There is an additional factor which, to be conservative, we shall ignore for the purposes of this exercise, which is that an additional amount of about 37% of the settlement figures for which there is no inter-bank settlement, are settled in-bank, for example FNB clients will pay to FNB clients, and so on. So the R168 Trillion should actually be R168*1.37 or R230 Trillion.

TEAL , THE BIG PICTURE:

Application 

% of R168 Trillion

Teal Trillions of Rands

Target Trillions of Rands

Annual Target

Fiscus

0.50%

‘R0.840

‘R0.840

30% R2.8T

Basic Income Grant

1.25%

‘R2.100

‘R2.064

34.4MxR5kX12Months

Advancement Grant

0.09%

‘R0.1512

‘R0.150

750KX200k

Left Behind Grant

‘0.325%

‘R0.546

‘0.546

R10.92T/20

Totals

‘2.165%

‘R3.6372T

‘R3.600T

 

A TEAL of 2.165% will generate R3.6T which is considerably bigger than the GDP, which will have many economists throwing their hands up in horror as the conventional tax burden, it is said, should not exceed 30% of the GDP. The point is that the GDP is not a true measure of the economic activity of the country, merely a measure of the Gross Domestic Product. The level of economic activity needed to generate the GDP, on the one hand, and sundry other economic activity which does not classically fall within the scope of a GDP, is a great deal more than the GDP itself. How much more we were only able to extrapolate from a small economic history of some 5 years back (in 2011). Clearly we need more information to prove the extent of this relationship, in particular for the current economy, which is very different from that of 2011, when SA’s GDP peaked and then, in US$ terms, tanked, starting its slide into today’s abyss (yes, in US Dollar terms the GDP has been shrinking at about 5% pa over the past 5 years or so since 2011) . But we use what we have until we have better.

The fiscus component as above will totally replace the existing tax product of about the same amount. The additional amount collected by TEAL for non-fiscus purposes (BIG and Advancement Grant) will actually be a lot smaller than the gross, as follows: R3,672T less R840 Billion fiscus,  which nets out at R2.832 Trillion or only 1.686% of the TEA instead of the 2.165%.  By way of comparison, some faiths exhort their followers to give 2.5% of their wealth to needy causes every year. Some food for thought there.

The other thing to note is that while R2.832 Trillion seems a lot of money (and it is a lot of money), it is but a small percentage of the TEA (Total Economic Activity) (1,686% of R168T) which will do a great deal of good for South Africa and it’s economy and it’s citizens, enabling an economy built on general prosperity rather than an economy built on general poverty, which is what we presently have.

That is only part of the good news. The other part of the good news is that the big players in the economy (trade and industry) should also benefit from expanded economic activity. We at the DDF believe that the strategy inherent in adopting these policies is effectively an investment in the demand side of the economy and is a win-win strategy for all of us in South Africa.

The really big challenges are how to counteract inflationary pressures arising from that extra activity and how to build the GDP (as opposed to building imports) both of which pivot around turning South Africans into a nation of producers rather than a nation of consumers.

So we are not claiming that TEAL, the Basic Income Grant, the Advancement Grant and the proposed Sovereign Wealth Fund are some sort of all -encompassing panacea for SA’s economic woes. At best they can only help us along the path to economic recovery.

The rest is up to what we as South Africans do with these devices and the benefits which should flow from them.

How to pay for an annual Advancement Grant

An Advancement Grant is a once in a lifetime grant intended for every South African citizen to advance their lives through whatever means the grant can purchase. For example, education, training, travel, investment, opening a business, helping to purchase a home. There are no restrictions on how it can be used. It is intended to be the equivalent of paying for a professional tertiary degree (four years of university). In the post There is no such thing as a free lunch Part ll, we postulated an Advancement Grant to satisfy the Fees must fall demands. We indicated that we would sharpen our pencils to determine costs and the means of payment. This is it.

If one assumes an Adult Population of 35 million and a working life of say 47 years (18 to 65) and for the sake of simplicity assume that each year there would be 1/47th of 35 million school leavers qualifying for an advancement grant, that would be 745 000 (say 750 000) school leavers each year. Assuming an advancement grant of R200 000 each that would be R149 Billion a year.

TEAL can fund this as follows.

If we assume a R2.8 Trillion GDP for 2017 that would equal a Total Economic Activity of 2.8 X 30 or R84 Trillion flowing through the banking system. Each Rand of that flow represents both a deposit and a withdrawal from the banking system so the actual Tealable amount would be R168 Trillion. R149 Billion as a percentage of R168 Trillion = 0.089% or about 0.09% (=151.2 Billion)

So, an annual TEAL of about 0.09% on R168 Trillion will pay for a R149 Billion Advancement Grant granted to 750000 school leavers (each school leaver receiving R200 000) each and every successive year.

What of the 34 250 000 who will not receive the Advancement Grant in year one of the scheme (The Left Behinds)?

If each of these ‘Left Behinds’ received R200 000 that would cost R6.825 Trillion. If that were paid out to them evenly over 20 years at an interest rate of say 6% pa, that would be about R10.920 Trillion or R546 Billion per year. Paid out to 34.25 Million each month over 240 months would be 10.92T/240months/ 34.25 Million// per month, or R1328.47 per month per person left behind. R546 Billion as a percentage of R168 Trillion is 0.325% .

So the annual Advancement Grant of R149 Billion and the annual Left Behind Grant of R546 Billion (in total R695 Billion) could be paid annually by a TEAL of 0.09% + 0.325% or 0.415%.

0.415% of R168 Trillion is R697.2 Billion

In Table Form:

Grant

R168 Trillion TEALable amount

TEAL

Total Grant Amount pa

Advancement

‘0.090 % of R168T

R151.2 Billion

R149.00 Billion

Left Behind

‘0.325 % of R168T

R546.0 Billion

R546.00 Billion

Annual Total

‘0.415 % of R168T

R697.2 Billion

R695.00 Billion

NB: This is an exercise. The GDP and the Tealable amount will vary from year to year as will the number of persons qualifying as may the payouts as also will the population, so these numbers are not to be taken as absolutes, merely an indication of what is possible.

Have a look at DDF policy on the Basic Income Grant (BIG) and DDF policy on the Total Economic Activity Levy (TEAL).

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Endangered Capitalism

In the aftermath of Brexit, but perhaps not so much so for the election of Donald Trump as president of the USA, because he is more probably the archetypical capitalist than not, there is talk of the demise of unfettered capitalism. In an article How Britain fell out of love with the free market, sentiments such as what follows prevail:

The UK Conservative manifesto attacked aggressive asset-stripping” “perverse pricing” ,“exploitative” markets in energy, property, insurance and telecommunications and “the remuneration of some corporate leaders” while the Labour Party offered policies to include – nationalisation, restored trade union rights, restrictions on the City of London – which would undo much of British neo-liberalism. While John McDonnell, a possible contender for Britain’s Chancellor of the Exchequer, lists “generally fermenting the overthrow of capitalism” as an ambition of his, so it seems the possibility that politicians will be interfering in Britain’s and other economies is becoming ever stronger.

Nigel Vinson, who has been a leading player in Britain’s free-market think tanks lists “Wage stagnation, poor GDP growth, crony capitalism in the contracting-out of public services, endless gaming of the system by corporations, a general ennui about the prevailing economic system … ” as criticisms of capitalist practices, culminating in the 2008 crash, resulting from the “deregulation and hubris of the financial markets”.

If you have any doubts about the way capitalists rip value from ordinary people, for their, the capitalist’s own benefit, this article The Real Cost of Regeneration will soon dispel those doubts

The tale from the United States is much the same. In an article How Power Profits from Disaster, Naomi Klein, an outspoken critic of the capitalist excesses, draws a grim picture of these practices in the USA, from which many of the present political leaders of the US profited hugely, which says a lot of the relationship between government and capital in the USA.

In contrast there is the argument that capitalism and the free market system have immeasurably improved the general well-being of the world’s population, particularly during the past century or so, and in particular globalisation has led to the improved life conditions of millions of previously poverty stricken “peasants” in the under-developed countries of the world who have been drawn into the global economy as sources of cheap labour. These improvements are often rooted in exploitative practices of workers abused in sweat shops, for a pittance by western standards, and such-like. Consumers do not always condone these practices in their names, just for cheaper prices, which if only by association may render them complicit in neo-liberal slave labour, and boycotts of certain brands which use these practices break out sporadically throughout the world.

Another downside to globalisation are those left behind by movement of industries from their historic places of operation, to lands with cheaper labour and more exploitative labour practices.

All of this is happening as I write this in 2017. So we have a conflict of outcomes, massively improved life styles for some ironically brought about by abusive capitalist practices and massive losses for others, brought about by the same practices, The only people who seem to benefit consistently are the ruling elite and the big players in the capitalist system.

The point to all of this is that I do not see neo-liberal globalisation as practised currently as a sustainable option. Yes, the rich can continue to get richer and the poor poorer and this can carry on until something gives. Maybe the market place collapses because there are not enough affluent consumers to support it, or maybe the poor just get sick and tired of being poor (a la France (1789-99) and Russia (1917) and Germany (1930-1945)), and history has a way of repeating itself, and the world could slip into another cycle of autocratic despotism. And do we want that to happen? Do we really want democracy and capitalism to collapse to be replaced by autocratic rule? From chaos come autocrats to impose order and that is a distinct possibility.

Is there another way? Is there a way to save capitalism and democracy and to fend off their attackers, whether they are religious fundamentalist (a la radical Islam) or statist autocrats (a la Vladimir Putin)?

I would argue there is.

The only reason either of those or any other extremist versions of society are allowed to gain a foothold is that populations perceive unfairness by existing systems as being unacceptable and will welcome almost anything in their place which promises justice and order, thus allowing extremism to occupy a moral high-ground. “Liberalism has failed”, they will argue. “We (our religion, our autocracy, our order) will restore order and justice to society”, they will argue. And folk, sick and tired of being abused and marginalised will listen, in their misery and hope for something better, forgetting that what comes with the promise of autocratic justice and order is far worse than the limited and imperfect freedoms under a neo-liberal order

What if there were generally order and justice in society? Extremist appeal would be very much diminished. They would have to work harder to destabilise societies to the point where their intervention would be supported even by a disgruntled minority.

Let me explain what I understand by capitalism. Capitalism is the private ownership of wealth and the means of production and distribution of goods and services for profit. I believe that as far as possible, government and bureaucrats should be kept at arms length from capitalism, namely from private ownership of wealth and the means of production and distribution for profit. Can we risk losing that ownership by ceding it to others?  I don’t believe so.  .I believe however that rampant capitalism as practiced by the neo-liberals as evidenced by the examples given above, should not be beyond the scrutiny and censure of society and in particular, capitalists should be accessible to society. That is, there should be in place the means for ordinary people to protect themselves from the excesses of rampant capitalism. How you achieve this last goal is not exclusively part of this discussion.

So, could there be order and justice in a democratic and capitalist society?

I believe there can indeed be such order and justice, one born out of consent of the governed.

Typically, government is run by the political and oligarchic elite, often the same body of people or at least bodies closely associated with one another. There is little or no influence from the electorate except at four or five year intervals for election purposes, and even that is highly manipulated with the same oligarchs and elites controlling media controlling opinion and trends in a manner that is far from objective. We won’t even consider for the moment, the phenomena of false news or propaganda.

If instead there were a senate peopled by ordinary people, through which all legislation and regulation needed to pass for approval, I would argue that such political representation of ordinary people would change the political landscape. It is true that not all the political and oligarchical elite would approve of such a senate, but I believe it would be preferable to any of the revolutionary outcomes cited above.

Such a senate is proposed here for South Africa.

So how does this control the excesses of unbridled capitalism? It would allow the ordinary people of a society to exert their influence on regulation and legislation which may be intended to disempower them or defraud them. I believe that would be a very significant act of empowerment.

So capitalism can otherwise continue making the rich richer and the poor poorer?

One of the primary concerns about rampant capitalism is that tendency. It leaves the poor (the left behinds) poorer and feeling disempowered and helpless and strips wealth and dignity from them. This is a dangerous outcome that needs to be addressed and a very effective way of addressing it is with a Basic Income Grant. Apart from helping to fight poverty, having a basic income will empower people who otherwise may have nothing, not even hope and dignity, and aid others who may not be so impoverished but are borderline cases, with little or no income surplus to their needs.

To those who believe that one should only receive that which is earned, let me suggest that the world is full of capable people equipped and willing to earn but who cannot be employed because the formal labour market is oversupplied. This is not going to get better. This is going to get worse with the advent of automation, computerisation and the gig economy. So how are these people going to survive? A basic income grant will not only provide for basic needs but will give recipients opportunity to invest in themselves, in savings, in education, in training, in businesses and arts and crafts and so on. Whatever you can imagine would be stimulated and advanced by such a grant.

You can think of it like this; a basic income grant paid to your population would be a very effective way of stimulating both the demand and the supply side of any economy and those most in need will spend it on their needs instead of having nothing to spend, and nothing to contribute to the economy. So I believe a basic income grant is a win win solution for many social and economic needs.

A Basic Income Grant is proposed here for South Africa

There are other things one can do to engage your population in your economy. A Sovereign Wealth Fund is one such means, provided that it was owned by each individual of your population, in equal parts, rather than by your government. In turn the sovereign wealth fund invests in your and other’s economies, wherever an investment makes sense and profits are to be made by the fund, and therefore by its owners, your population. In most countries, such a fund would become a very significant part of your economy and give your population a sense that it is engaged in your economy, rather than being divorced from it.

Such a fund is proposed here for South Africa.

Capitalism, which has been so badly managed from a societal perspective as to make it an endangered system, needs to be reinvented to be better managed from a societal perspective, so as to no longer be endangered. What these moves do in effect, is to empower ordinary citizens politically and economically using the tools of capitalism and democracy to help eradicate poverty, and to raise democracy and capitalism to a moral high-ground that radicals of whatever persuasion will find difficult to match let alone challenge.

This post originally posted in John’s Bolg 

Have a look at DDF policy on the Basic Income Grant (BIGand DDF policy on the Total Economic Activity Levy (TEAL).

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DDF Health Care Policies vindicated

Direct Democracy Forum’s (DDF’s) health care policies have been vindicated by a top South African medical aid expert.

In an article How the government took away the hope of private healthcare from millions of currently uninsured”, Eve Dmochowska, who has made knowledge of the provision of medical aid and medical services her business, slates the ANC government for leaving the public health system in total disarray and promising delivery of a universal public health system only in 14 years time. In the article she points out that “the government is already running a universal healthcare system, and failing miserably. Everybody has access to state healthcare already, and those who cannot afford the healthcare receive it for free.” So, we ask, what is going to change in 14 years time?

Ms Dmochowska also asserts that in the light of their abysmal track record in health care, government should extract themselves from the provision of health care and that “If the (medical aid) schemes were incentivised with R3-billion reasons per month to make private primary healthcare work for 10 million people, I bet you they could. And I bet you they would”.

So what is Ms Dmochowska proposing if not in essence the DDF’s health care policy.

We further quote Ms Dmochowska to make the point:

The government would benefit greatly if the burden of providing primary care to 10-million people was removed from the public system. It could improve the service levels to the remaining 25-million uninsured. Or it could even outsource the entire primary healthcare problem to the private sector: pay the premium and leave the logistics to the private sector. In return, the government would further benefit from lower public hospital admissions levels as good primary care is preventative of long term health problems”

This is almost exactly what the DDF are proposing, except we also propose to privatise nearly all the public health care delivery systems. Not only would it extract government from the invidious position of overseeing a system engaged in an ever downward spiral, but it would also put the patients in the driving seat. It says to the service provider, ‘provide the service and we the patients will support you. Don’t provide the service and we will go elsewhere, because we can’.

This is not just handing over a huge market to the private sector to profiteer from but instead the patients will insist that they must deliver in order to profit from the system. As does Ms Dmochowska, we also bet they could and bet they would, both deliver to their patients and profit from that process.

We at the DDF think this is a good thing and we doubt it would take fourteen years to deliver.

See also how to pay for a basic income grant and take a look at DDF policy on the Basic Income Grant (BIG) and DDF policy on the Total Economic Activity Levy (TEAL).

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There is No Such Thing as a Free Lunch. Part II

In my last post Is a Basic Income Grant Stealing from the Rich I referenced an article There is a problem with the way we define inequality.

This article made a number of interesting assertions about attitudes on inequality, the principle one to my mind being that we should stop obsessing with the rich and super rich and start obsessing with eliminating poverty, and also, importantly, the assertion that peoples’ attitudes were less angry about wealth and more angry about unfairness. As was stated the public perception of wealth inequality itself being aversive to most people is incorrect, and that instead, what people are truly concerned about is unfairness” and also that “People typically prefer fair inequality to unfair equality”, and, as we are beginning to see in South Africa, what really gets folk going is unfair inequality, a la the Zuptas state capture and wealth grabs.

So we all need the right to work harder and earn more and be wealthier than our neighbours, that is fair and acceptable. Just reward for just gainful employment is acceptable. But if you cheat in order to be wealthier, that is just not on.

This got me thinking about the Fees Must Fall movement and protests (see here) because it really is unfair that certain sectors of our society perhaps have little or no access to higher education. Let me be very clear, it is not the access of those who have access that is unfair, but the lack of access by those who don’t have access that is unfair. This is a major argument in the article There is a problem, the issue of unfairness.

A major conclusion of the article is that “the solution lies in addressing the fact that poverty and unfairness exist.”

This set me to thinking about the conflicting unfairness inherent in the fees must fall campaign; the unfairness of the poor being unable to access higher education just because they were poor, and the unfairness of the same poor, expecting those who do not benefit from higher education, to have to pay for the higher education of the same poor. Something simply does not add up.

You cannot fix a wrong inflicted on anyone or group by inflicting another wrong on another one or group. That is simply wrong and unfair and will be perceived as wrong and unfair and is probably why most people object to paying for the education of others who are seen to be unwilling to pay for their own education.

To reiterate, at the risk of being boring, “what people are truly concerned about is unfairness” and “People typically prefer fair inequality to unfair equality”.

So the problem is how to fix one wrong without creating another wrong?

The Direct Democracy Forum (DDF) believe that the Universal Basic Income Grant goes a long way to relieving poverty in a fair and equitable way, Thus all in society contribute to the system in an equally proportional manner and all benefit from the system equally. Is this fair and equitable? Some would say no and others, the DDF included, would argue that imperfect as it may be, it is fair and equitable, and is a lot better than what we have.

But, and here is the big BUT, could all higher education students afford to pay for their education (fees and accommodation) exclusively with a BIG? Of course, students can supplement their income by working full and part-time in internships or apprenticeships or articles, and there is nothing wrong about that, in fact many qualifications require it of you in order to qualify you as a professional fit to administer to (for example) your patients if you are a doctor or your clients if you are an accountant or lawyer. But what if a Basic Income Grant simply isn’t enough because fees and or accommodation have escalated out of all proportions.

Education throughout the world is becoming almost prohibitively expensive. Privatisation of funding is making it even more unaffordable and the level of debt that graduates are left with is making them wonder if education is even worth it, and some of the schemes are just there to make finance providers rich at the expense of society in general and the graduate population in particular. And yes, there are calls all over the world for fee free education, so South Africa is not alone. Indeed there are countries where tertiary education is free, but the much lauded fee free system of Germany is branded by some as being unsustainable. Others are saying the opposite, that fees are becoming, like the dinosaur, extinct, So everyone has a point of view and is looking for a solution.

Maybe then we need a different mechanism

The DDF believe that such a mechanism could exist which may be imperfect, but might none the less be better than what we have. But again there is the question of fairness..

But to address the issue of fairness, it would need to be a mechanism that benefits all equally, maybe a universal education grant. But what about those to whom a higher education is unsuited. How would they benefit from such a scheme? The short answer is that they would not benefit, and we would be back to a situation of unfairness.

Perhaps, as has been suggested about wealth and income inequalities taking our attention away from the real issue of poverty (see There is a problem), we are focussing on the wrong thing. Instead of just focussing on education for the poor we should instead be focussing on the bigger issue of how to better the lot of all. So what the DDF are now considering is the possibility of a once in a lifetime “Universal Advancement Grant”. I can hear the groans – “not another grant!” and “this is a slippery slope?” and “What a daft idea!” – I can just imagine the moans and groans and yes, you have a right to be sceptical. Indeed the DDF still rest on their assertion that there is no such thing as a free lunch so the means to pay for this needs to be found.

But consider this in the light of fees must fall and the issue of fairness; What if everyone had this once in a lifetime “Advancement Grant” and could use it to pay for their tertiary education or as a down-payment on a house or as a business investment or to travel abroad with, or indeed, just to fritter it away on trivia. What if?

And what if this could be substantially paid for by the savings made from shrinking the size and cost of government? What if?

Wouldn’t that solve the issue of fees must fall and fairness at the same time? It possibly would for this and future generations of beneficiaries, but those of us who have already missed that boat would not think of it as fair and to to pay such a grant to all the rest of the county’s citizens would probably be impossible, but could we compensate them somehow? Perhaps an enhanced BIG granted over time (say over 20 years) to compensate those who didn’t receive the advancement grant might work and be affordable?

So maybe a universal once In a lifetime “Advancement Grant” is not so daft an idea after all, and is worth considering.

The DDF have some pencil sharpening to do to figure out how to pay for it all. But that is part of the process.

Have a look at DDF policy on the Basic Income Grant (BIG) and DDF policy on the Total Economic Activity Levy (TEAL).

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Is a Basic Income Grant stealing from the rich?

An interesting article from BBC Future (There is a problem with the way we look at inequality) looks at the wealth gap and some publications on the subject and concluded that there were actually three different elements that one should distinguish between in order to understand what needs to be done to rectify an obviously unjust situation. The issue, they say, is not the existence of a gap between rich and poor, but the existence of unfairness”.

So the trick is to understand what of the wealth gap is just and what of it is unjust. We would paraphrase the situation thus, we need to deliver justice without destroying that which is just and desirable, because, if we destroy that which is good in an attempt to destroy that which is bad, what is left for those of us who want the good? Perhaps only the bad. This is reflected in the law of unintended consequences.

English is full of pithy little sayings and a very pertinent one for this topic is; “don’t throw out the baby with the bathwater”. In other words, be careful of the baby (the economy). You don’t wish to destroy the economy.

A point highlighted in the article was that one study argued that the public perception of wealth inequality itself being aversive to most people is incorrect, and that instead, what people are truly concerned about is unfairness” and that “People typically prefer fair inequality to unfair equality”. Nicholas Bloom, an economics professor at Stanford University arguing against a world of absolute equality, observed “why would I work for 50 hours a week if everything I’m given is free?”. Indeed, why work at all if you receive the same as Joe Blogs who works 50 hours a week, when you get the same for not working at all?

The three ideas we need to grasp about equality are 1) People should have equal opportunity in society, regardless of their background, race, sexuality, gender and so on. 2) Fair distribution says that benefits or rewards should be distributed fairly based on merit. 3) Equality of outcome says that all in society should earn the same rewards irrespective of their input into society.

Most of us would agree with points 1 and 2 but many would disagree with point 3 (see Bloom (above)).

Many economist interviewed for the article agree that too much attention is paid to the fact that the 1%, and the super-rich exist. Instead, they argue, we need to concentrate more on helping those less fortunate, who via a lack of fairness, are unable to improve their situation.

Harry G Frankfurt, emeritus professor of philosophy at Princeton University argues in his book On Inequality that “the moral obligation should be on eliminating poverty, not achieving equality, and striving to make sure everyone has the means to lead a good life”.

Experts say the solution to poverty lies in addressing the fact that poverty and unfairness exist because addressing that should be the real moral obligation.

While we at the Direct Democracy Forum (DDF) agree with all of this, our approach is more pragmatic than moral. We suggest it is in fact in the interests of all of society, including the rich and the super rich, that poverty be eradicated, and that it is also in the interest of the market economy that poverty be eliminated. After all, the poor cannot afford to buy cars and washing machines and dishwashers and clothing and medical services and education and housing and recreation and food and travel and electricity and swimming pools and stereo sets and computers and video equipment and so on and so on and so on, while even the modestly affluent, the sort of lower middle class (financially speaking), can, over time, buy all these goods and services. By making the demand side of the economy stronger, we all, even the rich and the super rich, grow richer.

If we use a slightly different analogy, every farmer knows he has to sow the seeds of his prosperity by investing in his land and his livestock. Similarly every person who relies on the economy for his prosperity, both the rich and the poor, needs to sow the seeds of this prosperity by investing not only in the means of production, but also the means of consumption.

So we at the DDF argue that a Basic Income Grant (BIG), funded at first by the economy through the application of a BIG TEAL, will sow the seeds of that prosperity, and should not be viewed as stealing from the rich to give to the poor, but as an investment in the demand side of the economy, and if at the same time, a BIG makes the lives of countless of individuals better and makes ”sure everyone has the means to lead a good life”, to quote Harry G Frankfurt, so much the better.

In addition, it should be remembered that TEAL collects in equal proportion from everyone. While the rich may contribute more than the poor, that is only because the rich are more economically active than the poor. But they all contribute in equal proportions.

So, in answer to the question, is a BIG stealing from the rich, we would answer emphatically and resoundingly, NO! It is an investment in their own and everyone else’s prosperity.

For those who wonder how we could pay for a Basic Income Grant, see how to pay for a basic income grant and take a look at DDF policy on the Basic Income Grant (BIG) and DDF policy on the Total Economic Activity Levy (TEAL).

Join with us.

See how you can benefit from DDF policies.
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Mental Health Subsidy Crises? Dial BIG for Help!

Remember the Esidimeni crises when a mental health care facility was closed and patients transferred willy-nilly to other ill-equipped facilities. A health ombudsman report suggests that as many as 80 (others say more and still counting) patients may have died as a result of that fiasco and not just 36 as originally reported.

Could things get worse? Apparently they can.

The San Michele Home, a flagship facility for mental health care, faces being closed because the Gauteng Health Department is withdrawing the R3400.00 per patient per month subsidy, because, the department claims, the facility does not comply with the regulations for such an establishment. These regulations were recently changed and, it is claimed, are excessively stringent and, in any event, the home has not been given a reasonable opportunity to comply with the new regulations.

Forget the San Michele Home for a moment. It appears that as many as 160 (one hundred and sixty) mental care facilities face closure for the same reasons. San Michele Home has about 200 patients in its care, so let us assume that each of the 160 homes have on average100 patients in their care. That means that some 16 000 patients (or more) are at risk, something that reduces the Esidimeni crises to a level of insignificance that is truly frightening.

It seems that the Gauteng Health Department are trying to discard their subsidy obligations to the mentally ill community and, quite callously, do not care much about the risk of a few more deaths here and there.

One would have thought that they would have learned from the Esidimeni fiasco, but apparently not.

But the Direct Democracy Forum (DDF) are not here to berate the Gauteng Health Department for whatever their lapses may be, merely to observe that if a Basic Income Grant of R5000 per month for every adult South African were in place, all sixteen thousand or so patients would not be at risk, because they could provide for their own medical subsidy at the facility of their choice, and would not need to be subsidised by a reluctant province or even an unwilling national government.

For those who would ridicule the idea of a Basic Income Grant, see how to pay for a basic income grant and take a look at DDF policy on the Basic Income Grant (BIG) and DDF policy on the Total Economic Activity Levy (TEAL).

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Recession? Dial BIG for help

Recession? Car sales down? No problem. Dial BIG for help:

South Africa slipped into recession with two successive quarters of negative growth in the GDP and car sales shrinking 13% to 34 956 units, year on year to April 2017.

Imagine there is in place a Basic Income Grant (BIG) of R5000 per month given to every adult South Africa citizen (see here) in 2017, and 0.1% of that population, say 34 400 of them, decided that they would like to buy new cars in 2017 because with the R5000 BIG they could afford to buy a car and pay it off over say the next three years. That would almost double new car sales for 2017 and boost new car sales by maybe R6.2 Billion, or more, in 2017.

I wonder what effect that would have on the motor industry and on SA’s latest recession?

I wonder too, if the remaining R1.5 Trillion pa additional spend by BIG recipients in 2017 (see here) would have any effect on the rest of the economy? I would guess that yes, it would have an enormous and positive effect on the economy.

Bye bye recession. Hello prosperity!

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How to pay for a Basic Income Grant

How can one pay for a Basic Income Grant (BIG)?

The short answer is that a TEAL (a Total Economic Activity Levy) would pay for a BIG. Later, the role of TEAL as a source for a BIG may be taken over by a Sovereign Wealth Fund, in part or in full, depending on the success of the SWF project (see SWF)

Let us explain how:

First what should a basic income grant be set at?

In the UK people who typically use food banks earn less than £320.00 (at R17/£ = R5440) per month and in the US they are thinking of $10 000 pa or about $800 BIG per month (at R13:50/$ = R10 800) while Finland are talking about €800 BIG per month (at R15.50 = R12 400), so the Direct Democracy Forum’s (DDF’s) suggestion of R5 000 BIG per month is quite modest when compared to other countries’ needs and suggestions. But let’s stick with R5 000 per month as a starting point.

What would the monthly and annual BIG bill be at R5 000 per month?

Our best guestimate is that the adult South African population is about 34,4m. That would mean a monthly BIG bill of R5 000 X 34.4m equals R172 Billion or an annual BIG of 12 times that amount (no thirteenth cheque) or R2.064 Trillion.

That’s frightening. Where on earth do we get R2.1 Trillion Rand a year, an amount rising along with the population as we go on in time? That is almost the value of the current GDP (our estimate at R2.8T for 2017).

The DDF reasons as follows.

If there is a relationship of 30 times the GDP to the amount of money flowing through the banking system (a relationship we observed in an earlier TEAL exercise in 2011) , a GDP of R2.8T would equate to R84T passing through the banking system, per year, We call that the TEA or Total Economic Activity. But each Rand of TEA represents a deposit into one bank account and a withdrawal from another bank account (we call this the doubling factor). So the TEALable amount is the TEA doubled, or R84T doubled to R168T.

Suddenly, 2.1 Trillion Rand seems quite small. In fact a 1.2% levy on the Tealable amount of R168T would deliver R2.1 Trillion. Not cheap but also not that expensive when you consider that the R2.1 Trillion will go back into the economy and effect the money velocity and the GDP (more about that later) and generally increase the size of the pie that we are all eating from.

Is a BIG just a thinly disguised wealth redistribution?  Does it not steal from the rich to give to the poor?  

This is not the topic of this post but for those who are thinking along those lines and do not at first see beyond the wealth redistribution element (yes, there is such an element) then we suggest you consider the effect on the economy of boosting the potential spend of the population by a net R1.5 T a year (remember the social welfare grant offset).  That has to boost the demand side of the economy enormously and provide the suply side of the economy with numerous wealth making opportunities, not just for the existing industrial and commercial powerhouses but also for the small trader and industrialists (the SMEs that everyone says should be the backbone of our economic revival) and individuals at large. In addition the socio-economic benefits for the population as a whole probably make it worthwhile.  But this is discussed more fully here and elsewhere in DDF’s current affairs posts,

Are there dangers? Yes, there are:

Will a BIG effect inflation?

Yes, it probably will, but that would need to be countered by 1) easing into a R5 000 BIG over time (say over 5 years) to ease the inflationary pressures on the economy, and 2)  dropping existing social welfare benefits (for example old age pensions) as the BIG matches or betters them (you won’t receive both an old age pension and a BIG together) and 3) increasing the GDP, in short increasing the supply of goods and services to match the increased availability of the R2.1T of BIG money.

Will a BIG effect the money supply and won’t that in itself be inflationary?

The answer to that is probably not a simple yes or no. Yes a BIG of R2.1 will effect the availability of money but not to the extent of R2.1 T.  Remember the social welfare offsets and that TEAL does not create money.  The economy may become more liquid.  A BIG will probably make existing money more accessible, particularly for the poor, and make money circulate more quickly and more often and that could be inflationary (see above on counter measures).  The No side to that is that TEAL does not in itself create money, print money or borrow money.  So the money supply per se should not be effected by a TEAL funded BIG, and that in itself should restrain inflationary tendencies.

Will a BIG of R2.1 Trillion lift the GDP to R4.9 Trillion?

No, probably not: 1) the BIG will substitute for existing social welfare grants, so there will be an offset factor, and 2) any increased demand trend will probably be met by a trend to import more, not produce more (remember we are in a post industrial phase in South Africa and are more a nation of consumers than producers, and I squarely blame the ANC for that).

So how do we move the supply trend to produce more and import less?

This will need a concerted and coordinated effort of the private and public sectors to boost production, maybe even engaging in targeted programs of import substitution and production benefaction, particularly by engaging as many of the BIG recipients as possible to invest as much of their BIG in production capacity, either of their own or through the JSE by investing in corporations which can expand their capacity to compete for the expanding markets for their goods and services, and of course, investments by the Sovereign Wealth Fund in South Africa’s production capacity.

Would a DDF administration have an overarching socio-economic-industrial strategy?

Yes, there would have to be such a strategy. In short, all the damage that successive ANC governments have done and in particular the damage the most recent (2014-19) ANC government has done, would have to be reversed. This is a tall order but when South Africans can stop hating one-another and when even the poorest of the poor has a stake in the economy and has some security and hope for the future, we believe that a united and determined South Africa can do just that, and in fact must do it, because the alternative is an ever downward spiral toward abject misery for most of our population.

So that is how a Total Economic Activity Levy will pay for a Basic Income Grant.

Capisce?

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Unpacking State Capture:

The Public Affairs Research Institute (PARI) have produced a report which unpacks the Capture of the South African State by Zupta Inc in a very clear and dispassionate manner that makes sense of and expands on, Thuli Madonsela’s (our ex Public Protector) State of Capture report and details very succinctly the manner in which Denel, Eskom, Transnet, Prassa, to name a few SOEs (State Owned Enterprises) and Treasury were taken over by Gupta surrogates and then milked.

Page 42 of the PARI report Betrayal of The Promise details the modus operandi for milking an SOE. We paraphrase:

New minister (say for energy) changes the SOE board composition

SOE embarks on new capital expenditure projects

The new board support radical economic transformation or has close personal links to bidders

Tender is awarded in circumstances of clear conflict of interest.

This is a process that can take years to put in place and clearly is part of a systemic process of looting compliant state coffers and public and private purses (for example, how much do you pay versus how much should you pay, for electricity?).

To add insult to injury, the DA’s Natasha Mazzone suspects that Eskom engineered the rolling blackouts (remember them?) in order to create a panic filled and compliant market place to ensure that the coal deals of Eskom’s choice and terms and conditions were met, as part of the milking process. Well, the Direct Democracy Forum (DDF) pretty much suspected that was behind the rolling blackouts, and it wouldn’t be the first time that Big Power (here and elsewhere) manipulated the market place to their profit. Wherever there is a monopoly these behaviours are pretty much a given.

Then came the email exposé about the extent of the state capture and President Zuma’s planned retirement bolt-hole in Dubai, and further still, the role Bell Pottinger had, (also see here) a UK PR firm contracted by the Gupta’s to run a disinformation campaign aimed at the South African public, duping the nation and creating red herrings to detract from the looting that was happening in front of our very eyes.

It is all pretty sickening, particularly given the state of the economy, wide-spread poverty and the terrible need for social, economic and administrative justice in South Africa.

South Africa is not entirely alone in this sense. If you haven’t heard of Operation Car Wash, a Brazilian equivalent to Zupta-Gate, read all about it, it is very informative. There are lessons to be learned from Brazil’s experience.

There is not much you or I or the DDF can do at the moment but they say that truth is stranger than fiction and there are upcoming elections and, while the DDF having the necessary political clout to do anything substantial about this is unlikely, sometimes the unlikely happens against all odds. We also think that the members of Zupta Inc should contemplate the fact that many in South Africa will be looking forward to seeing justice done when a government of integrity takes power from the ANC.

So, our message to them is, “You can run but you cannot hide”.

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Fake News

The American presidential election stirred a lot of mud in the USA and internationally. There are theories that Russia interfered in that election by hacking democratic party e-mail accounts and leaking the results through wiki leaks and other compliant avenues in an attempt to discredit the democratic campaign and in order to install a pro-Russia candidate in the White House. Sometimes theories can be concocted to match outcomes but in this case, my guess is that there is some credibility to the theory that Russia did its best to discredit Clinton and the Democrats and install a much more malleable candidate, namely, President Donald Trump of the USA.

Since then, there have been lots of reports of fake news, one for instance dubbed pizzagate, where the Democrats were alleged to be running a paedophile ring out of a Washington DC pizza parlour See here. Crazy? Yup! But apparently some idiot took it very seriously and went in there with a gun to check out the story. See here.

Some fake news is just motivated by greed. The more ludicrous the claims the more they are shared the more advertising revenue they generate for the web site reporting the absurd. To these sites and their owners it is just a money game. Many of the sites reporting fake news are allegedly run by East Europeans. See the transcript of this discussion between Craig Silverman of Buzz Feed and David Davies of NPR (US National Public Radio) Fake News Analysis Transcript. Wherever the site is based, the criteria is how many hits and revenue can a story generate and the truth of the matter is that the truth of the matter is of no concern.

So if a fake news story generates conflict between two nations who live on the brink of mutually assured destruction (only a slight exaggeration) as was reported on here between Pakistan and Israel, so much the better for the story. What is the big deal if some idiot shoots some of the staff at a pizza parlour (it didn’t but could’ve happened) or a nuclear conflict is precipitated (it didn’t but could’ve happened)? So what, they will argue, as the till clangs ‘k-ching’?

And in case you imagine for one moment that we in South Africa are immune to these machinations, may I draw your attention to the likes of Dr Eschel Rhoodie and the Information Scandal of the Apartheid era (he had a real PhD) and the current scandal surrounding Hlaudi Motsoeneng (who has a fake or no Matriculation Certificate at all), who, while in charge of the SABC (South African Broadcasting Corporation, South Africa’s public broadcaster), decreed that there had to be 70% positive news stories broadcast about South Africa by the SABC, and that there would be no coverage of unrest (of which there is a fair amount), and who decreed that SABC should broadcast 90% local content and who ruled the media department at the SABC in what has been described as a reign of terror, all of which demonstrates the relevance to South Africa of the curse of fake news and manipulation of the news and the media by the powers that be, past, present and future. It gets even more complicated when big business takes over government and the media serves their interests

Take the story of Iqbal Surve. Born in Cape Town in 12th February 1963 in poor circumstances he apparently pulled himself up by his own shoelaces and became a medical doctor (the facts are unclear – Cape Town U, or did someone mention Cambridge U, or does he even have a MBChB degree?) and confidant and medical advisor to Nelson Mandela (apparently while still a junior medical student) and a recipient of multiple awards from organisations who have never heard of him. His life appears to be a fabrication (see much posturing, political favour currying, more incredulity). In fact, he seems a bit of a charlatan who has got into bed with the ANC and who managed to con the Public Investment Corporation (or maybe they were complicit) into parting with R900 000 000 (Nine Hundred Million) of public pension funds apparently to buy the Independent Newspapers, which sum is alleged to be non-repayable, whatever that means. One’s head spins. And this person heads up the not so Independent Newspaper Group. The largest group of English language newspapers in South Africa is headed up by this apology for a media mogul and ANC stooge. And that is the relevance of Iqbal Surve to the topic of fake news.

Surve is not the only worm in the can.  If you only concern is how government departments spend your hard earned money, look no further than the new Nielsen report which highlights the Gupta owned New Age rag (I hesitate to imply it has a better status) having hooks into major government departments and parastatals, sucking them dry of their advertising budgets.  Read all about it here and be as appalled as I am..

As if that were not enough to make the average South African nauseous, the ANC has, apparently for years, run a black ops department, specialising in tailoring news and information for public consumption. One of the Black Ops contractors is now suing the ANC for unpaid fees for fake news activities. The ANC of course are claiming this is fake news, which is sort of the point of this entire blog. Who and what to believe.  See Lies will always out.

So when Putin says with a wink and a nod that no Russian regulars are engaged in military activities in the Ukraine, the media, in an effort to be non biased, print the assertion even though the evidence suggests otherwise.

The point of all this is, who in the world do we trust to keep us informed and not to misinform us. On what do we base our decisions on who to elect as future leaders and what if anything can we do to discredit and maybe punish purveyors of fake news? Is it not, after all, a question of fraud? But if you go after the news fraudsters you are bound to damage genuine media outlets as well, who could in self defence engage in self censorship. Dare we publish this or that story? Kind of self-defeating.

Of course, fake news is nothing new.  Britain used it on China to encourage China to Join against Germany in the first world war, Germany used it  in the second world war against the Jews and other non Aryans and against the Allies, Goering was Nazi Germany’s propaganda wizard. Fake news has always been with us.  What has changed is the method of delivery with media like twitter and Face-book and the news media trying to keep abreast of itself.  Fake news that took months or even years to plan and disseminate before now happens in moments on the Internet and has an avid global audience.

But some of the things we can do to protect against fake news are discussed here, here and here, and a good dose of skepticism will go a long way. You can also read up more here and here.  Sadly this is actually never ending. So let me at least end this now.

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The Age of Anger and the Educational Divide

The angst generated by Brexit and the Trump election is still generating much comment with all sorts of views being expressed.

Pankaj Mishra, writing in the Guardian in an article titled “Welcome to the age of anger” asserts that emotions of fear, anxiety and humiliation played a significant part in both Brexit and the election of Donald Trump and asserts further that a rigid contemporary belief that what counts is only what can be counted and what cannot be counted – subjective emotions – therefore do not (count). He points out that these emotions are also what drove Germany into the second world war and are driving anti-western sentiments in China, Russia and India.

He quotes Robert Musil speaking of the critics of Enlightenment rationalism, who observed that the problem was not that we “have too much intellect and too little soul” but that we have “too little intellect in matters of the soul”. This is a statement that resonates with me.

He further observes that seeking the “rational actor” we fail to see the individual as a “deeply unstable entity” particularly prone to ressentiment, a French word describing an emotion “caused by an intense mix of envy, humiliation and powerlessness” and resulting in a sentiment that can be expressed thus, “that it is not enough to succeed. Others must fail”. (Gore Vidal). So ressentiment “is poisoning civil society and undermining political liberty everywhere” which is further exacerbated by the inability of our “grotesquely unequal societies” to satisfy expectations of the equality of social conditions and individual empowerment presented as ideals of modern democracy.

Pankaj Mishra observes that “Never have so many free individuals felt so helpless – so desperate to take back control from anyone they can blame”. He concludes that we need a “radically enlarged understanding of what it means for human beings to pursue the contradictory ideals of freedom, equality and prosperity”.

Mishra says a lot more and is worth a read here.

In a related article, “How the education gap is tearing politics apart” David Runciman, also in the Guardian, observes that the chasm in education between the poorly educated and the well educated elite is ever growing and “has become a fundamental divide in democracy” and “how people vote is being increasingly shaped by how long they spent at school” and to a significant extent, this is what helped shape the Brexit results. Runciman succinctly states the fears that “democracy will mean rule by the poor, who will use their power to steal from the rich” and “rule by the ignorant, who will use their power to do the dumbest things” and that “both these worries go back as far as Plato” (428/427 bce – 348/347 bce) and recur “at times of political crises”.

Walter Lippmann, an American propagandist of the first world war, wrote of democracy that it was impossible to believe “that the knowledge needed for the management of human affairs comes up spontaneously from the human heart”. Evidence and reasoned argument mean little to the average voter, he argued, and that only specialist experts could rescue politicians from the dubious instincts of the people and direct them to what evidence required.

Runciman argues that to think that 2016 was a return to a democratic norm would be a big mistake. Runciman instead suggests that the educated tend to flock together and share common values and vote one way, and that the uneducated would do much the same but vote another way. Greater freedom tends to produce more social stratification rather than social diversity and this tends to support political choices of both groups, the educated and the less educated, with the divide highlighting alternative values ‘often characterised as opposition between libertarians and authoritarians” and this “represents a gulf in mutual understanding”.

Neither Runciman nor Mishra offer solutions, just analysis. That is more than enough. The solutions must come from those who heed their analysis.

How is this significant for the Direct Democracy Forum (DDF)?

First, the DDF senate proposal permits participation of ordinary citizens in the day to day political process. But the DDF’s Senate is not a legislative body. It is an approval element of a legislative body. So, the Senate cannot approve a law where the poor raid the rich unless the experts (the legislators) actually pass such a bill and send it to the senate for approval. Nor can a DDF Senate legislate something abysmally stupid unless the same legislators pass such a bill and send it to the Senate for approval. One would hope that the DDF Senate, even if presented with such a bill, will have the good sense to reject the bill, because it would have first to debate the pros and cons of such a bill and those presenting those pros and cons would also be part of the ‘learned elite’, who we believe will no doubt seek to alert the Senate members of the pitfalls surrounding such a bill.

Thus meaningful participation in the legislative process would be accessible to anyone who volunteers and is selected to sit. For details of the process and of the proposed Senate, see here. It will be obvious that the senate would have the power to quash any legislation or regulation that it feels was elitist or otherwise undesirable, no questions asked, and would need to be convinced of the desirability of any bill or regulation passed by the legislators or regulators but, importantly, would itself be unable to initiate legislation.

This should address in part, the sense of helplessness felt by so many referred to by Mishra and to enable human beings to pursue the contradictory ideals of freedom, equality and prosperity in a structured, peaceful and democratic manner.

Then there is the sense that society is being divided between the well educated and the not so well educated. The only way to address that is to ensure that all have the opportunity to be adequately educated, according to whatever their intellectual capacity is.

Here the DDF are proposing a number of interlocking policies which will support an education system, paid for from funds made available through a Basic Income Grant and available nationally to all South African citizens. Thus, government would no longer be the primary employer of education resources. Instead the students and the parents would be the employers and educators would, amongst other features, suddenly have their ability to blackmail all of society with threats of nationwide strikes, curtailed, because there would no longer be one service provider but thousands of service providers, all of whom would need to be negotiated with separately. In short, the DDF are proposing a free market solution where freedom of choice is paramount. If you don’t like the choices offered your child at school A, remove the child and the fees he is paying from school A to school B or C, whichever school works best for you.

OK, the solution is not a quick fix. There are no quick fixes in a process with a twenty five year cycle from entry into pre-school to exit from post-graduate school, but improvements to the entire system would be immediately available to scholars and students in the system, from pre-school to post-graduate school, from day one.

Of course, one cannot have education without qualified, competent and enthusiastic educators. So educators would be well paid and education would be a prestige occupation reserved for the competent.

The DDF do not claim that this would remove the education chasm that is growing year by year, but it first would slow the growth and later on, with more and more scholars having access to quality education through the whole process, there would be less of a divide between the highly educated and the not so well educated, and an education would be respected by all of South Africa and would be delivered as a right, not as a privilege.

As to fees must fall, there is no such thing as a free lunch so those receiving the benefit of a tertiary education will have to pay for it, before, during or after receiving their degrees.

All of this is not a perfect solution but is much better than what we currently have in South Africa.

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Junk Status still on the table

Looming credit downgrades are but one symptom of the economic turmoil wrought by political infighting in the ANC. In lock step are market performances which are very much on a downward trend and have been for the past 9 months or so, after a brief period of recovery early in the year. And we are nowhere near being out of trouble with possible junk status ratings in sight as soon as June 2017, unless there are some substantially positive changes in the management of the economy. (time is running out)

Nene-gate, Gordhan-gate, and political leadership hell bent on programs of self-gratification instead of listening to sound fiscal advice from the very people they appoint to watch the economy for them, are all contributing factors to the prospects of an impending junk status.

One wonders if it is the intent of the ANC to actually destroy the economy and whether they realise that in doing so they will also destroy the lives of the tens of millions of South Africans who rely on the economy for their daily bread, and what they, the ANC will do, once they have achieved their goal, how they will appease the poor and starving who have had the wealth of their nation and their communities and their homes smashed and littered at their feet.

The Direct Democracy Forum (DDF) recognise the interdependence of the nation-state and the economy and will use economic indicators as useful benchmarks for measuring their success in governance. DDF policies for Basic Income Grant and a Sovereign Wealth Fund will enable all South African Citizens to share in the fruits of the economy. The DDF believe that a wealthy nation will be a happy nation and gaining and sustaining that wealth for all in the country will be the primary goal of DDF economic policies, where the integrity and acumen of people such as Nene and Gordhan will be respected and supported and harnessed to attain those goals.

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The Capital Punishment Debate

The reality is that there are some crimes that are so heinous and criminals who are so devoid of human conscience, that these criminals are beyond any chance of rehabilitation, redemption or safe detention. Such criminals should be sentenced to the maximum penalty available to the law so society can rid itself of the responsibility of safely imprisoning them for the rest of their lives with the concomitant risk of escape or being inadvertently let loose into society.

In an article “Capital Punishment – …..”, Ruth Hopkins argues in the Daily Maverick, that capital punishment is unacceptable because too many convictions are flawed.

The Direct Democracy Forum (DFF) acknowledge this but, rather than toss out capital punishment as an option for the courts to exercise, would rather introduce meaningful legislation to improve the quality of our judicial system and trial, conviction and penalty processes. This would include the following steps:

1) outlaw admissions of guilt, thus all convictions would need to be evidence based and proved beyond a reasonable doubt.

2) eliminate plea bargains or deals between the prosecution and defence admitting guilt to lesser charges in return for lesser sentences, often without a trial

3) all instances of capital punishment would have a statutory three level appeal process, to separately examine a) the trial process for correctness and the evidence for veracity and b) the quality of the defence (was the defence deficient in any way) and c) the appropriateness of the penalty.

These appeals would be heard by higher and separate courts than the trials courts.

4) the state would not defend an accused with public defenders but rather the state would fund the defence by private defence practitioners, selected by the defendant, and deemed competent to mount an adequate and appropriate capital defence. There is in fact an international precedent for this where the defence of Adolf Eichmann was paid for by the state of Israel, to ensure that the defendant was adequately represented, because the defendant could not otherwise afford the counsel of his choice.

5) finally, any verdict involving capital punishment would have to be considered by Parliament, where a statutory bill of clemency would have to be voted on. This would involve all the houses of parliament engaged in the normal legislative process. This would preclude any clemency or concession granted by the State President or any other political figure.

The DDF believe that capital punishment should include sentences exceeding 20 years to life of imprisonment, without the possibility of parole, and of course, the death sentence, but the application of the death sentence would only be administered when the impact of these new prosecutorial limits and the appeal processes were deemed by parliament to have effectively eliminated flawed convictions.

The DDF do not believe that this is all that can be said or should be said about the death penalty and capital crimes and capital punishment, but do however believe, that this is an appropriate position from which to start the debate. The endeavour to ensure that our judicial systems and processes are just and without flaws needs to be an ongoing process of self appraisal and assessment.

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Withdrawal of South Africa from the ICC

South Africa’s and others’ withdrawal from the International Criminal Court (ICC) has seriously undermined the ability of the world to bring needed change to the ICC.

In an article “Going Beyond the ICC Hysteria” – SIYABULELA GEBE argues here that while there are legitimate reasons for and against the participation of South Africa in the ICC a compelling argument for involvement is that without the ICC, there is no institution, neither the stillborn African Court of Justice nor the ICC, that can hold African leaders to account for their plundering of Africa’s people and resources.

In another article “Sticking with the ICC is Africa’s best shot at reform” – Allan Ngari for ISS TODAY argues here that while there are imperfections in the ICC’s agenda, based mainly on the ability of the UN Security Council to indicte ICC member states’ heads of government for committing atrocities, an ability seen as unjust because most of the permanent members of the UNSC are not signatories to the Rome convention of the ICC and thence are beyond the reach themselves of the ICC, there are avenues through which the Rome Statute can be amended, and that in fact, the Southern States have sufficient votes to give effect to desired amendments. Given that that is the case, it makes no sense for African states and, in particular, for South Africa, to withdraw from the ICC. Rather they should engage with the ICC and seek a more just means of bringing indictments through arguments for amendments of the Rome Statute.

Yet another article “African states must not waste a golden opportunity” by Solomon Sacco, Senior Legal Adviser and Netsanet Belay, Africa Director of Research and Advocacy at Amnesty International, argue here that the two greatest challenges of the ICC are to also focus its attention on atrocities in other continents than Africa and that the ICC is very much hostage to global politics. Both these failings need to be addressed by an all inclusive ICC and that Amnesty International needs African nations to support their efforts in seeing that these failings are addressed, and that abandoning the ICC in a fit of pique merely weakens the possibilities for meaningful change to the Rome Statute.

The Direct Democracy Forum (DDF) believe that the ANC led government is posturing for the approval of the pan African lobby, saying, “see what great Africans we are”, instead of remaining in the ring and punching above its weight as South Africa has so often done on international stages in the past.

Nothing is gained and everything is lost by this form of grandstanding and is just another example of ANC ineptness.

The DDF are very much in favour of engagement and bringing about change through rational argument amongst equals in the world’s forums.  Abandoning forums like the ICC will never bring about change, instead it will reduce South Africa to the role of an external and helpless observer with no influence on and in world affairs.  The DDF believe that engaging with South Africans and the world at large in a principled manner, will encourage the adoption of principles amongst all in South Africa and in the world, and that conversely, disengaging from the world will encourage the abandonment of principles both nationally and internationally. 

A DDF administration would ensure that South Africa takes its rightful place in international forums and in particular, rejoins the ICC.

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Trumped, Brexited and Where To Go Now.

The US voted Donald Trump in as president elect of the US of A. Maybe the guy confounds us all and becomes the best president in living memory but my hopes are not very high for that to happen. He rode in on an anti-establishment ticket and the democrat’s candidate was Hillary Clinton, an establishment candidate. There were lots things wrong with her candidacy; that she is pro-establishment at a time when the establishment had largely ruined middle America with its globalisation policies, that she has no anti-establishment credentials and Trump claims them instead, that she is seen as deceitful and too political and not principled enough, that she is married to Bill Clinton and I think America has already had enough of the Clintons, so I don’t actually know what she had going for her. Possibly her experience as America’s first lady and as Secretary of State in Obama’s cabinet, and being a trained and probably highly skilled lawyer and negotiator. And then of course, she had Trump as an opponent, which I had thought alone would suffice to block his election. But Clearly that was not enough.

Probably what sealed the election for Trump is that the only effective counter to Trump was Bernie Sanders. Bernie Sanders is another anti-establishment politician, but a Democrat. He was robbed of his candidacy by the Democratic pro-establishment lobby, and I suspect Sanders’ supporters largely stayed at home because their candidate was no longer standing. The pro-establishment lobby really shot themselves in the foot this time.

IMHO Trump is a reckless misogynistic, homophobic, xenophobe and has been described as a snake oil salesman, in other words, a man not to be trusted. One wonders how many of his campaign promises he will keep.

So there was not much to choose between the candidates. America and the world at large probably view this US presidential election as the most disastrous in the history of the USA and maybe in the history of the world. One can only hope that the responsibility of the most powerful office in the world will give Trump pause to think before he speaks or acts, and that he does not set the cause for civil liberties back too far during his term of office.

There is no lack of commentary on Donald Trump’s victory.

Mark Mardell links Trump’s victory to Brexit (Trump and Brexit), and Saul Musker claims that Trump’s victory was not a victory for change but rather a victory for the status quo in response to the loss by middle America of their privileges, (US 2016: This was not a change election), while Kevin Bloom observes that Bob Dylan predicted this event, in general terms, in his 1965 song Tombstone Blues, (Tombstone Blues: On the other side of Trump), and Ben Wright, writing for the BBC ponders whether the age of liberal democracy is imploding (…the end for liberal democracy?) while my personal favourite is a very thoughtful article by Chris Waldburger, (How Trump’s Flaws became Political Strengths.) And those are just the ones that caught my attention.

So the world is in shock, and denialists hope that the US college of electors will rescue the world from Trump the same way that Remainers hope that British Parliamentarians will Rescue Britain from Brexit. Not much chance of either happening, I believe.

So how is this relevant to the DDF  (The Direct Democracy Forum) and why am I even bothering to post this article?

It is relevant because whatever the promises of Brexiteers and Trump are and whether or not they will put their money where their mouths are, they were enabled by the failure of the neo-liberals and the elites of the world to look to the plight of their own nationals and to respect the national sovereignty of their own countries and to assume that for as long as they were delivering profits to their own shareholders and themselves, they could do no wrong. Nothing is farther from the truth. And Occupy Wall Street, Brexit, Trump’s win and the rise of the far right elements in the Europe and the possible demise of the EU, are all symptoms of the same malaise.

The elites and the neo-liberals and the corporatists and the oligarchs (just different names for the same group of misguided technocrats) have failed their own people and have acted in total disregard for their welfare, and the worm is turning.

The Ruling Elites of all nations need to find another formula that will not neglect middle America, middle Europe, Africa and Asia and South America, will not neglect the “left behinds”. And by the way, the terms “middle” and “left behinds” embrace all elements of societies that find themselves excluded from the benefits of prosperity and social justice enjoyed by the privileged few.

It needs to be a formula that embraces the positives of the world’s two greatest systems, Democracy and Capitalism, and discards as much as possible, the means by which these systems are captured by the oligarchs for their own and exclusive profit and well being. It needs to restore sovereignty to citizens and nations through meaningful access to and participation in democracy. It needs to restore economic security through meaningful access to and participation in the capitalist market places as envisioned by Adam Smith in his book The Wealth of Nations and Milton Friedman in his book Free to Choose. It needs to restore hope and dignity to all in the world.

In fact, what that formula should seek to address is a way to share some in order not to lose all. I say “lose all” because the disenfranchised, who have nothing to lose, are quite prepared to destroy all in retaliation for what they see as the injustices of a society that doesn’t even register them as a blip on the horizon, let alone as a significant force for change.

So let’s not get bogged down in arguments of conservative Judeo-Christian ethics where one reaps what one sows and only the deserving profit from life (although both are pretty much truisms), for who then are the undeserving? Today you may not be part of that group but tomorrow, perhaps quite unexpectedly, you may join them for any one of an endless number of possible reasons. And if one of life’s fickle jokes leaves you in that predicament, how will you cope in a society which will not even see you as a blip on the horizon?

If you are wondering how Brexit and Trump were possible, the reason is simple. Too many have been disenfranchised by the neo-liberal movement and they, the disenfranchised, the left behinds, just want to tell the establishment to go and “take a hike”.  In the USA, the 1% pretty much destroyed the American Dream for the 99%, and now they, the 1%, are pretty much trumped. That is no way to run a world. 

To get back to the relevance of all of this to the DDF – the DDF are proposing one such formula for the resolution of society’s woes. We are not saying of the disenfranchised that we have to be responsible for them. What we are saying, however, is that we need to invest in the disenfranchised so that they can become empowered and enfranchised members of society, who contribute to society’s welfare and sustainability, who are in fact, responsible for themselves, and who are working to strengthen society instead of seeking to destroy it.

We are arguing that none should be excluded from that socio-economic-political system for to do so would merely be creating enemies, who, if they are large enough in number (maybe 99% of the world’s population), will overwhelm all, good and evil included. What we are also saying to the neo-liberals is that if they want wealth, if that is their goal in life, they are more likely to attain and retain that wealth in a prosperous society than in a society based on poverty for the many and wealth for the few.

If the neo-liberals had not turned their back on the “left behinds” of the world, we would not have had movements like Occupy Wall Street, Brexit and people like Trump and religious elements like militant Islam, all occupying the moral high ground in a world seeking change. There would be no moral justification for their existence and no need for that kind of change.

The DDF are pragmatists, not moralists. We seek solutions for society’s problems, and we believe that our vision of Democracy and Capitalism in a society that embraces both for all, is one such solution.

Join with us.

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Minister Nene and the Tax Base

South Africa’s Finance Minister Nhlanhla Nene is absolutely right, we do need to broaden the tax base, but the Direct Democracy Forum (DDF) are streets ahead of his thinking. Imagine a tax system that was all-embracing and set at 1% of economic activity. Sound too simple? Too good to be true? Nope – go to http://ddforum.co..za and look at their proposal for TEAL. Not only is it doable but it is the solution to SA’s tax and National Debt conundrums. It follows the KISS principle. What can be better than simple?

But the DDF are about more than just TEAL. DDF policies will lead to fair government and fair tax and an economy based on prosperity, not poverty. You simply cannot beat that.

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Constitutional Reform

The South African parliamentary model is loosely patterned after the Westminster Model with an elected legislature and a second house intended to moderate the acts of the legislature (in UK a House of Lords and in SA a House of Provinces)

The Westminster model has largely been regarded with some respect and has been more or less emulated around the world.  Ok this is probably because Britain was a prolific colonizer and left its stamp on many aspects of the life and politics of its former colonies.  But the Westminster model is under scrutiny, indeed perhaps even under attack, particularly from those who want devolution from a centrist authority.  The most recent attack on Westminster itself came from the Scottish referendum of September 18 2014 on the issue of Scottish independence from Britain, but was defeated by a 10% margin (45% for and 55% against secession).  

None the less, the vote has sparked a great deal of debate about the Westminster style of government.  The sentiment for a greater and closer say in the process of government is developing a groundswell in Britain and elsewhere in the world.  A recent manifestation of this groundswell comes from a group of the world’s mayors, who are pushing for a parliament of mayors.  See Will mayors one day rule the world?

The Direct Democracy Forum might support such a move provided the mayors were directly elected but wonder if mayors would then have the time to also act as members of a national or international legislative body and how would that work?

The idea is interesting but DDF believe that any parliamentary model that does not include elements of direct democracy in it would basically usurp the rights recognized by the DDF, for a population to approve all laws and regulations by which it is governed.  

This is the core of the DDF‘s Senate model, that a legislature can be appointed in any manner provided it is directly answerable either to the electorate as a whole, by referendum, or to a senate representing that electorate, such as suggested in the DDF‘s proposal for a Senate.

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Budget Debates or Rubber Stamps

The fortnight covering 15th to 24th July 2014 saw a perfunctory parliamentary program of budget debates, 24 debates in 5 parliamentary days over the period.  See here and here.

That would work out at roughly 5 debates a day or 24 debates in a 40 hour week, an average of 1 hour 40 minutes per debate.

Do you think that is adequate to properly debate any single portfolio?  We don’t think so.  It is a thinly disguised rubber stamp and smacks of indecent haste.  Makes one wonder what the ANC don’t want to be revealed by adequate debate and disclosure.  No wonder the Nkandla fiasco was possible.  Nkandla in itself warranted a 40 hour debate (and then needed to be thrown out), let alone the time needed to properly investigate and sign off on the rest of public works and or the president’s budget.

The Direct Democracy Forum doesn’t have a specific policy on budget debates but would expect all budget debates to be allocated an adequate time for proper assimilation, debate and approval by both the legislative assembly and the Senate.  That would not be less than the time needed for adequate debate in committee and in a plenary session of the legislative assembly, for each budget, at the very least a two day process, and then each budget would have to go forward to the Senate for its approval.  That would be nothing like the indecent haste of the rubber stamps dished out by the current ANC led parliament.  Those minimum requirements would be Constitutional requirements.

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Expropriation by any other name is expropriation

Successive South African governments have been hacking away at the rights enshrined in the constitution. Not the least of this constant hacking is the new Protection of Investments Bill. The bill supposedly seeks to present a uniform protection for foreign investors equal to that enjoyed by local investors but coincidentally attacks protection of property rights granted by the constitution, and thus seeks to circumvent South Africa’s  constitution.

The ANC are playing with semantics. ‘Semantics is the study of meaning. It focuses on the relation between signifiers, like words, phrases, signs, and symbols (eg expropriation) and what they stand for, their denotation (eg separation from one’s property)’.

This is how the game is played: Expropriation ‘occurs when a public agency …. takes private property for a purpose deemed to be in the public interest’. The constitution clearly lays out the manner and consequences of expropriation (basically there must be exchange of value).

The protection of investment bill, however, sets out that property may be taken by the state provided the state does so, not as owner, but rather as ‘ custodian ’ for the disadvantaged (IRR @Liberty on Protection Of Investment Bill) and that people who’s property is taken in this manner could end up receiving zero compensation on the loss of their property, first because the state can determine the amount and manner and timing of any compensation, grounds for a sort of never-never compensation system, and second, because the constitutional court has already ruled that where ownership has not changed hands (viz the original owner is not deprived of ownership even when deprived of access or control) there is no expropriation (IRR @Liberty on Protection Of Investment Bill).

If depriving people of the rights of ownership with or without a change of ownership is not expropriation, then what is expropriation?  This has to be playing with semantics.  It is obfuscation, prevarication and spurious – in short it is plain dishonest and amounts to little more than legalised theft – and that the constitutional court should find in that manner raises a serious question mark on their own honesty, integrity and impartiality. 

Non expropriation removal of access to one’s property means that such deprivation does not enjoy the protection of the constitution regarding expropriation. So, the state could move 20 vagrants into your home (say designed for 4 people) and say it is for the public good.  So you are deprived of the right to use your home as you see fit, a home you may still be paying for, and the state will not be obliged to compensate you because no expropriation has occurred.

This sort of duplicity by the ANC-led government is not unusual. They did it with the state secrecy act, the general intelligence laws amendment bill and the Protection of State Information Bill to mention a few statutes that come to mind. Clearly the ANC view the constitution as a hindrance to their ambitions and are doing all they can to circumvent the constitution.

The slippery slopes for property rights has just got steeper and more slippery.

By contrast, a Direct Democracy Forum (DDF) administration would view property rights as a cornerstone of the state and its obligation to all South Africans. A DDF approach to all South Africans who were not enjoying property ownership would be to engage them in property ownership and protect that ownership unambiguously and with fervour, through the rights enshrined in the constitution. This would involve empowerment through education, training, employment and wealth creation, in a state whose duty is to serve its citizens, not feed off them.

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Gordhan and Nene

Gordhan’s ousting and his replacement by Nene are not entirely unexpected.  Gordhan has often been outspoken, as were his predecessors, who all wielded considerable power by virtue of their public declarations on financial mismanagement in the ANC led government, declarations uttered with predictable results.

It is probable that Nene has been groomed for this move and one wonders if he is going to be compliant member of cabinet who endorses the excesses of government, remains silent on them, or will he continue the slightly maverick course of his predecessors? One hopes for the latter but fears for the former.

As for Gordhan – why not just fire him from cabinet instead of demoting him to the circumcision and sangoma affairs portfolio, as described by one South African tweeter?  Perhaps Gordhan’s position is a backstop, in case the appointment of Nene does not work out as planned?   Also, perhaps, out of cabinet all together Goprdhan could pose some sort of a threat?  Just keeping him close and available could be keeping the stopper on a genie’s lamp?

What isn’t speculation is that the finance ministry has always been a zone of calm, rationality and realism in otherwise questionable seas.  Let us hope that Nene continues that tradition.   

A Direct Democracy Forum administration will certainly include the likes of Gordhan and his predecessors and their predilection for rationality and the sensible use of taxpayers money, and with the application of TEAL in place of the hodge-podge of existing taxes, they will have a much more plentiful and reliable source of funds for them to realise their visions.

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Children’s Rights locked out of the election

South Africa should be in tears that the the Direct Democracy Forum failed to gain entry to the 2014 election race.

There are many reasons for this, not the least of which are the DDF’s education policies, youth development policies and social welfare policies, driven by TEAL, the SENATE and LOCAL GOVERNMENT policies, which would have ushered a new era of advancement and development across the whole of South Africa.

This article “Children’s rights forgotten” actually got it wrong.  There is at least one party in South Africa who have not forgotten the children.  It’s just that the DDF don’t have an election manifest because the DDF weren’t allowed into the election.  But the DDF are the only party in South Africa with a clear vision for the country and its children and clear and accessible policies that can me measured against DDF actions and the political will to implement those policies, yet the the DDF are locked out of the 2014 election race.  That is a crying shame.

At the DDF we believe locking out the DDF and other parties from the elections is unconstitutional and if we have the opportunity to argue that case before the Constitutional Court, we will embrace it with all our hearts and minds.

In the meanwhile, shed a tear or two for our ailing nation as it faces another five-year cycle of abuse.

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No Spoilt Votes

It’s very frustrating when a senior member of the political establishment urges disaffected ANC supporters to spoil their votes.  The message appears to be a mixed one.  If you are unhappy with the ANC, vote in the opposition or, if you don’t fancy any opposition party, go to the polls and spoil your vote.  What a waste that last option is.

Ronnie Kasrils must be grandstanding in the hope that some sense of concern is conveyed to the ANC over their poor and sometimes dishonest dealings with South Africans because if he really wanted to send a message to the ANC stalwarts he would be urging them to vote for the opposition, because that is the only action the ANC establishment will understand.

We have said this before – every vote for the opposition is another vote the ANC need to get in order to stay in power.  Spoiling your vote is one less vote the ANC need to get in order to stay in power.  By spoiling your vote you are actually helping the ANC to stay in power.  Is that what you really want to do?  

The Direct Democracy Forum urge everyone who is unhappy with the ANC to vote the opposition into power.

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DDF Out of 2014 Race – what now?

Sadly for all of those who wanted us in the race – we were unable to raise the R200 000 that we needed to get onto the National Assembly Ballot – so for the time being we are not there for our supporters.  Another time, we promise.

We are being asked who to vote for in our absence.  The answer is simple – vote for your conscience.  If you were going to support us you were going to cast an opposition vote.  That should not change.  We hear story after story about spoiling votes, drawing a DDF logo on the ballot and putting a cross alongside it also spoils the vote – so please don’t do that.  Too many people fought for what they believed was the right road to democracy.  People of all races and political persuasions died for democracy in South Africa.  To spoil or withhold your vote is to say that what they fought for wasn’t worth the sacrifice.  Please don’t do that.

Instead, find a party which most closely fits your ideals, or the ideals of the DDF, and vote for them, even if the fit is less than perfect.  Every vote cast for the opposition is one vote more the ANC needs to get back into power.  As members of the opposition we should be making each vote count against the ANC.  You can’t help the DDF get back into the race for 2014 but you can help diminish the ANC presence in parliament.  This is a DDF goal that we all need to aim for.

Use your vote to do that.

Meanwhile, the fight goes on.  There are other elections and one will be a victorious election for the DDF.  It’s more a question of when than if.

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Elections – DDF Needs Support to get onto Ballot

Deadline for submission of lists for the 2014 elections is nearing – 5pm 12th March 2014.

There are two things the DDF need at this point – 830 Candidates (see list below) and R605 000.

These are both difficult goals to achieve at short notice.

Below is a list of Candidates required from each province and nationally.

National Assembly                   National           Regional               Provincial            Total

National Assembly                   200                  200                                                  400
Regional                                   200                  200
EC                                                                      26                         63                       89
FS                                                                       11                         30                       41
GT                                                                       48                         73                     121
Kzn                                                                      40                         80                    120
Limpopo                                                              19                         49                       68
Mpl                                                                       15                         30                       45
 NW                                                                     13                         30                       43
 NC                                                                        5                         33                       38
 WC                                                                     23                         42                       65
0
 Total                                       400                                                  430                     830

The way it works is each of those numbers is a list of that many (or fewer) candidates.

There is a list for 200 nationally allocated seats and 9 lists for 200 regionally allocated seats (see above for distribution), together making up the 400 seats in the national assembly.  That is for the elections for the National Assembly.

Then there are 9 lists for the 9 Provincial assemblies, in total 430 seats.  This is for the Provincial Assemblies elections.

The two together total 830 seats.  If we can we would like 830 names, one candidate for each of those 830 seats. 

To qualify for the regional or provincial lists you must reside and vote in one of the 9 provinces and your name can appear on the list for that region/province.  To qualify for the national list, you can reside and vote anywhere in South Africa.  In both cases you must be a registered voter, not have been sentenced to a prison term without the option of a fine or have served such a sentence in the past (we think) 5 years, not be an un-rehabilitated insolvent and be of sound mind.

If you qualify on those counts and wish to be listed as a candidate on our lists then complete and sign an Appendix 5 form (available from the IEC web site or Appendix 5 for  CandidateAcceptance&Undertaking (in .doc format) and return it to the DDF c/o johnadrianbarri at gmail dot com) before Friday  7th March, along with a copy of your ID page with bar-code and photograph and a CV with photograph.   If we receive this after 7th but before 12th, we will try to include you if the lists are still open.

This is a chance to serve society and your fellows in a meaningful way.

Regarding the R605 000 – we hope the Constitutional Court will intervene but none the less are trying to meet that requirement.  So if you or anyone you know has some spare cash lying around – contact us at johnadrianbarri at gmail dot com and we will tell you what to do with it.

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DDF will apply brakes to shifting standards

There seems to be an almost universal strategy to either set standards that are already achieved and then claim the credit for achieving them or to withdraw from battlefields and make like there is no battle.

Three articles in the current M & G on-line edition bring both theses strategies into pretty clear focus. Africa is very much a homophobic continent and however liberal South Africa’s constitution is, support for the lesbian, gay, bisexual and trans gendered people in the streets of our cities is lamentable. So also is the general support for victims of sexual violence and sexual and violent crimes against women and children proliferate. Sadly also, institutionalised violence seems to have been extended from the political arena to the more general criminal arena, and reports of police violence and indifference to criminal acts by their own members, proliferate. These are the three articles; Khayelitshe police incapable, Apartheid culture of violence and universal access.

All of this can be summed into an overriding indifference to the rule of law both by promulgators and administrators, and a general unwillingness to apply the rule of law.

It is denialism at its worst. Wikipedia defines it thus: In human behaviour, denialism is exhibited by individuals choosing to deny reality as a way to avoid dealing with an uncomfortable truth.

That is exactly what SAPS did when it removed specialist units dealing with sexual violence cases from its police stations. This was done in the name of cost rationalisation. What the government of the day did was to deny there existed the sorts of problems that demanded those costs be incurred, so as to ignore the uncomfortable truth of sexual violence That is exactly what successive departments of education have done by dumbing-down the nation’s matriculation examination standards. “We have no educational problems – look at the improved matriculation results” they crow. Then there is the question of acceptable standards of water delivery and broadband delivery. Yes-Siree – ‘look at how we have improved access to water and to the internet’, neglecting to point out that the only way they were able to report improved statistics on water and broadband delivery was by shifting the goalposts to levels that required no effort to achieve, indeed to levels that were largely already achieved. They did something very similar to the housing problem in South Africa, exacerbated by opening SA’s borders to everyone who could claim struggle credentials. Instead of responding by building more and adequate housing for the homeless they turned our suburbs into ghettos and the most appalling shanty towns have sprung up in every available corner of every major city in the land, without roads nor even the most basic service delivery.

All of this happens under the banner of a fiction that said of successive post apartheid governments – look at how we are addressing the needs of the nation. And what a fiction that is! 

A Direct Democracy Forum administration would set standards that were meaningful to constituents and would insist they be met. It would insist on the rule of law and would severely censure any officer of the state for not upholding the law. A DDF administration would deliver running water to every household in the land and that would be the standard. It would deliver communities which residents could live in in safety and comfort, that it’s children could go to school in, in safety, and be properly educated and that would be the standard. It would deliver meaningful education standards to the nation. It would return industry and agriculture to the land and create employment. It would restore food security to the land and it would restore South Africa to South Africans, and that would be the standard. We remember when South Africa worked and we will make it work again, with meaningful education, health care, transport, social and community development, only this time without gate-keepers, without racial, sexual or gender discrimination, without nepotism, or cronyism, or patrimony. Only merit will drive South Africa, and South Africa will flourish as never before, and that would be the standard.

Come. Join us.  

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The buck stops at the ballot box

The DA and Glynnis Breytenbach

The Direct Democracy Forum have to admit to more than a touch of envy that the DA and Glynnis Breytenbach have got together.  What a coup for the DA.

We also admit to a touch of sadness.  There is a crying need for people of Ms Breytenbach’s caliber in the corridors of government and it is truly sad that she has left them for the corridors of Parliament.  No doubt she will contribute as meaningfully to the latter as she did to the former, but that is not the point.

The DDF are probably not on Ms Breytenbach’s  nor the DA’s radar, yet, but none the less serve notice to both that if we ever have the opportunity to poach Ms Breytenbach back to the corridors of government, we will, and there will be a position for her as head of the NPA, and an opportunity for her to deal with some unfinished business.

For the moment, though, congratulations to the DA and to Ms Breytenbach.

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The buck stops at the ballot box

Lobbying, Party Funding and Electoral Reform

A Direct Democracy Forum administration would comply with DDF policies. So the DDF would install a Senate which may or may not include peer groups for business people. This would not however be the same as providing business people access to the legislative process, an access needed if you consider that an economy is both driven by businesses and serves as an environment intended to attract business, so there should be a forum where business and government and legislators can engage in dialogue, so government understand the needs of business and business understand the needs of government.

The attached M & G article “Stop the rot of secret party funding” is an appeal for such a forum to replace the present non-system, where influence is peddled to those with the fattest wallets. A DDF administration would take a serious look at what presently happens and develop a forum devoid of peddling for secret party-political funding.

Which leads one to the question of how parties are funded.

The DDF would like to see a system that funds all political parties equally, merely for being registered, having thus satisfied a certain level of public support, and a system that also funds parties proportional to the level of support as evidenced by the number of registered party supporters a party can claim, rather than simply based on the number of seats a party has in parliament, although that also needs to continue to cover party-political parliamentary expenses.

State funding of political parties may or may not preclude private ‘party’ funding.  There could be a common pool of private and corporate donations to the democratic system or private individuals and corporations could continue to donate to parties which will need to declare all or at least all major donations, or some mix of those extremes may be desirable. The matter needs debate and needs to be subjected to the democratic process. But what we have is clearly open to corruption and abuse that will frequently place vested interests above public interests, and the DDF suspect this is what occurred in the E-Tolling debacle.  The DDF are equally convinced that this non-system, where chaos and all sorts of deceits can reign supreme, must be replaced with a more structured and transparent system of public dialogue and party funding.

This in turn leads to the question of the electoral process and the role of the R500 000 hurdle for access to national democratic elections. The DDF are sympathetic to the plight of the EFF (Julie’s party) who need to raise R500 000 to get on the ballot paper nationally for this year’s elections. The DDF are faced with the same problem. 

The DDF would like to see a multi-round electoral system that funds all parties equally at each round of the elections with losing parties dropping out of each successive round until there are clear winners tasked to form the next government, either by a coalition having an electoral majority or by a single party obtaining an absolute electoral majority.

This is a system which will allow nascent political parties entry into the electoral system, and have their policies and goals judged by the electorate, without needing to overcome a potentially debilitating financial hurdle, and will challenge the status quo at each election and prevent stagnation of the political system. The DDF believes such would be a sensible and healthy system although the status quo will not necessarily agree with this view. 

DDF policies repeatedly focus on the need for collaborative government. The need to give business a voice to express its needs and the needs of the economy and the need to give the electorate a meaningful voice in a new electoral system, are merely a continuation of the collaborative theme expressed in the Senate at national level and Municipal Forums at local levels. 

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Plea from the coal-face of education

This considered and impassioned appeal for sanity in the education system comes from a senior school history teacher whose experiences in the classroom do not equate to the results of her pupils in the 2013 Matric examinations and echo the opinions of Professor Jonathan Jansen University of Free State vice chancellor.

The bottom line is what the Direct Democracy Forum have been asserting constantly, that successive ANC governments and in particular their education departments have been perpetuating massive educational fraud upon the hapless and near helpless parents and students trapped in our public education system.  Not only is the message misleading to these unfortunates but also attempts to mislead society as a whole.  These attempts fail because society has its own standards.  They are simple standards.  Are high school graduates sufficiently literate and numerate to make it in the work place or in institutions of higher learning?  The general consensus is that no, the average high school graduate is not sufficiently literate or numerate for those tasks.

Why is this fraud?  Well, if you enter into a contract with a supplier to supply you with a given product of a given quality and function and the supplier supplies you with a dysfunctional product of an inferior quality dressed up as a product of the contract, then the supplier is committing a commercial crime.  He is committing fraud.  The fact that the supplier is government supplying to a captive market who cannot effectively counter government’s claims of functionality and appropriateness of product merely exacerbates and heightens the degree of fraud.

It is the DDF‘s intention that a DDF administration will hold those responsible for this fraud accountable and bring them to account.  And it is a massive fraud, perpetuated on nearly 500 000 scholars per year over a period of nearly twenty years, and nearly that number again of those students who dropped out of the system, and nearly twice that number of parents over the same period of years.  This is clearly an opportunity of a class action of enormous proportions maybe effecting some 40 to 60 million persons over 20 years.  

But it is worse even than that, because the effect of that fraud is felt over the rest of those persons’ lives and by society as a whole who have to accommodate those poor unfortunates.  The lucky ones are those who actually make it to university and are re-educated and then subjected to the rigors of a tertiary education. The unlucky one’s are those who didn’t make it and who will never make it.  The scope and effect of the deceit is mind boggling and inexcusable and the fact that is was perpetuated in the name of political expediency just makes it even more inexcusable.

But this blog is not about retribution.  It may be about restitution but even that is unimportant when compared to the primary purpose, which is to illustrate to South African’s that the DDF is aware of the nature and extent of this deceit and that a DDF administration will stop it in its tracks and heed the pleas of  high school teacher Maryke Bailey and University Rector Professor Jonathan Jansen and so many other largely voiceless and helpless victims.

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Baragwaneth Hospital is in pain

Baragwaneth Hospital, probably the largest hospital in the southern hemisphere and the third largest in the world, is in pain.  With some 3 200 beds and 6 700 staff members it has one broken X-ray machine that hasn’t been fixed, one broken CT scanner and one other CT scanner that is in the process of failure through work overload,  per this M & G on-line report.  Obviously this has a negative effect on patient care and staff morale.

Why do I have a sense of deja vu?  The reason is that No 1 Military hospital had a similar problem of equipment not being repaired.  These events may be symptomatic of the state of many of our hospitals and the state of their equipment and evidence at the very least, of a systemic functional break-down in some of our major hospitals.  Not very comforting.

The problem should not be one of money but probably is administrative in nature – things not being done, orders not being placed, inadequate follow up from inception to payment.  The CT scanner at Bara apparently is not being fixed because of an overdue account with the suppliers.  Why should they incur the cost of repair when they are not being paid for previous work?  This begs the question; why is the administration not functioning?  Why are accounts not paid?

The Direct Democracy Forum believe that these sorts of failures are top down in nature.  That is; if the minister of health does not expect the director general to do his or her job, who in turn does not expect his or her managers to do their jobs, who do not expect the executives of hospitals they are responsible for to do their jobs, there is no incentive for anyone to do their jobs, to see that accounts are paid correctly and on time.  It is insidious, like a cancer at work in the body of a patient, and the patient, in this case Bara Hospital, is in pain and is seriously dysfunctional.

A DDF administration will ensure that the whole chain of authority, from the minister down to the lowliest worker in every state hospital in the land, knows what is expected of them and will perform and be functional or be fired.  

Patient care cannot suffer from administrative dysfunction, whatever the cause.  A DDF administration will install a system where the patient comes first in the national health service, where equipment is maintained in a functional state, where orders are placed on time and medicines are available for medical staff to prescribe and dispensaries to dispense and where accounts are paid on time and where breakdowns are fixed in time, all for the benefit of the system’s patients.  Because serving the patient base is the only reason for the existence of a national health system any part of that system which does not deliver on that obligation no longer has a reason to be a part of the system.

DDF health policies outline DDF commitment to the National Health System patient base.

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Why low education standards?

It is funny the way pieces of a jigsaw miraculously snap together and the picture you see is not what you expected to see.  That the truth is not what it seemed to be from viewing the pieces separately.

I’m really discussing the death of Nelson Mandela and the empowering effect of that event, taken up by commentators who suddenly seem empowered to look at SA’s and Mandela’s history, with greater clarity, to connect what is happening today with what happened under a cloak of secrecy yesterday.

Let me be explicit:  The struggle was not so much about liberating the suppressed of South Africa as it was about affording the communist empires access to the entire Southern African sub-continent.  This is what gave the West political justification to tolerate successive Nationalist governments and the freedom to remove that implicit support at the end of the ‘Cold War’.  This is what Mandela was really about and if the liberation myth had an ounce of truth to it, we would have had ethical governments over the past 20 years, our public schools system would work, our public health systems would work, our public transport system would work, we would have a thriving industrial and manufacturing sector working for the people of South Africa, we would not have close to 50% of our work-aged population unemployed, we would not import most of what we consume, run current account and balance of payment deficits and massive government debts that our children and their children after them will be paying off decades into the future, unless we do something about it today, and we would have reserved South Africa, if not exclusively for South Africans, at least mainly for South Africans and South Africa would still be the power house of Africa and the gateway to Africa.  But that is not what has happened over the past 20 years.

Why am I expressing this now?  First, the Myth of Improved Matriculation Results debunked as discussed here by Professor Jonathan Jansen, which is testimony to the fact that despite the stats, our standards of education are not improving from a level that is repeatedly judged to be close to the lowest in the world, second, the observation by a caller on a Radio 702 chat show that the only way autocratic government succeeds is by keeping its citizens ignorant (he was also discussing the 2013 Matriculation results) and third, the myth of ANC role in the struggles as discussed in this M&G on-line report, and elsewhere, and what it was really about.  

Change must happen, at the next elections.  Let’s empower a government of the people, for the people, by the people.   A Direct Democracy Forum administration will deliver government of the people , for the people, by the people.

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Professor Jonathan Jansen speaks. Hear, hear.

Professor Jonathan Jansen speaks. Hear, hear.

But who is listening?

The short answer is the Direct Democracy Forum are listening.  We’ve been listening to Professor Jansen since before our formation.  Our very existence is steeped in Professor Jansen’s messages.

A DDF administration will carefully note every word written and spoken by Professor Jansen on the topic of education in South Africa.  Someone needs to hear Professor Jansen.  We do!

See DDF Education Policies.   See how DDF policies can help you.

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Six Reasons for adopting TEAL

  • Johann Heinrich Gottlob von Justi (1720-1771) wrote in 1766 in his ‘System des Finanzwessens’ that; given that no state can exist without expenses and that no modern state is completely self-funding, contributions (taxes) from the subjects (taxpayers) become necessary, and that six principles of taxation should always be adhered to.

They are:

  1. Subjects (taxpayers) must be in a position to pay the taxes without depriving themselves of necessities nor taking from their capital and that an authority which deprives taxpayers of the protection of civil societies (viz protection of the necessities of life and of their property or capital) ceases to be a legitimate authority and becomes a tyranny. 
  2. Contributions (taxes) must be levied with complete equality and just proportions. This is rarely achieved with the very rich mostly contributing very little and the very poor nothing, so the bulk of the burden falls on the middle class.
  3. The method of collecting contributions (taxes) should be such that the welfare of the state and the subjects and civil freedom suffer no harm.
  4. Contributions (taxes) should be organised according to the nature of the state and the forms of government. That is, the taxes need to support the institutions of the state and must not be skimmed, for example, by collecting agents and agencies.
  5.  Contributions (taxes) must be certain and honest, fixed definitely and clear to all, so contributors know both the purpose and the amount of the contribution (tax), again adding certainty to the process and discouraging dishonesty in the collection process.
  6. Contributions (taxes) should be collected in the easiest and most convenient way and with as little expense as possible, both to the state and the subjects (taxpayers).

(Source: Early Economic Thought ISBN 0-486-44793-6 (pbk) pp 377 – 399)

Those thoughts were expressed almost 250 years ago and are just as relevant today. 

  • It is clear to the Direct Democracy Forum that current tax systems (including but not limited to E-Tolls) mostly do not satisfy those principles, whereas TEAL (Total Economic Activity Levy) mostly does.
  • If only for that reason, the DDF are determined to do all in their power to introduce TEAL as the only tax in South Africa.

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Sunny Skies SABC Censorship

What amounts to self-censorship by SA’s public broadcaster was reported in this article by the M & G on-line “SABC ‘censors’ Numsa-Zuma reporting“, banning reporting of Numsa’s rejection of the ANC.  

This is not the first time SABC management and, presumably, the ANC, have had a hand in SABC editorial content, having also banned reporting of the booing of president Zuma at the Mandela memorial.  In fact, political influence in SABC broadcast content goes way back to the days of the Nationalist Party’s control of the broadcaster, a tradition ably carried on by their successors, the ANC.  A brief look at the SABC’s history clearly shows the extent of this interference. 

As the primary communicator in SA the SABC needs protection from all political interference. The Direct Democracy Forum communications policy outline’s how the DDF will protect the public broadcaster by affording it the protection of Chapter 9 of the constitution.  See how DDF policies will help you.

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How can someone so stupid or so deceitful be?

So government denies Pres.Zuma had any knowledge of the development or cost implications or the funding of the upgrading of his (Zuma’s) Nkandla compound.  Is that the same as Pres. Zuma denying said knowledge?  Almost?  Nearly?  Well, maybe.

How can this be?  Have a look at the extent of the development traced graphically here and tell anyone  that the owner or primary occupant of that property could not have some awareness of the extent of the development and some  inkling of the cost implications of the project.  No thinking person will believe that assertion.  So the assertion must be an inaccurate rendering of the truth.

But let’s just pause a moment and imagine that the primary occupant was so preoccupied with matters of state that the before and after pictures of the Nkandla compound passed over his head and weren’t noticed.  Two possibilities exist.  He was either very very busy indeed or unusually insensitive to what was going on around him in his own compound.  Not exactly what one might expect of a head of state.  But this is South Africa so perhaps even the most unlikely events become possible.

And it is not as if the expenditure was limited to R200M.  The publicly funded costs of Nkandla and its surrounds broke the R2 Billion mark.

It does beg the question,  how can someone so stupid or so deceitful be……..?  Perhaps they just think South Africans are so stupid that none of this matters?  Well, South Africans are not stupid and it does matter, very much.

See Direct Democracy Forum policies and imagine a  Nkandla happening on a DDF administration’s watch. Beyond unlikely.

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Seas, Coasts, Fisheries and Borders

he  Sekunjalo controversy as reported here is about much more than just possible or probable corruption and the awarding of tenders to the palpably ill equipped.  The tender was to perform highly specialised services in the protection of South Africa’s coastal and deep see fisheries and was obviously rigged so the successful bidder, who admitted it did not have the resources or the capacity to perform, was awarded the tender on the basis that it would pilfer the resources of the unsuccessful bider in order to satisfy the terms of the tender.  How sick is that?  Perhaps the members of the selection committee were influenced to change their original decision from an outright winner in favour of Sekunjalo, perhaps not,  but the bidding process was clearly flawed.  More importantly it is a tale about how badly South African public services are underutilised in the protection of valuable national resources.

The Direct Democracy Forum expressed concerns about the co-ordination of many different elements of crime in the DDF Human and Contraband Trafficking  policy and lamented the underutilisation of the SANDF in protecting South Africa’s borders and the Sekunjalo controversy underscores the very need for that to change.

A DDF administration would form a border co-ordinating body that would co-ordinate the efforts of all agencies involved in the protection of our borders, both inland and at sea, and as stated in DDF Defence and Military policies the Defence Force would be actively involved in the closing down of South Africa’s borders to all forms of illicit traffic, and that includes poaching livestock from South African lands to poaching shellfish from our coastlines and poaching fish stocks within our economic interest zones along South Africa’s coast line.

South Africa’s defence force will keep itself in a state of high alert and competency through these activities while serving the interests of the country it is tasked to defend.  It will be familiar with every secret rout used by criminals in the course of their activities, who will no longer have the advantage of better knowledge of our borders than our own countrymen do.  South Africa will claim back its own and will do so without entering into dubious arrangements as envisaged in the Sekunjalo fiasco.

Under a DDF administration,  South Africa will become a nation proud of itself and jealous of it’s resources, which will no longer be available to all-comers.

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Hawks, Scorpions and the Constitutional Court

This report highlights the weakness of the  South African Police Service Act which in 2011 was found by the Constitutional Court to be unconstitutional and invalid because it failed to give the Hawks the adequate degree of independence they needed to fulfill their duties. The Constitutional Court sent the act back to parliament for them to fox it.  

Last Friday (13th December 2013) the Cape Town High Court found that the fixes were not good enough and still left the Hawks too vulnerable and subject to political interference arising from the ministerial appointment of the head of the Hawks and the lack of parliamentary oversight of their actions.

This is relevant because the High Court’s concerns are similar to the Direct Democratic Forum‘s concerns about the NPA and of what should be our elite investigative unit, the Hawks.

The DDF‘s solution to this would be to make the NPA and the Hawks, or their equivalent, protected by Chapter 9 of the Constitution, as expressed here.  In that post we suggested that the NPA have their own investigative unit and were thinking in terms of the Hawks being that unit, but it may work better for the Hawks (or whatever that unit is) to work independently of the NPA but with the same Chapter 9 protection.  The DDF believe that either option would render the Hawks and the NPA immune from political interference and enable both to pursue their jobs of investigating and prosecuting criminals in the corridors of power, ‘without let or hindrance’ as the saying goes, which is the way it should be.

DDF judicial policies and the DDF security policies, developed from the DDF‘s sense of what is needed for the pursuit of justice, seems to largely reflect the perceptions of the highest courts in South Africa, and the DDF is encouraged by that, to believe they are at least on the correct path with those two policies. 

The DDF are about much more than just the pursuit of justice.  They are about affordable and effective health care, affordable and effective education, affordable and effective transport, to mention just a few elements of DDF Policies, which broadly speaking are about what is needed to make South Africa work for all of its citizens.  How can the  DDF help you?

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Prison Numbers tell all

This M & G on-line report lists numbers in South Africa that are telling.

  • Cost per prisoner per month                                  R9 876.35
  • Cost per prisoner per year                                  R118 516.20
  • prison population (includes remands)                   156 370
  • cost per month                                          R1,544,364,849.50 
  • cost per year                                           R18,532,378,194.00
  • prisons                                                                          243 
  • average cost per prison per year                   R76,264,930.84

These are costs to South Africa’s taxpayers.

Compare this to the cost of a tertiary education in a state sponsored university.

  • Student cost of 1 year’s fees at university range from 30K to 50K (say 40K average)
    depending on the courses.
  • So a three year degree will cost a student about R120 k.
  • The state will contribute about 30% and private sponsorship the balance.
  • Assuming private sponsorship of zero, the R120k = about 70%, so
  • the state will contribute about R51 000 for a three year course.

So, the cost to the state of 1 year’s imprisonment for 1 prisoner will be about R118,5k or equal to state sponsorship for 2.3 three-year degree courses.

 Put another way, three years’ imprisonment for 1 prisoner (R355k) = state sponsorship for 7 three year degree courses (R350k).

Setting aside the fact that 30% or 1/3rd state sponsorship is simply not enough, the fact that you can equate 3 years of imprisonment to 7 three year degree courses speaks volumes of where the state’s funding priorities lie.

Let us say that the state sponsored education 100%, so a three year degree course might cost the state R171k compared to a three year imprisonment cost of R355.5k, even then three years’ imprisonment would equate to two three-year degree courses. Makes you think.

  • By comparison, the R2 Billion spent on President Zuma’s  Nkandla compound and the infrastructure in the surrounds (see here) would have funded
    • 100% of 11, 691 three year degrees or about
    • 40 000 three year degrees at the present level of sponsorship.  
  • Makes you think some more.

It makes Direct Democracy Forum’s education and training policies supported by a TEAL backed fiscus even more relevant, when you consider the impact it would have on the prison population. While not claiming that only the uneducated are criminals (they certainly are not), the DDF are pretty certain that the better educated a person is and the more employable he or she is (the two generally correlate), the less likely he or she will be to resort to crime to survive.

This will result in

  • less crime,
  • fewer prisoners,
  • less pressure on the criminal justice system as a whole (we haven’t even considered those costs in our calculations)
  • less distressed families and individuals,
  • less pressure on the social services funded by the state and civil society

this is just a win-win situation whichever way you look at it.

These are all DDF policy basics. See how the DDF can help you.

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E-TOLL BOTTOM-LINES

This report from the M & G Business should be of interest, not because it reveals shocking manipulation of a flawed tender system but because of all the extraneous financial information it contains, which the Direct Democracy Forum summarise as follows:

A thought provoking look at some e-toll numbers taken from the article:

E-Toll Cost summary: 

2010 estimated  cost per Km for new high grade road 
(allows for 5% pa average escalation over 4 years)                R5.5M
2010 cost estimate for 185km new roads @ R5.5M/Km         R1.1B
2010 cost estimate for 185km refurbishment, say                   R2.2B
2013 OUTA estimate (including e-toll costs), say                  R13.0B

Current cost guestimate (excl finance charges) say             R20.6B 
(an almost tenfold escalation over 2.2B)
Add finance charges over 20 years                                        R20.0B

Total cost over 20 years                                                         R40.6B

Cost per year                                                                            2.03B

Recovered through e-tolls:                         20y                           /y

Capital Costs (% of E-Tolls) 28%               R20.6B                    R1.03B
Debt Service 29%                                        R20.0B                    R1.0B 
Total Capital Cost and
Debt service recovered
over 20 Years (% of E-Tolls) 57%               R40.6B                    R2.03B

Road maintenance 15%                              R10.7B                    R535M

E-Toll Maintenance 17%                                 12.1B                     R605M 

Sanral profit 11%                                              7.8B                     R390M 

Total Cost over 20 Years                          R71.2B                     3.56B

By Scrapping E-Tolls the taxpayer would save

                                Debt service charges              R20.0B
                                E-Toll Maintenance                     12.1B
                                Sanral profit                                  7.8B
                                in total                                     R39.9B   (56% saving)

                                which approximates R2B per year for 20 Years.

Total costs over 20 year without SANRAL, Etoll and Finance charges should be 31.3B.  If you are to believe OUTA that figure should be no more R23.7B (R13B + R10.7B maintenance costs, but that includes e-toll costs).  Who to believe?  If OUTA are anywhere near correct, the R71.2B cost over 20 years represents a 200% hike over the OUTA R23.7B figure.  That from E-Tolls, Finance charges and Sanrall.  That’s a heck of a lot of taxpayer money that South Africa cannot afford.  

E-tolls simply do not make any contributions that a properly run Fiscus cannot make and do not make any financial sense at all except to SANRAL and the Debt Financiers, and that’s if we can believe the numbers in the article.  What we can see is bad enough but what if those numbers are somehow unreliable, as the Sanral experience suggests to us is possible?

The DDF believe they have a clearly superior form of taxation (TEAL), compared to the current methods, which will more than easily absorb the capital costs of the Gauteng and all other roads upgrades in the country, without breaking the bank, and save huge debt service charges, which can instead go toward lowering the costs of our roads development and maintenance and improving the lives of all South Africans.  

Look at DDF policies and see for yourself what the DDF can do for you.

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NKANDLA SLIDE-SHOW

For anyone in doubt as to the extent of the development of the Nkandla presidential compound, this is a slide-show not to be missed:

View the Nkandla Slide-Show, compliments of the M & G On-Line.  

The show speaks for itself but it must be remembered that in addition to the Nkandla development costs there is the development of the Nkandla surrounds, the costs of the complex and the surrounding infrastructure amount to two billion rand or more.  So we are not talking about a trifling R200M, but ten times that amount in taxpayers’ money. 

It seems from this report that President Zuma basically hijacked the public works department’s involvement and inserted contractors of his own choice to deliver the results that he wanted Nkandla to reflect.  Read the report yourself and see what you think.

No wonder Thuli Madonsela is critical.

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SA Education Authorities wear Blinkers

The habit of the ANC government to see only what they wish to see and hear only what they wish to hear is shooting South African children in the foot by denying them a proper education and then expecting them to perform in a competitive manner in a competitive world.  This is just another example of the ANC’s Messiah complex in action.  The Direct Democracy Forum have expressed this sentiment before but will do so again.  This is tantamount to criminal fraud perpetrated on the school children of South Africa and one day those responsible will be held to account, but by then the damage done to millions of South Africans who have passed through the South African education system these past 20 years, will be very difficult to undo.

Two reports on the Annual National Assessment results, ANA results are not comparable and Critics slap down Motshekga’s confidence over ANAs absolutely slate the manner in which the tests were conducted and the Minister’s interpretation of the results.  Either the Minister believes her own propaganda or the Minister is fully aware of the implications of the results and is simply lying to the people.  Both alternatives are totally unacceptable.

DDF education policies, backed by DDF TEAL policies  are the only chance on the current political horizon for South Africa’s crippled education system, and then it will be a long haul over decades to set the matter to rights.

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ANC’s Messiah complex

OK – the Direct Democracy Forum are paraphrasing Verashni Pillay’s words.  She actually wrote about the Government’s Messiah complex, but since the government is mostly the ANC, we don’t feel too bad about that stretch.

So, why are we engaging in ANC bashing again?  Actually no one is ANC bashing.  Instead Ms Pillay is voicing very legitimate concerns that the ANC led government at both local and national level are not listening to the people, and instead are advancing willy nilly along a path which has very little to do with what the people want.  Ms Pillay cites two current examples to illustrate her point and in doing so writes with the same words and concerns with which the DDF have been writing these past years.

We are not claiming that Ms Pillay endorses DDF positions.  In fact, we very much doubt that Ms Pillay is even aware of the existence of the DDF.  But like Ms Pillay, we are aware of South Africa’s opinion on E-Tolling.  A DDF administration would never have implemented E-Tolling and the DDF have undertaken that any DDF administration will dismantle all road tolls because the national roads system will be funded through the fiscus which in turn will be funded by TEAL.  This is not because the DDF are adopting a populist position but because the national roads system is a national asset from which the entire nation benefits and for which the entire nation should pay, not just a few captive users. 

This video elaborates on why e-toling is just plain bad policy.

The DDF also believe that the Johannesburg City Council’s eviction of street traders was the use of a shotgun tactic to counter a situation of lawlessness on the streets resulting from bad management of the streets by the ANC-led council.  Instead a more selective strategy should have been adopted targeting elements on the streets which required proper management.  In short, the ANC-led Johannesburg City Council did not do their jobs properly and instead unnecessarily messed with the livelihood of thousands of honest traders.

Simply put the DDF have the same opinions of the behaviour of the ANC led government at both local and national levels as Ms Pillay has.  The ANC are not prepare to manage the society which misplaced their trust in them and worse still, the ANC no longer even engage in the pretence of consulting with the people,  for when the people speak, even with a single voice, such as on the subject of E-Tolling, the ANC led government simply don’t listen but engage their Messiah complex to do what they believe is good for someone (we don’t know whom) instead of doing what the people believe is good for them.  And that is a charitable view.

A less charitable view is to follow the money trail of the E-Tolling debacle, to observe who benefits from e-tolling.  And the ANC led government and SANRAL are being remarkably coy about those details.  So the DDF asks itself why should motorists pay what probably amounts to more than double taxation to those invisible beneficiaries?

And the point of this rant is that Ms Pillay and the DDF are on the same page, even if Ms Pillay has never heard of us.  We are even on the same page that government should be consultative and not prescriptive and should suppress any messianic inclinations.  DDF Senate policies and DDF local government policies both use a process of deliberative democracy that should satisfy anyone’s need for a more consultative government.  So the DDF are quite happy that they and Verashni Pillay are on the same page, at least in these matters, and have little doubt that the DDF would be on the same page as Ms Pillay and many other South Africans on many other issues.

What makes the DDF different from any other political party in South Africa is its central theme of formal consultation at local government and national government levels and its ability draw on TEAL to adequately and properly fund all the needs of the country, while at the same time liquidating SA’s national debt and turning South Africa into a debt-free country, at least so far as its government is concerned.  No other political party can come anywhere near that promise.  Then there are all the other DDF policies to consider.

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South Africa’s AIDS Shame.

20 Million tested for aids is certainly an achievement but when you only have a third of your 6 Million aids population receiving ARVs, or medication for aids, that is letting down the other 4 Million aids sufferers.  In 2012 SA had an estimated 370 000 new HIV infections and 240 000 Aids deaths, a net growth of 130 000 aids sufferers.  As some observe, we have little to celebrate on the 25th Annual Aids Day.

Direct Democracy Forum policies will have a significant effect on the fight against aids and the quality of life for all aids sufferers in South Africa.

DDF TEAL policies’ support of DDF Health Policies will ensure that every AIDS sufferer in South Africa receives ARVs, which will allow them to live a largely normal lifestyle and lifespan and DDF job creation policies and DDF education and training policies will uplift the social and economic status of most South Africans, which will significantly reduce the transmission of AIDS between South Africans of all ages.

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Unions, Teaching and Marking

This M & G report highlights one of the biggest problems underpinning education in South Africa.  As can be seen, one survey indicates that as many as 68% of grade 6 maths teachers are inadequately informed on the subject to teach in it at that level.  The Direct Democracy Forum don’t have statistics available for all subjects at all levels but anecdotal evidence suggests that that sort of incompetency may exists across most subjects at most levels.   It follows that if the teachers are unable to teach at any given level they are incompetent to judge the competency of others at that level viz. they are equally incompetent to mark at that level.

Should unions be concerned and what should their position be?

The DDF believe that unions should be concerned, not with the fact that many of their members may not be allowed to mark but rather with the fact that many of these members may be required to perform duties they are incompetent to perform.  We believe that the union position should be that those who are incompetent at any given knowledge level should be encouraged to acquire the required level of knowledge or to teach and mark at a level for which they are fit to do so.  This should involve ongoing competency examinations and testing.

This is not intended to denigrate the dignity of our teachers but rather to equip them professionally for their duties in the classroom and marking rooms so that they can competently deliver a sound education to their pupils.  Far from denigrating the dignity of teachers such a process will empower them and reinforce their dignity.  At the same time it will also deliver to South Africa’s pupils what they have a constitutional and moral right to expect, a competent and meaningful education, which will suitably prepare them for their lives as responsible and contributing members of society.  They too need to be empowered, they too have a dignity which needs to be considered.

The DDF are firmly in favour of the application of merit at all levels and across all activities in society.  This includes the education process.  In fact, the assessment of merit in  academics and teaching skills are fundamental to a functioning education system and a DDF administration will deliver just such levels of merit assessment as are needed in the classrooms of South Africa, and believe they will do so with the support of the unions, who also need to be empowered to perform their duties to their members and to society in a dignified and ethical manner.

DDF education policies are intended to lift all out of the poverty of ignorance and incompetence so that everyone in South Africa can find a fruitful place for themselves in society.

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Don’t believe SANRAL on E-Tolls

Our previous posts on the subject of E-Tolls refer.  Here and here and here, amongst other places, in our policies and FAQs.  SANRAL are ratcheting up the propaganda and the pressure on the public to accept E-Tolls.  Our sense is not to believe anything SANRAL say.  Opposition to E-Tolls is just about universal within South Africa and that isn’t going to change no matter what SANRAL say. 

Mondli Magwaza, entrepreneur, technology professional, an economics student and a patriotic South African, adds his voice “Whose Freeway is it?” to what can only be described as a cacophony of protest.

A Direct Democracy Forum administration will end tolling of all South Africa’s roads, and no, roads will not fall apart from neglect,  SA’s roads will be the best maintained road system in Africa and as good as you will find anywhere in the world. 

That is a DDF commitment.  Visit DDF Policies and DDF FAQs

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SA votes No to mining transparency

SA votes No to mining transparency – why we are not surprised?

Isn’t this just typical of the ANC’s battle against transparency and generally for secrecy in its handling of the affairs of South Africa?

Witness the secrecy bill, the battle with the Public Protector, to name but a few attacks on civil liberty.  As for transparency in the mining sector?  Not likely, and no we are not surprised!

Direct Democracy Forum‘s policies on transparency can be found throughout this website, in this DDF blog posts, DDF FAQs and DDF Policies.

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Blame Game in the Security Sector

Government’s concerns over the proliferation of foreign ownership of the major players in the security industry as discussed here, is xenophobic at best and disingenuous at worst.  If the so called security cluster really want to know what is wrong with the security sector, they should look in the mirror a bit more often.

It is true that the government should not be responsible for guarding every household and every private building and  every cash in transit vehicle in the country but it is equally true that government is responsible for adequately policing and prosecuting criminals responsible for the proliferation of crime in the country.  It is government that is responsible for public safety and security and not the private security industry, whether foreign or locally owned.  It is also true that Government is responsible for the abysmal state of our economy, the poorly educated, poorly trained and underemployed masses and the circumstances that make criminality so attractive to these unfortunates thus adding fuel to the fire, as discussed here.

  • A Direct Democracy Forum administration will have the means to properly staff, train, equip and support the South African Police Services so they again become the primary enforcers of public safety and security and an effective force in the detection and prosecution of criminals throughout the land.
  • More importantly the same DDF administration will have the means to skill and employ most of those unfortunates and remove any social justification for their criminality, as discussed here and here

It is a sad reality that what was a highly respected police service was politicised by the Nationalist government of the apartheid era and has been and is politicised by the current ANC regime.   The fiascoes concerning control of the police services and the judiciary and the political interference in the affairs of the criminal justice system, such as discussed here, and here and here and here and here will be history under a DDF administration.

  •  Any attempt to politicise the criminal justice system from whatever source whatsoever, will be dealt with severely by the criminal justice system itself, with the full blessing of the DDF administration.  DDF Safety and Security policies and DDF Judicial Policies speak for themselves on DDF commitment to an independent and apolitical and functioning criminal justice system.

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Uncertain benefits of youth wage subsidy

This article is an analysis of the possible effects of the proposed youth wage subsidy.  The conclusion of the analysis is that the policy may do more harm than good.  

Given that the prime directive of any business is to maximise profits (read also as not to  incur unnecessary expense) the wage subsidy is likely to create a situation where existing employment is shifted from un-subsidised employees to new subsidised employees, with little or no growth in employment except where growth in employment occurs that would have occurred anyway, even without the wage subsidy.  So the state will then pay a double whammy, first for the youth wage subsidy, much of which has little or no effect on new employment, and then also for the unemployment that it creates amongst unsubsidised labour.

 The Direct Democracy Forum‘s approach is to stimulate youth employment by paying the youth to advance their employment prospects through further education and training whilst at the same time stimulating the job market so there are more jobs to employ the newly skilled and more employable youths, and that anyway they are then more desirable as potential employees and as young entrepreneurs.

You will see that DDF policies are all aimed at these sorts of goals rather than at supporting a welfare state with welfare entitlements.

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The Plight of the Poor and Socialism

This M & G on-line article tells a tale of the poor driven by uncaring administrations to levels of social disobedience which are as unacceptable as is the behaviour of the uncaring administrations, the whole spiraling into a mess of oppression characterised by politically sanctioned evictions, beatings, torture, shootings and murder.

Because the Direct Democracy Forum care about the plight of the poor and believe that there is a place in the sun for every South African citizen and bemoan the plight of the communities written of in that article, and anticipate that that caring will tempt some to label the DDF as  socialist or communist, we will examine the nature of socialism, to dispel any such ideas.

The Merriam-Webster on-line dictionary defines socialism as “a system or condition of society or group living in which there is no private property and in which the means of production are owned and controlled by the state”.  Caring for the poor is not a feature of socialism. (see full definition here)

Since the DDF advocate the private ownership of capital and private ownership of the means of production, the DDF cannot be labeled socialist.  In the FAQ “Are the DDF thinly disguised Communists?” the DDF describes itself as “libertarians with a social conscience”.  The DDF are proud of being libertarian and having a social conscience and of championing individual empowerment and responsibility through education, training and encouraging economic opportunity. 

By contrast, the African National Congress (black African National Socialists) want to corner both the means of production and the market-place through its cadres and follow in the steps of the avowed National Socialists of Germany (the Nazis) and white Afrikaner National Socialists of South Africa (the Nationalist Party or the Nats).  As a consequence the ANC led South Africa is a great deal more socialist than a DDF led South Africa will ever be.

All of this is a preface to stating that a DDF administration will ensure that every poor South African is properly housed and skilled and in gainful employment (see DDF policies).  This may take some years or even decades to achieve but never the less the process will commence from day 1 of a DDF administration’s term of office.  The DDF will break the cycle of corruption, poverty and social disobedience that has led to depths of oppression and politically sanctioned evictions, beatings, torture, shootings and murder written of in this article, and that does not make the DDF socialist by any means, it just makes us responsible members of the human race.

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Evicted Street Vendors’ Plight

The Direct Democracy Forum believe they understand the objectives of both the Johannesburg Municipality (cleanliness and orderly conduct in Johannesburg’s Streets) and Johannesburg’s street vendor community (right to securely earn a living) but believe that indiscriminate removal of vendors from the streets is not the way to go about realizing either of these objectives.

What is needed in place of such draconian measures and the obvious costly legal challenges in response, is proper and ongoing management of the streets in which vendor activities are allowed.

In the view of the DDF, proper management of our streets does not seem to be happening, perhaps this is deemed too costly in terms of manpower and budget.  But that is what managing a city is about, the proper allocation of manpower and budget to see that agreements between the city and its residents are complied with, not indiscriminate raids and confiscation of goods and property when the agreements break down, which lower the city authorities to the level of pirates and brigands themselves.  All that to clean up a mess created by poor management, amounting in effect to poor service delivery.

If the job of managing the streets was done properly in the first place, this questionable behaviour would not have occurred and street vendors would be secure as productive members of Johannesburg’s streets and structures.

DDF local government policies will make for accountable and transparent government and, amongst other things, for proper service delivery and the proper management of the streets of all the country’s settlements, villages, towns and cities.

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Health Care:

Background:                                          PDF: Policy Statement Health Care

Goals: 

  • The purpose of Direct Democracy Forum (DDF) health care policies are to improve the health care delivery system through a process of incentivisation and privatisation.
  • It is anticipated that this will occur in stages and over time:

Stages:

  • 1) Incentivise public health care systems with bonus systems based on delivery and outcomes for health care units (HCUs).  A health care unit is any hospital or clinic or practice run or previously run by the state.
  • 2) Shift burden of salaries from the state to the HCUs based on delivery and outcomes.
    • This would probably be voluntary, that is state employees who wished to remain state employees rather than HCU employees could probably do so but would be unable to participate in the HCU profit share schemes and share ownership and etc. (see below).
  • 3) Offer profit sharing schemes for participating staff of HCUs also based on delivery and outcomes.
  • 4) Offer share ownership of HCUs for participating staff of HCUs,  in partnership with the state.
  • 5) Disinvest the state from health care delivery systems in favour of the private sector.

Payment for services:

  • The DDF will install a Basic Income Grant (BIG) system and recipients will receive as part of the BIG package, paid for membership of a national health insurance scheme (NHIS), much like existing private sector medical aid schemes except it would probably be run under the auspices of a Sovereign Wealth Fund.
  • Private sector medical aid scheme members will be able to use the HCU facilities as well as private health care facilities, as also will members of the NHIS have access to both sets of facilities.
  • Whichever scheme you are a member of will pick up the payments for services rendered in accordance with the rules of your scheme.
  • It would probably be possible to be a member of both the NHIS and private medical aid schemes.

How to fund the NHIS:

  • A deduction of around R600 per month per beneficiary from the UBI/BIG will in all likelihood adequately fund the NHIS (National Health Insurance Scheme) but could be adjusted up or down if needs be.
  • The arithmetic for that is as follows:
    • Assume a GDP of R3 Trillion.
    • The nation’s health spend is said to be 8.8% of the GDP = R3 Trillion X 8.8% = R264 Billion (includes public and private resourced health care).   
    • Assume a Citizenry of 35 Million each getting a UBI/BIG, from which is deducted R600 per month and paid over to the NHIS.
    • So contributions from the UBI = R600 X 35 Million per month X 12 (for a year)  = R252 Billion.
    • The point being that the R252 Billion contributions from the UBI/BIG are in the ballpark for the national health spend of R264 Billion. 
  • So a NHIS funded from a UBI/BIG is doable. 

Points to ponder:

  • Public health care workers would, in time, be paid based on services rendered rather than just for turning up for work.
  • The NHIS would probably be the single largest buyer of medical services and would just as probably have a sobering influence on medical costs and medical aid costs.
  • Health care patients would be free to use the service providers of their choice and service providers would, in theory, rise or fall based on the quality and quantity of the services they provide and their reputations in the health care market place.
  • It may be necessary to provide state run health care facilities for sectors of the health care market that cannot be run profitably by the private sector on its own.  Such state health care units may be run exclusively by the state or preferably, in partnership with private sector health care providers.

Conclusion:

The DDF  believe there should be an element of competition between medical facilities in order to stimulate the provision of improved services and improved patient experiences and outcomes.  Members of the public can attend the facility of their choice, the different institutions will be encouraged to compete with one another to provide better services and thus attract more patients and more revenue, from which the institutions and their staff will benefit.  

In short the DDF will be introducing rewards for good service delivery and consequences for poor service delivery.   The DDF believe this will benefit all sectors of the medical profession and their patients, who at the end of every day, are the most important players in a health care system. 

DDF Home

Have Your Say    Who we are      Check voter status       Check ID Status        Google+      Twitter  Publications         State Capture Report    Help the DDF  Change.org Petition

The DDF or DIRECT DEMOCRACY FORUM  is a South African political party registered with the IEC (reference 936).     The DDF has four main agendas that will ensure FAIR TAX,  FAIR GOVERNMENT, SOCIAL JUSTICE  & COMMERCIAL PARTICIPATION in the economy for all South African Citizens. (See DDF in a NutshellHave Your Say,   FAQs, GOALS, Change.org Petition)  

They are:

  1. Create an UPPER HOUSE OF PARLIAMENT or SENATE, populated directly from the streets, bypassing Party Political processes & structures in a process called Sortition.
  2. Adopt TEAL (Total Economic Activity Levy) as the only source of state revenue, replacing all other taxes and levies.
  3. Initiate a Basic Income Grant (BIG) and Advancement Grant (AGfor ALL ADULT SOUTH AFRICAN CITIZENS
  4. Create a Sovereign Wealth Fund to invest in SA and the world at large and in which every adult South African Citizen has an equal share (SWF)

These four agendas will 1) restore politics to the people, 2) tax all participants in SA’s economy fairly and equitably,  3) invest in the demand side of the economy by engaging all adult South African citizens in the demand side economy and 4) ensure that every adult South African has a stake in the economy. 

The direct effect this will have on poverty is less important than the effect on wealth creation opportunities for all sectors of the economy but particularly for those who will not previously have had such opportunities, both in  the formal and informal sectors, this arising from an expanded economy.

(See  Have Your Say,  DDF in a Nutshell, FAQs, GOALS, Change.org Petition

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