E-mail to the treasury – Covid 19 Supply Side Economic Response

Ladies and Gentlemen of the Treasury.

As previously stated, I head up a political party: Direct Democracy Forum Reg Number 936.

I previously submitted on 24/03/20, a proposal based on adopting some of DDF cornerstone policies but note that they were intended to uplift and support the demand side of the economy and only have an indirect effect on the supply side. Their effectiveness depends on the existence of a functioning supply side economy with which the demand side can interact and indirectly stimulate.

The Lock-Down from 27th March to 16th April effectively closes down much of the supply side and therefore the proposed interventions will not work as envisioned.

We are therefore proposing additional measures directed at the supply side in order to maintain a functioning supply side so that the economy does not implode during and can resume after the lock-down. The point being, that after the lock-down, which currently is intended for 21 days but may be longer, an economy supported by interventions of this nature should be able to pick-up where it was before the lock-down. In effect, business will be able to resume pretty much as usual.

In the absence of such intervention, we anticipate that the economy and many of it’s component businesses and industries could become dysfunctional, insolvent or even bankrupt, and may well be unable to resume business as usual, in some cases, if at all. The impact of this on our already dysfunctional economy could be catastrophic. The recent downgrade to junk status does not help.

Our suggestions are that:

1) All historic debt which cannot be paid for by effected businesses should be paid for by funds provided by the state, on a loan basis, to be repaid after the lock-down but without the burden of interest.

2) Funds should be provided by the state to pay for on-going operational expenses, as a grant, for all those business with fixed operational expenses (including salaries and wages) and without existing operational income, for the duration of the lock-down.

3) These interventions can be funded by the creation by the state of the necessary funds. The state could borrow but the funds would then first be created and then advanced by the lenders at interest. Better for the state to create the money themselves without the burden of interest. Perhaps there should be a disaster recovery insurance to give effect to future interventions.

The rationale behind these interventions and behind the state needing to step up and support the economy in this manner, is that the circumstances surrounding the lock-down are not a consequence of economic malfeasance on the part of the businesses making up our economy, but rather of the extraordinary circumstances and responses of the economy and government to the Covid19 pandemic, irrespective of how rational those responses may or may not be, so it makes no sense to burden the players in the economy and jeopardise the businesses and the economy itself any further than they already are. These extraordinary circumstances need an extraordinary response.

While I do not know what the costs of these interventions would be, I believe that the economy should be supported at whatever cost is necessary, while avoiding the unnecessary burden of interest bearing debt, so as to survive until, and regenerate itself after, the threat of Covid19 subsides.

Further details are available at our web site, http://ddforum.co.za. If you wish to discuss any of this you may contact me on +27 76 060 1973 and or at

Thank you for your attention.

John Barrington.
Leader, DDF.
30/03/2020

E-mail to the treasury – Covid 19 Demand Side Economic Response

Ladies and Gentlemen of the Treasury.

I head up a political party: Direct Democracy Forum Reg Number 936.

We have as cornerstone policies:

1) A Senate, drawn from the streets, 2) Tax Reform (Total Economic Activity Levy, Replaces all other taxes) (TEAL), 3) A Universal Basic Income (Including National Health Insurance Funding) (UBI), 4) An Advancement Grant (for tertiary education and other advancement activities) (AG), 5) A Sovereign Wealth Fund (SWF), 6) Banking and Monetary Reform

We suggest the last five items should be adopted to relieve the effects of the Covid 19 pandemic and any subsequent economic fall-out.

Assuming an adult population of 35 Million adult South Africans, a UBI of R5000 per month would deliver R175 Billion into the demand side of the economy, each month. Apart from the obvious economic stimulus this would bring to the economy it would also have the effect of empowering and uplifting every recipient in the economy, and to ‘challenge’ the supply side to claim their share of that stimulus through trade and industry. A UBI is intended to replace all other grants.

A UBI can be paid for by a 2%TEAL on all the money flowing through the banking system. You would not be printing money so much as re-purposing existing money. If you created or borrowed the money you might wish to recycle it using TEAL. A ½% TEAL could also fund the Fiscus.

You can ‘create’ the required money, if you wish (see below*). This is what the banks would do if you borrowed R175 Billion from them, at interest. They would create the money from nothing, as is their wont, then lend it to you at interest. If treasury themselves created the money from nothing instead of going to the banks, treasury would get the money and save the country and the taxpayers the interest.

The ANC are talking of a Sovereign Wealth Fund (SWF). If you stimulate the demand side of an economy without ensuring that the supply side keeps pace, you have a classic inflation/hyper-inflation situation. The SWF can be used to intervene in the supply side of the economy to help it maintain the required balance between demand and supply. This it does by investing in the supply side economy. This, however, would not be the SWF’s sole function. The SWF can be rapidly funded using TEAL and other mechanisms to become effective in this manner, inside of months, or even days (see below**).

Part of the supply side intervention would be for the SWF to own and run commercial, industrial and community banks alongside privately owned and run banks, thus influencing the financial services sector. We believe that the S A Reserve Bank (SARB) should be wholly owned by the SWF and operated for the benefit of the economy, regulating the money supply and interest rates to that end. Any money creation (see above *) would be under the auspices of such a SARB.

The rational for this is that a UBI is an intervention designed to fill the void left by the already existing 4th Industrial Revolution’s lack of formal sector employment opportunities. The Covid 19 pandemic seems just to have accelerated the onset of this dilemma. There is more to this (see below **).

** Further details are available at our web site, http://ddforum.co.za. If you wish to discuss any of this you may contact me on +27 76 060 1973 and or at

Thank you for your attention.

John Barrington.
Leader, DDF.
24/03/2020

SA’s Economy: DDF versus the ANC.

A hard look at the ANC led economy paints a grim picture for 2014.

By contrast a Direct Democracy Forum administration will both liberalise and discipline the economy with emphasis on economic fairness, including but not limited to:

Out the window will go patrimony, nepotism, graft and corruption.  While the DDF cannot guarantee the absence of these practices in the market-place and in the public service, what the DDF can guarantee is that any evidence of such practices will be pursued timeously, diligently and to the full extent of the law, irrespective of whomever is involved.

Look at DDF Policies to see how they can help you.

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The buck stops at the ballot box.

New BEE regulations add nails to South Africa’s economic coffin

They say the road to hell is paved with good intentions.  That is certainly the case with South Africa’s BEE, or is it now  BBBEE, per the new requirements of the Broad-based Black Economic Empowerment Act.

Far from stimulating economic empowerment, these requirements cause the success rates of new business to slip to dismal levels and the cost of startups to rocket, with the only winners being the BEE consultants and big businesses which have the knowledge to navigate and comply with bureaucratic BBBEE requirements of multiple government agencies engaged in the transformation process.  Read all about it in this M&G 0n-line report.

The net effect of all this is that everything a South African consumes costs more than it should, fueling inflation and inefficiencies across the whole spectrum of South African society.  

By contrast Direct Democracy Forum policies will do away with as much bureaucratic bumf as possible, focus on that which is absolutely essential for the successful survival of fledgling enterprises, and skill, encourage and free-up the whole of our economy to succeed.  

Correction of imbalances in the economy, namely all those goals hoped for by implementation of BBBEE legislation, will be addressed by market forces being given the freedom to assert themselves.  What business in a  free market South Africa could possibly succeed as well as one which wholeheartedly embraces the black community both as entrepreneurs and as consumers, and the purpose of all business is to succeed as best as possible. But South Africa is both a black based country and a country of diversity that will do better working together than separate.  This is something we should have learned from the mistakes and injustices of the apartheid era.  

Transformational success is all but a given if the right infrastructure, incentives and freedoms are provided for businesses and enterprises to succeed.  A DDF administration will guarantee those conditions.  Alternatively, transformational success in a failed economy will be a hollow victory 

In short, more carrot will succeed where more stick will continue to fail.

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The buck stops at the ballot box.

SA 17th most gender-equal country.

This BBC report indicates that according to the World Economic Forum (WEF), South Africa is the 17th most gender equal country in the world. I guess South Africa should be proud of that, that is, until you look at the details.

On a range of 1 (most equal) to 4 (least equal), South Africa scores a 1 overall; a 4 (least equal) for health and survival, a 2 (mostly equal) for education, a 3 (mostly unequal) for economic participation and a 1 (equal) for political empowerment. So let’s not get too proud, we have a long way to go for all categories but for political empowerment, and political empowerment is just not that important if you are going to die young, probably from a combination of poverty and ignorance.

Direct Democracy Forum policies clearly indicate their commitment to gender equality, the best possible education, health care and economic opportunities for all. The DDF are committed to at least a score of 1 on each of those categories.

The buck stops at the ballot box