“The African National Congress Youth League’s hijacking of the term ‘economic freedom’ and twisting it to mean the very opposite of what it actually means is no insignificant feat.”
Today in Business Day an article by Eustace Davie, a director of the Free Market Foundation, appeared for the first time – Drop the double speak on economic freedom. It is essential reading for all concerned citizens in South Africa.
With the permission of Business Day this post contains some random extracts from the article but it is recommended that the complete article be read by clicking on the above link or going to Business Day itself.
“It is right to place it at the very heart of the policy debate but dangerously wrong to distort the concept out of all recognition.”
“According to US economist Walter Williams, a simple definition of “economic freedom” (or a free market) is ‘voluntary exchange between individuals free of third-party intervention’. This is certainly not what the league means in its declaration that ‘seven cardinal pillars of economic freedom in our lifetime are identified as the most vital components of the immediate tasks and functions to be pursued in the consolidation of real and sustainable economic transformation’.”
“How is it that a two-word concept like ‘economic freedom’ can mean polar opposites to different people? Economic freedom in the sense of freedom from government interventions in the sense that Williams understands them, is the direct opposite of the big government intervention, theft of property and violation of the rights of individuals in the sense that the youth league appears to understand them.”
“Friedrich Hayek (The Fatal Conceit: The Errors of Socialism) may have the answer. He starts with a quote from Confucius: ‘When words lose their meaning, people will lose their liberty.’ As Joseph A Schumpeter rightly put it, ‘as a supreme if unintended compliment, the enemies of the system of private enterprise have thought it wise to appropriate its label’.”
“That the youth league policy is antagonistic towards private enterprise even though the organisation has chosen ‘economic freedom in our lifetime’ as the main focus of its work this year is revealed in the choice of its ‘seven pillars’.”
The ‘seven pillars’ are:
• Expropriation without compensation for equitable redistribution.
• Nationalisation for industrialisation.
• Inclusive and decentralised economic growth and development.
• Land restitution and agrarian reform.
• Building a strong developmental state and public service.
• Big investment in the development of the African economy.
• Provision of education, skills and expertise to the people.
“In a perversion of language, the youth league interprets plunder in the form of expropriation without compensation and pervasive state control to mean ‘economic freedom’. This confusion of language is dangerous in that it leaves the average citizen not knowing what either side of the debate is actually talking about.”
“Declines in economic freedom have serious repercussions. Many studies have shown that countries with higher levels of economic freedom grow more rapidly and have higher levels of per-capita incomes than those less free. Economic growth is primarily the result of gains from trade, capital investment, research and development, lower-cost production methods and better ways of doing things. Increases in economic freedom and improvements in quality of life are closely related, as are declines in levels of economic freedom and deterioration of quality of life.”
In 2009 a blog was posted to assist in understanding the meaning of words like ‘liberal’, ‘conservative’ and ‘socialist’ – see Meaning of ‘liberal’ in Europe & USA. See also the blog – Van Zyl Slabbert needs to be honoured & his liberalism debated.
Today in Business Day an article by Eustace Davie, a director of the Free Market Foundation, appeared for the first time – Drop the double speak on economic freedom. It is essential reading for all concerned citizens in South Africa.
With the permission of Business Day this post contains some random extracts from the article but it is recommended that the complete article be read by clicking on the above link or going to Business Day itself.
“It is right to place it at the very heart of the policy debate but dangerously wrong to distort the concept out of all recognition.”
“According to US economist Walter Williams, a simple definition of “economic freedom” (or a free market) is ‘voluntary exchange between individuals free of third-party intervention’. This is certainly not what the league means in its declaration that ‘seven cardinal pillars of economic freedom in our lifetime are identified as the most vital components of the immediate tasks and functions to be pursued in the consolidation of real and sustainable economic transformation’.”
“How is it that a two-word concept like ‘economic freedom’ can mean polar opposites to different people? Economic freedom in the sense of freedom from government interventions in the sense that Williams understands them, is the direct opposite of the big government intervention, theft of property and violation of the rights of individuals in the sense that the youth league appears to understand them.”
“Friedrich Hayek (The Fatal Conceit: The Errors of Socialism) may have the answer. He starts with a quote from Confucius: ‘When words lose their meaning, people will lose their liberty.’ As Joseph A Schumpeter rightly put it, ‘as a supreme if unintended compliment, the enemies of the system of private enterprise have thought it wise to appropriate its label’.”
“That the youth league policy is antagonistic towards private enterprise even though the organisation has chosen ‘economic freedom in our lifetime’ as the main focus of its work this year is revealed in the choice of its ‘seven pillars’.”
The ‘seven pillars’ are:
• Expropriation without compensation for equitable redistribution.
• Nationalisation for industrialisation.
• Inclusive and decentralised economic growth and development.
• Land restitution and agrarian reform.
• Building a strong developmental state and public service.
• Big investment in the development of the African economy.
• Provision of education, skills and expertise to the people.
“In a perversion of language, the youth league interprets plunder in the form of expropriation without compensation and pervasive state control to mean ‘economic freedom’. This confusion of language is dangerous in that it leaves the average citizen not knowing what either side of the debate is actually talking about.”
“Declines in economic freedom have serious repercussions. Many studies have shown that countries with higher levels of economic freedom grow more rapidly and have higher levels of per-capita incomes than those less free. Economic growth is primarily the result of gains from trade, capital investment, research and development, lower-cost production methods and better ways of doing things. Increases in economic freedom and improvements in quality of life are closely related, as are declines in levels of economic freedom and deterioration of quality of life.”