Volume 8, No. 20 23 —29 May 2008


THIS WEEK:


Africa Day

Xenophobia is a crime

May 25th is Africa Day. This marks the day that we, as Africans celebrate the formation of the Organisation of African Unity, the predecessor of the African Union. Today the African Union is an instrument to unite all the people of Africa both politically and economically.

On Sunday we will wake up in this country and celebrate the victories our forebears have had over colonialism and Apartheid.

Many of us, including myself, will think of the kindness we received in the poorest communities of Angola, Mozambique, Zimbabwe, Zambia, Tanzania, Nigeria and many other African States. We will recall that our neighbours were collectively punished by the Apartheid regime for harbouring the cadres of the ANC. We will remember that our children were given spaces in overcrowded schools in remote rural villages, and when we were injured and ill, the hospitals of many African countries nursed us back to health.

Above all, when we wake up on Sunday morning we will remember that we are Africans. We will celebrate the fact that the African continent entrusted its Parliament, the Pan-African Parliament, to South Africa, which is located in Midrand, not far from one of the scenes of the horrendous attacks on South Africans and Foreign Nationals, which are our brothers and sisters from this continent.

It is on Sunday that we will go to church and bow our heads in prayer and many of us will pray for those who have been murdered, raped, injured, possessions looted, homes destroyed and displaced. Many of us will have taken from our own meagre resources to assist the people who fled to police stations for safety. We cannot but conclude that an injustice and crimes of a serious nature have been committed against fellow Africans, here in South Africa. To date 42 souls have been lost. Somewhere out there, somebody's mother, father, sister, brother, husband, wife, son or daughter will no longer come out to greet them.

In Alexandra, Tembisa, Thokoza, Reiger Park, along Jules Street in Johannesburg and in the city itself, homes and businesses have been looted and burnt. A shameful pogrom, ill informed and angry with people whom they perceive to be robbing them of their right to services. Is this the truth? The same mob that accused people of being criminals acted in the most obscene of criminal ways.

There is no room for this behaviour in our country ever; there is no reason that compels us to behave in this atrocious manner. For this reason we support the deployment of the SANDF to the effected areas, to do no more than support the police in rooting out the criminals who inspired these acts of barbarism.

We call on all anc members to:

  • To spring into organised action.
  • Give support to the police
  • Form the street committees and take the streets back from criminals.
  • Give comfort and support to all who have been displaced and lost all their wordly goods.

There is no doubt that overcrowding and poverty has a hand to play in how people will react when they feel hard done by.

We have work to do comrades and friends.

We have to work hard to ensure that we root out corruption of the nature that robs us of our humanity. Many people have taken occupation of more than one RDP house and sell their houses instead of living in them. We must put a stop to this practice and expose all who are corrupt.

Our policies are not at fault, the policies of the ANC seek to fight poverty and to provide services to the people. We have to ensure that we do the job that needs to be done to make delivery efficient and effective.

We call on all public representatives and civil servants, to make our country work for all who live in it.

Let us fight crime and corruption and work together to build this unique nation.

On sunday 25 may, let us take the lead wherever we are to ensure that we celebrate africa day as fellow africans and condemn xenophobia for the henious crime that it is.

Let us support the police in their work they must do to rid our streets, hostels and informal settlements of criminals

** Gwede Mantashe is Secretary General of the ANC.

Gwede Mantashe


Xenophobia

Youth must rise against thuggery and hooliganism

South Africa is a thriving democracy brought about by the sweat and blood of our forebears anchored on the liberation struggle that placed human rights and human dignity at its pinnacle. Ours is a society that is an integral part of the African continent and our destiny is intrinsically linked to that of our fellow comrades across Africa. We therefore have a responsibility to ensure that those who come to our shores seeking refuge for whatever reason are treated humanely.

Those who believe they have an unfettered right to murder, loot and destroy the property of others because they are not South African are not deserving of our hard-won freedom, and have no place in our society. We have noted with dismay that young people seem to be at the forefront of these despicable attacks. We call on our youth to defend our hard-won freedom and our democracy with everything they have. They must rise against this thuggery and hoologanism and claim back their communities. All ANC Youth League branches must assume leadership in this regard working closely with ANC branches and other organs of civil society to ensure that order prevails in our communities and that our people are educated on the kind of society we espouse.

We further condemn with contempt those who participate in these criminal activities using the name of the ANC and singing revolutionary songs like "Umshini wami" while perpetrating crime. If any of our members are found to be participating in these activities, we expect our structures to take the harshest possible action against them.

While we acknowledge that service delivery challenges loom large in our townships, our people must not be hoodwinked by criminal elements who claim to have a solution to their plight. Killing others and burning their homes does nothing for our society, and may cloud genuine concerns they may have. We call on government to unleash every resource at its disposal to nip this anarchy in the bud, including the deployment of the military if the need arises.

We do not believe the government has done enough to arrest this anarchy and we expect swift and decisive action from the law enforcement agencies and other relevant organs of state. Those who quell this anarchy must be apprehended and the criminal justice system must ensure that they rot in jail. We call on our communities to work with the law enforcement agencies to identify these thugs and ensure that they are removed from our communities as they have no place in our society.

** Julius Malema is President of the ANC Youth League.


Food prices

Growing market failures, not farming

In an article by Trevor Manuel published in ANC Today Vol 8 No 18 he said "the world has generally been able to feed itself(and)eat times, surpluses in some parts of the world have had to be diverted to cover shortages in another part of the world". We agree with this observation.

We wish to argue that there is still enough food produced by the world to still feed itself. Put differently, there is no shortage of food in the world. Therefore, the problem is with the distribution of food and commodities, particularly as determined by the commodity futures system at the Chicago Board of Trade.

The Chicago Board of Trade can be a volatile platform for food commodity price formation for a variety of reasons. For example, after the sub-prime crisis, and in search of windfall profit, large funds embarked on a spate of speculation that the US wheat crop would be short of expectations. In addition to this, there has been much speculation that US biofuels demand could create a never ending cycle of fossil fuel fertiliser engine fuel food price inflation. As Manuel states, any economy that is largely dependent on imported food commodities will be in for a rough ride, especially when panic buying sets in.

For those states with more equitable land distribution, food production know-how, and large strategic grain stocks, it could be seen as quite logical to have recently imposed export taxes on their domestic grain supply, while spurring the production of a greater diversity of foods and, simultaneously, avoiding the subsequent underutilisation of grain lands.

In South Africa, we do not buy the argument that the Australian and Central Asian drought has caused a major disruption in the supply of maize or wheat, and rice or potatoes. Furthermore, and in all probability, the water quality throughout China shall be much less significant as a negative factor in food production than variations in rainfall patterns in many parts of the world, in time to come. Even if there is a negative energy or cost cycle involved in conventional high-input agriculture, the rate and magnitude of increases in input costs thus far cannot solely explain the rise in food prices.

We acknowledge the rising demand for commodities and food from China and India (accounting for approximately a third of the world's population). This should have been responsible for nothing more than a gradual and steady increase in prices, in tandem with income distribution growth among a large number of people. We don't buy an argument that this could have significantly contributed to global commodity prices reaching sky high levels, as they did after the sub-prime crisis.

Market failure

Food production by the diversity of our people in Southern Africa has long been depressed. However we are not as interested as Manuel appears to be in production incentives going to existing producers, whether through higher agricultural prices or some other form. Inequalities in access to affordable water, finance, quality land, know-how, infrastructure, appropriate technology and marketing opportunities are critical constraints to the sustainability of the economy and the absence of hunger.

In summary, our concerns centre on the speculative increases in domestic and international food prices that have arisen from the trades of large funds after the sub-prime crisis. Clearly, the price formation of key staple foods, as determined on the Chicago Board of Trade, is a reflection of market failure on a big scale. This concern about futures market failures does not seem to be shared by Manuel as deeply, and we encourage a more clearly thought through debate on the uses and abuses of certain export taxes at certain times.

We agree with Manuel that the impact of rising food prices would negatively impact on the poorest of the poor the most, mainly because they spend more than half their income on food expenditure. We agree that price plays a critical role in any trends in expenditure on food by the poor from 2000 to 2005, to now. If anything, with the persisting poverty levels, stubborn unemployment rate and widening income inequality, the gini situation has become worse than better.

Any sensible economist or government leader knows that if markets fail (or there is market failure) state intervention is warranted and justified.

An intervention on the demand side to relieve consumers from the impact of price increases without tackling the structural problems and market failure on the supply side, would be tantamount to redistributing resources away from the poor to the rich as government will be tapping from the fiscus to fund feeding schemes and food parcels while purchased food prices remain high and windfall profiteering continues.

Responses

We wish to propose, among other things:

  • that the nationalisation of companies located in the value chains of staple foods and those found guilty of price-fixing should be pursued;
  • setting up state-owned enterprises that would seek to influence prices downwards, through training people and producing and storing commodities in times of surplus;
  • setting up a price regulatory body that should control prices from reaching levels reflecting windfall profits;
  • strengthening competition authorities and reviewing competition law, such that CEOs presiding over companies found guilty of price-fixing are impeached and banned from serving as directors or employed as senior management;

On the demand side, the following measures should be introduced or improved:

  • the expansion of the value and extension of the volume of social grants. The Old Age Grant should be extended to male citizens at the age of 60 years immediately and be paid at R1,000. The Child support grant should be extended to all children up to the age of 18 years immediately and be paid at R250.
  • the introduction of a basic income grant in the next financial year at R100 (2002 prices) to all citizens between the ages of 18 years and 60 years without means-testing;
  • the introduction of food stamps, subject to means testing, in hot spot areas such as villages, informal settlements and townships;
  • the expansion of school feeding schemes to cover a wider geography of poor communities and be extended to all schooling attending children irrespective of their age.

In conclusion, we believe that supply side intervention, including price controls, will work even in the long-run. Demand side measures, such as cash grants, without doing much rapidly on the supply side would feed windfall profiteering by food processors and retailers into the future.

** Katishi Masemola is General Secretary of the Food and Allied Workers Union (FAWU). This article is a response to an article by Trevor Manuel in ANC Today Vol 8 No 18 published on 02 May 2008.


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