Parliamentary Caucus

14 April 1998

SA IS STILL SUFFERING INEQUALITIES FROM RACIAL CAPITALISM

Apartheid had two key elements: white political supremacy, which deprived
black South Africans of their fundamental rights as citizens, and racial
capitalism, which concentrated wealth in the hands of a white minority
and kept black South Africans in exploitative poverty. Between 1934 and
1973 the South African economy had an annual growth rate of 4,5 per cent,
but this period was one in which whites were undeservedly enriched, and
blacks were undeservedly impoverished.

The first democratic elections in 1994 swept away white political supremacy
and replaced it with a non-racial democracy, with a constitution guaranteeing
the rights and equality of every citizen. In fact, in the years before
1994, the National Party Government had been dismantling some of the elements
of white political supremacy in its desperate bid to retain its dominant
position. Hence, the pass laws, the Immorality Act and other examples of
petty Apartheid were abolished.

But 1994 did not auger the demise of racial capitalism. The stark reality
is that many of the social and economic inequalities brought about by racial
capitalism are as acute as ever. South Africa`s wealth is still overwhelmingly
concentrated in white hands, despite black empowerment, and the crisis
of black poverty in the new South Africa is the unacceptable legacy of
the Apartheid.

Racial Capitalism - the Facts about Inequality

1. The per capita income of whites were 10,6 times higher than African
   per capita income in 1946/47. It was 15 times higher in 1975. Wealth was
   redistributed upwards from poor blacks to rich whites.
2. Between 1975 and 1991, the income of the bottom 60 per cent of the
   population dropped by about 35 per cent.
3. In 1996, the poorest 20 per cent of income earners received only 1,5
   per cent of total income in South Africa, while the top ten per cent had
   50 per cent of total income.
4. In 1995, the poorest 20 per cent of households received only three
   per cent of all household income, while the richest 20 per cent of households
   had 65 per cent.
5. In 1995, the poorest 30 per cent of households received only five per
   cent of all household income; the poorest 50 per cent received only 11
   per cent; the poorest 60 per cent received only 16 per cent; and the poorest
   80 per cent had only 35 per cent.
6. For the first three quarters of the century, per capita spending on
   pensions, health and housing for Africans was about ten times smaller than
   on whites. By 1990, it was still four times smaller.
7. In 1970 spending on education for a white pupil was 20 times higher
   than spending on an African pupil.
   
   
   
   

Racial Capitalism - the Effects on Africans

• Africans were displaced by whites from large parts of land on which
  they performed successful traditional farming for centuries.
• For decades millions of black people were paid exploitative wages in
  all sectors of the economy.
• Laws deprived blacks of opportunities to acquire skills, and also forced
  them to do humiliating work at very low wages.
• Blacks were denied opportunities to accumulate human capital.
• There was no opportunity for blacks to accumulate property or develop
  entrepreneurial and professional capabilities.
• The racist systems impoverished and destroyed not only individuals,
  but whole black societies, often brutalising large numbers of them, and
  prevented South Africa`s peoples from becoming a society.
  
  

The Focus of the ANC`s Redistribution and Restitution Policy

A major plank of the ANC Government`s policy is a poverty upliftment
programme to improve the lives of 18 million of the poorest South Africans,
who were the direct victims of the injustices of the Apartheid system and
the indirect victims of the "creeping poverty" caused by the
Struggle between the freedom movement and the oppressive NP Government
between 1975 and 1991.

Some significant changes have already been delivered by the ANC. For
example, black empowerment has helped the proportion of urban Africans
in the top 20 per cent income group to increase from two per cent in 1990
to six per cent in 1995.

Educating South Africans about Racial Capitalism

Many white South Africans have accepted the injustice of white political
supremacy, but have not yet recognised the injustice of racial capitalism.
It was not just white Afrikaner business that profited from National Party
policy measures: all white businesses benefited, including those owned
by English speakers, regardless of whether they agreed with the NP Government`s
policies or not.

Whites do not accept that the economic gains they made during Apartheid
were undeserved, made as they were on the undeserved economic subjugation,
oppression and exploitation of the African majority. But the richest whites
should know that a sizable part of their wealth is undeserved, because
it was ill-gotten through:

• white power structures
• white privileges
• white favouritism
• white patronage
• white corruption.

They should therefore be made to understand that they have to make sacrifices
as an investment in reconciliation, social justice and social stability.
This is not punishment, nor is it an immoral racially-motivated confiscation
of wealth; it is instead a meagre contribution to be made by the richest
(mainly white) people in South Africa in order to undo the systemic injustices
of the Apartheid system upon the poorest (mainly black) people in South
Africa.

This Bulletin is based on a paper by Professor Sampie
Terreblanche of the University of Stellenbosch