16 April 2020
Markets’ richest families play in being prioritised
One of the biggest lessons from philosopher Emmanuel Kant is what decisions or values we would rationally choose if we could decide on issues impartially.
Put differently, what ethical decisions would we take if our judgments were required on issues over which our own interests, or those of family, friends, enemies and acquaintances were removed from the equation. To be Kantian is to believe in one rule for everyone, to believe in the removal of what he terms “the foul stain of our species”.
To make fair decisions, John Rawls argued in A Theory of Justice that decision-makers must be deprived of information or knowledge about themselves, race, sex, age and many other factors. This is further expanded on in The Idea of Justice by Harvard professor Amartya Sen. So important is this principle that it has, in some ways, contributed to recent notions of conflict of interest and the rationale behind blind trusts – something our president Cyril Ramaphosa used when he ascended to political office to obviate clashes in interests.
Truth, though, is that these ideas can only work in an ideal society. Many decisions taken in public and private sectors are in complete disregard for what is ideal in society. As we battle the monster that coronavirus has become for the world, and as world leaders take decisions about what is necessary to navigate our way out of this pandemic’s firm grasp, questions arise about the framework used when certain decisions are taken.
One of these is the latest government decision on which sectors of the economy must be opened and which must not. What, many wonder, are the considerations? The biggest surprise for me was the rationale for allowing mining to resume while construction and manufacturing, pegged at level two with the functioning of government departments, must remain shut.
South Africans have a love-hate relationship with mining. From when production started in 1873, it has remained a paradox of note. While it is a source of much economic activity, which has spawned the very city of gold and the Johannesburg Stock Exchange, it is the same sector that has led to large-scale exploitation of black workers, many of whom remain buried underground following many accidents. Others were simply shot and killed for demanding human rights.
In 2016, the country’s mines – totalling just over 300 – accounted for 60% of SA’s exports which, significantly, are essential for global manufacturing. Therein lies my point: mining and manufacturing are joined at the hip. The government can’t argue that social distancing, which is essential for breaking the back of the virus, can be achieved more in mining than in manufacturing. We also know that the government gave us a flimsy excuse to explain the premature opening of mining, arguing that we would suffer if mines aren’t allowed to operate at 50% capacity. All of us, except some bright sparks in the government, knew that this was unreasonable. No science behind the claim.
What was not said is the power that mining owners have over those who make decisions – and how persistent they can be. Ramaphosa, who several years ago used such power and force with calamitous results, knows best. While mining has the Oppenheimers to exert pressure while offering donations, manufacturing and construction are going through a tough period, with top listed companies in the sector falling apart.
The other power players, the Ruperts, are in the wine market in addition to a range of sectors that are open for economic activity. It is common cause that regulations relating to wine were relaxed, then changed following a backlash, way ahead of the latest risk-adjusted changes introduced by the president last week.
It must be stated upfront, if not repeated, that the Ramaphosa administration has, to date, out-performed itself in its management of the virus that has now infected close to 3 million people around the globe, killing over 50 000. While leaders of the West were caught flat-footed, our government was nimble-footed. Credit must go where it is due.
That said, the rationale for opening some sectors of our economies while others are shut is questionable. The obvious “foul stain of our species” is to be found in relationships and powers wielded by those whose markets are open. Is it coincidence that the markets in which the richest families play are the first to be prioritised? If these decisions were taken, as the idealist Kant wishes, without knowledge of the players, station in society and other factors, would stage five to one be stacked as they are? I doubt it.
When a government does well in its management of a crisis, it is not only important to say so – but to do so while remaining vigilant about where “foul stains” may creep in.
The relegation of manufacturing and construction to level two while mining is open for activity at stage four requires reconsideration.
I am in agreement with the government that the re-opening of the economy requires astute management because, if not properly managed, we may see a spike in the rate of infection at levels that become impossible to manage. Nobody wants that.
But the decisions we take must still make sense. At its core, the argument I make is that those in manufacturing and construction, incidentally responsible for many jobs, are able to do social distancing better than those in mining. The prioritisation of mining over other similarly structured industries has the potential to soil what has been a splendid performance by the government.