By Gerhard van Onselen

“The point is that the public never has the opportunity of voting on the State system itself; they are caught up in a system in which coercion over them is   inevitable.” Murray Rothbard – Power and Market, pp. 1065 – 1066 

The famous science fiction writer of the Pern series of books, Anne McCaffrey, was once allegedly criticized for creating a fictional world without religion. Being a lady of fine persuasion she remarked that as a writer of science fiction, Pern was her world and she could do in it what she wanted. McCaffrey noted that in her fictional world – her sandpit – she’s allowed to write the rules as she pleases.

Fortunately for us, we do have a choice of participating in McCaffrey’s world. It is simple if you don’t like the rules of McCaffrey’s world, you don’t have to participate. You can choose not to play along. Opt out, just don’t read her books. We all have choices in consumption, and that is what is great about free markets.  In a true free market, you can choose not to consume McCaffrey’s fiction, along with a wide array of other goods and services, you may not wish to consume.

There is however one organization in society that gives us very little choice in consumption, an organization from which it is nearly impossible to opt out from. This ever expanding organization is the state and its associated legislation and services.

Unlike in McCaffrey’s sandpit, the governmentally imposed ‘sandpit’ allows for very little choice. In essence, we are forced by law to play along.

But is it not the nature of governments to exercise power; to coerce people into following the rules of the ‘sandpit’? Whether by the sword, the gun, or the threat of jail, we all are forced to participate. At the core, this seems to be an advantage that governments have, that the free markets do not. True free markets are based on voluntary exchanges.

In the west, the state seems to exercise power under a guise of democracy; but in reality, modern political systems are often nothing else than the imposition of political power from small, well connected, well funded, political elites. Elites are often found to be protecting their interests above all else; often at the expense of society. These elites are effectively telling the populace to drink the ‘bitter medicine’ because ‘Father’ knows best.

Whether black or white, at present much of our lives are still being dictated by the state. In our ‘sandpit’, political elites appear to be writing the rules of the game and exercising the power to force obedience. The recent passing of the Secrecy Bill, even in the face of much uproar, should testify to the growing trend of more and more imposition of power.

This is understandable considering that modern political and economic theory regard the person as a type of mechanistic agent: a drone that is expected to follow external guidance rather not unlike a machine. I like to call this theory politico-economic fiction. Sadly, this system is not based on the reality of what people really are. In actual fact all intervention in markets will have unintended consequences. That is the nature of complex emergent social systems. But when holding such a view of the person, it is only logical to think that the person has to be controlled in one way or another by supposedly wiser, smarter, authoritarian Elite. ‘Father’ knows best, remember.

Take the South African Affirmative Action, Employment Equity, Black Economic Empowerment legislation. These laws were imposed with the hope of improving our ‘sandpit’. As is often the case, such laws are introduced in a package of worthy ideals. The ideals behind these laws were ideals of a society of equal opportunity and social advancement. I have no problem with that, we should all aspire to such a society.

But I have to wonder if these laws, now enforced through governmental force, have actually achieved the goals of equality?

Recently, much has been said about the localization of economic power in so called ‘white capital’ structures. These, for now, passing comments paint a picture of ‘white capitalists’ greedily hording all the toys in the ‘sandpit’. It is a picture that is sure to stimulate much anger among the poor in our country. This picture is also a very useful political instrument used to rally mass support.

If the assumption that politico-economic Elites will strive to secure and protect their power is correct, we have to wonder whether the picture of a racially polarized South Africa is not actually serving a fundamental political-economic goal. Could it be that the Elites, in the actual networks of power, need this picture of racial polarization in order to keep their existing economic and political power networks in place? Are we not being subjected to yet another example of a traditional political ‘false flag’ operation where those with real power are setting up a fictional bad guy in order to advance their objectives even further?

If ‘white capital’ is indeed the bad guy then that would require even more ‘help’ from ‘father’. That would mandate even more laws, oversight and engineering by the State? Now ask yourself, who is really to benefit most from equality legislation, ‘the people’ or the elites? I’ll allow you to draw your own conclusions.

Unfortunately, I am very sure that when we divide our world-view along the lines of race, we’re sure to become blind to the other forces of power and inequality, at work. It is very certain that both black and white may become enslaved by it.

We should then wonder whether existing equality legislation is not actually concentrating power in much the same way as apartheid has done. Remember, apartheid was a ‘dog’ fed by the state.

To join the ranks of the ‘big business’ in South Africa, requires being an ‘empowered’ company with the right, state sanctioned, shareholders and stakeholders. That means forming limited liability corporations with politically correct members and connections. Only then will you have access to the big contracts and state tenders.

It is only logical that such corporations will unite to form larger consortiums. Such consortiums are typically well funded, often benefits from the protection of equality legislation, and have considerable economic and political power. They make up the new ‘old boys’ clubs.

Even more problematic is the possibility that such consortium networks will distill into even stronger monopolies; monopolies, against which the average small business man, will find it very hard to compete. Such monopolies, in many cases, aren’t competing solely on service, quality, or cost, but on fitting a politically correct profile. Aren’t the volumes of crumbling RDP houses testifying to that? The consumers of the RDP houses really have little choice in who to buy from. This seems to suggest a situation of forced consumption of goods. A logical conclusion in a state controlled market.

Politico-economic monopolies are nothing new; South Africa’s economy has always been skewed in favour of big-business protected by some form of governmental, politico-economic protection. This was the case during apartheid and indeed, in 2012, how much has actually changed? You still have to be part of the ‘right’ ‘boys club’.

So, has equality legislation actually produced more equality and empowerment? Yes it has, it has for the new ‘boys clubs’, those who enjoys new forms political economic protection. Has the situation changed for the small business man, now smothering in an ocean of legislative compliance and other governmental requirements and interference? I’m not so sure.

But legislation is great for the ‘boys clubs’ when it allows for even a greater concentration of politico-economic power. I mentioned that it is natural for Elites to protect their power. That’s only natural. The Elites often have all the funds and expertise needed to comply with the legislative burdens. Having the threat of unpleasant government enforcement as a back-up also increases power. Proposed amendments to our labour legislation, where it is sought, for example, to criminalize employment equity infringements should testify to such power at work.

The situation is not that great for the small guys, the start-ups, or the mom-and-pop shops all now competing at an economic disadvantage. It is no wonder then that SA does not really have a strong entrepreneurial culture; the culture said to be needed for our South African renaissance. Cost of compliance for small businesses is prohibitive; by some estimates more than ten percent of turnover. No, equality legislation has not really brought about more equality for the average man or woman. Not as far as I can see. Those not part of the new ‘old boys’ clubs, the average man or woman on the street, is still left in the cold on the outside, looking in.

Our present situation is well explained by free-market economist Murray Rothbard, who argues that all forms of state intervention are coercive at some level[1]. Apartheid was an ugly example of coerced exclusion of individuals from free market participation. It was a gross generator of inequality, a violation of the innate rights of human beings.  In essence it was installed by the State. Clearly we are better off without it. However, it seems like the present interface between the State and the new Elites is creating fertile ground for yet another form of exclusion and inequality. This makes me wonder if true economic freedom can ever be instituted by the State. Rothbard argues that it can’t, he concludes that “the picture of State intervention is [always] one of caste conflict, coercion, and exploitation” [emphasis mine][2].