Sounding the Alarm on Property Rights – Where the IRR Stands, and Why

0
9
Property Rights

Written by: Terence Corrigan

Criticism has been levelled at the Institute of Race Relations (IRR) in recent weeks – including a battery of charges on a number of popular talk shows – on our opposition to the government’s drive to introduce compensation-free land expropriation.

Much of the criticism focused on our stance on ‘the list’, purportedly of 195 properties earmarked for seizure. We believed the list to be legitimate, and said so, pointing out that what is known about it confirms something we have long warned against: that EWC will be directed at productive properties and is likely to be undertaken with very little regard for the impact it has on the economy.

The comeback was that the department denied the existence of the list, and so there is no reason to accept its veracity. Consequently, our position was ‘alarmist’ and it was undermining South Africa’s economic prospects.

Elsewhere, accusations have flown that we are selective in our defence of property rights. University of Cape Town academic, Prof Aninka Claassens, recently wrote:

“What have sectorial interest groups who propound their belief in property rights and the free market economy — such as Business Leadership South Africa, the Minerals Council and the ever-strident Institute of Race Relations — had to say about this ongoing dispossession of the property rights of the poorest and most vulnerable South Africans? Nothing.” (‘Mandela didn’t sell out, post-94 ANC did’, Mail&Guardian, 8 August)

One recent interviewer, evidently thinking he’d reached a gotcha! moment, asked rhetorically what our ‘agenda’ was. This is easy to answer. Our agenda is clearly stated on our website:

“We stand for classic liberalism – an effective way to defeat poverty and tyranny through a system of limited government, a market economy, private enterprise, freedom of speech, individual liberty, property rights and the rule of law.”

We at the IRR have indeed been vocal in our opposition to EWC, and have worked hard to explain its dangers and to mobilise opposition. We are especially proud that we have provided a platform for tens of thousands of South Africans – ordinary people, from all walks to life – to let the government know they reject EWC.

This has both a pragmatic and a normative dimension. Property rights are indispensable to a successful economy. They allow entrepreneurs to sink their capital into ventures with the certainty that they will not be subject to arbitrary deprivation. They make long-term planning possible.

They are also important supports for democratic citizenship. The ability of people to hold their assets – whether land, or anything else – enables them to live a life that is not dependent on the state. Property rights help put people in a position where they can draw on other sources of sustenance and support and negotiate a relationship with the state.

And for this reason, we take threats to property rights – no less than to any other civil or democratic freedoms – extremely seriously. We have been warning for the better part of a decade that the government intended to move on property rights. We’ve documented over two dozen policies, laws or regulatory changes – proposed or adopted – that sought to do so, each of them granting the state greater latitude to intervene in the holdings of individuals and private businesses.

Our concerns were frequently dismissed as ‘alarmist’.

Our own experience, since 1929, has taught us to be very cautious about the exercise of power, and to be sceptical about how it is justified. Indeed, a healthy suspicion of the motives and actions of those in power is a lesson that the country as a whole might fruitfully have learned from the past decade.

It is a grave step to shift the balance of the relationship between the citizen and the state towards the latter. This is precisely what the government and the ruling party have indicated an intention to do. Repeatedly.

It is time to be alarmed. And if ‘alarmist’ describes that posture, we do not object to it. It is certainly preferable to the passivity and complacency evident in accepting – as but one example – the response by the Minister of Rural Development and Land Reform that there is no list of properties targeted for EWC. The existence of such a list (containing 139 properties earmarked for seizure) was widely trumpeted for a week before the advocacy group AfriForum posted the document in its possession on its website, and this drew no denial or refutation from the minister or her department – a strange disjuncture indeed. And one that many seem strangely content to overlook.

Nor is it accurate to say – as Prof Claassens does (and she is far from alone in doing so) – that we have been indifferent to the property rights of poor people. In fact, we have made the point that property rights are crucially important for those owning little: poor people, after all, do not have deep pockets to pay lawyers, nor do they have powerful politicians on speed-dial. We have frequently stated that a failure to take this issue seriously is one of the greatest shames of the post-1994 era.

My colleague, Gabriel Crouse, has been travelling around the country collecting first-hand accounts of just such dispossession and exclusion, both in urban and rural areas. We have had much to say about it. A piece published recently even referenced Prof Claassens’ work.

To say that we have had ‘nothing’ to say about the trampling of poor people’s property rights probably says more about a lack of familiarity with our work.

Perhaps more than anything, we have certainly been willing to take unpopular positions. We have eschewed blind faith in a benevolent state to drive society towards a future of prosperity and infinite justice – if for no other reason than that the South African state hasn’t remotely the capacity to do anything of the sort.

Regrettably, it all too often lacks the integrity to do so. This was part of the reason we opposed the current legal framework governing mining – an issue close to Prof Claassens’ heart. (Interestingly, there was no shortage of voices endorsing it, on the basis that the state would be able to ‘empower’ the people of the country. Today we have both a stressed mining industry, and constant complaints about the failure of communities to benefit.)

And hence, again, our opposition to EWC. Even ascribing the most generous of motives to the current policy push, there is as good as nothing to suggest that greatly expanded state discretion to deprive people of their assets will do anything to solve either the malaise afflicting land reform, or to put South Africa on a path to prosperity. Quite the opposite. As the American economist Thomas Sowell once remarked, the measure of good policy must lie in the quality of its outcomes and not the (assumed?) nobility of its intentions

‘The ever strident’ Institute of Race Relations? Perhaps. With the perilous drift of policy, we see no shame in sounding forthright and unambiguous warnings.

* Terence Corrigan is a project manager at the Institute of Race Relations (IRR), a think tank that promotes political and economic freedom. If you agree with what you have just read then click here or SMS your name to 32823.

LEAVE A REPLY

Please enter your comment!
Please enter your name here