The venality and gross incompetence of the ANC government have provided a convenient smokescreen for unelected lobbyists and vested interest groups to inveigle themselves into the South African political process at the expense of transparency and democracy.
One such organisation is the Free Market Foundation (FMF), a neo-liberal* lobby group that styles itself as a non-profit Public Benefit Organisation. Kind of bizarre if you consider that they charge R20,000 – R250,000 per year for corporate membership and their only real expenses would be the salaries of the Foundation’s staff and the odd spurious court case on behalf of its corporate benefactors.
Its patrons include some of South Africa’s wealthiest people, mostly privileged white males, such as Donald Gordon (founder of Liberty Life), Johann Rupert (chairman of Richemont and Remgro) and Raymond Ackerman (retired chairman of Pick ‘n Pay). Another patron is Bongani Khumalo, Chairman and Chief Executive of Gidani (Pty) Limited, which previously ran the National Lottery and currently embroiled in a legal battle to regain the goose that lays the golden eggs.
The FMF was founded in 1975 by Leon Louw, a conveyancer at the time, with its core premise,
“to promote and foster an open society, the rule of law, personal liberty, and economic and press freedom as fundamental components of its advocacy of human rights and democracy based on classical liberal principles.”
At first glance it comes across as a laudable and benign organisation, but in reality it is a thinly veiled vehicle for opportunistic carpetbaggers** and big corporate interests. Louw is a vehement neo-liberal ideologue who has been allowed to spout his generic and sophomoric “government bad, companies good” mantra in mainstream business publications for ages. The FMF seems to conflate economic civil liberties with social civil liberties, both tenets of classic liberalism built on John Locke’s theory of personal rights and Thomas Hobbes’s social contract, as opposed to the brutal laissez-faire capitalist ideology of Friedman, Von Mises and Hayek. A fact that is corroborated by Louw’s self-declared and frankly quite puerile reverence for Ayn Rand’s incoherent egotism.
The irony of calling his organisation the Free Market Foundation probably escapes the loquacious Louw, a man with a non-existing business track record and modest academic background, who displays a fundamental misunderstanding of what a free market is. A true free market ensures a level playing field for all the participants; if that is not the case, then government (public) intervention is a necessity to correct the artificial imbalance created by historical monopolies, cartels and unequal access to education, information and communication. Denying those imbalances is to embrace de facto technocratic fascism.
According to the Free Market Foundation’s website,
“The FMF’s submissions to Codesa[sic] and Parliamentary constitutional committees contributed, for instance, to the devolution of exclusive powers to local and regional tiers of government, the inclusion in the limitation clause of the requirement that limitations of rights must be “justifiable in an open and democratic society”, and the inclusion of the administrative justice clause (33), the freedom of trade clause (22), and the rule of law as a justiciable provision in the Founding Provisions of the constitution.”
Except for the fact that we could find no official record of the above claim there is the problematic issue of why a vested interest group with no mandate from voters was allowed to influence negotiations for South Africa’s first democratic constitution. Some pearls of wisdom from the pen of our learned friend:
“The reason why rhinos are endangered and cattle are not is because cattle are privately owned and there are relatively free markets in cattle products.” … “The nationalisation of rivers, beaches and wilderness areas increases the likelihood of degradation.”
Yep, them beautiful South African beaches and our world renowned National Parks are for those who can afford it, not the inconvenient, unwashed masses who just clog up amenities and make a nuisance of themselves. Anyone who has taken a cursory glance at the cost of staying at one of the private game reserves will know that the fully fledged privatisation of South Africa’s conservation areas would mean that only the privileged few will be able to visit them, excluding the vast majority of South Africans and creating a sort of Ballardian dystopia where we’ll all eventually have to pay for oxygen in Louw’s brave neo-liberal world.
Perhaps the most damning evidence against Louw’s integrity is his claim to have been a Nobel Peace Prize Nominee, not just once, no siree, three times: 1989, 1991 and 1992 according to his Who’s Who profile. What makes this claim a bit dodgy is that the Nobel Peace Prize Committee makes it very clear that: “The names of the nominees and other information about the nominations cannot be revealed until 50 years later.”
That means our Leon and his FMF acolytes are either suffering from temporal confusion or the naughty rascals are trying to game the system.
All mentions of Louw’s Nobel Peace Prize nominations are made in publications for which he or his foundation provided the information. Even if his nominations were above board, he and his foundation blatantly ignored the explicit instructions of the Nobel Foundation in order to gain some semblance of gravitas.
It is also very clear that Louw’s Wikipedia page was written by himself or his foundation as a promotional exercise. All the references are either from the Free Market Foundation or generic profiles that he provided to third parties.
When we contacted the Free Market Foundation with the above facts, Louw’s long-time sidekick and FMF director, Estace Davie, ignored all our pertinent questions and responded with a curt one-liner: “As far as I know Leon Louw was nominated by members of Parliament of a Scandinavian country.”
[Update: Frances Kendall, who was apparently nominated with Louw, has contacted us offering to provide proof that a Norwegian political party did in fact nominate them. Of course all our other queries were once again ignored. More in the comments section.]
After our correspondence with Mr Davie, the mention of Louw’s Nobel Peace Prize nominations mysteriously disappeared from his Wikipedia page. It was still mentioned on his Free Market Foundation and Who’s Who profiles at the time of writing this article though.
The biggest damage done by players like Louw is that they helped to entrench an ever deepening polarisation of the socio-economic debate in South Africa. They are not the only guilty parties; the anachronistic and globally debunked pseudo-socialist approach of the tripartite alliance is as much to blame. But to put the blame for South Africa’s current ills solely at the feet of the ruling party shows not only woolly thinking but is also a mendacious disavowal of blame for what is frankly blood on the hands of neo-liberal ideologues like Louw.
The FMF is a chilling reminder that lobby groups can often be proxies for vested interests that will use buckets of money to manipulate the media, public discourse and even the political process.
A pertinent recent example would be the government’s clumsy Orwellian attempt at internet censorship and transparent attack on freedom of speech via the Films and Publications Amendment Bill, which would see all internet material classified and licensed. In a brazen breach of net neutrality and in the classic apartheid era tradition of gaining an unfair advantage at all cost, organisations representing mainstream media and advertising conglomerates (IAB, Sanef and the South African Press Council) have negotiated special terms with regards to the bill, which if implemented would see independent digital publishers further marginalised by big media, this time in cahoots with government. In the process they have hi-jacked what is in fact a Constitutional Court issue that affects all South Africans.
Joseph Stiglitz, who has actually been awarded a Nobel Prize ( Nobel Memorial Prize in Economic Sciences in 2001), had this to say about Louw’s unfettered free market:
“The theories that I (and others) helped develop explained why unfettered markets often not only do not lead to social justice, but do not even produce efficient outcomes.”
“The real debate today is about finding the right balance between the market and government. Both are needed. They can each complement each other. This balance will differ from time to time and place to place.”
Another Nobel Prize winner for Economic Sciences (2008), Paul Krugman, argued extensively in his The Conscience of a Liberal that government policies played a much greater role than commonly thought, both in reducing inequality, e.g. the 1930 – 1970 period (starting with F.D. Roosevelt’s New Deal), and in increasing it, e.g. from the Reaganomics of the 1980s to the present.
Krugman describes himself as an American liberal which he views as similar to being a European social-democrat. He has also publicly endorsed Thomas Piketty’s magisterial, but often badly understood tome on income inequality, Capital in the Twenty-First Century.
All these highly regarded academics are brazenly contradicted by the home-brewed Louw and his FMF, who have consistently refused to address the how and why of righting the wrongs of the past and levelling the playing field for all participants in the economy. And just so that we are clear, that means confronting historical private sector monopolies, cartels and professional guilds that exert undue influence on civil society despite not being accountable to the public (reference the dismissive intransigence of the South African law societies).
BEE is a failure because it does not address the root causes of inequality in South Africa, which is the corrupt origin of many of its biggest companies and wealthiest denizens and the lack of equal access to education, information and communication. Instead BEE tries to replicate apartheid-era crony capitalism with dire consequences for the country as a whole.
Reprobate has said this before, and will keep repeating it until common sense prevails: South Africa is staring down the barrel of a socio-economic gun that has its origins in the corrupt, myopic deals made between the ANC and big business in the aftermath of the first democratic elections in 1994. An Economic Truth and Reconciliation Commission based on forensic evidence of the origins and past actions of South Africa’s biggest companies is an absolute necessity to establish a semblance of trust and transparency among the marginalised majority. An opinion that veteran journalist and political analyst, Allister Sparks, has elaborated on in an article published three years ago.
Is Leon Louw an irredeemably horrible person? Probably not, but he is representative of a huge tranche of apartheid legacy beneficiaries who are in complete denial about their continued discordant privilege despite their relatively modest abilities and their chauvinist insistence that success must at all times be framed in terms of their narrow cultural or class paradigm.
This obtuse, self-righteous mindset is prevalent across the comment sections of mainstream media and often in the articles themselves. Much of which can be ascribed to the baseless intellectual arrogance of many white South African professionals, who are generally not nearly as well educated or well read as they care to think. The not-so-inimitable Andile Mngxitama is usually guilty of nonsensical verbiage, but he did recently come up with the salient point that white South Africans are generally more confident and eloquent in the expression of their ignorance than black South Africans.
*Neo-liberalism: to avoid any potential confusion, we use the term neo-liberalism in the
current sense of a radical and laissez-faire capitalist set of ideas. What it means in reality is the swapping of one tyranny (usually that of the socialist state) for another, the untethered power of multi-national corporations.
**Carpetbaggers: In contemporary terms, carpetbagger refers to roving financial opportunists, often of modest means, who spot investment opportunities and aim to benefit from a set of circumstances to which they are not ordinarily entitled.