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DA: Statement by Pierre Rabie, Democratic Alliance Shadow Minister of economic Development, on COSATU (17/09/2009)

17th September 2009

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Cosatu's call to nationalise the food industry is economically incoherent and will inflict untold damage on the economy in general and the poor in particular. It is the idea of an organisation that is economically illiterate and selfish; and amounts to nothing more than superficial political rhetoric which reveals their true intent: to protect their own interests and the interests of their members at the expense of those people who desperately need to be uplifted. It should be condemned in the strongest possible terms. Cosatu is the ANC Youth League of economics: unthinking, devoid of content and warped by personal interest. If the food industry were nationalised the consequences would be simple and devastating: the lack of competition would quickly see food prices rise - a development which would hurt the poorest of the poor first and most acutely - and the ANC government, which struggles even to deliver electricity, would systematically destroy a vibrant sector which, although it has problems, functions with an efficiency the state will never be able to compete with. It is also completely financially unviable. Just like the call to nationalise the mines, the cost of buying out the various retailers in this sector would be astronomical, certainly way too much for anyone to consider the idea to be anything more than completely mad. If Cosatu and the ANCYL had there way, we would be living in the Soviet Union in the 1930s. Everything would be run by the state: the mines, the health care system, the food industry. We would wake up in the morning and have to phone our local councilor for permission to get out of bed. To put the idea into stark terms, imagine the ANC was responsible for running your local corner café, and remember, this is the same party that cannot manage anything from a multi-billion rand parastatal to the Robben Island museum. These ideas are the consequence of the tri-partite alliance's obsession with power and control and their absolute lack of respect for individual choice or freedom. Seen in this light, Cosatu's proposal is nothing more than an insult to the South African people. It seems to believe South African citizens are passive victims, unable to make decisions for themselves. Like all rational people, the DA acknowledges that food inflation has been particularly resistant to the general slowdown in inflation - and structural problems such as industry collusion and weak infrastructure have certainly contributed to this problem. But this can be addressed by proper oversight by the authorities such as the competition commission and by improving our port-and-rail system. To put the state entirely in charge of resolving the issue would only but guarantee the problem would worsen and worsen dramatically. The DA supports the competition commission in this regard and proposes that the funding towards the commission should increase in order for it to investigate collusion into food prices more effectively. This is a very direct and simple way to lower food prices, and is not a pie in the sky idea like the Cosatu proposal.

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