The Africa Review in Five highlights African current affairs from a Christian perspective. Listen and subscribe through Youtube, Apple Podcasts, or Spotify.
Today is Tuesday, August 8th, A.D. 2023. This is The Africa Review in Five, written by David de Bruyn and presented by Yamikani Katunga.
No Satellite Internet For South Africa Because of Racial Quotas
Elon Musk’s company Starlink, provides high-quality internet service via satellite to most places on earth. Many African countries have signed agreements with Starlink including Kenya, Nigeria, Rwanda, and Mozambique. It is likely that most of the African continent will have issued licenses to Starlink by the end of 2024. But not South Africa.
South Africa has written into its law that an internet provider must be 30 percent owned by historically disadvantaged people, which by South African definition includes black people, women, the disabled, and youth. Communications Minister, Mondli Gungubele, has said that this is the issue holding up the granting of a license to Starlink.
Like any investment in a country, Starlink would bring in tax revenue, create jobs, and give access to the internet to those in rural areas, increasing their educational and employment opportunities. More competition among internet providers would mean lower prices for the South African consumer and more money in their pockets. Why hold on to a law about racial quotas when it appears to only negatively affect the economy?
Many of South Africa’s politicians are in the grip of an unbiblical view of economics. A common African perspective is that there are not enough good things for everyone to enjoy them. This is the idea that wealth can only be distributed, not created. It’s as if the world is like a pie. When someone takes one slice, there is not enough for others. Therefore, government must step in to control how the pie is sliced. Government must act like the guardian of the economy, controlling prices, setting minimum wage laws, protecting labourers, and creating racial quotas for employment. This is all done out of supposedly benevolent motives: to help those who are impoverished. But government interference in an economy seldom ends up looking like what they intended. For example, by forcing employers to pay a fixed minimum wage, several negative effects occur.
First, if the value of the labour is less than the minimum wage, employers employ fewer people and make the ones they do employ work more. There are now fewer jobs, and those with jobs have worse working conditions. Second, an ‘informal’ employment economy develops, where labourers who are competing for labour vastly underbid the minimum wage. These labourers are probably working for less than they can afford, but some wage is better than no wage. Or, in the case of racial quotas, companies sub-divide into multiple small businesses that evade the quota laws, or they get contractors (who charge more) to perform part-time what would have been done full-time. In some cases, the quotas are fulfilled, but at a higher cost to the company with shadow positions created to make up for the skills shortfall, which means less profit, which means lower wages for those employed, and less money in the economy.
The unseen damage and financial drain on the economy are masked by the fact that it superficially appears as if more blacks, women, and disabled people are getting jobs. But the numbers do not lie. South Africa’s unemployment rates were at around 19 to 21% from 1991 to 2010. By 2023, it was at 32.9%. You can legislate all you like, but businesses will vote by hiring and firing. Economic reality trumps economic ideology
100% of the time.
Does the Bible call for governments to control the economy? A brief tour of Proverbs gives us several roles for government. They are to discourage evildoers from their evil (20:8), find out and punish evildoers (20:26), remove evildoers (25:5), rightly condemn the wicked and not vindicate them (17:15, 24:23-25), promote justice (14:34), and protect life (24:11-12, Gen 9:6). Nothing in there about the economy.
The New Testament tells us in Romans 13:1-6 that governments are to reward and honour citizens who keep the law and defend those who could be hurt by other citizens or nations. The Bible’s mandate to governments is to keep law and order so that citizens can get on with trading in a free market. Of course, a free-market economy is not enough to guarantee wealth. Complementing a free market must be a culture of thrift and hard work, equality before the law, the rule of law through the punishment of evildoers and the rewarding of the honest, limited government, and individual liberty.
These are the effects of Christianity on society, and therefore, a free market requires Christianity’s influence to maintain its freedom. The president of Ghana and the president of Ivory Coast made a famous bet in the 1960’s when they both received their independence. Ivory Coast bet that they would have more wealth and prosperity than Ghana in the next generation because Ivory Coast had a commitment to a free market, while Ghana had a government-run economy. Of course, Ivory Coast by 1982 had so far surpassed Ghana that the poorest had higher incomes than the majority of Ghanaians. This situation was reversed when the next generation of politicians in both countries adopted the system of the other.
We pray that South Africa’s leaders, for the good of their people, would follow their God-given roles, and pursue what wisdom, history, and common sense have taught about wealth creation.
And that’s it for The Africa Review in Five on this Tuesday, August 8th in the year of our Lord 2023. Subscribe to the Missionary Minds podcast on Spotify or Apple podcasts. I’m Yamikani Katunga. Be not weary in well-doing.
It is so true.. But it is beyond Africa leaders to understand this concept. Lets hope and pray that a new generation brings wiser leaders.