OPINION: We have not moved on from Milton Friedman’s mantra that ’the social responsibility of business is to increase its profits’, writes Dr Pali Lehohla.
By Dr Pali Lehohla
WE HAVE since not moved on from Milton Friedman’s mantra that “the social responsibility of business is to increase its profits”.
We know that the planet and people are important and statisticians have known this for a while.
In this regard, national statisticians developed a set of measures. With its system of environmental economic accounting, the UN Statistics Commission, through statistical country programmes, has created a framework for measurement that allows the voice of the environment to be heard.
This probably comes too late because communists, socialists and capitalists alike have raped global natural resources beyond recognition in their quest for development.
They are now crying about climate change.
The unjust consequence is that Africa has to bear the brunt of this rapacious use of resources and is being denied access to energy under the guise of saving the planet through a “just transition” façade.
In the light of the evidence before us, it is impossible that the Ps of people and planet matter in the just transition energy façade. Let us introduce the genesis of the problem.
The idea of the Overton window of political possibilities becomes relevant when change that was on the margins of policy suddenly becomes centre stage and makes what formerly seemed impossible inevitable.
In the just transition façade, what appeared to be the impossible becoming the inevitable has been scuppered by the Russia-Ukraine war.
It has revealed the underbelly of capitalism. It has dramatically revealed the most important P – profit. That remains the dominant motive.
The other two Ps of planet and people are for the triple-F of family, friends and fools. The mantra of double-G for “greed is good” has never been as glaring, thanks to the Russia-Ukraine war that exposed this position.
The case of South Africa with its abundant coal in this global energy crisis is one of family, friends and fools.
And in this regard what is good for the goose is not good for the gander. We again see this in coal.
We act in haste to close down our coal-fired plants while Europeans have opened all their coal-fired power stations. South Africa is failing to demonstrate acting in the national interest even where it is justified. This is hypocrisy, if not national foolishness, beyond measure.
In the 1987 film Wall Street, the character Gordon Gekko said: “The point is, ladies and gentleman, that greed – for lack of a better word – is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed in all of its forms – greed for life, for money, for love, knowledge – has marked the upward surge of mankind.”
Gekko was building on the influence of Milton Friedman, a Chicago economist. Friedman demonstrated how the Overton window works.
Our refrains and exhortations on vaccine nationalism and dirty-energy nationalism are based on Friedman’s ideas of “the social responsibility of business is to increase its profits”. We have not since moved on from this mantra.
So quite unsurprising, yet uncritical of Milton’s mantra, are South Africa’s targets for sustainable development goals, which are rather timid.
They fail to condemn this philosophy of solely maximising return to shareholders and wherein regarding any benefit to society as merely accidental collateral.
The collapse of Enron was a classic example of greed, as was the 2008 financial crisis seven years later.
As for South Africa, the Zondo Commission has beyond any doubt shown the consequences of greed. It has collapsed the nation. Yet South Africa walks the same path in its policies today..
A recent mea culpa in a parliamentary hearing made by the acting director-general in the Treasury, Ismail Momoniat, on the follies and unintended consequences of the Public Finance Management Act reflects how cut off from different ideas our policies are.
The ANC’s sixth policy conference offers no better, and we can therefore expect yet another mea culpa at the end of the next three decades.
That energy policies have not become emergency deliberations in the light of Europe’s thirst for coal shows how greed continues to deafen and blind South Africa in matters that matter.
* Dr Pali Lehohla is the director of the Economic Modelling Academy, a professor of practice at the University of Johannesburg, a research associate at Oxford University, a board member of Institute for Economic Justice at Wits, and a distinguished alumnus of the University of Ghana. He is the former statistician-general of South Africa.
– BUSINESS REPORT
