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Yes, inclusion will fix our woes; provided we define it correctly

01 December 2023 Gareth Stokes

The trouble with many political- and social-leaning inclusivity programmes is that they introduce exclusionary focuses to achieve their objectives. So, instead of defining ‘inclusion’ as the ‘the practise or policy of providing equal access to opportunities and resources for [all] people’, as the Oxford Languages definition begins, they append ‘who might otherwise be excluded or marginalised’ for a long, long list of reasons.

Include this, include that

Nowadays the word inclusion and the phrase ‘financial inclusion’ have been appropriated in doctrines and policies that seek to elevate segments of society on the basis of a current or legacy disadvantage. To illustrate, consider the following United Nations’ definition of inclusion, being ‘the process of improving the terms of participation in society for people who are disadvantaged on the basis of age, sex, disability, race, ethnicity, origin, religion or economic or other status’. The remedy, also enshrined in their definition, is to compensate the disadvantaged ‘through enhanced opportunities, access to resources, voice and respect for rights’. 

The problem, dear reader, is that in order to placate the ever-expanding definitions of disadvantaged people, all seeking some or other form of redress, businesses and governments are choosing to marginalise other segments of society. The former does so by, for example, implementing diversity, equity and inclusion (DEI) hiring practices while the latter doles out redress through countless disadvantage-based laws and regulations. In South Africa, the central disadvantage is race-aligned, stemming from the country’s well-documented Apartheid history. And indeed, the separate development policy contributed to the sorry state the country finds itself in today. 

Irony: policy designed to include through exclusion

One of the reasons today’s push for inclusivity will fail is that it seeks the upliftment of the disadvantaged at the cost of the so-called advantaged. Wherever you turn, you find policy designed to include through exclusion! At the extreme, you find the African National Congress (ANC) Radical Economic Transformation (RET) agenda, which seeks “the displacement of white racial domination, rather than the overturn of capitalism”, this comment from a piece by Roger Southall, who sought to answer: ‘What is the RET faction in South Africa?’. 

This rather lengthy opening sets the stage for some powerful insights from a November 2023 working paper published by Harvard University Professor Ricardo Hausmann et al, titled ‘Growth Through Inclusion in South Africa’. Prof. Hausman, who is recognised as a leading thinker about growth strategy, was recently interviewed by Ann Bernstein, an executive director at the Centre for Development and Enterprise (CDE). The two set about identifying the key reasons for the ongoing decline in South Africa’s economy, before postulating on how a sensible approach to growth and inclusion could improve outcomes. 

A lousy performance, on any benchmark

To set the scene, Bernstein asked the professor how South Africa was doing in terms of growth and inclusion compared to other developing countries. “The performance has been a disappointment, mainly to South Africans. In international comparisons the country has underperformed Sub-Saharan Africa, on average; it has underperformed mining exporters; it has underperformed upper middle-income countries … on any benchmark you choose, the performance has been lousy,” Prof. Hausmann said. He cited the country’s decade-long negative per capita income growth and high unemployment as indicators of its long-term underachievement. 

The report does a deep dive into two ‘classes of explanation’ for the country’s rather lacklustre growth and inclusion track record. The first, described as a structural element, is labelled ‘spatial exclusion’. “This is a structural [issue] that comes from Apartheid times; but almost 30-years since the end of Apartheid these spatial inequalities have not been overcome or even reduced; if anything, they have widened,” he said. One of the main drawbacks of this spatial inequality is that thousands of South Africans are cut off from economic opportunities. This exhibits in the influx of citizens from rural to urban areas, often into informal settlements close to cities, alongside countless other access-to-the-economy-related social ‘skews’. 

The collapse in state capacity

The second explanation is labelled ‘collapse in state capacity’. “South Africa was a fairly complex economy, meaning that it is an economy that incorporated a lot of knowledge in its production structures,” Prof. Hausmann said. In 2000, South Africa was quite close to China on a measure of how much knowledge is being incorporated in the economy but by 2020 it had slipped in the global rankings. In the context of a country that relies heavily on a functioning state for its success, the “generalised deterioration in state capacity” introduced significant constraints. The report delves into shortcomings in electricity supply; rail and port infrastructure; water and sanitation infrastructure; and security, to name a few. 

It also identifies four primary contributors to the ongoing decline in state capacity including political deadlock; entrenched ideology; the overburdening of state organisations with objectives beyond their core mandate; and political patronage. The first of these contributors stemmed from the landslide majority the ruling ANC has enjoyed in all national and provincial elections since 1994. “The idea that [political] power was entrenched and that [elections] were less contestable gave a certain feeling that there was no urgency around [structural and systemic challenges],” Prof. Hausmann said. 

How ideology blocks pragmatic solutions

Much has been written about the conflicting ideologies within the ruling party. The ANC relies heavily on the South African Communist Party (SACP) and the country’s trade unions for support, especially around election time, and remains married to its liberation struggle credentials. “Ideology has prevented pragmatic solutions to many problems,” Prof. Hausmann said. “For example, society had the capacity to fix the electricity problem; but ideology prevented the state from allowing that to happen”. To this day, the state’s overreach in the energy and resources fields continue to scupper new investments, sending much-needed direct foreign investment into friendlier markets. 

The overburdening of state organisations with objectives beyond their core mandate is more nuanced. It essentially stems from government departments and state-owned enterprises (SOEs) being pressured to transform, regardless of the consequence. “This led, in some instances to what we call ‘premature load bearing’ where municipal government is given a bunch of responsibilities for which they have no capacity, and on top of that, are given the responsibility of transforming society,” Prof. Hausmann said. In the SOE context, imagine being told to build roads, maintain railways or maintain the electricity grid in addition to achieving employment equity (EE) goals. 

Finally, political patronage, the extent of which was recently exposed to a horrified citizenry through The Judicial Commission of Inquiry into Allegations of State Capture, Corruption and Fraud in the Public Sector, also referred to as the Zondo Commission. This commission, which ran from January 2018 to June 2022, heard testimony from over 300 witnesses over 429-days of public hearings. Even if you had the time to study the commission’s 1.7 million pages of documentary evidence, you will struggle to come up with a better explainer for State Capture than that offered by Prof. Hausmann. 

We did not join the struggle to be poor

“In an environment in which you are using the state to transform society, and you are changing procurement rules, it is very easy for that process to be captured [and to] attract people into the political process that are not there for the public good,” he said. The attitude, dear reader, reflects in the comments and lived experience of  members of the country’s ruling elite, many of whom ‘did not join the struggle to be poor’. Returning to the ‘fixing South Africa through inclusion’ topic, the interview touched on the policy error of trying to make the top of society ‘blacker’ rather than making the bottom of society better. 

“The way the discussion is framed in many societies, is that we are unequal ergo we need to redistribute income; but we prefer to look at the sources of that inequality,” Prof. Hausmann said. In South Africa, inequality stems from an inequality in productivity, which in turn derives from various factors such as level of education, unemployment and the aforementioned spatial exclusion. “Instead of focusing so much on redistribution to compensate people for their exclusion we want to see investments to make sure that people get included,” Prof. Hausmann concluded. “Achieving growth through inclusion is going to be a win for growth and a win for reducing inequality”. 

To tie back to the headline of today’s op-ed. Yes, inclusion will fix South Africa’s woes, but only if we define it as ‘the practise or policy of providing equal access to opportunities for [all] people’ without any appended ifs, buts or maybes. Applying this definition, you will soon discover that truly inclusive economic growth also delivers on government’s narrow, exclusion-skewed transformation goals. 

Follow the writer on

LinkedIn: https://www.linkedin.com/in/gareth-stokes-media/

Twitter: @stokesmedia

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