The not-so-secret source of success we don't have

26 August 2018 - 00:00

Resilience. That's what two business mavens advised me was the secret sauce that allows SA to power on. Even with blackouts from Eskom and other travails from our failing state.
"Africa's grocer," as resilient Shoprite Checkers is dubbed, displayed some of this sauce in its annual results this week. Headlines trumpeted the word "disappointment" with the retail giant's first earnings drop in two decades. But the wonder in the bad numbers was that the group managed to increase its volumes and customer numbers at all.
Because, in the detail of the results, were numbers redolent of a "state of war", as the shopping giant tells it. It was hit in the financial year by 489 armed robberies, 13,200 products in deflation, a VAT hike, a sugar tax, the listeriosis crisis, and 150 trading days lost to protests. The wonder is not the 8% slump in its share price, but the fact that it trades at all.
The state charged to provide an enabling economic environment and basic services for both business and citizen is beginning to resemble Otto von Bismarck's put-down of late 19th-century Italy: "It has a large appetite but poor teeth."
Our government cannot ensure regular electricity or even basic sanitation at primary schools, or safely care for psychiatric patients. But its appetite to encroach ever further into the sections of our economy that actually work appears limitless: health care, private farms, and even the rare foreign firm actually wanting to invest here. All these our political masters want to control. Or anaesthetise. Or close down.
Across the Atlantic, US President Donald Trump careens across the Twittersphere on all topics, from farmers in SA to trashing his former lawyer. Just as he destroys the architecture of the postwar order, an extraordinary number was recorded on Wall Street: Apple became the first US company to hit the $1-trillion (R14.3-trillion) valuation mark. Less noted is the statistic that our whole national economy in 2017 was just $349.4bn. Our sovereign GDP is only about 40% of the strength of the largest US company.
It is difficult to know how the Trump whirlwind, particularly using coercive economic diplomacy to wreak revenge on foreign potentates who displease him, will affect global giants like Apple. Evidence suggests "this too shall pass".
One of the most interesting commentators writing these days is Bret Stephens. He is wise and eloquent, and impossible to classify with the binary rigidity we use here. Stephens is a mainstream conservative, but hates Trump, and now writes for the liberal New York Times. However, five years ago, from his perch at the impeccably conservative Wall Street Journal, he penned an essay "The Marvel of American Resilience".
In it he pondered why the most breakthrough innovations in the world - from planes to mobile apps - are all stamped "Made in the USA". His answer was not to be found in the paralysis of its politics and the shortcomings of its leaders, and this was years before Trump entered the White House.
Rather, the answer at the micro-level was personal: "In the US I can drink water straight from a tap, a policeman has never asked me for a 'contribution', my luggage has never been stolen and nobody gets kidnapped for a ransom." He added: "Americans have property rights (even to minerals under their yards)."
Five years later, he might have noted that an independent special counsel appointed by the US justice department has just secured the conviction of the president's campaign manager in the courts, and the president's former personal attorney has pleaded guilty to crimes relating to payoffs he alleges he made on behalf of Trump. None of this required years-long judicial commissions costing billions. Just dedicated and fearless prosecutors doing their work.
Space to innovate and flexibility to trade coupled with institutions more resilient than the whims of their leaders are the ingredients for this not-so-secret, but tested, source of sovereign success. Perhaps Checkers could stock it.
• Leon is a former leader of the opposition and former ambassador to Argentina

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