BY SEAN DARGE
Dawie Roodt believes South Africans are chronically misinformed about their economy. In Tax, Lies and Red Tape: Confessions of an Unreconstructed Neoliberal Fundamentalist, the book he has written with Linette Retief, he is determined to change this, discussing the economy’s macro and micro elements and possibilities with playful thoroughness.
In this accessible diagnosis, Roodt describes what he believes are the causes of South Africa’s ailing economy and offers readers a muscle-relaxant for the tightening grip of “South Africa’s three great evils”: unemployment, poverty and inequality. The book discusses the opposing economic and ideological pulls in South Africa by first providing an historical account of the emergence of capitalism, followed by a caustic rebuff of communism. This truncated economic history lesson is important, as the solutions which Roodt proposes for South Africa’s economy take stock of what hasn’t worked in the past. Indeed, Roodt is unforgiving of those in South Africa who cling on to antiquated economic principles: the successes of free market precepts are highlighted and presented (generously) as the panacea for South Africa’s stalling economy.
Roodt animates his explanation of economics by grounding theory in examples which stretch right around the world, demonstrating the inefficiencies produced when Adam Smith’s invisible hand is strong-armed. The reader is inducted quickly into the theories which give weight to our rands; through easy economic-speak Roodt tries to catch you up on everything essential to holding your own against a second year economics student. Roodt is able to communicate ideas and consequences of economic theory simply, without patronising the reader or obfuscating meaning through his reductions. This shouldn’t be surprising given his past experience as economics editor of Finweek and nine years spent as an economist at the South African Reserve Bank. He has translated knowledge gleaned from working in the central nervous system of the South African economy into deliberations on the fiscus, the labour system and the state’s functions. He proposes solutions for government debt and, cheekily, proposes reforms to the central bank.
Roodt’s explanations of monetary policy and the immediate impact it has on South Africa is essential reading for the economic novice, or for those who want a quick and loaded projection of South Africa’s economy. You’re left feeling confidently familiar with economic theory despite having to negotiate the bi-polarity of policy approaches in South Africa’s economy.
Most interesting is Roodt’s predictions on future prospects for South Africa, where he is wearing his hat as Chief Economist of Efficient Group Limited. Appropriately concluding his argument, he offers a forecast of what South Africans will experience in respect of their demographic dividend and what this means for South Africa’s future prospects. Roodt presents how South Africa’s economic growth rates could accelerate due to a decline in fertility and morality rates, as well as considering the age structure of the population — providing insights for those concerned about youth unemployment especially.
While Roodt is confident of the proposals he puts forward to restore South Africa to optimal growth, he does urge South Africans to question those who purport to have all the answers to SA’s problems. His book empowers the reader with some knowledge of what to look out for when doing so.