To Nationalise or Not To Nationalise (?).

The subject of nationalisation has sparked quite a significant amount of controversy.While ANCYL president,Julius Malema,believes it is an effective strategy that can be used as a tool to combat the country's staggering unemployment rate,SA Chamber of Mines and BHP Billiton South Africa president,Xolani Mkhwanazi,maintains-and I quote-that it is an "obsolete ,unsuccessful intervention" that should be reconsidered.He is quite adamant that there are numerous other policies that the government can utilize to proliferate our somewhat unstable economy and thus create employment opportunities.What strikes me most about Mr.Mkhwanazi is the inadequacy of his argument:He does not substantiate-unlike his counterpart ,Mr.Malema-why he personally believes nationalization's futile,nor does he mention the so-called alternative policies that the government can resort to,other than nationalization.

What a lot of people are not aware of-Xolani Mkhwanazi included-is that nationalization was Nelson Mandela's primary economic objective when he was released from prison more than two decades ago;it is a policy that has always been a component of the ruling party's (ANC) manifesto.Alas,the reason why it was not implemented initially is that the pathetic apartheid government had left the country in so much financial and economic turmoil,that such a policy was hitherto just not realistically feasible.The country's GDP has expanded quite substantially since then and our economy has subsequently drastically improved;parastatal ownership of private entities is arguably financially feasible.

Unemployment and poverty are undoubtedly two ginormous problems that the state is struggling to resolve-not to mention that they are the primary constituents of crime.Now, to resolve the aforementioned monumental problems would require a solution of equal magnitude;a policy that will create huge amounts of employment opportunities. It seems that people do not completely comprehend the concept of nationalisation.I say so because everytime the notion is discussed,people always ask the same question:how will state ownership of enterprises bring about employment opportunities?The answer to this economically daunting question is quite simple and matter of fact and I will explain it by comparing nationalisation with privatisation:Public enterprises are productivity-and service-delivery driven.Yes,making profits is also an objective for such enterprises,but it is not their main objective.Their primary objective,on the contrary,is to expand and maintain productivity levels;this requires them to deploy a huge amount of human and other types of resources.The need for human resources is good for the country because it means employment opportunities for the populace.Private enterpises,on the other hand,are porift-driven,have a relatively minimal need for human resources,and usually have very stringent employment criteria,thus making it extremely difficult for most of the populace to get jobs.

So,it is apparent that Xolani Mkhwanazi's criticism of nationalisation-that it is "obsolete" and "unsuccessful"-is irrefutably unsound!

Conclusively,the above comparison of the two contrasting economic models poses yet another economically daunting question:Which economy is more viable,a profit-driven or a productivity-driven one?