Polokwane win slowed growth to crawl
ANC leadership upheaval at Polokwane in 2007 marked a switch towards a more interventionist economic role from which SA has yet to recover, writes Gavin Keeton
Rival ideologies complicate the already complex challenge of addressing SA’s numerous economic problems. Rival positions are defended resolutely, even against evidence to the contrary. One view claims that many of SA’s problems can be traced back to the decision in 1996 to constrain government spending. Lack of funding, critics of this decision argue, hobbled subsequent efforts to address our education, housing and infrastructure needs. Counterarguments — that inefficiency and poor allocation of available funds were equally responsible — are stoutly resisted. Central to the debate is the Growth, Employment and Redistribution (Gear) strategy adopted in 1996. A key priority of Gear was to help SA escape the fiscal debt trap inherited in 1994, thereby freeing resources for urgent social needs. A debt trap occurs when borrowings and their interest repayments rise relentlessly. Governments that have overborrowed find themselves in this position. Rising interest payments cut into the fund...
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