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PROPERTY RIGHTS AND PROPERTY WRONGS

PROPERTY RIGHTS AND PROPERTY WRONGS

The current expropriation debate demonstrates Nassim Taleb’s observation: news adds noise while it subtracts information, so that the more newspapers you read, the less informed you become (Taleb, Antifragile, 2013). Former Business Day editor Tim Cohen has confessed for instance that “sometimes in the national debate you just don’t know where to start”. However, this bewilderment did not prevent him from confidently denouncing the National Assembly’s current acceleration of property rights reforms as a “desperate, terrible historical mistake” (5 March).

Then came more noise in “expert” guise, when Pieter Niehaus, head of real estate at the law firm, Norton Rose Fulbright SA, warned that “If expropriation without compensation is passed into law, it would give rise to serious difficulties both for property owners and banks which lent money against security over properties” (Fin24, 1 March 2018). Again, none of that is true. But in order to grasp this, one needs to look past the fake “current affairs” discourse of the last few months and instead align the track record of the last twenty-four years against the anti-apartheid critique of the decades before that. I do so below.

New Rights Property rights transformation under the 1996 Constitution began promptly with section 3 of the 1998 National Water Act, afterwards replicated by section 3 of the Minerals and Petroleum Resources Development Act of 2002, which consolidated an approach that is long overdue to go viral in urban and rural land reform.

The intellectual heavy lifting on the associated constitutional and practical challenges was done twenty years ago. Today’s ideological “Fight Back” by such voices as Cohen, Niehaus and Tony Leon is in truth a pale echo of the more formidable opposition such constituencies (including Leon personally) mobilised twenty years ago, when they first lost these same debates. EFF Chairperson Dali Mpofu shrewdly made this point in debate with the present day DA. (Dali Mpofu@16:28: “we did it with water”: https://www.youtube.com/watch?v=-vsjm0xHrS0).

The current sociology of discourse has entered a pre-Polokwane “time warp”, complained Nicole Fritz, who founded the US State Departmentfunded Southern African Litigation Project and is currently CEO of the Rupert-funded Freedom Under Law (on FUL’s funding, see “Law and Dogma: The Illiberal Elite”, Mail and Guardian 23 October 2009). In an ironic illustration of the difference between durable truth and noisy news, Fritz deleted her own 11 March tweet on March 12th.

As the power of South African public discourse turns away from the “mainstream” propaganda of such “regime change” NGOs as SALC and FUL, and back towards such irrepressible historical claims as land rights, our past is indeed our best resource. The property owners and banks to whom Niehaus refers would therefore do well to examine – and then to tweak rather than tweet – the basic approach set out in section 34 of the National Water Act, read with Part 8 of the same legislation. The net effect of these provisions, from the analogous water rights context, is that once the law comes into effect, the existing pattern of land use and security would remain transitionally unchanged, while designated priority areas of “resource stress” are spotlighted for urgent transformation in accordance with available administrative capacity, socioeconomic urgency, and related factors.

Meanwhile, Niehaus will discover that the practical requirements for orderly and bankable land leases are already set out in principle, by analogy and implication, in sections 27 and 28 of the National Water Act. Beyond the hysteria of the news cycle, he might apply his mind to such concrete questions as: should we, for the land context, tweak the Water Act’s stated maximum 40 year tenure cycle? Would 80 or 99 years be preferable in land? In truth, despite journalistic and “expert” noise, the introduction of a finite time-bound land leases merely aligns local urban and rural tenure with the ancient wisdom of the United Kingdom, a jurisdiction ordinarily beloved of local illiberals. As Niehaus might readily learn from his London colleagues, it is utterly commonplace in London property markets for timebound leases to pass between buyer and seller, with the underlying freehold separately and continuously held (infractions or as a whole) by a third party aristocrat, entrepreneur or individual. Far better to have the state as third party custodian in the public interest.

UK property markets are, moreover, demonstrably able to price both long and short term leases, across all land use and market price segments. Buyers of opulent Belgravia property for £20 to £30 million, for example, generally take a mere long term lease, with the freehold rights retained by aristocrats such as the Duke of Westminster, or by third party entrepreneurs (see “Who Owns London”, Evening Standard, 2 April 2002: https://www. standard.co.uk/home/who-ownslondon-6308427.html.) Such leases may even remain saleable with less than a year to run, albeit at an appropriately drastic pricing discount (and often for cash buyers only), such as the following Belgravia bolt hole that was on a London property website in February 2018 at £295,000, a calculated fraction of its longer term value: http://www.rightmove.co.uk/property-for-sale/property-64147759.

Html By contrast with the foregoing, Business Day’s rather breathless package of “Seven articles that you must read to understand land expropriation” (2 March, 2018) offered more noise and less information than its readers would have received had they instead quietly delved into London property markets today, the water rights reforms of twenty years ago, or venerable antiapartheid truths from even further back, to which I now turn.

Old Wrongs The anti-apartheid movement, more than any twentieth century cultural or political formation demonstrated the stark difference between property rights (legitimate ownership) and property wrongs (primitive accumulation). The 1996 SA constitution, and especially its property clause, deliberately rights these wrongs.

“The Historical Injustice” (1978), by Thabo Mbeki, is the anti-apartheid movement’s modern critique of apartheid’s expropriations, beginning with, and moving beyond, Marx whom Mbeki quoted: “the expropriation of the great mass of the people from the soil, from the means of subsistence and from the means of labour, this fearful and painful expropriation of the mass of the people forms the prelude to the history of capital.” Speaking shortly before the apartheid regime’s Wiehahn Commission recommended recognition of black trade unions, Mbeki contrasted the evolution of British capital on its UK home ground, through progressive voting and trade union rights, against the intensification of primitive accumulation in South Africa:

Here [in SA], the capitalist inherited the rights of the feudal lord and appropriated to himself the right to determine where, when, at what price and under what conditions the African shall sell his labour power to the capitalist. He also appropriated to himself the right to decide ‘what is good for the native. (https://www.marxists.org/subject/africa/anc/1978/historical-injustice.htm) Against this backdrop, the ANC designed the Truth and Reconciliation Commission as a platform for the transformative public discourse that would in turn fuel the radically antiapartheid 1996 constitution, for transformation of apartheid property and other relations. This TRC design was set out in the ANC’s August 1996 submission to the TRC, and was amplified in Reconciliation Through Truth: A Reckoning of Apartheid’s Criminal Governance (1996) which Kader Asmal, Louise Asmal and I published four months after President Mbeki launched the 1996 Constitution, and an associated poetics of reconciliation-as-transformation, in his “I am an African” speech in the National Assembly. Mbeki followed up by speaking at the launch of Reconciliation Through Truth, a text that carries the only Foreword that President Mandela ever published under the formal letterhead of his Presidential office.

It is necessary to belabour this lineage because the noisy amnesiacs of twitter and the talk shows now seek to rewrite the 1996 Mandela- Mbeki ANC as an ideological captive of sentimental togetherness. They for instance conflate Mandela’s ANC with Desmond Tutu’s Rainbowism. Such critics need at least to reckon with the actual historical record, in which the ANC vigorously contested where Tutu and his Deputy, Alex Boraine, ended up in their final TRC report. (I will address these larger tensions between TRC and ANC visions for reconciliation in a subsequent instalment of this series; here the focus is upon property rights alone).

Reconciliation Through Truth contained a dedicated chapter on the need to “place property upon a legitimate footing”. It emphasised that “existing property distributions in South Africa are saturated with the logic and history of white supremacy”. The book expressly problematized “innocent” beneficiaries such as a young couple who were attracted to Triomf (formerly Sophiatown) by “[t] hese brand new houses around R5000 each” and who asserted: “our move here was not politically oriented, we were just poor young folk who bought here because we could”.

Tony Leon’s illiberals of course defended the accumulated property wrongs of apartheid, seeking to dignify these as “rights.” This “Fight Back” gambit obliged the Asmals and I to remind Leon, in our book, that “in a comprehensive sense, apartheid denied property rights not only to blacks but ultimately also to whites”. We wrote in 1996: for whites, apartheid abolished merit. It delinked pay and performance. It therefore removed the possibility of legitimate rewards for effort, an idea that is integral to the concept of property – the idea that separates property from theft.

This is what Democratic Party leader Tony Leon overlooks in saying that his ‘policy and political approach commences with an understanding that the quality of a person’s life will approximately reflect the quality of effort you put into it.’ That can only be a statement about some utopia elsewhere; it certainly does not apply to South Africa’s past nor (as yet) its present. Under apartheid blacks were dispossessed while whites had possessions, but not property. Only now, in the new South Africa, is a regime of property rights dawning for the first time. As it dawns, black dispossession and white possessions will require orderly and sensible realignment. These goals are reflected in the property clause (section 25) of the New South African constitution . . . [which we then cited verbatim and analysed in the manner that journalists have very belatedly begun to do] . . .

Beyond fine rhetoric, this promptly became the live constitutional logic of the 1998 Water Act, which duly nationalised water rights without compensation. A similar logic can be seen in the EFF’s credible multi-step methodology towards “Expropriation of land without compensation for equitable redistribution”: https://www. effonline.org/on-land Whatever its populism and offensiveness on numerous other issues, this specific EFF policy statement on land rights in fact credibly approximates the pre-Polokwane ANC’s own constitutional analysis on water rights, from which the Zuma-era ANC had gone adrift. When journalists such as Stephen Grootes stereotype the EFF as simplistically populist on this particular issue, they are yet again elevating noise over information (Daily Maverick 23 March, 2018): https://www.dailymaverick. co.za/article/2018-03-23-analysisthe- eff-vs-………….-insert-nextenemys- nameacronymdescription/#. Wrf4HbaZPOQ New Normal Genuine radicalism, unlike simplistic populism, becomes the new normal. When Helen Zille disingenuously thanked farmers for their supposed “donation” of massive water rights during the recent water crisis, she paradoxically underlined the DA’s longstanding intellectual surrender in the constitutional jurisprudence, if not in political rhetoric, of water rights.

Farmers will doubtless shortly “donate” land in the same way, reconciling themselves to a revised place within a transformed national consensus. By contrast, Andile Mngxitama tweets that “Land expropriation without compensation which doesn’t upset the agricultural sector is like beer without alcohol”. One final curiosity cannot be evaded: why didn’t the pre- Polokwane ANC complete, in the land sector, what it achieved in water (1998) and in mineral rights (2002)? As late as July 2017 (!), Derek Hanekom, who as Land Affairs and Agriculture Minister had clashed with Asmal on the property rights analysis inside the Mandela Cabinet, was still characterising nationalisation without compensation as “rubbish”, “seriously unjust” and “nonsense”. Hanekom was reshuffled from harm’s way after the 1999 election, but this then inaugurated all manner of contestation between his and other old and new guards in and around the Land Affairs Department, the Land Bank, and so on (See Marinda Weidman, “Who Shaped South Africa’s Land Reform Policy,” Politikon, November 2004). Then, as such contestation subsided, Polokwane fatefully intervened.

The upshot, as has been widely noticed, is that substantive land reform peaked in 2008 and then sharply dropped off, alongside the rise of intoxicated rhetoric, since then. In 2006, President Mbeki had explicitly announced the review of the “willing buyer, willing seller” principle (Fin24 3 February 2006). After Polokwane, he reiterated the need “to speed up land reform” (property24, 8 February 2008). He has returned to the point in the El Pais interview, now. We therefore continue to count the costs of the ten lost years of corrupt and demobilised statecraft since September 2008.

By Ronald Suresh Roberts

This article has previously appeared on The Thinker Journal, its has been republished with permission

PROPERTY RIGHTS AND PROPERTY WRONGS