“All things at Rome have their price.”
A quote from Juvenal’s latin lamentation about the sorry state of affairs of his home city in the 110 CE satirical verses, Satire. It describes a city of thieves and liars, where the poor are increasingly shunned and the rich shower their patronage on those that know their guilty secrets.
It is not a piece one would expect many of the State Capture protagonists to have read. There is a tendency to ignore the historical record in these circles, believing instead in the absolute novelty of our current circumstance. We are, of course, the only land to have ever lived through the rise and fall of a nation state.
The chronology of the South African governance project since 1948 can be loosely summarised as: Looting. Flash in the pan prosperity. Looting.
We are, of course, some of the best extractors in the world. Our Golden City, built on the basis of economic exclusion, formed the bedrock of our society, and pioneered the capitalist explosion on the Southern Tip.
Surely then, it cannot come as a surprise that the current cohort of conspirators have simply repeated the feat: maximum gain, limited pain (for themselves), writing the next chapter of the sordid tale a’loota continua.
As a professional hob-nobbing in the public accounting sphere, I am well aware of the importance attributed to price. It is the meeting ground of demand and supply. The watering hole where pedlars and purses perform the parlous act of value exchange. Adam Smith called it the Invisible Hand, a self-regulatory mechanism that purportedly ensures human prosperity through human pursuit of their own whims.
It is a well documented process that has dominated the modern era, and is largely considered responsible for human population explosion and all of the commensurate costs involved.
During the hob-nobbing described above, today’s conversation often diverts to KPMG, the blue boxed sink-hole blighting all of our professional designations. Particularly, I find that there is a continued lamentation about the plight of all of the “good people” in that organisation that are “unfairly” tarnished by the actions of a few. The argument generally runs that they are paying a price for an action they action they never committed.
KPMG did pay a price, to be fair. That price was the full reimbursement of all Oakbay audit fees as well as repaying earnings sourced from the infamous “SARS Report”.
So there we have it. KPMG has repaid what it made. The top dogs have all resigned (with severance pay, of course). Leave everyone else alone. They did nothing wrong.
But is that really the price we should demand? Put another way, what was the actual cost of the firms actions?
KPMG was paid R23-million to rubber stamp the wrecking-ball that Tom Moyane used to demolish SARS. Ignoring the fact that R23-million was earned from one rubber-stamping exercise, one has to wonder at the real cost of a purchased professional opinion.
Jacques Pauw, in his SSA endorsed book The Presidents Keepers, has started counting that cost, with countless billions lost after the investigative capacity of our revenue collector was disembowelled. Case after case is described in tear-jerking detail, invariably concluding with the bad guys winning at the end. Tobacco smugglers, gang-bosses and drug dealers, once doggedly pursued by SARS, once one of the best revenue collecting authorities in the world, now roaming free with a skip in their step. It is a sorry tale of Guptas, Zumas and their nefarious friends not paying their dues, all the while stealing the dues of others.
This complete disregard of our state-building capacity by the politically connected has blown a hole in the fiscus. Revenue collection projected for the 2017/18 financial year puts South Africa Incorporated at R50bn below budget. To put that in practical terms, Judge Dennis Davis and his tax wonks estimate fee-free tertiary education would cost R60bn per year. A R50bn revenue shortfall means that there is another #FeesMustFall festering somewhere in our system. And if Zuma decides to heed the student’s call and make university education free, there are about to be two massive holes to plug.
#SASSAGrantFreeze? #BringBackOurWater? #WhereAreOurARVs?
Thank goodness Twitter has bestowed an additional 140 characters on us. We’re about to have a whole lot more to complain about.
Put simply, KPMG loaded the gun that Tom Moyane fired.
Since then the firm has scrambled to gather the shrapnel, but the horse has bolted.
How then should we count the costs of their actions?
What is the price of the RDP house never received by Ma’Khumalo because government ran out of money to build her her rightful home 25 years after it was promised? What is the price of the Bryson April’s future, once a talented six-year old with a flair for mathematics, now thirteen and mired in gang-warfare as he tries to protect his family from extortion? What is the price of Thabang’s broken heart, as he watches his mother queue for the ARV’s that are always another week delayed at the clinic in Umlazi?
This is what subverting state capacity looks like.
Perhaps the question is, could KPMG pay such a high price? Or is our society once again left to fit the bill for their greed?
Global capitalism, and the neo-liberal policies underpinning it, has been forced into a decade of introspection. On the back of an ardent rejection of globalisation in two capitalist strongholds, America and the United Kingdom, a new settlement is being negotiated. Democracy has kicked its bedfellow in the teeth, with free-movement swapped for high walls and international trust traded for suspicion.
South Africa is not immune to these global shifts, and as we slowly reckon with the growing pains of our new democratic dispensation we have also been brought to our local negotiating table. Now that we’re here, we have to be very clear with one another about the society we have agreed to build.
Perhaps, then, this is the time to put a price on our democracy. What does it actually mean to us?
If we let corporations like McKinsey, KPMG and SAP keep an open shop on our shores after so brazenly undermining our sovereignty, we will have thwarted our democratic project before it has properly begun. Bribery and corruption should be dealt with in the most definitive terms, so that the price of these actions is far higher than the reward from committing them. Companies unwilling to play by the rules we set should not be allowed to play at all.
Price is the watering hole where buyers and sellers meet. If we as a country are selling democracy, then we need to make sure it holds real value. Governance “for the people” cannot simply be a catch phrase, and those that subvert this ideal should not be allowed to stay.
We sent Bell Pottinger packing. The Gupta’s are on their way out.
Now is the time to be clear to KPMG.
If you’re going to do business here, you’ll do it clean, you’ll do it transparently and you’ll do it according to our rule book. Otherwise, there is a scrapheap of corporate calamities just waiting for their latest addition to the pile.