You don't need a faster horse!

Wednesday, 17 August 2011

My first car was a Peugeot 504. As a student with almost no income, I had to do much of the maintenance myself, including changing the oil. The drain plug on the sump of the 504 required a special tool; a square key (similar to the Allen or hex wrench principle) needed to be inserted into the plug to unscrew it. The key cost a lot of money, and could only be used for opening the drain plug on a Peugeot — an expensive solution to a simple problem.

My uncle Bali – a self-educated backyard mechanic – realised that the shape of the key was very similar to that of the metal shaft that fits through most modern doorhandles. He removed a doorhandle, found that it fitted perfectly into the drainplug, and used that to open it and drain the oil. When he was done, the tool went back to being a doorhandle.

I’ve told this story many times over the 25 years since my uncle passed away because it is a story that’s worth telling. Most people are informed by what they know, not by what they can imagine. As Henry Ford said: “If I had asked my customers what they wanted, they would have said ‘a faster horse’.” The best answer to a problem is not necessarily to be found in conventional wisdom.

For years under apartheid, the government was the biggest thing that anyone knew. It was the single biggest employer, the single biggest source of technology, the single biggest source of information, the single biggest source of largesse for some, and the single biggest source of terror for the rest of us.

Fifteen years after the official end of apartheid, our government fires its most intelligent leader (I’m talking about Mbeki.) (And I mean Thabo, not Moeletsi.) The new guys come in, a global meltdown hits, and we find ourselves facing the problems of a collapsing health care system, a collapsing educational system, and rampant unemployment.

So what do our leaders do? Firstly, they drastically increase the size of government (by appointing more ministers). Then they begin throwing money at every problem. Then, they start running out of money.

They are doing exactly what the apartheid government did, but trying to do it better. Yes, they are trying to build a faster horse.

I had dinner a few hours ago at the home of Virendra Gupta, India’s High Commissioner to our country. India celebrated its independence day this week with the announcement that they are on track for at least 8,2 percent economic growth this year.

That’s right. While global economies are in meltdown, India is ploughing ahead. India is now the fourth largest economy in the world, and late next year will overtake Japan for third place.

There are now more than 100 Indian companies with a market capitalisation of more than a billion dollars each. And 125 Fortune 500 companies have research and development bases in India.

But its not just the economy: population growth has slowed dramatically to 1,5% today from 2,2% in 1980. Literacy levels have shot up from 52% in 1990 to 80%. The middle class has exploded from 65 million people in 1980 to 368 million people today. And poverty levels have declined from 46 % in 1980 to 16 % today.

And all government had to do to make this happen was get – out – of – the – way !

In the 90s, India began industrial deregulation, privatised state-owned enterprises, and reduced controls on foreign investment and trade. As a result, expats flooded back into the country bringing expertise, money, and jobs. No quotas.; no BBBEE; just a better life for all.

Yes, Mr President. It really is that simple. You don’t need a faster horse. You just need to get off the one you are on. It’s too high.