Analysis
When Influence Trumps Ability Forget Investment
Written by Gavin Chait
In 1503, Giuliano della Rovere bribed all but three of the College of Cardinals in order to become Pope. The "investors" who allowed him to secure this position expected a handsome return on their financial support and, as Julius II, he ruled the world's most powerful and wealthy organisation for 10 years.
Bribery in order to secure high office, and the corruption that follows, is hardly new. The impact that corruption has on the wellbeing of the people ruled by corrupt systems is less known.
Read more: When Influence Trumps Ability Forget InvestmentThe return to Serfdom
Written by Gavin Chait
In Feudal societies, land is owned by a king who doles out fiefdoms to favoured vassals who dedicate the productive capacity of that land to protecting the interests of that king.
The more you can do for the king, the more he favours you with land and entitlements.
Along with the land came all the people who happened to live and work on that land. Be they farmers, miners, foresters or fisherman, their land and work belonged to their feudal overlord. Peasant farmers couldn't pass on title to their families and neither would they benefit from improving their work or performance. Anyone challenging this system could lose their land, homes, or lives.
This state of bonded labour was medieval slavery. Such societies saw little difference between enslaving their own people, and conquering other nations in order to enslave them too.
Read more: The return to SerfdomIs the Tata Nano recession proof?
Written by Gavin Chait
The cheapest new cars in South Africa cost around R 64,000 and the cheapest five-year-olds at R 35,000. With credit drying up, and many people worried about the state of the economy, cars are looking unaffordable.
An opportune moment for an innovative company to change the game entirely. In New Delhi on Monday, 23 March, Tata unveiled the first commercially available Nano. At R 21,000, the four-door car is the cheapest on the planet.
Innovation over the past few decades has involved using technological improvements to offer ever more sophisticated products at ever-increasing prices. Over the past year, this has changed.
Read more: Is the Tata Nano recession proof?The Contrition of the Bankers - the Rules can't save you now
Written by Gavin Chait
"Come before the American people and take that deep bow and say I'm sorry. And then either do one of two things, resign or go commit suicide," said US congressman Chuck Grassley in a radio interview.
He was discussing AIG, a large US insurance company recently bailed out for billions of dollars, and apologised later for the heat of his language. Many people probably feel that he was too polite.
It must be very cathartic to lay all of the blame for the financial crisis at the doors of bankers and investment brokers. No-one has yet asked how it is that a single industry has managed to attract nothing but liars, lunatics, imbeciles and pathological hucksters while the rest of the world is filled with wide-eyed softies who have been taken for a ride.
Point is that the banking community is still comprised of people not unlike any other part of society; in parts filled with kind souls, mournful mutterers, soccer-moms, hipster wannabes, old-timers waiting for retirement and whatever other social class you can lay your hands on.
The disaster in the banking sector is deeper than the vapid demonization of a few men, and contemplation of that disaster should give thoughtful people the tremors.
Read more: The Contrition of the Bankers - the Rules can't save you nowThe risk of upending the tax base
Written by Gavin Chait
Much of modern economic theory has been about reducing the gap between rich and poor, and making a more equitable society.
Troublingly for social scientists, inequality varies wildly irrespective of the economic system. However, poor and autocratic societies tend to be more unequal than wealthy and free ones. And even where income disparities are wide (as in the US, where the poorest 20% of Americans earn as much as the richest 20% of Russians) it doesn't always mean that the poorest are scrabbling in the dirt while the rich dine on caviar
The South African taxation system is what is known as progressive; it falls more heavily on the wealthy than on the poor. The intention is that it is to be fairer.
There are 5.2 million individual taxpayers in South Africa, but 25% of them cover 75% of personal tax. There are 1.5 million registered companies, but 4,500 of them pay 76% of the total company tax bill.
In other words, South Africa’s population of 47 million people depends on 3% of its citizens to cover 40% of all taxes paid.
Read more: The risk of upending the tax basePage 8 of 44
