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Explaining The 'Revolting' Labor Conditions In South Africa

Tyler Durden's picture




 

It seems a week does not go by without some kind of violent (or non-violent) protest against conditions in the mining industry in South Africa. Only this week we had the Amplats-related platinum spike, but it appears the split between the private and public sector has become not just better known but unsustainably massive in the last few years. In what will likely set off another riot, Bloomberg notes that salaries for public servants have increased an average 14% annually since 2007 versus a 2.7% rise in the period for all-industry (es Agriculture) in the private sector. All this as CPI rose 6.3% annually on average. As one analyst noted "it is not sustainable," but it appears Pravin Gordhan - South Africa's FinMin - is apparently unlikely to meet a pledge to limit government salary increases to 5% - to help narrow the budget deficit (as GDP is expected to grow 4.8%). This government largesse appears to be 'revolting' - and is certainly fueling the fire across the nation's labor force.

 

 

Source: Bloomberg Chart of the Day

 

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Tue, 02/19/2013 - 22:39 | 3258237 Smuckers
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Having lived there a few years, that country is going to take a couple generations to sort themselves out.
It's currently in the Act of Scene II, "Now it's our turn."
Loved the place and the people, but it is quite fucked.

 

Tue, 02/19/2013 - 23:00 | 3258278 AssFire
AssFire's picture

Now it's our turn....

To destroy everything built in the last 300 years!!

 

Wed, 02/20/2013 - 05:44 | 3258743 Rubicon
Rubicon's picture

Yeah, a bit like the US

Tue, 02/19/2013 - 22:57 | 3258285 cynicalskeptic
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First thing any group coming ot power does is give themselves a raise - and another and another - and a few more perks.    On eof the problems with a representative form of Democracy.  The 'representatives' make sure tehy are better of fand then start giving moeny away to voters to hold onto their position.  Look at Tammany in NY.

It's why all Republics collapse - peopel are more than willing to spend money that's not theirs.  People want government ot give them as much as possible - but don't want to foot the bill.

I suspect the whites were a bit more circumspect when running things - were happy enough running things and being so much better off than the blacks - they didn't want to piss off the majority too much or give them any more of an excuse to revolt but now with the majority running things.....  they're starting off with less and looking for a quick path to financial improvement.

Wed, 02/20/2013 - 03:50 | 3258677 Super Broccoli
Super Broccoli's picture

the problem they have now is the same any country has : the current awful governement pretends all the problems comes from the precedent government ... except here it then has black against white implications !

Wed, 02/20/2013 - 01:28 | 3258565 Troy Ounce
Troy Ounce's picture

 

The nail on the head:

"now it is our turn"

Narcissism rules big time.

And why would you want to become a farmer or start a factory as sitting behind the computer, shifting paper from one side to the other or writing policy documents can make you hundreds of thousands! Just like a banker!

 

Wed, 02/20/2013 - 07:21 | 3258778 RafterManFMJ
RafterManFMJ's picture

If by 'sort themselves out' you mean 'murder every white, and then fall into a mess that makes Zimbabwe look like a well-run country', I agree with you.

Wed, 02/20/2013 - 08:32 | 3258845 Super Marco
Super Marco's picture

I am a higher income earner in South Africa and I hate to be insensitive but low income earners in this country will never be satisfied... Ever!

Tue, 02/19/2013 - 22:41 | 3258239 cherry picker
cherry picker's picture

Isn't that happening all over the world.  Government leeches sucking the life blood from the hand that feeds it?

Tue, 02/19/2013 - 22:42 | 3258242 lizzy36
lizzy36's picture

Obama should take note before raising federal minimum wage by 25%.

Wed, 02/20/2013 - 01:27 | 3258564 Ropingdown
Ropingdown's picture

He wants to raise it because several key unions actually have a large number of members in minimum or low-wage jobs.  It has nothing to do with fairness or economic reality.  It will lead to a loss of non-union jobs, according to economists across the spectrum.

Tue, 02/19/2013 - 22:43 | 3258244 Freddie
Freddie's picture

Sounds like Obummers police state and Greece. 

Tue, 02/19/2013 - 23:42 | 3258400 otto skorzeny
otto skorzeny's picture

the cops will be the last govt employees drawing checks from Uncle Sam

Wed, 02/20/2013 - 02:59 | 3258659 Acidtest Dummy
Acidtest Dummy's picture

No that's the army you're thinking of, the cops PAY THEMSELVES. Just as bandits, highwaymen and kidnappers always have. It is their privilege for doing the PTB'S bidding.

Tue, 02/19/2013 - 22:48 | 3258259 DoChenRollingBearing
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I'd be pissed off too!  In fact, kind of the same thing is happening here.  When I worked for the federal .gov as young 'un, I was paid LESS than most roughly equal private sector jobs.  Now if you work for Obama, you do very well, three weeks vacation to start, better than a month after three years on the job.  And a lot higher salary on average.

Tue, 02/19/2013 - 23:01 | 3258298 cynicalskeptic
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Was on a once in a lifetime cruise to Alaska a few years back.  Seemed like most were Federal retirees (EARLY retirees) - in the VERY good cabins.  Also a load of tier one retired teachers (the ones with the best retirement plans before districts started cutting benefits).

One couple - in their 50's, both former Federal employees - was living the good life, house in MD and taking 3-4 cruises a year in thier retirement.  Even they thought the federal government was way too generous but hell.... if they were offered early retirement, why turn down a good deal?

Tue, 02/19/2013 - 23:01 | 3258279 LetThemEatRand
LetThemEatRand's picture

 

"Johannesburg - Executive pay has increased in South Africa notwithstanding the financial crisis and onset of the global recession, according to Computus, a forensic accounting firm.

Using a sample group of 326 listed companies and parastatal corporations, the average CEO remuneration of all the companies studied amounted to R4.76m a year in the year ended June 2009. The average basic salary of a CEO in South Africa was R2.37m.

CEO remuneration increased by 11.5% a year on average from 2006 to 2009. Astonishingly, CEOs of parastatal companies, which number Eskom and the Land Bank among them, received R5.1m on average annually of which 51% was made up by incentive remuneration."   http://www.fin24.com/Business/Executive-pay-on-the-up-20100430

"The 2011 wage gap between the CEO and the average worker in the mining industry [in South Africa] was 390 to 1." www.lrs.org.za/docs/A%20Mineworkers%20Wage.pdf

Exec compensation wouldn't even come close to fitting on the chart above.  It would entirely flatten out the other trends.  Sounds familiar.  Blame the wage earner for the country's ills while the top engorges itself.  

 

Wed, 02/20/2013 - 07:09 | 3258771 Doña K
Doña K's picture

In RSA at the moment near Sandon suburb of Johannesburg and the Porsches, Audis, MB's and Beamers are everywhere. I have never seen anything like it. Most drivers of these cars are blond ladies or black men. (Strictly by observation statistic) I guess others work for a living.

Tue, 02/19/2013 - 22:59 | 3258287 Yen Cross
Yen Cross's picture

 The Cape of Lost Hope. Land audit complete - Political economy | Moneyweb  Blacks are Killing whites every day in South Africa!

 

Wed, 02/20/2013 - 01:40 | 3258578 Jorgen
Jorgen's picture

Here is a good commentary on present day South Africa: http://mikesmithspoliticalcommentary.blogspot.com/

Tue, 02/19/2013 - 22:58 | 3258291 Theos
Theos's picture

where is the us version?

Tue, 02/19/2013 - 23:04 | 3258304 NoWayJose
NoWayJose's picture

Come to Amerika and get free healthcare, free TVs, free smartphones, free housing, free food, and bigger checks than you get now and you do not even have to work!

Tue, 02/19/2013 - 23:08 | 3258309 Dieselclam
Dieselclam's picture

I have worked union, non-union and anti-union, all in the same job field for the same company over 34 years. Only a fool would believe that cutting lazy government worker's salaries in non-labor jobs will stop the labor revolt now that it has started over decent wages for laborers. If you believe otherwise, you are just as arrogant-elitist/entitlement-brain-dead as Obama's entitlest brain-dead-dead-beats are. Labor will only put up with being shit on for so long before they demand UPWARD equality.

Tue, 02/19/2013 - 23:24 | 3258349 Oldwood
Oldwood's picture

What I would want to know is if these are skilled workers or simply laborers. The next thing I would want to know is are there others willing to work at these jobs at the current wage. If not, all the workers need to do is stop work, otherwise quit bitching and get back to work. I have no problem with unions negotiating wages or contracts. I just believe that anyone or group should not have the power to force anyone to work or employ.

Tue, 02/19/2013 - 23:35 | 3258383 Dieselclam
Dieselclam's picture

They are skilled laborers- you cannot hire any idiot off the street and send them a mile below the surface of the earth for 8 or 10 hours and hope simply hope they don't swallow profits or cause a cave in that kills hundreds of people and closes the mine, and then expect to get away with claiming some inalienable "right" to pay them an increasingly lower wage due to inflation without trouble rearing it's head...union or not. That's human nature.

Tue, 02/19/2013 - 23:11 | 3258320 WTF_247
WTF_247's picture

Coming to the US soon.

 

There are simply too many people here that are completely uninformed - if something is ok for them then they go about their daily lives.  Most do not think ahead and believe what the TV tells them to believe.  

Govt employees always get raises and make more than others in similar jobs.  This is likely going to come to a head worldwide.  The issue is politicians - they want to be re-elected and move up in office so they will sign any pact with public unions in exchange for votes.  There is no accountability - what they sign into place now is likely to create a problem 5-10 years down the road - by that time they are long gone to another office.  Then taxes are raised - rinse and repeat.

We are likely only a few years away from a global revolt against govt salaries and pensions.  What used to be underpay 40 years ago has completely swung the other way to be idiotic in nature.  Revolt will only swing into action one the population has been fleeced enough of their money that they all a sudden wake up and realize they are paying massive taxes and fees for almost no service.  More and more money goes to legacy costs each year, detracting from everyday expenses that people "think" thier tax dollars go for..  I would only give it a few years before a massive problem erupts that cannot be fixed with "raising taxes and fees" - people will start to refuse to pay and then the end is in.

 

Tue, 02/19/2013 - 23:23 | 3258345 LetThemEatRand
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While I am all for reducing the size of government, the amount of the budget devoted to paying government workers is a tiny percentage of the total federal spending each year.  Reducing government employee pay 20% or even 50% would not even be felt in the average person's tax bill.  This entire issue is a (red meat for libertarians) red herring.  We as taxpayers lose exponentially more on government spending that enrich a few, mostly involving the manufacture of weapons, bank bailouts, the police state apparatus, etc.

Tue, 02/19/2013 - 23:29 | 3258373 Oldwood
Oldwood's picture

So exactly what is it thats breakng the budgets for states and municipalities? My impression is that the bulk of state and local expenditures are for public employees. And its not just their pay and bennies but the volume of employees. What was all of that noise about in Wisconsin if not public employee spending?

Tue, 02/19/2013 - 23:47 | 3258408 otto skorzeny
otto skorzeny's picture

fuck that commie LTERand-80% of IL's revenues goes to salaries and pensions of state employed slugs-shit like state cops getting 100k pensions and retiring at 50. the only good part of it is the growing hatred of govt employees.

Wed, 02/20/2013 - 00:03 | 3258440 LetThemEatRand
LetThemEatRand's picture

 

"As Figure 2 shows, in FY

2007, the state appropriated

83 percent of the General

Revenue Fund budget to

health care, education and

human services. Medicaid is

currently the biggest single

state budget item and is appropriated

across several

budget categories, including

health care and human services."  https://docs.google.com/viewer?a=v&q=cache:YVDn3LI0GLgJ:www.ctbaonline.o...

 

80% to government employees?  Not even close, but hey, who needs facts when you have ideology. 

 

 

Tue, 02/19/2013 - 23:47 | 3258411 LetThemEatRand
LetThemEatRand's picture

5. Wisconsin
> Taxes paid by residents as pct. of income: 11.1%
> Total state and local taxes collected: $24.39 billion (16th highest)
> Pct. of total taxes paid by residents: 77.7% (8th highest)
> Pct. of total taxes paid by non-residents: 22.3% (8th lowest)

Approx 45% of the total Wisconsin state budget is government employee pay.  If you eliminated all government workers, that would reduce state taxes by a roughly equivalent amount.  But no one was even suggesting that.  A small percentage reduction in state employee pay which is what the Walker controversy was all about, would hardly be felt by the average Wisconsin taxpayer, if at all.  It would be a fraction of a percent.  

Wed, 02/20/2013 - 00:08 | 3258448 Oldwood
Oldwood's picture

You mean like that paltry 85 billion sequester thats about 2% of the federal expenses that Obama says will devistate the economy, putting criminals on the street, and kids starving and being thrown out of school? I'm sick of this shit. Our government is hemoraging money that we don't even have (and never will) but yet we can't cut spending. Everything is untouchable and all we have to do is just raise taxes just a little bit more! The GAO published a report two years ago outlining 200 billion of redundant and wasteful spending. Non partisan stuff and Obama hasn't touched it! Nothing. We can't cut nothing. Bitch about CEO pay which we have no constitutional right to say anything about but public workers are just not relevant to you. SMALL CHANGE! Its all small change till you add it all up.

Wed, 02/20/2013 - 00:13 | 3258457 LetThemEatRand
LetThemEatRand's picture

You and I disagree only about the priorities for cutting.  We spend trillions each year on the military industrial complex, most of which goes to private contractors and wars that have nothing to do with "protecting our freedoms" (quite the opposite, in fact).   We spent trillions on bank and other bailouts and no, they didn't pay it back.   Focusing on the wages of government workers is a favorite technique of the beneficiaries of those giant checks to distract the sheep into debates about nothing.  Government is outrageously bloated, but let's start with the big stuff and worry about the little stuff later.

Wed, 02/20/2013 - 07:59 | 3258805 Bicycle Repairman
Bicycle Repairman's picture

Slash the MIC and expose the sick care and education industries to the free market.  Dispose of the "regulators" of said industries.

The rest is small stuff.

Tue, 02/19/2013 - 23:32 | 3258375 Bobbyrib
Bobbyrib's picture

I believe in cutting compensation by that much. People should nto be able to retire at 50 with a full pension just for working for the government. Adding to future liabilities will be felt by future generations. They'll have to increase the average person's tax bill to meet the ridiculous benefits these people receive. Put it in line with the private sector at least.

Wed, 02/20/2013 - 01:22 | 3258552 Ropingdown
Ropingdown's picture

I would accuse you of forgetting the exponential function.  The current wages in a given year grow exponentially, but so do the pensions and health care costs for governement employees, and their number grows, as well.  You will see that this leads to an exponent of growth much greater than the mere excess of current salary growth over private sector pay.  As for the wealth of the lower 50%, it's never added up to much.

Tue, 02/19/2013 - 23:11 | 3258325 runthenumbers
runthenumbers's picture

I thought that was the chart for California government workers.   If you went back to 1999 and adjusted it for benefits provided it would look like a hockey stick for public employees.

Tue, 02/19/2013 - 23:26 | 3258362 Abrick
Abrick's picture

5.7% increase in annual compensation increase for the average worker in the US from 1987-2011.

726.7% increase in annual compensation increase for the average CEO in the US from 1987-2011.

 

Tue, 02/19/2013 - 23:36 | 3258385 Oldwood
Oldwood's picture

What is the percentage if CEOs to everyone else? Are you suggesting that if they were paid less profits it would make any real difference in income numbers for the general population, cause I really doub.t it. Ifnyou are just bitching about the apparent unfairness of it, I would be inclined to agree. Itsnjust that everytme someone tries to do something about the injustices of life, life seems to get worse. Maybe its just an accident but I doubt it.

Wed, 02/20/2013 - 00:40 | 3258483 LetThemEatRand
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400 American individuals control more wealth than 1/2 of the American population combined.  Most of those 400 were born into their wealth and contribute nothing to the economy.  Large corporations are avoiding almost all taxation through offshore ventures.  That is not a trivial problem or simple unfairness.  It is a broken system that resembles the days of nobility.  We no longer call them Lords and Princes, but they are the same in every way that matters and they own (via contributions and MSM endorsements) the government.  And they dictate spending of taxpayer dollars to benefit themselves in ways that dwarf what most citizens are currently debating.  It's a tired expression, but rearranging the deck chairs on the Titanic by debating the income of workers will not solve the problem and if anything will only further entrench the ruling class.

Wed, 02/20/2013 - 07:11 | 3258772 toys for tits
toys for tits's picture

What do you think happens with the taxes that corporations pay?

They pass it on to the end user.  If corporations didn't pay taxes then market forces would drive down the prices by, on average, 20%.

That's an effective 25% regressive sales tax on everything that you purchase. Then you have to pay real sales tax on top of that tax.

Corporations should not be taxed at all.

Wed, 02/20/2013 - 01:28 | 3258566 Gavrikon
Gavrikon's picture

If the reason for the CEO peformance increase is due to the dismantleing the ladders of upward mobility for the US workers while offhshoring production work, and importing cheap labor from Asia ro replace the US workers, then there really IS something wrong somewhere.  Of course, if one is not an economic nationalist and does not care about putting the US and his fellow citizens last, then one might offer the seponse that, if US citizens need to have more money for doing the same work as an Asian in Timbuktoo, then that is just breaking some eggs to make an omelet, one might not agree.

In any case, the economy, the country and its workers are royally fucked, "free" trade is NOT working, uncontrolled of immigration of cheap labor does nothing for anyone except the multinationals' bottom lines. 

 

Tue, 02/19/2013 - 23:40 | 3258392 Peter Pan
Peter Pan's picture

I guess men like Mandela and Tutu will realise that a colour change of government is just that.....a colour change.

Or as someone else once said.... the more things change the more they stay the same.

Tue, 02/19/2013 - 23:55 | 3258428 Oldwood
Oldwood's picture

While Africa has had some pretty significant high points in history, those have long since past. Africa was largely a wild and uncivilized place durring most of its more recent centuries until Europeans settled there. It is questionable whether the native people as a total society have the ability to conform to a more modern template that we would recognize. Of course they may well still be around long after the white races have eliminated themselves! Oh modernity!

Wed, 02/20/2013 - 00:08 | 3258431 earleflorida
earleflorida's picture

Cecile John Rhodes and De Beers [blood?] Diamonds...

http://en.wikipedia.org/wiki/Rhodes_Scholarship 

..., all roads lead to 'La`Famille' in LondonTown?

http://en.wikipedia.org/wiki/Nathan_Rothschild,_1st_Baron_Rothschild

Note1:    Why [De Beers] diamonds?... Why [Rio Tinto] gold?... Why [Royal Dutch Shell] oil?...??? 

Ps.  Rothschild minted their own 'Gold'... but what's so obvious, is when they pull'd out of 'LBMA' in 2004 along with AIG shortly afterwards...?

Ps2.   http://en.wikipedia.org/wiki/Gold_fixing     http://www.scotiabank.com/ca/en/0,,3032,00.html

Note2:  What does this have to do with Platinum? Catalytic converters are soon to be retrofitted/ replaced with a better heat-sink at a 75% discount,... and last longer?

Note3:  This is an opportune time for variants of al Qaeda to mass recruit the indigenous youth, that have absolutely no future but a coerced adjudicated, and feudalistic future!? 

JMO

thankyou Tyler

Wed, 02/20/2013 - 00:51 | 3258515 Clowns on Acid
Clowns on Acid's picture

South Africa is 5 years away from going Zimbabwe

Wed, 02/20/2013 - 07:23 | 3258782 Sudden Debt
Sudden Debt's picture

Getting rid of apartheid and the redistribution of wealth did miracles to South Africa.

I particulairy love the part where the negroes may kill a white farmer and just take posesion of the lands and house.

Or where they can kill and rape people without justice.

Really a perfect example of how a perfect world looks like.

...

Africa has 2 options in my point of vue:

1. Let them kill each other live in stoneage situations.

2. Colonise them and help them rule with strickt rules.

These people are just to retard to live in cities. They still have the mentality of small villages where you need to kill anything that doesn't live in the village.

Some might think it's racist but these people are totally underdevelopped!

IT'S IN THEIR GENES!

Look in America. Where did the big riots ever take place. What kind of people started the burning down, killing and raping? It's always the same kind!

And people say: Yeah but white people did bad stuff to! They also killed black people and stuff!

SURE!! BECAUSE THAT WAS THE ONLY LANGUAGE THEY UNDERSTOOD! THAT ARE THEIR WAYS OF LIVING!

THEY RESPECT YOUR IF YOU CONTROL THEM IN THAT WAY!

 

Thu, 02/21/2013 - 02:21 | 3262417 Troy Ounce
Troy Ounce's picture

 

 

A rant like that and then write: "they are underdevelopped".

 

*Sigh*

 

 

Wed, 02/20/2013 - 08:16 | 3258814 sebmurray
sebmurray's picture

I've heard that tune being sung since 1994. I'll believe it when I see it...

Wed, 02/20/2013 - 05:21 | 3258726 Fred123
Fred123's picture

Typical 3rd worlders, especially those in Africa or the Middle East, going tribal. These people will chew each other up trying to get something for nothing until they have nothing. I don't think they can become civilized until a decent religion is allowed to flourish, and I don't think its islam.

Wed, 02/20/2013 - 14:21 | 3259563 rufusbird
rufusbird's picture

It is good to see Africa discussed here. It will loom larger in the future.

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