OPINION: The only way to radically transform the economy

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There is only one way to radically transform the SA economy and it must start with the government investing meaningfully in education, writes Fin24 user Steve Thomas.

Radical economic transformation is hot topic in SA politics. However, what frustrates me as that it seems all the policies put forward are either too radical/populist or simply ill conceived, in other words, they just won’t work.

In my view, the only way to radically transform the SA economy is to spend every last cent on education.

Education is the best investment the government can make. A nation that can read will never go hungry. Educate everyone to the point that it is impossible for anyone to go hungry. Wealth goes to those who are educated, whether it is a trained plumber, electrician, or doctor.

A person who receives a basic education can expect an income for a lifetime. They will educate their kids who in turn can expect an income for a lifetime. In those two lifetimes, the government will be receiving tax. It is the only guaranteed investment that will pay back 100 times in 100 years, even more, if you consider that those who are educated educate their kids.

Since investment in education is so profitable for the government, it would be worth taking out debt to achieve that goal. It is by far the best investment the world has to offer.

In my view, it doesn’t take much to get a person to the point where he or she can earn R20 000 per month. Over 40 years, R20 000 per month adds up to R9.6m. You cannot re-distribute R9.6m to every person, but you can give every person the ability to do that for them. Many countries have done it and are doing it. Just look at China and Japan!

The government can try and redistribute wealth (which we know won’t work), or we as a country can do the right thing and take the longer term approach. The rewards last forever.

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