Whiskey, car keys, teenage boys … and taxes

• By Keith Bryer

Would you give whiskey and car keys to a teenage boy?

Of course not.

Nobody in their right mind would be so foolish, but that was one of many witty sayings of the late PJ O’Rourke, an American writer whose opinions of Big Government were, shall we say, less than favourable. He was describing what happens to taxes.

It made O’Rourke hugely popular in the United States, where the federal government is seen in some quarters as encroaching on the freedoms Americans cherish.

Such anti-bureaucracy feelings are not unusual in democratic countries. Indeed, there are more and more people of that opinion with every day that passes in this country.

There is a widespread perception that government officials are getting too big for their boots, soak up far too much tax money in paying themselves (or stealing it), and generally get in the way of those of the private sector who (unlike civil servants) create wealth and gainful employment for others.

Some say that such opinions can only be fairly applied to politicians whom we vote for, not to public servants. The counter-argument is that this would have been true 150 years ago when civil services were small in number and picked for their skills and brains as well as their ability to pass stiff entrance exams. Civil servants were an elite, picked from the best society had to offer.

Civil servants were once small in number because there were then fewer regulations governing everyday life and therefore fewer officials to enforce them. People were expected to get on with life as best they could without looking to the government to do it for them. In a word, people were freer then than we are today — even in the Western democracies.

CHANGES

This changed gradually. People began demanding that “the government” do things in return for their votes at election time. A huge increase in civil servants resulted, especially in wartime, particularly during World War I and II when everything became the government’s problem and responsibility.

The trouble was that when peace was declared, there were still large numbers of civil servants. They had tasted it, found it sweet and clung to it. Since civil servants also voted, it was a foolhardy politician who tried to cut their numbers or their costs.

The result was that many countries found themselves with a civil service beholden to their patrons rather than to the citizens. This changed the civil service from an institution of elite public servants to a group best described as voter fodder for the particular political party in favour.

Such criticisms are, of course, generalisations. Not all public servants are placemen and women. Some are indeed servants of the public. They do not see the civil service as a road to personal enrichment. They see it as an honourable job to serve the public. There are thousands of good civil servants among the police, the teachers in state schools and the doctors and nurses in state hospitals and clinics.

Problems with all civil services (apart from their growing numbers) are more likely to be found in the middle and senior management, those with the power to purchase things, the men and women who pay invoices due to suppliers.

Our situation as a semi-developed country is different from other democracies. For a start, when we all got our freedoms ensconced in our splendid Constitution, we inherited an almost full-blown socialist state set up by the previous government.

Our civil service was quickly purged of its previous occupants. The new lot was quite blatantly selected for their political allegiance to the new government. Not that they can be blamed for doing so, but such was the demand for lovely, secure jobs that the numbers increased substantially.

Or did they? The actual numbers in the official civil service as opposed to the state-run enterprises (SOEs) such as Eskom and the 200-odd other similar but smaller entities that were excluded from the description were not that much bigger than they always had been.

Adding in the SOE cohorts the expansion of state jobs boomed, to the point that salaries soon gobbled up a huge proportion of taxes leaving not much over to spend on things like school toilets, roads and bridges.

But even if we take the smaller definition of civil service jobs their pay not only kept pace with inflation, it exceeded it by a country mile. Today more than a R1-trillion is paid each year to 1.3 million civil servants. Remember that excludes the wages and salaries paid to the SOE employees.

Even the government, which is after all responsible for this situation, now admits that something must be done. Finance Minister Enoch Godongwana, no less, is on record as saying the situation is unsustainable; that is even without taking the SOEs’ wage bills into account. So it is much worse.

Those happy souls employed in the civil service have seen their pay triple in the last 10 years. Every year they have received an automatic two percent increase based on the number of years they have stayed on the job. This is added to the going inflation rate.

JIBBING

No wonder civil servants are jibbing at the idea of a wage freeze.

What this all boils down to is that more tax money is spent on jobs in the broader definition of the civil service than the country can afford.

So, before socialists get all hot under the collar about the hard facts of the matter, perhaps they should consider that it is a perfect demonstration that we voters should beware of what we voted for.

It is a vain hope that governments can make everyone richer and everyone equal. The plain truth is, as history shows, eventually other people’s money (that of the taxpayer) runs out.

Civil servants are necessary to keep order, make sure the water is drinkable, look after the sewers and repair the roads and build bridges, run schools for those who cannot pay for private teachers, clinics and hospitals for those who cannot afford private health care.

But when the wage bill is the largest single component of government spending (in South Africa it is a whopping annual R682.5-billion), something is seriously wrong. Most of all, any government that wants to aid the creation of wealth for all its citizens should realise that state-run organisations don’t make money.

We voters have to realise it too and expecting those we vote for to solve all our problems is a false hope that will end in tears unless there is a sudden realisation that the private sector and people who make a profit in business are not enemies, but essential allies in any drive to improve living conditions for everyone.

*Keith Bryer is freelance journalist and communications consultant and writes for the Free Market Foundation.