Monday, March 01, 2010

Unemployment, White Economic Domination, Employment Equity and IQ

There is this commonly held belief that whites are stubbornly holding onto the economic reigns of power in South Africa, thereby creating the last "freedom struggle" for the masses. Well it is not quite as simple as that.

If we go back in history, we will see that South Africa developed economically along similar lines to other settler, or colonialist nations. Strong industrialised nations sprung up, largely as a result of British influence. This was independent of the state or nature of the indigenous populations. And there was no reason to suggest that South Africa wouldn't develop similarly. You see these economies weren't intended for the indigenous people, not because it was intended to exclude them, but because this was the settler way of producing a living. At that time, most indigenous populations lived a subsistence lifestyle. Let's jump forward a few hundred years.

South Africa, which has relinquished its political power to the masses, which always had a white minority, and was always going to find it challenging to find an equitable solution for the black majority, now finds itself under pressure to hand over economic power. But economic power isn't simply a case of changing management. The bulk of any economic power is derived from public companies, which are owned by shareholders. Shareholders only make funds available for investment if they receive a risk premium for their capital, relative to safer forms of investment. It is encumbent upon the directors of these companies to manage these enterprises in such a way as to remain attractive to investors. In other words, it isn't the arena for wild social experiments. If an economy collapses due to some ill-conceived ideology, then millions suffer the consequences.

Now, it goes without saying that South Africa structured itself to serve a modern, industrialised population. This included building universities and technikons to provide a source of skilled labour; and this pool of labour was built up over many generations. All of a sudden you have a change of political power, and the conditions within the country become such that it is no longer an attractive option for the skilled minority; which leads to a "brain drain". At the same time, the ruling elite believe that past discrimination needs to be redressed in a way that represents demographic proportionality at all levels of society, at all costs. Well, naturally, they cannot be accommodated without risking an economic implosion.

I designed a simple model, that takes a few realities into account.

In order to accommodate the economy it is prudent to assume that there has to be enough suitably qualified personnel. Lets assume this means management personnel. In any industrialised economy this would require at least the equivalent of a bachelors degree, or the IQ to achieve same. This requires at least a 110 IQ or above. No doubt indigenous populations have this level of IQ, but are they in abundance, are they skilled and how many do we need?

Well if we use the number of registered tax and SITE payers, we can calculate the number of managers, using a widely accepted ratio. This comes to approximately 967,000. Now, let's assume that at 1994 whites dominated this figure by 80% (5% Coloureds, 10% Asians, 5% Blacks). This would have been 773,000 people or 35% of the white employed work force. Jump forward a few years. It gets thrown at the whites that they "still dominate" the management positions, with at least 60% of positions remaining white, when whites only constitute 9% of the population. Okay, but what are the numbers?

At 60% this equates to 580,000 people, or a reduction of about 25%. At the same time we can calculate that black numbers have advanced from 48,000 to 242,000, or a 404% increase. This is hardly a lack of transformation. Naturally these numbers are based on some assumptions. I have held the population figures constant. These would have been somewhat different, but the message is the same, and the actual transformation is probably far greater given economic growth over the period.

So let's look at the numbers a bit more. To accommodate the blacks we have had to place at least 194,000 candidates in 15 years, or 12,900 suitably qualified blacks each year. Do you think that there was a pool of individuals to choose from? No. Do you think the universities are graduating that many blacks per year? Impossible. What happened to the whites that were removed? It is prudent to assume that they simply took their skills elsewhere, namely overseas.

Back to IQ. Using various techniques it is quite easy to deteremine how many candiates one can expect to find at the various levels. We are concerned with 110 IQ and above. At this level, and knowing the sub-Saharan mean and standard deviation, we can conclude that we can only expect to find about 34,000 black candidates (and even this is optimistic as I used the entire black population instead of just the employable sector). Now if they want to control 75% of the economy, they will need 725,000 people. Even if you lower the standards to a 100 IQ, we can only expect to find 288,000. But the universities would never be able to produce the kinds of numbers needed in such a short space of time, even when we know that they are probably graduating students with IQs as low as 80.

So how does this manifest itself? Incompetence, inefficiency, criminal activity, poor customer service, corruption etc, and we are seeing it already. It is all too familiar. Yet Jimmy Manyi is insistent that the whites are lying when we say there is a skills shortage, and almost zero appropriately qualified blacks.

So to answer the question, do whites dominate the economy? Yes, but not because of some grand conspiracy, and decreasingly so. However their displacement will come at a horrible cost to the country. The golden goose will finally be slaughtered, once this "struggle" is won.

As for employment equity, Jimmy Manyi is hell bent on ensuring that management postions reflect the relative race proportions of the population. This is interesting, given the above discussion, and given Zuma's cry for us to respect other cultures. When determining these percentages Manyi ignores gender and culture. There is a ratio called the participation rate. This is the rate at which eligible individuals choose to participate in the economy, and can be influenced by culture. It is an accepted norm that whites have a high participation rate, usually much higher than 50%, and feasibly as high as 75% (Asians 65%, Coloureds 60%, Blacks 54%). Some cultures place a greater value on having a "stay at home mom" for example. Given the different participation rates it is logical to conclude that you cannot align Employment Equity targets with demographic proportionality figures. Moreover, males participate at a higher level than females, yet no adjustment is made for this either. So, in conclusion, it is apparent that in order to accomodate Manyi's vision of employment equity, white males will need to make the largest sacrifices; and they are. But do not be fooled into thinking that Manyi's vision is fair.

Finally, unemployment. Naturally this is correlated with IQ. It has nothing to do with excluding blacks from the work place, due to some hidden racist agenda. Investors don't care what race group the management belong to, as long as the profits are sufficient to compensate for the risk. It is disingenuous to suggest otherwise. It is suggested that South Africa's unemployment rate is 23%, but this can easily be manipulated by tinkering with the informally employed numbers, and the participation rates. My guess is that the unemployment rates are far higher than officially reported.

11 Opinion(s):

Donatello said...

Excellent article, 5 out of 5!

Jim Beam said...

So what is your solution?

1. Be like the internationalist and encourage cross breeding between the races since IQ is genetic so we can all have people a bit more brighter?

2. Go back to Afrikaner rule (Thanks but no thanks).

3. Go towards a homeland system and let the bright rule the bright, the not to bright rule the not to bright and the dumb rule the dumb?

Any solutions you can think of - I am all ears! Best man for the job based on skills will never fly in this politically correct world.

Exzanian said...

Great article. Transformashun, she is happening alright, but the pool of choice is not so much a casket of jewels as it is a coalpit...I wonder when black leaders will ever have a good, long, hard look in the mirror and walk away with a new perspective and perhaps a little less arrogance.

VI said...

Wow; about time I wrote a hit record. The No. 1 article in 24 hrs. Obviously I hit the spot for a change.

Anonymous said...

This is an extremely important post.

It tells of a rarely discussed objective truth, and one that is fundamentally important for whites to grasp.

All the whites have to do is stick around, get educated, have kids, pay taxes, keep a close eye on their security and in general focus on the private sector. If they can pull this off, they will never lose the country. Never.

Ignore the hysterical BS. These empowerment people can huff and puff but there are certain realities they can't change.

They need us more than we need them.

In the end, bar a complete breakdown in the rule of law (which is a threat, as the frustration mounts), they cannot stop us succeeding economically and running a parallel system. This might even mean an alternative private currency; or whatever.

But the lessons of this post are good news for any population with an average IQ of about 100. We just have to stick together, be civilized in our dealings with blacks, co-operate as necessary and don't lose heart.

Anon.

VI said...

@Anon 13:31. I like your glass is half full approach. You are correct, but only if some wild assumptions remain constant. Already business is taxed a minimum of 25.1%, through pseudo-equity partnerships. This is a guise for serfdom. An assumption would have to be that most whites will be able to establish their own businesses. This isn't viable. Even if it were possible, Government has the power to tax and legislate at will; all to their advantage. Why would you want to build a business under those onerous circumstances? They do need us more than we need them, the problem is they don't know it. But if you have no options, yes, it is best to establish your own business, work hard at maximising your money, and get as much of it out the country as you can.

FishEagle said...

@VI, nicely done!

Viking said...

great stuff, VI

Anon, couldnt have said it better, ...

Anonymous said...

VI, I accept your points, the govt has the ability to extort wealth creators but it does not,in the long run, have the ability to keep on doing it forever. Of course, they could ruin us as well as themselves en route to discovering that. No easy solution to a redistributionist govt, but I want to make one point: there is obviously going to have to be some price for living in SA, but it should be borne in mind that in some crucial other respects, economic life is easier than in, say, Canada or Australia. We have cheap labour, huge natural resources, a fairly captive market, little intellectual competition and the whole of Africa to play in, and I think it is fair to expect to pay something for racial peace-BUT WITHIN LIMITS. But they can never run SA and one must just hope they understand which side their bread is buttered on. If we go down, so do they-and big time.

But I agree-if we pay too much, it is a form of enslavement, and this will be tested. However, if we can play chess, we can win this game, and if we win, they do not necessarily have to lose.

Anon.

VI said...

@Anon 12:22. You are correct; economic life is much easier in South Africa. The competition is so fierce everywhere else, that you have to raise your game.

Your hypothetical case makes sense to me, and I imagine many others. However reality doesn't seem to play out like that. I don't want to take that chance.

Anonymous said...

I think, in the long run, you will be pleasantly surprised.

They cannot run a technologically advanced society, and there are too many stakeholders in modernity in SA to imagine that a retreat to primitivism will be acceptable, even amongst the blacks.

Anon.