Friday, October 29, 2010

The Politics of industrialisation

Government intervention in the economy in the history of SA has been criticized and favoured. Major criticism of the neo-classicism for its lack to denounce government intervention in the economy to my assessment has been important as it clashes with the liberal notion of free trade. I agree with Kaplan (1976;70) the state has persistently dictated to the market and not allowed the omniscient market to fix commodity or factor prices or to determine factor production. Economic production where market forces determine supply and demand mechanisms to my acknowledgment is not the true reflection of how economies operate although according to Kaplan (1976;71) as he quotes Horwitz propounding that SA economic development has been very much to the response of market forces l concur with Kaplan (1976;72) that nevertheless of Horwitz’s notion the formulation of the protection policy was primarily in favour for the protection of the domestic industry and in favour of the so called ‘civilized labour” that was white labour. Protection policy was much needed in the agricultural produce as l ascertain that with the major competition of the world prices, protection was to be imposed on imports to protect the domestic industry.

According to Kaplan (1976;74) the severe slump that followed after the boom of 1919 and 1920 and in face of rapidly increasing competition from imports as normal trading patterns resumed, industrialists began to be even more vociferous in their demands for protection. Protection policy was the only way to protect the primary industry l assumed that this led to the 1910 industrial commission to question and examine the tariff protection policy which received with a lot of criticism but industrial community realized the utter futility of expecting a proper appreciation of its needs at the hands of men whose position training and interests necessarily influence their judgement when dealing with economic problems. The argument that of free trade and protection within the history of economic development in SA to my assessment is of important as all accepts enforced for true economic development. With the South African authorities of the Tarriff Board in conflict of which economic policy was suitable to implement according to Kaplan (1976;76) in 1925 the Pact Government of the Customs Tariff act No 36 was implemented this followed major criticism as protests against protection were based on the fact that the policy was bound to raise the general wage level with adverse effects to profitability and the economic life of the industry.
Within this realm l agree to Smuts as quoted the Kaplan (1976;76) that bear in mind that we are mixed crowd and that Freetraders and Protectionists forgather in our camp.
I have learnt from this article that it is very difficult to remove government intervention or the protection policies in the economy as well to let Freetraders have ruin in the economic matters without regulation.


Kaplan, D. The politics of Industrial Protection in South Africa. 1919-1939.” Journal of Southern African Studies .Vol 3,No 1,October 1976