Apartheid In The Global Economy

Introduction

Apartheid is a system of oppression that continues to have great effects on the country’s social, political and economic issues to this day. To ‘survive’ in the global economy, the newly elected democratic government decided to take control of the economy especially in places where the private sector did not dominate (Rumney, 2005:402). To combat the inequality that existed in the country while also making sure South Africa can compete in the global economy, the government opted for a more neo-liberal stance on capitalism.

A free market economy is where all the factors of production (labour, land, and capital) are owned by private owners and not the government (Kates: 2014:1). People can set up their own businesses, with the main

This is the total spending in the economy. In the Keynesianism view, aggregate demand does not inevitably equate the productive capacity of the economy, in its place, it is influenced by a host of factors and sometimes behaves erratically thus affecting employment, production and inflation.

Keynesian economists argue that decisions made in the private sector often lead to wasteful macro-economic outcomes that require active policy responses by the public sector (Skidelsky: 2015: 3). For instance, these may be monetary policy actions by the central bank and fiscal policy actions by government to stabilise output over the business rotation. Overall, Keynesian economists advocate for a mixed economy that predominantly is operated by the private sector but with a role for government intervention during recessions. For example, in 2008 when the financial system crashed and dragged down the economy with it, governments steeped in with ‘stimulus packages’ that bailed out several stakeholders. The only issue with this is that it may lead to bankruptcy, inflation or even both (Skidelsky, 2015:5). What distinguishes Keynesians from other economists is their belief in activist policies to reduce the amplitude of the business cycle, which they rank among the most important of all economic

The first flaw is the problem of surplus labour. Per this concept, the bourgeoisie profit not by selling their product at a price above the cost of materials plus labour, but rather by paying the worker less than the value of their labour (Mander, :88). The second flaw in capitalism is its chaotic nature. Whereas the state can control every aspect of socialism from production to distribution, capitalism is controlled by the free market (Mander, :88). Technically, capitalism is known as a market-directed economy and socialism as a centrally planned economy although in practice most economies are a mixture of both. In a socialistic system, economic decisions regarding price, production, and consumption are made by central planners affiliated with the government. In a capitalistic system, economic decisions are made by every producer and every consumer (Mander: 89). For instance, a housewife with a shopping list is an economic planner in a capitalistic