Land ‘expropriation’ in context

5 May 2006

Alexandra Fuller’s books on her youth in Zambia and what was then Rhodesia – Don’t Let’s Go to the Dogs Tonight and Scribbling the Cat – have deservedly made her a minor literary sensation. If she submits an article to a major US or British newspaper, she is likely to have it accepted, and it is likely to have an impact.

In one such piece, published in the Los Angeles Times last October, she argued that President Thabo Mbeki “looks set to sail the same course as Zimbabwe’s Robert Mugabe” in pursuing a policy of “uncompensated expropriation of land held by whites for black resettlement”.

Because of stereotypes about Africa, this kind of statement, profoundly inaccurate though it is, finds ready credence in the US.

I don’t know where Fuller got her facts from, but it is a fair bet she follows events in her old stamping ground via the internet from her new one, Wyoming.

To be fair, given the sometimes sloppy way in which South African land reform has been reported in the media, it is easy to see how she could get things wrong. Not that the media is exclusively to blame. The language that officials use can also lead to misunderstanding.

It is important that the South African government’s land restitution and redistribution policies are properly understood. The perception that South Africa is headed the same way as Zimbabwe has serious consequences. It raises the cost of capital. It deters investment. It constrains the government’s ability to promote growth and reduce poverty.

International precedents
At the root of much of the misunderstanding is the phrase “willing seller-willing buyer” and what is seen as its opposite, “expropriation”.

When the government says that it means to start favouring the latter over the former, this is reported in ways that make it sound like a draconian shift from reason and reconciliation to the coercive and uncompensated dismemberment of property rights. The truth is otherwise.

Respectable, prosperous democracies the world over reserve the right to take private property for public use on a compensated basis when the owner proves unwilling to sell or demands a price the government is unwilling to pay.

In Britain, this is called compulsory purchase. In the US, where property rights are held in popular mythology to be especially sacrosanct, the government is said to exercise the power of eminent domain.

The South African Constitution grants the government a precisely equivalent power and imposes on it limitations scarcely less binding than the fifth amendment to the US constitution, the relevant clause of which states: “. nor shall private property be taken for public use without just compensation.”

What constitutes a legitimate “public use” is a matter of ongoing debate in the US. Some contend that local authorities have been abusing eminent domain by using it to condemn low-income neighbourhoods so that they can be sold to private developers.

The US Supreme Court on ‘public use’
The authorities have justified their actions on the grounds that they are improving public welfare by bringing in new wealth and jobs and growing the tax base to improve services. A narrow majority of the Supreme Court has sided with this view.

On one “public use”, the Supreme Court has been unanimous. In 1984, in an opinion penned by Justice Sandra Day O’Connor, an appointee of the very pro-property President Ronald Reagan, the court declared that eminent domain was an entirely legitimate means to deal with “the perceived social and economic evils of a land oligopoly”.

In an answer to a parliamentary question on land reform last October, President Mbeki cited the O’Connor opinion and urged members to study it.

The case, Hawaii Housing Authority vs. Midkiff, concerned an attempt by the state legislature in Hawaii to undo the effects of a feudal land tenure system which had resulted in just 72 private landowners owning virtually all non-public land, or nearly half the state.

On Oahu, the most populous of the Hawaii’s islands, 22 landowners held 72% of all property titles. This, said the legislature, was skewing the local property market, inflating land prices and “injuring the public tranquility and welfare”.

The remedy the lawmakers adopted required landowners to sell land to the state which would then transfer it on a subsidised basis to former tenants. If a sales price could not be negotiated, owners had to submit to binding arbitration.

They filed suit, claiming breach of the fifth amendment. When the case reached the Supreme Court, they were resoundingly defeated.

South Africa and eminent domain
In South Africa today the government is moving to use its power of eminent domain in much the same way, for a “public use” little different from the one explicitly approved by the highest US court.

The democratic will of Hawaiians, expressed through their elected legislature, was for sweeping land redistribution. When this could be achieved on a willing seller-willing buyer basis, their representatives exercised eminent domain. So it is in South Africa.

The Hawaiian landowners were compensated, of course, as ours will be. Was their compensation just? No doubt they received less than they would have wished. But that is automatically going to be the case whenever eminent domain is exercised. Eminent domain is what respectable, prosperous democracies do when a “willing seller-willing buyer” agreement cannot be reached.

Does anyone seriously think that the US is headed down the same path as Zimbabwe?

If not, as South Africa’s US ambassador, Barbara Masekela, asked in a letter to the Los Angeles Times, under what set of assumptions should South Africa be judged any differently?

Simon Barber is the United States representative of the International Marketing Council of South Africa