I think you have it spot on. But, as Margret Thatcher is reputed to have commented on socialism, the problem is that eventually you run out of other people's money. I would also be surprised if the government closes SAA, even if it clearly in rigor mortis. Sadly, the only long term outcome is that it, and the other SOEs will take the country down with them. The money has to run out sometime and someone will have to pay - politics, however well intended, can never be divorced from economics.ArthurDent wrote: ↑Fri Feb 14, 2020 10:00 amWell, that requirement would take care of about 99% of the posts on this and some other threads.Darren wrote: ↑Thu Feb 13, 2020 2:21 pmIn other words, you can't shout from the sidelines and expect to be taken seriously unless you have better proposals. More specifically, those proposals should be based on hard numbers or at least well-researched estimates so that we can accurately compare options on a like-for-like basis.
Policy on SOE debt and mismanagement is one thing, bringing it down to SAA's operational level means deciding what you want SAA to be. It cannot both be a political tool (employment agency, BEE supplier champion, BEE cadet employer, strategic air asset flying politically important routes at a loss) and be a profitable airline. The margins in our business are just too small to force a small airline to carry such a large social responsibility.Darren wrote: ↑Thu Feb 13, 2020 2:21 pm
Where we diverge is over the question of what makes for good policy versus what would make us all feel better.
Policy is difficult, it has to take all sorts of related factors into account, and it's often deeply unsatisfying because the only viable options are usually compromises where nobody gets everything they wanted. Policymakers don't have the luxury of just saying 'suck it up' to the public or saying there are no solutions, nor can they ignore negative economic effects. After all, everything is connected, so as just one example a failing SAA could knock SAA into a recession, which would further cut down tax revenues and actually leave us worse off than keeping the airline on life support a bit longer. They have to muddle along and find the set of policies that reduces risk the most while not harming present and future growth.
It's is deeply unfair, not to mention counter-productive, to criticise those creating and executing national economic policy without also taking into account the very real constraints they have to work with. To be clear that doesn't mean they've above criticism, just that it should be informed criticism that points out how they could be doing a better job at a systemic level.
All the SOE's have been forced/encouraged to over-employ and to procure through BEE companies or "partnerships"(which just means the BEE company takes a cut without any value added at all). Couple that with questionable management ability and theft on a grand scale, and there was never any chance of any SOE being profitable.
I think some of the posters on this thread have lost sight of the bigger picture. You might think SA is an ordinary, modern democracy where sound financial principles carry weight and the white population is seen as an asset (even if only for their tax contribution), but you would be wrong.
It is only once you move away from this and look in from the outside when you see the full picture. Moaning about the money being sunk into Escom, SAA, SABC, PostOffice, etc only makes you unhappy. It will not change anything. Rather take your indignation and go somewhere where it might mean something. This thread is already beyond 30 pages of almost religious agreement of how SAA should be closed down (and the undertone of teaching those arrogant, overpaid pilots a lesson in humility), and it all means f-all. SAA has already lost hundreds of pilots who got tired of working for an organisation as described above and will in future lose hundreds more, but I cannot see it closing down. The political price is too high and the opinions of white South Africans don't count.
I'd love to be proven wrong on all of this, and that the turnaround is at hand, but the trajectory since around 2005 up to and including last night's SONA, has not exactly been encouraging.