The expropriation of land and other assets without compensation by governments is not a new practice. It has been done before, not merely in the distant past but in the very recent past. The consequences are sobering and should lead policymakers to reconsider what may seem politically expedient in the short term, but offers catastrophe not only for the expropriated but for the expropriators as well.
This is an especially critical time to consider such moves very carefully. As the Covid-19 pandemic threatens global food supplies the last thing policymakers should undertake are moves that, when tried before, have collapsed agricultural production and led to hunger, famine and mass starvation. The most powerful contemporary example is Venezuela, where the disastrous consequences are unfolding before our eyes. But the policies of expropriation have had the same or worse consequences on the continents of Asia, Europe and Africa.
Although often justified as returning land to people with superior claims, the actual implementation is invariably characterised not only by collapsing production of food, but by corruption, typically in the form of cronyism, enrichment of political allies of the governing faction and the use of expropriation to carry out vendettas against rivals.
The experience of brutally colonised Kazakhstan in the 20th century set the stage for what was to be repeated elsewhere. In 1927 and 1928, Russian forces expropriated grain and livestock from the nomadic peoples of the steppes. In 1929 they expropriated the holdings of the independent peasantry. In 1930 and 1931 agricultural output collapsed and the numbers of sheep and goats declined by 70% and 90% respectively.
The starving attempted to escape to China, Iran, Afghanistan, and other countries. A conservative estimate of deaths from the confiscation of land and livestock run to about 1.5-million, or one quarter of the entire population and a full third of the ethnic Kazakh population. A contemporary observer, Tatyana Kevadovskaya, wrote in 1933: "I hope the current generation of Kazakhs will not forget about the people, the children, the elderly who died of hunger; about the villages that were deserted and died out; about the sick and those who died in the steppe ..."
The case of Ukraine and the Holodomor, or Genocide Famine, became better known because of the presence of more observers capable of informing the world. The expropriation of farmland led to a collapse in the harvests and the slaughter of livestock; between 1928 and 1932 the number of cattle and horses dropped by nearly half, pigs declined from 26-million to 12-million, and sheep and goats from 146-million to 50-million.
Estimates of the human deaths vary, but they are conservatively put at four-million additional deaths just in Ukraine, of whom about half died just between May and July 1933. The deaths in Europe were dwarfed by the famines in Asia that were directly caused by expropriation of agricultural property, with the number of dead in China estimated at a minimum of 45-million during what Frank Dikötter called "the greatest demolition of property in human history" in his carefully documented book Mao’s Great Famine, which drew from previously unavailable archives of the communist party.
Less horrifying cases of expropriation that did not involve mass starvation deaths nonetheless were followed by food rationing and compulsory farm labour for urban populations, as in Romania where confiscation was followed by a collapse of output and the mass slaughter of livestock for consumption.
Lest anyone think hunger caused by expropriation of property was exclusively a 20th century problem, attention should be paid to Venezuela, where agricultural output collapsed in the 21st century in response to expropriation of fertiliser factories, followed by expropriation of agricultural land and other assets. Agricultural output, including cattle and chicken production, fell dramatically in the ensuing years. The resulting hunger, and the loss of weight (an average of 8.6kg per adult, as measured in 2016), came to be known as the "Maduro Diet," after Venezuelan president Nicolás Maduro.
The regime, which through the state oil monopoly Petróleos de Venezuela controls the world's largest proven reserves of petroleum, brushed off the problem by using oil revenues to import huge quantities of food. In 2010, even the Venezuelan government admitted that tens of thousands of tonnes of imported food were allowed to rot by corrupt state firms.
In the ensuing 10 years the situation has worsened. When oil output collapsed due to state mismanagement, followed by the free fall in petroleum prices, the regime found itself with almost no funds with which to purchase food. According to the UN high commissioner for refugees, already at least 4.5-million Venezuelans - over 15% of the population of the country - have fled the country. Every day more seek to escape to neighbouring countries.
According to land laws passed in Venezuela in 2001 and 2005, land-owners must demonstrate consistent chains of property titles going back to 1848, which is a hurdle almost none can surmount. If they cannot provide such documentation, they face outright expropriation.
That expropriation has been followed by others, even of those who could provide title documentation, as the Venezuelan government has seized millions of hectares of land to award to loyal cronies and political supporters of the regime, who, unsurprisingly, are rarely efficient farmers.
To allocate land, the regime used voting rolls and, very conveniently, the identities of signers of a 2004 petition that had sought to recall president Chávez. Moreover, to ensure loyalty the land grants following expropriation are granted "provisionally" and may be revoked if the recipients fail to demonstrate their loyalty to the regime that transferred possession of the land to them.
As noted by political scientist Michael Hubertus, who carried out an extensive study of the role of political allegiance in Venezuela's expropriation scheme, "Even when land is cleared for distribution, recipients must exploit the property according to its ambiguously defined 'social function' for at least two years to receive formal title." Expropriation proved to be a powerful tool that the governing party used to destroy Venezuela’s democracy.
The Venezuelan story is not over. The situation in the country continues to deteriorate as food shortages become worse, exacerbated by shortages of electricity, medicine and even petrol in a country that once was one of the world's greatest petroleum exporters, meaning that whatever food there is cannot be transported from farms to consumers.
Food security is already a major concern in much of the world, including across Africa. That concern is greatly exacerbated by interruptions in global supply chains due to the disruption caused by the Covid-19 pandemic, which is in turn being exploited by nationalist regimes, such as the US Trump administration, which are openly promoting beggar-thy-neighbour policies to harm other countries.
Expropriation without compensation in SA could very likely lead to huge suffering and hunger, even to starvation. Venezuelans have been fleeing the hunger caused by expropriation in their country. If expropriation without compensation in SA creates famine, where will South Africans go?Palmer, a senior fellow at the Cato Institute and director of Cato University, occupies the George M Yeager chair for advancing liberty and is executive vice-president for international programmes at the Atlas Network.
This article was first published on BDLive on 11 May 2020