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South African novelist Alan Paton, an outspoken liberal critic of apartheid, once declared: "I am full of joy to realize that I never had anything to do with any divestment campaign." Paton, unlike those who protest today, knows that the divestiture movement rests more on moral outrage than on a sober evaluation of South African realities. Because American disinvestment can so easily harm those whom it ought to help, and because Harvard's financial involvement with repressive regimes hardly begins and ends with South Africa, blanket divestiture would represent the first step into an ethical minefield.
Certain less-than-scrupulous American firms have provided the South African government with the equipment necessary to sustain apartheid. We have already divested from these companies, and rightfully so. Yet while American businesses employ only a small fraction of South Africa's nonwhite work force, many have brought about significant changes in the lives of South Africa's nonwhites and have aided the movement for change. General Motors and Kellogg, in defiance of government policy, were the first companies to recognize the Black trade union movement that now constitutes one of the strongest forces for progress. Those American firms which have signed the Sullivan Principles have cut the wage gap between unskilled Black and white workers by half, and in 1983 filled 15 percent of their managerial positions with nonwhites. In 1982, American companies spent more than 5 percent of their operating earnings on community development, education, and training programs. "It is more likely that American companies can only play a very marginal role in a course of events that must be determined by South Africans themselves," President Bok accurately points out: "Nevertheless, American companies can at least improve the lives of their own employees, provide material support to educational and social action organizations, and add their voice to the protests against the apartheid regime."
By withdrawing from South Africa, American businesses would not only surrender their limited capacity to do good, but would deal a severe blow to South Africa's nonwhites. Those whom American firms directly employ will of course lose their jobs. More important, American disinvestment would check the growth of the South African economy. South Africa's nonwhites, half of whom are already underemployed or unemployed, would feel the brunt of economic stagnation most profoundly. Without a growth rate of at least five percent a year, Black unemployment will continue to rise, and with it the misery of the Black community. As Sanford J. Ungar and Peter Vale, the latter a professor at South Africa's Rhodes University, argued in a recent issue of Foreign Affairs: "Given the level of suffering that already exists in the country, it is in no one's interest to destroy the South African economy or to induce further chaos in the country." Writes Alan Paton: "I will never give any support to any campaign that will put men out of jobs."
The divestiture movement derives its sense of urgency from the assumption that South Africa is somehow on the brink of major change, that the harms of disinvestment to South African Blacks represent nothing more than short-term sacrifices. But it could take decades for the Blacks majority to take its rightful place in South African political life. The white community possesses not only the sheer strength but the will to keep power; 40 percent of employable Afrikaaners work for the government and thus have a direct stake in upholding apartheid. The South African economy can withstand an economic siege, and plentiful reserves of gold, diamonds, and strategic metals ensure that someone, somewhere, will always do business with Pretoria. Writes John Kane-Berman, director of the Institute of Race Relations and a liberal opponent of the government: "This government is entrenched well into the next century; that is a view, not a wish."
Those Blacks whom disinvestment would hurt would thus have to wait an unconscionably long time for relief. Ungar and Vale conclude: "Despite the frequent declaration from many quarters about the willingness of Black South Africans to endure sacrifices in exchange for eventual freedom, it is not for the United States to condemn them to more abject poverty and deprivation."
In light of the potential for disinvestment to grievously harm the Black population, to indulge in short-sighted moral posturing over Harvard's portfolio is irresponsible and self-serving. Moreover, to concentrate exclusively on South Africa is inconsistent at best and hypocritical at worst. While demanding divestiture from companies which have played a positive role in breaking down the apartheid structure, the protesters ignore these same companies' role in supporting the totalitarian regimes of Angola and the Soviet Union. The case for divestiture is much more compelling in dealing with these regimes, under which American businesses have absolutely no potential to work for progress.
It is ironic that the main speaker at today's rally will be Dr. Everett Mendelsohn. Mendelsohn first became involved with the divestiture movement in 1972, when, as a divinity school student, he protested Gulf Oil's operations in Southern Africa. Mendelsohn will probably not say a word about Gulf today, choosing to ignore the fact that this American oil company pays the communist dictatorship of Angola $2 billion in hard currency annually in taxes and royalties. The Angolan regime is kept in power by 30,000 Soviet-armed Cuban troops. Luanda pays these Soviet proxies with the hard currency provided by Gulf. By its own admission, the Angolan regime would collapse without Gulf Oil. No were does an American business play as important a role in keeping a dictatorship in power. Yet nobody protests Gulf Oil.
The protesters will also ignore the issue of U.S.-Soviet trade and the role played by American corporations in providing Moscow with the military technology used to subjugate the Soviet Union's neighbors and threaten American national security. The Ford Motor Company constructed an automobile plant at Gorkii which produces motors for the T-72 tank, the workhouse of the Soviet army in Afghanistan. Swindell-Dressler helped build the Kama River Truck plant which also produces vehicles used by the Red Army in Afghanistan. The Bryant Chucking Grinder Company of Vermont sold the Kremlin the ball bearings without which the construction of the SS-20 missile would have been impossible. J. Fred Bucy, president of Texas Instruments, itself a trading partner of Moscow's, told a Senate panel in 1977 that "the transfer of militarily significant technology has been of major proportions." Harvard holds stock in Ford, Swindell-Dressler and Texas Instruments. Yet we hear no calls for divestiture from these companies, all of which have clearly abetted Soviet expansion.
Those who want to use Harvard's stock portfolio to make a moral statement are very selective in their morality. Their criterion for divestiture is not that a company play a role in supporting dictatorship, but only that it operate in South Africa.
Divestiture advocates should not only recognize how the policy they endorse threatens the community they wish to serve, but should also take into account those cases in which the link between University investment and oppression is much clearer. They should apply a single standard, and call for divestiture from those companies which have been most instrumental in supporting dictatorship, whether it be in Angola, the Soviet Union, or South Africa. Once the perils of divestiture are fully appreciated and the need for a single standard recognized, then will we have a genuine National Divestiture Day.
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