South African Investments

To The Editors of The Crimson:

Who is investing in South Africa (S.A.)? 350 American companies do business in S.A., but 10 of them account for nearly 90 percent of all American investment in S.A.: Mobil. $450 million; IBM $360 million; Caltex, $334 million; Ford. $213 million; Kennecott, $130 million; Phelps-Dodge, $130 million; GM, $129 million; Newmont Mining, $127 million; Union Carbide, $51 million; Goodyear, $20 million.

(These figures are the latest-4/29/82-from the American Committee on Africa. 1980 Department of Commerce figures put total U.S. investment in S.A. at $2.2 billion. G.E., I.T.T. and Chrysler have sold their business in S.A.)

Harvard has stocks and bonds (fixed income securities) in five of these top investors in South Africa, as of the Financial Report of Overseers of Harvard College for Fiscal Year 1980-81. Calculations show that Harvard has about $170 million in holdings (market value June 30, 1981) in corporations among the top 10 investors in S.A. The figure is probably somewhat higher in actuality because Harvard has probably invested more in these corporation since June 30, 1981. When Harvard reported its holdings. The figure is unlikely to be much lower than $170 million.

As a percentage of the endowment. Harvard's holdings in the major profiteers of apartheid is about 10 percent of the $1.71 billion market-valued stocks and bonds. This figure is about one half the figure of the endowment which was shifted from stocks to bonds in fiscal year 1980-1981.

This is especially important for two reasons. First, Harvard traditionally has held most of its investment in apartheid in the form of stock. About $120 million of the $170 million invested in the leaders of American Capitalism in S.A. is in stock.

Secondly, Harvard has already agreed with students not to invest in banks that make loans to S.A. To do the equivalent for non-bank corporations. Harvard must divest itself from stocks in apartheid corporations and invest in the increasingly attractive bonds market.

Of course, Harvard Treasurer George Putnam claims. "For U.S. companies to leave South Africa now would leave the country in worse shape than it is in now." (Harvard Crimson, 4/20/82) Indeed, the American corporations and South African whites share the ostensible belief that the development of the apartheid economy in existence since 1948 is good for Blacks.

This liberalization thesis is clearly ridiculous when one considers that Blacks in the United States, although better off than their counterparts in S.A., have been historically oppressed. In fact, the ration of Black median family income to white median family income in the U.S. has declined from 61 percent in 1970 to 56 percent in 1979. Most of the drop occurred in the middle of the supposedly pro-Black Carter Administration.

Moreover, Black unemployment at 14.2 percent in 1981 is the highest of all the years 1948 onwards in the 1982 Economic Report of the President. December 1981 was the month of the highest unemployment with 15.7 percent of all Blacks unemployed. Finally, the ratio of Black to white unemployment rose from 1.8 in 1975 to 2.3 in 1979, and both ration are higher than the ratios of the late 40s and early 50s.

The drive for profit very easily corresponds with and reinforces racism in the U.S. How much could the U.S. corporations possibly have helped Blacks in S.A. in the over 30 years of apartheid? Clearly Putnam must be referring to fears that the government of S.A. would collapse without U.S. business, taxes, technology, loans, capital equipment and military goods and supervision to suppress growing Black resistance.

MARVARD OUT OF THE BIG TEN! Henry Park '84   Member RADACAS