Why can't a scalable traffic system be designed and built with smart traffic lights that actually see and react to traffic?
They can. As a former signals engineer, I can tell you that "smart" signals have existed for the last 50 years. It's just that there's often little will to spend money on intelligent control. In the USA, 95% of traffic signal controllers run in "Fixed Time" mode, where they may as well be clockwork. Here in the UK, some local authorities actually have a clue, and (within the limits of their budgets) implement "Urban Traffic Control" using a centralised traffic analysis and timing modification systems. It's interesting (and informative) to see the differences in traffic flow with UTC active and inactive!
The stupidity of the SA authorities is amazing, though not unexpected - they kicked out all the competent engineers years ago! The people that remain there are the ones who bought themselves positions of authority and created spurious "qualifications" to try to justify themselves. They are a uniformly clueless bunch.
It's funny that they didn't lock their traffic signal controllers, they installed SIMs with full facilities, and they didn't spot the problem as soon as the first or second SIM went missing!!
The thieves would have identified the controllers with SIMs by the external aerials fitted to them!