A fair amount of drama is happening in the old homeland this weekend. It’s the Mbeki-Zuma stand-off in the high street, guns at the ready. For the bulk of the white population, as well as some of the black diamonds (a name given to the emerging black middle class), this is a scary time. The ANC, the ruling party of South Africa, is getting together this weekend to appoint its new leader.
As so often happens, coincidentally I am reading Naomi Klein‘s The Shock Doctrine, and the chapter on South Africa is particularly relevant to the entire Mbeki-Zuma debate. I strongly recommend this book. It is worth reading.
For me, the issue about the leadership of the ANC boils down to one thing and that is the fact that the ordinary citizen in South Africa is no better off now than during the apartheid years. The reader may replace the word “ordinary” with the word “black”.
In fact, some of the statistics I have seen recently have shown that the bulk of the black people are worse off economically than under apartheid rule. And yes, some of the whites have also seen a drop in their living standards. The black South African may have the vote, but the majority are starving and living in slums.
The ANC-led government may have provided the citizens with cheap housing and services such as running water, electricity and landline phones. However, the cheaply built houses are falling apart and the people can’t afford to pay for the services.
Some stats from Naomi Klein’s book, which were recorded in 2006, show that the number of people living on less than $1 per day had doubled from two million to four million by 2006 (from a CS Monitor report). Between 1991 and 2002 the unemployment rate for black South Africans had more than doubled from 23% to 48% (report in Le Monde diplomatique).
What happened in South Africa? Where did the rainbow nation go wrong? Of course economists will state that nothing went wrong. The South African economy is booming, inflation is under control and eventually the wealth will trickle down. I don’t think so. There is a worldwide trend of labour losing jobs or workers forced to live on less income.
A United Nations University study reports that 2% of adults in the world own more than half of the global household wealth. Ten percent of adults account for 85% of the world total and the bottom half of the world adult population owns barely 1% of global wealth.
Going back to South Africa, when the ANC took over after democratic elections, Mandela and his government tried to address the inequalities the apartheid years had inflicted on the majority of the population. Every time they moved in this direction, such as land redistribution, the developed world punished them by withdrawing its investments. No matter the road shows that the then VP Mbeki and his Minister of Trade and Industry, Alec Erwin, held to get the world to invest, they came away empty-handed most of the time.
If South Africa wanted to play on the global economic stage, it had to follow economic principles set down by the powerhouse economies of the world. And these included such killer steps as keeping inflation low at all cost. As an aside and talking of killer steps, watch the current governor of the Reserve Bank kill off the growth by hiking interest rates and pushing the cost of borrowings out of reach of the manufacturing sector. More job losses?
It has taken years for the ANC-led government to earn some brownie points on the global economic stage. Even taking on and paying off the debts incurred by the apartheid government has not been enough to provide sufficient credibility to the external dictators.
After all the kowtowing and letting of blood at the demands of the IMF, World Bank, international trade organisations and other foreign institutions, these brownie points are still not sufficient to encourage a flood of investment into the country. It has purely stopped the large-scale exodus of money out of the country.
According to Naomi Klein, one further important reason why South Africa’s democracy “was born in chains” was local white business. In retrospect this makes total sense to me. According to Klein, white-owned South African business dictated the shots during the negotiation period before the first democratic elections. White business felt that the black masses could have the political clout as long as the economic one remained in their hands. Who cared about the vote as long as the bank balance was as high as ever?
It’s difficult to compress the point I am trying to make into a short article on a blog. Books have been written about this, especially worthy ones such as Klein’s. It can be nothing more than a very superficial process. So why try at all?
It’s the unfair deal that black South Africans have been dealt that has worried me for years. It’s not right that people who really want to work and earn money to feed their families can’t do so. They want to educate their children and ensure a better future for them. The squatter camps are testimony to the fact that the current government has not delivered to its mandate.
Mbeki and, to a certain extent, Mandela have been running the country with one eye constantly on the approval of the powerhouse economies of the world. Not only that, they are also at the mercies of white-owned business at home. They have let their people down. What is so sad is that they have done this inadvertently, thinking they were acting in the best interests of their country and people. But it has not worked.
The people are hoping that Zuma will deliver for them. They are hoping that he will create jobs, provide better health services, quality education and control crime. Will he deliver? I don’t think so. His hands will be tied just as Mbeki’s have been. In essence, whether Zuma runs the show or Mbeki, one thing is fairly certain, nothing will change. To gauge sentiment, watch by how much the JSE will drop once Zuma is confirmed leader of the ANC.
The dreaded question the whites are too scared to ask: Will South Africa end up like Zimbabwe? There are two points here. Yes, it will end up like Zim if whites continue to control business. They still do, although a few percentages have been hived off to black economic empowerment groups. There is even the odd black CEO. And the second yes, if the world continues to dictate economic policy, it surely eventually will become another African country in pain. It’s what happened, in one form or other, in Zimbabwe and Kenya and Mozambique …
Interesting article but you miss the 2 factors that change things forever.
1. Education. The power game is knowledge begets economic power which in turn begets political power. Until africa produces maths and science graduates en masse it will forever be in charge of political power only. The ANC burned schools and books instead of building and writing them. The legacy is that today there is a large skills shortage. Indeginous africans still cannot build a modern town and northern hemisphere peoples know this and exploit it.
2. Based partly on the above is the electricity problem in southern africa. We have run out of power and so cannot grow. In the next 2 years my guess is that we will have negative growth as factories move to where they can operate.
Neither of which are the fault of western powers or white locals.
Very nice blog Anja, however, I query the Le Monde unemployment stats, they have hovered at 40% (shamefully) for quite some time from StatsSA, I can never remember them rising to 48% … although if one goes into many periurban and rural areas the rate is far higher. But obviously StatsSA evens it out. I’m not sure what Naomi Klein was smoking when she wrote that white business controlled the negotiations process to a democratic SA but that is so wrong it is laughable, as even a cursory reading of history will show. I covered that process as a journalist and for Klein to write that, if you have reported her correctly, and if my understanding of what you have written is accurate, is the most insulting denigration of the incredible and very tough, exhausting process that went on there. White business was not only not involved, other than in an extremely peripheral sense along with the churches etc… but they had no control. The outcome led to an incredible negotiated settlement and quite frankly the people I would laud the most for that process? Cyril Ramaphosa, Matthews Phosa – both of whom in those days drove around in Toyotas loaned to them, they had no capital nor did very many of the finest people in the process. Other great people included Leon Wessels and others. It was a punishing process. It showed the mettle and quality of South Africans at their best. Is Klein saying we owe our fine constitution to white big business? Phah! It is one of the finest constitutions in the world and came from hard, loving work by people not interested in finance but in human rights. Sometimes Naomi Klein gives me a headache.
You make a good point about the black majority being no better off than under the apartheid regime. However, you fail to mention the fact that a great many “WHITE” businesses have actively embraced BEE in the hope of redressing the balance. What about our “BLACK” brothers – the only BEE they are interested in is their own – a few fat cats get rich whilst their REALLY needy comrades go hungry. Yours, is just the kind of posturing South Africa can do without. You also fail to mention how industrial action is CRIPPLING this economy and this has NOTHING to do with white vs black. This is being led by a militant union base – they have already toppled a once-thriving clothing trade. To coin a phrase, makes you think doesn’t it?
Admittedly Zuma will probably be no better for South Africa – how can a rapist and fraudster hold any kind of integrity in the eyes of the rest of the world. For goodness sake will you get over blaming the white minority and the rest of the world for our woes!
Nice piece, there is a need for gradual transformation. the point of contention is what should be the speed, and the direction of transformation process. it is problematic to determine how fast the process should go. it seems to me the government policy at promoting a black middle class at any cost was wrong( it should have been a side effect of the process). it just that the trickle down effect does not work. it would have been much preferable if the government has opted to address the poverty and employment creation head on from the start. I do not have problem with the Macro Economic policy- seeking macroeconomic stability. but micro economic policy of this government needs to be revisited
Interesting piece – Safe to say that whoever is elected has anything but an easy task at hand. Methinks government needs to get its own house in order, ito reducing government fraud & corruption, before it can create a meaningful, strategic problem-solving agenda for the masses. Owen makes a good point re. education holding the key to the the solution. Unfortunately, quality education does not come easily or swiftly.
Charlene, thanks for your comment. Naomi Klein, and neither do I, dispute that the constitution is one of the finest in the world, if not the. Nor that the ANC negotiated a powerful deal politically.
The consideration is about the economy, and who controls that. I really don’t see it in black hands. And hopefully one can add: ‘as yet’ to that.
And Michelle, I tend to support labour’s rights to fight for a living wage and don’t consider trade unions militant. They are not the ones crippling the economy.
I do not understand the major bit about the IMF, World Bank etc exactly the kind of institutions that South Africa has been averse to borrowing from. South Africa will only end up like Zimbabwe if the truth about Zimbabwe’s farm invasions is not told, the referendum presiding them, Western political survival consultants, Lumpen academics like Jonathan Moyo’s involvement,etc.
South Africa has only made one mistake, the denial of its own poverty. With its many problems we are in worse position than Zimbabwe and the minute we acknowledge that the better.
Land reform in terms of restitution is good because it does not make the assumption that every black person wants land. Equally important is the development of black commercial farmers so that we do not have impoverished land owners and unused prestige farming for weekend outings. The government must be brave enough to even disrupt if need be traditional settlement patterns to enhance land usage.
The most important thing is education. Future economic prosperity will hinge on innovation and technology not on commodities that depend on western needs. China used to be a laughing stock but is now a major super power not by weaponry as Russia but by economic might. The Great Leap has finally happened. South Korea was not worth talking about in the 1960s but look what they have managed to do.
The major failure of BEE has been the emphasis on equity instead of skills transfer. Zimbabwe has produced many able black CEOs and executives like the duo running Anglo America SAs operations and Peter Moyo and the Actis guy Nkosana Moyo not because of entitlement but by knowledge and experience acquisition. Most of SA companies top executives are people with years of experience in the industries and organisations they rose through the ranks to lead, it happens everywhere in the world. Parsons, Chenault, Stan O’neal to name a few black current and former CEOs went through that phase. As did white guys like Charles Prince, Jack Welch etc.
Zimbabwe did not only invest in educating the young but invested in the old and am told still does. Hence they talk about how the deputy President has earned degrees in this and that from a virtually illiterate background. No one can say she is illiterate above all she has demonstrated the value the government puts on education. The Zimbabwe police force has constables with world class business qualifications obtained with assistance of the force which cannot be said about our own police force.
We need a new consciousness of human development. The shortage of skills discourse must not be the preserve of Mbeki and traditional white reads but must be make it to the front pages of the Daily Sun and stokvels, the village kotlas etc
Anja, whilst your article is feeding the concerns of many South Africans on the Zuma – Mbeki issue, I believe that a lot of this negativity stems from fear. There are for certain many issues that have been concerning but to place South Africa in the same category as other African countries depicts both a disturbing and distorted point of view.
The white people of South Africa have become so complacent that a lot of us do not even cast our vote anymore, yet when the seas get rough we are the first to blame the government for not doing anything? If researched properly one will see that it is certainly not a matter of “the odd black CEO” and that we have come a far way despite the obvious obstacles. I am not saying that BEE has had a 100% positive effect but we have some excellent black leaders in South Africa and that is exactly what we’ve needed.
Zuma or Mbeki – the fact of the matter remains that one of these men will lead our country. In fact, a little hope is a great offer to give the poor of South Africa because they too have been waiting for their share of the pie. How many white people do you know who are members of the ANC? In times like these ALL South Africans should be uniting, voting and making our voices heard – we need leadership and we should be involved in electing our leader!
It makes me so sad when I hear the negativity and resentment from a lot of fellow white South Africans. Those who believe that we’re doomed to the same fate as our neighbouring countries should go where they believe the grass is greener. For the rest of us, let’s pull our heads out of the grounds, become involved, care and share some positivity!
Anja, you hit the nail on the head with regards to the economic power and I do feel that we should be a little bit more creative when it comes to land distribution, I don’t think that giving a person a match box for a house, restores a persons sense of worth, why doesn’t the government look at growing more cities,e.g Las Vegas. Might be a crazy thought, but if you’ve driven around South Africa there’s endless space in this country. I don’t see why the majorities should be forced to live like caged animals or maybe it’s the apartheid housing policy still being implemented. I had a thought the other day and realized just how badly Apartheid affected those who live in informal settlements. Now, remember that when people settled in their homesteads some 200 years ago, they erected informal dwellings, nothing stylish maybe similar to what we have today and then developed that piece of land, generation after generation. I figured, If I was gonna erect an informal dwelling, I would wan’t to get as much land for myself as I possibly could.
Somebody please tell me why with all the new settlements going up, why is there not more larger pieces of land being distributed, instead of 60sqmper family of 10!!!.
We are yet to see another generation of free thinkers & revolutionists birthed from slums of Diepsloot or Bethlehem. The vote in the country is not really gonna change much for the next 10 – 30 years, but we should be thankful for what we are seeing now in the ANC. This only means that different bodies in the party see’s different future’s for the country and they willing to do the normal political backstabbing.
I don’t however feel that we could go any where close to situation in Zimbabwe, our people (Black & white) have a long history of fighting for freedom and any whif of an oppressing regime will without a doubt, lead us down a nasty road again.
Anja,
I think this could earn you a doctorate, were in to info already known. The difference though , you have compressed it so well, it makes sense eve to a dodo like me.
We are on on our owm; Black, white Indian and all.
Could anybody tellt me why the interest rate in the developed countries hovers around 5% and our is 15%.
I think the borrowed capital is killing us.
Madam, a very good analysis; it just shows how difficult it will be for africa as a whole to be economically free.
I think when we make these analysis we need to look at context rather than on mere statistics. For instance a survey will tell you so much people do not have houses and are living in shacks and when you go directly to this persons you find that the majority of them are owning huge properties in their rural homes. In fact you find that some of them are content living in a shack because they can not afford to furnish two homes. Your analysis that says we were better during apartheid is devoid of truth but perpetuate by stereotypes of swart gevaar like you possess and it malicious gossip. i hope that if you feel you don’t like black people ruling the country you must live the country.
Blaming white businesses entirely is a lot of hogwash. What about the enormous incompetence of state institutions – these same institution have chased away skills and now employ people who are more interested in chatting on cellphones than doing their jobs properley! These same institutions sit with stockpiles of money unspent because they lack the ability to spend the money properly where it is most needed! (Some state institutions even lack the energy to spend the money!).
What about corruption (which goes unpunished)!
What about crime!
Your article zeroes in on only one timy aspect of the whole big problem!
Ummmm…just a question or two. The Apartheid government was the stinking, festering carcass of the polecat of the world that was only seen to exist to be perpetually in conflict with and to oppress South African blacks.
What goverment on earth at the time would have extended Apartheid ANY loans and for what purpose if the only purpose of Apartheid was to implement and perpetuate racist oppression. So what apartheid loans are the ANC beholden unto and why have they not refused point blank to pay off any loans incurred by Apartheid to perpetuate apartheid. Surely Apartheid did not incur any debt that the international community would have deemed and therefore approved as earmarked for black South Africans, because if that was the case and such loans were not for the perpetuity of apartheid but were in fact for black upliftment, the ONLY reason that such a polecat would have very conditionally been granted a loan, then surely that would fly in the face of the anti-apartheid argument?
All these economic brownie points that the ANC have toiled so hard to earn to attract foreign investment in South Africa – explain?
I mean, I’m thinking, that if I was a foreign investor, I’d look at the ANC’s track record and what would jump out at at me like a mugger in my home threatening me with an AK 47 and a hot iron, would be, R60 Billion spent on weapons of war, for a war with whom? I’d look at the shenanigans and the corruption associated with this stupendously unnecessary deal, the current and incumbent ANC leaders involved and the official reasons given to justify this arms deal and I would feel very distinctly that that there is a hidden agenda somewhere that I would want absolute clarity on but which would be frustratingly not forthcoming. Particularly in respect of such a huge amount of sophisticated military hardware for a national defence force plagued by insubordination, ill-discipline and concomittant racial killings of senior personnel, depleted by AIDS and other things in a region that is characterised by tribal and ethnic conflict that just won’t disappear behind any amount of window dressing.
I would take a long hard look at the history behind the association of South Africa’s leaders and Zimbabwe which MY memory takes me back to the early ’60′s and the absolutely nothing that is being done by SA about a neighbour in which developments have a direct influence on a region I’m looking at investing in, and I would not like what I see, particularly 4000 illegal immigrants per day.
I would look at the violent crime statistics and seriously regard the impact on any investment I would attempt of 55 violent unnatural deaths per day. I would look further at draconian BEE requirements under which I would need personnel to safeguard my investment that do not exist within the definition of BEE due to the skills, experience and qualifications requirements of many positions.
I would look at the peculiar penchant that the ANC leadership has of funding not insubstantial personal excesses from state coffers and the extraordinary traditional views of the health minister of a disease that could severely decimate a labour force.
All in all, I would very carefully, with a very fine-tooth comb scrutinize any investment and even moreso the returns on any investment I was considering making in south Africa, and given the considerations I’ve scratched the surface of in this posting, I find your intimation that investment in SA has not been forthcoming due to a
reluctance and therefore, implied racism, to invest in SA because it is under black majority rule; patentlt offensive. One thing is certain, if I was an international investor, I would not invest in SA simply for the sake it is now under ANC rule and I find the essence of your article suggesting that that should literally be the sole consideration for investment in SA, not only an insult to my intelligence, but also an expose of yours to expect ANY investment under current conditions in South Africa, not least of which is the consequential flooding out of the country of every last skill and expertise that would be required to successfully sustain any investment.
Ngodoi
Thank you for your comment which is immensely apprecaited.
I’m not sure how you would imagine that my comment about no investment into SA post apartheid was racist. I purely meant to point out that big business, external and internal, has dictated what has happened in SA. And they didn’t care about race either, just about having their investment protected. And yes, apartheid SA managed to borrow billions. Hard as it is to believe.
The fact that Jacob Zuma did a road trip to the USA, a few days ago, to present his credentials and also to re-assure international business that it would be business as usual, really kind of supports the points I made.
Jas Dametjie, you missed my point by miles. Mention racism and there’s a knee-jerk reaction, every time a coconut.
I didn’t say that your comment was racist, I said, that you intimated that investors were not investing in South Africa despite the ANC Brownie point efforts because SA is under black majority rule, so their disinclination is rooted in some prejudicial reluctance or the other which can only be racist because they are non-blacks not investing in a black country.
Big business, internal, or external dictates what happens everywhere on the planet to the extent that it’s shaping global political policy and why shouldn’t they want to protect their investments, or in the case of some, their acquisitions?
Apartheid borrowed millions – to do what with – oppress the blacks further, and there were countries that were prepared to lend Apartheid this kind of money and risk being ostracised by every man and his dog in world government?
Zuma did a road trip to the USA – and so? Mugabe does road trips all the time and has done for nearly thirty years – look at his patch ?
With respect Anja, your points are basically that South Africa is not succeeding, will not succeed and the blacks have been given a raw deal because of the manipulations of white big business, which, against the backdrop of the considerations I’ve raised, are in the least myopic and subjective, cliched and sycophantic and at worst patently untrue.
South Africa has failed, is failing, will continue to fail and will inevitably become exactly like Zimbabwe, not because white big business is ripping the blacks off, but for a variety of other reasons that I dare not post here because my post won’t be put up. You know that, I know that and trust me, every thinking South African and potential foreign investor does too.
In a world of stellar altitude investment criteria thanks to global competition, narrowing product, differential advantages, narrower economies of scale, burgeoning debt, dwindling disposable income, human resource diversification and multiculturalism one cannot continue playing the race card in South Africa, especially as economically viable whites in the country represent about 3 % of the population and are dissipating rapidly like smoke.
Why not just scrap the race card and tell the truth starting with corruption, incompetence, affirmative action and the massive haemorrhaging of skills critical to the sustained development of SA?
In closing, I’d like to paint one hypothetical scenario. The public health service, which amazingly under apartheid worked perfectly well, especially the “black” hospitals which, as if in ominous portent for the rest of the country, now lie in utter ruin; were to be addressed as a matter of urgency by whoever emerges victoriously from Polokwane. How do you think white big business is going to stymie that especially given that the only departments that function do so because of the sponsorship and donations from white big business in SA and nothing, nothing, comes from any of the very new BEE juggernauts whose patrons have each become multi billionaires inside of the last 10 years?
Not quite about Zuma or Mbeki but the interests of party members.These are the costs of democracy which is known to have succeeded in failing to work in the USA, Europe and many other places.Hope the ANC will now finally consider having its own mouth piece.