Expect President Jacob Zuma to return from China overflowing with enthusiasm for the developmental state. Expect his nephews, nieces, second cousins and the extended family of his minor wives soon to parlay this and their political connections into massive personal wealth.
After all, favourite nephew Khulubuse Zuma moved from financial obscurity to billionaire status on a raft of deals in just two years. No business acumen needed if one has a surname that spells Open Sesame to one’s new Chinese and South Korean friends.
Don’t expect Zuma to reconcile such contradictions. These are the parameters within which the Zuma administration operates: a faddish embrace of the latest supposed panacea for economic growth while, simultaneously, tolerating levels of corruption, patronage and incompetence that make economic mediocrity a certainty.
As Greg Mills points out in his sobering new book, Why Africa Is Poor, economic growth does not demand a secret formula. There is no need to journey afar to find and unravel the blueprint.
“A lot of energy is spent gathering best practice examples from around the world, but these are seldom adapted and applied,” writes Mills, who heads the Oppenheimer-funded Brenthurst Foundation, whose remit is to strengthen African economic performance.
Instead of just steadily improving productivity, competitiveness, labour flexibility, skills and infrastructure, the tripartite alliance has decided that the developmental state is the missing answer. SA’s government must play a bigger role in devising and implementing industrial policy, “even though paradoxically [government] capacity is weak and difficult to create,” writes Mills.
Mills is being generous. To rely on an inept SA government to ramp up economic growth is to invite slow-burning failure and a massive increase in corruption. Patronage will be the main engine for delivery in a country saddled with a public sector rotten with deployed political cadres instead of professional civil servants.
What is interesting about the diverse array of successfully transformed economies that Mills cites, is the lack of ideology behind success. With the collapse of the Soviet Union and then the financial tsunami that hit the United States, nations are willing to do anything that works, rather than trying to apply ideological templates.
While fast growing economies that have pulled themselves up by their own bootstraps share certain characteristics — including a highly productive workforce, and at least initially a low-wage economy — Mills persuasively identifies the one thing that outweighs all others. It is leadership.
Whatever the historical scars that Africa carries, whatever the problems of access to markets, poor infrastructure, expertise, and the dependency culture induced by the aid industry, the continent is poor because its leaders have made that choice. Time after time African leaders have made bad choices for their countries because their primary motivation was personal and financial self-interest.
Mills partly blames an international community that has acted on the worst combination possible of altruism and self-interest. The “ruinous, self-interested” decisions by Africa’s “big men”, however, can mainly be blamed on the lack of democracy or single-party dominance.
Back home, Zuma knows full well that nationalisation of the mines, and “radical action against the strategic enemy, white minority capital” are not the solutions to SA’s problems claimed by ANC Youth League leader, Julius Malema this week. But he tolerates this damaging nonsense in the same way that he tolerates tenderpreneurs and nepotism, because it works for him.
SA’s pseudo-revolutionaries wear old grudges on their sleeves. They still flick through dog-eared copies of Das Kapital, searching for the clues to economic salvation.
Meanwhile the rest of the world, including much of Africa, is moving on, finding pragmatic answers. It’s not rocket science and there is no Holy Grail.
+ Greg Mills, Why Africa Is Poor (and what Africans can do about it), Penguin, 2010.
It boggles the mind to think that the Zuma Inc. are blatantly raping the system while poverty, unemployment and national strikes are rife. How do we not have the necessary checks and balances to keep our government malignant free?
In the wake of this whole media tribunal fiasco an independent NGO should offer to regulate all political business interests. That would help Zuma in his quest to ‘fight corruption’.
I thoroughly enjoy your thoughts William
The world ‘moved on’ many years ago, around 1990, just as SA joined, but burdened with old ideas. How could it have been otherwise?
It is mistaken to think today’s problems boil down to ‘leadership’ or the lack of it. There is much more to it than that. SA society has a long way to go before leaders can lead. At least we are seeing the start of change.
Hi William, “Don’t expect Zuma to reconcile such contradictions. These are the parameters within which the Zuma administration operates: a faddish embrace of the latest supposed panacea for economic growth while, simultaneously, tolerating levels of corruption, patronage and incompetence that make economic mediocrity a certainty” sums it up beautifully for me. And dont expect to be able to write such concise truths for much longer in SA.
I love your work. You hit the nail on the head every time. Good leadership is what we certainly do not have. Corruption flourished under Mbeki and has exploded under Zuma. In my line of work we deal a lot with businessmen of all colours, and please do not take my following comment as racist, but every black businessman we deal with is a “middleman” of one sort or the other and every one of them is tapped into government be it local or national. To enable our country to flourish we need to discourage this self-enrichment and to encourage our people to get education and to start producing instead of consuming.
The other concern that business with China creates is the possible damage that these deals could have on the environment.
Cement is THE next big environmental problem and yet our 1st deal with China is a R1.7bn cement factory in SA.
I wonder if this got fast tracked or if the proper environmental impact studies were done?
It hardly seems credible that a people that fought racial domination for all those years didn’t learn that there is no quick fix. And yet little is actually said to the workers about productivity and financial incentives. The general attitude in SA is that business owners simply have to put up with the general lack of work ethics and disinterest among their workers. I would have thought that a campaign towards improvement would have begun in 1994. Having worked within government, I am well aware that the safe employment status the private sector envisages is very much alive and well. Our labour laws have only made it spread to the private sector.
All the talk of disadvantages and the education sector’s stance don’t help. Severely disadvantaged people rise to the top if they really want to get there, without government contracts. Indeed many successful business people see winning tenders as the short route to bankruptcy; payments from government are often so delayed.
Imagine a worker believing that getting it right only 30% of the time is good enough? But it’s good enough for school…
My naive take:
Our expectations have been consistently lowered since even before Polokwane.
The striking nation is now in the hands of COSATU and the SACP. This telling blow against the “ruling party” was calculated a long time ago.
I like Zweli a lot, on the whole, but God help us all.
Zuma is a crook who ducked and dived to avoid having his “day in court “. In light of this how can we be shocked at his behaviour now.He only knows one way ….the crooked way.
There is an interesting political moment on the near horizon. Vavi is belatedly showing leadership and is not up to being a buffoon twice perhaps?The real time to get angry was during the Mbeki governement .Now its a time for a cool and calculating leadership. Everyone is looking at Das Kapital again even the FT, William’s old employer, in its discussion on the future of Captalism recently. Nothing wrong with reading books and having old yellowed ones either. South Africa has the Dutch disease with only minerals to sell and a one product platinum economy to keep the jam jars full.What”s practical as a way forward economically and socially.Leadership is not surviving well in the Anc they are dissolving their best leadership in their midst.Nzimande a thumber of Das Kapital is on the hit list of the nationalists- A nationalist Kraal is just that a nationalist Kraal seen one— seen all. Who are the practical leaders –the vested interests mining they lovingly cosy up to Zuma as a modern Lobenguela and seek men around him for high appointment and do not mind self enrichment in fact recognise it as an asset in nationalist leadership. Look at recent appoinments to boards in senior Anglo posts and there you will see the Lieutenants eg Valli Moosa to Anglo’s Fuel Cell initiative.Das Kapital helps you to understand lots of what we are looking at no way all -try Castells for new ideas avoid ranting its silly.
“Meanwhile the rest of the world, including much of Africa, is moving on, finding pragmatic answers. It’s not rocket science and there is no Holy Grail”
@William SM. Yes! And for example..
Nigeria has announced the Privatisation of the Electrical Utilities (I hope it’s not too late). There will be many more there once this is digested politically and results are manifest.
This is progress!!
You Go Goodluck Jonathan, come visit!! Or maybe we’ll have to go there soon(?)…I know SA skills are welcome.
Spot on. The developmental state rhetoric has led to an ANC state behemoth that tramples on everything in its path in the noble quest to transform and develop.
The private media so far is offering stiff resistance, but most other spheres of society has already capitulated.
South Africa is rapidly becoming a type of russia – a corrupt weak state that maintains political power through regulation, cronyism, corporatism and patronage.
Bob is right: You’ve hit the nail on the head.
It is the head of state that stands in the fore-front of the follow-my-leader mind-set of ANC governnance.
The ‘Do-what-you-want to Take-what-you-can-get’ attitude has filtered all the way down.
Nurses and teachers, instead of demonstrating responsibility and moral integrity, disgracefully and unconscionably ‘toy-toy’ their days away with their ‘demands’.
Scuttling out of his own corruption trial, his covering-up of dubious deals for himself and his extensive extended family, and his inappropriate, embarrassing behaviour, Zuma leads the way in ‘getting what you can and getting-away with it.’
He conveniently condones instead of condemns:
the ‘Arms Deal’ tumour pushed into remission is still there. What of the president’s unprecedented release of Schabier? or the baling out of Khulubuse Zuma, who became an instantaneous multi-millionaire mining magnate, by running the mine into the ground?
it is above all, his fostering of the Malema-monster festering into the cancer it is today, which places Zuma, as a leader, firmly below the bottom.
A carton of milk which is sour at the top, is also sour at the bottom.
Although still within its ‘sell-by date’, all the cartons in the ANC pack are sour, unsavoury and unpalatable. We need fresh milk – and definitely not from the Zuma herd.
What upsets me most about our leaders is thier lack of foresite. For example in SA we now have lots of black millionares but I have yet to hear about them coming together as a group and opening up a school that will help build future leaders. They can’t even form such schools for thier own children let alone all the disadvantage children in SA. Oprah showed them what could be done, its sad to see that no one has taken her example and followed it. Its almost makes one want to give up.
It is partially valid that “the continent is poor because its leaders have made that choice.” However, this is not the full picture. Corruptees require corruptors, and international interests and large companies are also to blame for cosy deals with corrupt leaders that ensure that all the money is siphoned offshore, to the corruptors shareholders and the corruptees Swiss bank accounts. The citizens never see it. Perhaps the only advantage these corporations have it they at least don’t pretend to represent the poor citizens who elect them.
“What is interesting about the diverse array of successfully transformed economies that Mills cites, is the lack of ideology behind success….. Zuma knows full well that nationalisation of the mines, and radical action against the strategic enemy, white minority capital” are not the solutions to SA’s problems claimed by ANC Youth League leader”
You eschew ideology yet regularly condemn the nationalization of mines on ideological grounds? How do you reconcile these two irreconcilable positions?
Mills has it absolutely right and therefore you too Mr Saunderson has it spot on in this time. I will be sure to read his book.
@Mark Robertson – I do not agree that corrupters make corruptees. If a leader is tempted to choose between getting rich and the welfare of his people, he is no leader but an opportunistic enterpreneur, which has no place in government. This puts a whole new slant on “the struggle” that leaves a sour taste. Did those who fought do it to stop human rights abuses, to give their fellow Africans back their human dignity or for a turn at the trough? This current ANC makes me think the latter.
@HD – The Russian a.o. less than spotless businessmen are starting to find SA a very congenial place to be, almost like home from home, aren’t they? Birds of a feather…
@Nate9 – Very valid question, that is, if we still had operative environmental laws, which it seems we don’t. Must have something to do with our Minister of the Environment being the former Minister of Mining. What would be really interesting is to find out who the shareholders of this new cementworks will be. Suppose the news suppression laws will come into effect just in time for us never to learn this.
Spot on as usual, William. The other Mbeki, Moeletsi, said it clearly: The powerful elite destroy African countries through their greed. We’ve known it for fifty years, but it continues unabated. Much of it is explained in our book: Tincture – passing the buck and bucking the system – authors Andre Gadfly and Peter Smacker. We concentrate on showing how an ideal system should function, but that needs the right kind of leaders. Eventually the whole system must grind to a halt when the greedy continue to enrich themselves because there is no effective governance.
Andre.
Apologies, Tom. I typed your name as ‘Bob’ by mistake.
Wee have heard that milk carton is not only sour at the top but all the way through. There is another wise saying which also has application here ‘A fish rots from the head’.
Sadly the ANC has become the favoured resting place of self-serving rather than public-serving individuals. Whilst that remains the situation we are destined to become yet another failed African state. The ANC must be voted out of office. This is our only hope.
As quoted by William Dr Greg Mills makes some good points, but those of you that think that the Asian Tigers such as South Korea, Malaysia, Taiwan etc achieved their economic growth and success without severe government and corporate corruption are sadly mistaken.
We are inundated with comments that concentrate on the expenditure side of Government – service delivery this, service delivery that, but very few on the income side.
Without healthy levels of INCOME (from a growing economy that collects taxes and duties efficiently)there can be no service delivery in the medium and long term (service delivery could be funded through borrowings in the short-term).
I think that the ANC understands this, which is why they adopt a conservative monetary and fiscal strategy, and try to keep big business sweet.
The scandalous tenderpreneurial and BEE deals are regarded as “just desserts” for the political elite – after all, the Nats did it for years, so why can’t the ANC?
I believe that the ANC top brass believe that they can uplift “our people” whilst at the same time (illegally and imorally) creaming lots of cash off the top for themselves.
Mark Robertson is quite correct – it takes two to tango, and a potentially corrupt Politician or tenderpreneur cannot achieve his aims without the collusion of an equally corrupt businessman / service provider.
@ David Brown – South Africa has a broad based economy and is in no imminent danger of experiencing “Dutch disease”.
Nigeria has experienced it during past oil booms, though