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This is a quick and casual aside as I await the more weighty matters of Pravin Gordhan’s medium-term budget policy statement at 14h00 today.

For various reasons* I attempt to keep abreast of the rapidly evolving technological and cultural aspects of what we call ‘social media’

New cultural trends drive developments in language and there are a couple of new words and usage that I found interesting enough to share here.

Recently a person I follow on Twitter (Sarah Britten who goes by the handle @ananitus – I love her stuff and follow her across several media platforms) used a hashtag to characterise the flood of criticism she got when she mentioned that she had gone to a chiropractor for relief from some or other ailment.

Most of the criticism/advice came from men and she called it (the criticism and advice) “#mansplaining’ as in: enough with the #mansplaining, I don’t need you to tell me whether alternative medicine is unscientific or illogical (that’s not a quote, I don’t have a record of the original interchange, but that is roughly how I remember it).

I immediately felt slightly embarrassed. Oops, busted. I have been patiently mansplaining to the women in in my life that their views are illogical and unscientific ever  since I was a too serious boy. Hurumph Hurumph – stroke my beard, push my eyebrows together, suck on my pipe. You see Josie/Mom/darling the scientific method exposes astrology as  … blah blah.  Yeah, right.

A hashtag (#) is a kind of metadata tag that allows all future conversations that deal with the same topic to be grouped and therefore accessible.

Listicle is another new word (well, new to me anyway) that perfectly sums up a phenomenon to which we are all being increasingly exposed. A listicle is an article that presents itself as a list.

It can be any rubbish … just make it up. The 10 ugliest South African politicians. The five top reasons to vote/not to vote for the ANC in 2014. Seven reasons that Blade Nzimande has become a recluse (or the 50 reasons he should become a recluse). Five secrets that are keeping Zuma in power. The 10 hottest DA members of parliament. Five reasons why South Africa sucks as an investment destination. The three top reasons why Zuma’s critics should keep their tax affairs in order. Five reasons we should not listen to the rubbish spouted by political analysts. The ten least known Zuma sexual conquests. Four ANC members most likely to become president in the next 20 years.

The point that I find so interesting is that  listicles  are almost irresistible to your finger hovering on the mouse. Just look at The Huffington Post and you will understand just how compelling (and trashy)  listicles are.

In fact listicles are so compelling that they can usefully to termed ‘click bait‘. Anyone who has ever flicked a gaudy lure in front of a fish in the hope of irresistibly drawing the fleeting piscene attention long enough to embed the hook in the creatures mouth (goodness, when I put it like that fishing sounds a faintly monstrous activity) will immediately understand what ‘click bait’ means.

I have held out against using listicles as click bait on my blog. I hope I am never reduced to heading a post with Top five political risks to investment in South Africa or 3 reasons supporting a sovereign downgrade or even Top 10 best dressed ANC NEC members. But you never know; desperate times lead to desperate measures.

 

 

*For me it’s a professional imperative: I have to get my views out there to persuade those  who might want to pay for those views (supposedly delivered in more depth) that the said views might be worth paying for … so I  trundle out my free-to-air discussion and curating on a range of platforms in the hope that this will generate paid work … which it generally does, btw. The two other reasons are

  • posting forces me to come up with a view on the unfolding situation … I am never certain what I think about something until the moment I am forced to say to someone else what it is I think – so thanks, you are that someone else;
  • keeping the blog is a way of safely storing a history of my views – this is all sitting out here in the interweb, a record of my views, safely stored away from my own lack of competence or the ill-fortune of my laptop.
  • the cloud.

By the way “deep blue” in the headline was not meant to be a riff on IBM’s chess playing supercomputer.

Rereading Part 1  I can see how someone might accuse me of being a little too certain about the shape of the future.  I am not running “deep blue” regressions and algorithms, modelling South Africa and the world, generating predictions x of y % accuracy with z % error margins … South … Africa … will … be … peachy … in …2021 … bidledeebidledee beep.

I have no real idea of what is going to happen in the future – and only the bare bones of an idea of the internal processes I go through to develop the views I advance here.

From time to time I investigate how we predict outcomes, and how we asses risks. I am interested in how our evolved systems (honed against sabre-toothed tigers and uncertain rainfall patterns, for example) apply in the kind of technology driven mega-societies we now inhabit – or, specifically, don’t apply i.e. that our ‘instinctive systems’ need to be suppressed or countermanded if we hope to get it right in certain situations. But that is not what I am doing in these quick pre-Mangaung notes.

The “deep blue” of the headline was actually a reference to being bleak, sad, cold and lonely.

Which leads me to:

Who are the demagogic populist, proto-fascists* now?

DancingANC

The ANC will (initially) combat the threat of losing support by becoming more ‘demagogic populist’, rural conservative and based in the lumpen classes – basically, by drifting to the right

In December 2010 I wrote an article in GQ Magazine under the headline: “Can you hear the drums?” with a concluding paragraph that read:

In the year 2010, anger and resentment … bubbled over  … The winners still have their stuff, but they are clutching it more tightly to their chests, and for the first time in 16 years they are straining for the hint, a sound or a smell, of what might be coming for them out of the night.

Read the whole story here.

Two ‘crises’ (or warnings) that occured this year are the equivalent of the scary sound of drums in the night for the incumbent ANC elite. The first warning is Marikana and the second, linked, warning is the traction Julius Malema’s manipulative populism was able to achieve amongst some sections of the disenfranchised youth.

I made some of these links in my coverage of Marikana here.

I think the ANC will ride out the gradually escalating social and industrial unrest by becoming the “proto-fascist” and “demogogic populist” movement that Zuma’s SACP ally accuses Malema of representing (here for the context of that). This ANC, under this president is being drawn inexorably, by the logic of its own politics, into the territory of rural patriarchy with its natural links to the fear and hatred of education and any form of gender equality. (I am not going to argue this out here … just take a glance at the saga around The Spear, the Traditional Leaders Courts Bill and various comments about women and about “clever blacks” and appeals to African ways of doing things over foreign ways of the same – see TrustLaw’s Katy Migiro’s excellent takes here  and here.)

Thus (forgive the leap) the ANC begins to lose the urban industrial working class (on the road to becoming much more like a classic middle class and deeply opposed to the looting of the state),  the professional classes (already at that destination), the productive and rule based businesses, local and global, and it eventually begins to lose the pirates looking to launder their money and ‘go straight’ (as I argued in Part 1).

This leaves the ANC with the rural poor, the marginalised unemployed, a bureaucratic elite within the state (those last three dependent on state spending through the public sector wage bill and social grants) and global resource privateers who powerfully thrive in countries like this with leaders like these.

Initially the ANC might get even higher turnout at its rallies (especially with free food and t-shirts and sexy young people dancing between the rabble-rousing and the singing of Umshini wami). But eventually the class and demographic changes of the society impact upon the party – reformat it, split it, renew it … change the political ecology in which it moves and feeds.

You will see from my next post that I do not only think the ANC is a useless bubble of foul smelling gas buffeted on the sea of history. The ANC, in my analysis, has become a most significant and material influence for and against my upbeat scenario … a sort of deranged midwife at the happy birth.

* The term “demagogic populists, proto-fascist” is from various SACP documents and was code for Julius Malema (and, I suspect, in slightly early versions, a code for Tokyo Sexwale). This is what the SACP had to say about it:

The “new tendency”

It was the SACP at the 2009 Special National Congress that first identified clearly the ideological and underlying class character of what we called the “new tendency”. We described it as a populist, bourgeois nationalist ideological tendency, with deeply worrying demagogic, proto-fascist features. It was the SACP that pointed out the connections between the public face and pseudo-militant rhetoric of this tendency and its behind-the-scenes class backing. It was a tendency funded and resourced by narrow BEE elements still involved in a rabid primitive accumulation process, based on a parasitic access to state power. It was a bourgeois nationalist tendency that sought to mobilize a populist mass base, particularly amongst a disaffected youth, to act as the shock troops to advance personal accumulation agendas.

The SACP must feel free to pat itself on the back, but the reality is that party took on the straw man of  Kebble/Malema/Sexwale and backed – to the hilt – the real demagogic, proto-fascist tendency – the one with real power … and the one with real patronage to dispense. (That last bit explaining why this SACP has backed the Nkandla Crew)

That SACP quote is from here. For my explanation of how that all fits together with the nationalisation of mines call and host of other issues here (again) .

Tokyo comes out to defend Julius Malema in the disciplinary hearing?

To be followed by Winnie Madikizela-Mandela and Tony Yengeni?

It is an almost too perfect reversal of Julius Malema’s own metaphor after his victory at the Eastern Cape provincial conference of the ANC Youth League in August 2010:

“We will never surrender to Blade. He has never been a member and has no understanding of …  the youth league … Their people have been receiving serious lashings in the youth league conferences. As we said before, we will beat the dog (SACP) until the owner (Nzimande) comes out” … (a copy of The Herald editorial I took that from here.)

The boot, at the moment, seems to be on the other foot (or ” the stick is in the other hand” might have been better – ed.)

The “dog” that is now being beaten at the disciplinary hearing is Julius Malema himself and the owners that are revealing themselves are Tokyo Sexwale, Winnie Madikizela-Mandela, Tony Yengeni and friends.

And who is doing the beating? Why, the South African Communist Party and Blade Nzimande (as well as Jacob Zuma, Gwede Mantashe and many – but by no means all – in the incumbent leadership of the ANC).

Last weekend, almost while the disciplinary hearing was sitting, SACP Secretary General Blade Nzimande said to  the SACP provincial congress in Esikhawini, near Richard’s Bay, in northern KwaZulu-Natal, that young people should be discouraged from participating in the ANC Youth League’s Economic Freedom in Our Lifetime marches and protests on the 27th and 28th of this month:

“Do not allow yourselves to be used by people with agendas that are not in your interest … We are not going to be supporting any march whose intention is malicious and to undermine the authority of the ANC and the government.”

Breaking ideological stereotypes and confusing the foreigners

Spare a thought for those of us whose job it is to explain to foreign investors why the communists are leading the fight against a youth movement calling for the nationalisation of mines, the expropriation of land without compensation and “Economic Freedom in Our Lifetime!”

I could, of course, have just sent them a few extracts from Fiona Forde’s An Inconvenient Youth – Julius Malema and the ‘New’ ANC (Picador Africa 2011).

Here she is, sitting outside a hotel in Caracas Venezuela chatting with a sulking Julius Malema on his way back to South Africa (from a conference of the World Federation of Democratic Youth taking place in downtown Caracas in April 2010)  to face his previous disciplinary hearing. She has been getting a lesson from Julius on the importance of matching the leather of his watch strap with his belt and his shoes.

Venezuela has never seen so many designer labels as it has these past 48 hours since the arrival of the South African young ones. They descended on the city with their expensive suitcases and travel bags, top-of-the-range baseball caps, flashy T-shirts, snazzy shoes and sneakers, sleek manbags and a string of other expensive accessories hanging out of them – and a bodyguard in tow – all dressed up for a socialist youth conference.

I have been wondering how they must appear in the eyes of the other youth who have flown in from all over the world, and who are also staying at the Avila. The three-star hotel is swarming with casually-dressed, young delegates and among them, to my mind at least, the South Africans seem to stand out a mile.

When we understand that these delegates are the very same people who have formulated the “Economic Freedom In Our Lifetime” slogan, the implacable opposition of the South African Communist Party to the campaign becomes  obvious.

The campaign is a classic attempt by a parasitic elite to manipulate those who are really poor and dispossessed so that these disenfranchised citizens become the battering ram and the lever through which that elite can capture even more resources and assets than it has already – through tender abuse and diversion of state resources into their own pockets.

So the dog is being beaten.

But we would be unwise not to think deeply and carefully about the nature and intentions of the owners that rush out to defend their animal.

What happens when we define ‘the enemy’ in terms that would justify shooting them down like mad dogs in the street?

I have often felt that the terms of our political debate are too extreme – from all sides of the political spectrum.

The idea or assertion that the government, the state and the ruling party is made up of an undifferentiated herd, squealing and grunting at the trough, might be rhetorically satisfying, but it’s wrong and not designed to foster our democracy.

But a more serious problem is emerging as the a Ruling Alliance, feeling threatened and burdened, has started characterising all forms of opposition as driven by white capitalists full of nostalgia for Apartheid.

The best example I can find is contained in Blade Nzimande’s Chris Hani Memorial Lecture.

Nzimande makes explicit something that is being articulated from every part of the Ruling Alliance – and it is important not to dismiss his words as part of a “loony left” view.

Nzimande defines two enemies of freedom, democracy, national liberation and “our revolution and its objectives”. These enemies are:

  1. The new tendency including tenderpreneurship and the general danger of business interests within our broad movement overrunning and defeating the revolution
  2. The anti-majoritarian liberal tendency

The first one is clearly ‘the enemy within’ – tenderpreneurs and similar – and in this he might be supported by the DA.

But in the lead-up to the municipal election, it is the second enemy and how “it” is defined that is of interest to me.

This is the essence of it pulled out as quotes and paraphrasing from the lecture:

Firstly, the Democratic Alliance and the print media are the organised representatives of the enemy.

Thus: … there is a “liberal offensive against the majoritarian character of our democracy” that with “growing arrogance and strident nature” is “pushed by the likes of the DA” but mainly conducted by its “principal ideological platform and mouthpiece … South Africa’s mainstream print media”.

Secondly, the enemy consists largely of previous beneficiaries of Apartheid:

In fact the (anti-majoritarian) liberal agenda seeks to defend, protect and advance the interests of the white capitalist class and the petty bourgeoisie, without explicitly saying so like during the era of the racist apartheid regime; and yet in a manner not different from white minority rule, but in conditions of black majority rule!

Finally, the main strategy of this enemy is to get the state to stop supporting the poor and instead make it (the state) an instrument for making capitalists richer still.

At the heart of the liberal offensive is the objective of weakening the capacity of the state to act in the interests of the overwhelming majority of the workers and the poor … In addition such state intervention in favor of the capitalist or local ruling elites … undertake(s) further measures (like repression and destruction of the trade union movement, especially its progressive components) in order to ensure that the conditions for the reproduction of capitalist relations of production are strengthened.

Believing your own propaganda

Like all effective propaganda these characterisations by the Ruling Alliance –  here expressed in the mostly pseudo-intellectual terms of Marxist Leninism – rely on packaging elements of truth with confirmations of  people’s lived experience – at the same time confirming their prejudices and fears.

In this universe a Media Appeals Tribunal or the disruption of a DA rally in Mamelodi are minor acts of resistance against an evil and dangerous invader.

The lie that the DA only represents Apartheid nostalgia equals the lie that the ANC is only a platform for pillaging the state.

Both characterisations leave the protagonists stranded on their high horses beyond the frontiers, with no roads back and no options but to push forward into the night.

I am clicking “Publish” in a rush … I suspect I will come to regret this later.

Anyway:

The popular mobilisations in Tunisia, Egypt and a swath of authoritarian North African and Middle Eastern states are interesting and important for more reasons than can be named, let alone examined, here.

But the aspects that have fascinated me are the over excited “I told you so!” claims of pundits, politicians and much of the Twitterati.

And not just the assertion that they had this right all along, but that they somehow understand the clattering Nasserite dominoes better than anyone and would just like to point out that it’s coming to get you. Yes, you (insert name of political opponent here), the revolution is coming for you.

There are literally hundreds of “takes on the crisis” I would like to poke fun at and take to task over this absurd conceit, but there is one I will look at (only slightly) more seriously.

Blunt Blade’s Bollocks

Blade Nzimande takes George Galloway’s excellent communist tirade in his column in the Morning Star (read it, it is also bollocks and brutal and crass but has enough thought and truth in it to warrant a second look) and turns it into the obscure and rambling  “Tunisia and Egypt: The deepening crisis of US imperialism and neo-liberalism“.

Where are the South African communists of yore who could always be relied upon to lift the veil, expose the skull beneath the skin and see the ape within the man? Oh yes, they are all dead or helping run the Department of Transport or become  bloated and insecure plutocrats … hmm, is that everyone?

Blade has it that Tunisia and Egypt are manifestations of a series of crises in capitalism “and its contemporary neo-liberal ideology”.

In short (in as far as I can understand Nzimande) the USA as the global representative of the corporate/capitalist machine has fostered dictatorships in the Arab world because they have agreed to leave the USA’s good friend Israel in peace.

So far so good, but then things start to unravel. Political upheaval in these Arab and North African countries sets back the USA’s task to reproduce the conditions of capitalist accumulation – through an amazingly complex web of dialectical causality. Thusly, the selling of upsized McDonald’s meals to the American guest workers rebuilding (if they work for Haliburton) and de/restabilising (if they work for Blackwater USA) any countries the US has recently invaded is threatened, because democratic governments are more likely to take a hard line on Israel … eh … oh goodness, there goes the thread.

You cannot successfully characterise Tunisia and Egypt as “crises of capitalism” unless you take an amazingly complex and interlinked world and reduce it to a childish little model that even the crudest Marxists would reject as ‘reductive’ and ‘over-deterministic’.

If  the term “capitalism” means the totality of international relations between states, global trade, the activities of local and international corporations and the shaping effects of culture, history and technology, then it is less than useless to characterise Tunisia and Egypt as “crises of capitalism”.

If the term “capitalism” refers (as I suspect it does, when used by Nzimande) to the secret set of rules in a secret club of greedy Americans who seek to control the world to protect and deepen their wealth, then I am sorry, but you can’t really be expected to be engaged with.

There are powerful and organised interests at play in North Africa and the Middle East and only a fool would not look to the USA for the sources of some of those forces. But there is also chaotic human activity and chance and rapidly unwinding and reforming complex systems that are part of what is happening and the blunt scalpel of Blade Nzimande’s theory takes us nowhere.

I would still recommend Galloway’s piece (as more insightful and the source of any interesting thoughts in Nzimande’s words on the subject) because part of what is happening in the Middle-East and North Africa is the unravelling of another mystifying US strategy to define, protect and advance its “national interests”.

What I wish the communists would give more attention to is not the greedy and rapacious aspects of US imperialism, but rather how it is often profoundly misconceived and poorly executed.

In my view human society should not be conceived of as “shaped” by particular forces or of being set on a certain “trajectory”. The totality of human existence is not an object (plastic and/or in motion). The totality of human existence – including the bits of it in Tunisia and Egypt – must be conceived of as a system so complex that making predictive statements is not hugely useful. Also, attempting to reduce the complexity to make it more understandable is a worthwhile endeavour only if undertaken with extreme caution and care.  Cooking it up as proof that your side is winning adds no real value.

In as far as the statement: “what is happening in the Arab world is a failure of US imperialism” is true, I suspect the reason is that successive US administrations have misconceived both the nature of history (as has Nzimande) and the nature of their own interests – not an error Nzimande appears obviously to have made.

I occasionally publish slides that I have used for clients as part of my attempt to examine political and investment risks to them.

Below are 3 from a presentation I delivered soon after the ANC NGC.

See if you can identify all the people concerned – a sort of politics general knowledge test ( you know the ones: if you score 10 you are probably a CIA/MI5 agent; if you score 9, then get a life and stop obsessing about politics …. if you score 2 you are living in a special care facility etc.)

As an aid here is a link to Stalking horses at the NGC – the blog I posted at the time. To help refresh your memory ‘the NOM’ was meant to describe the group that had coalesced around the ANC Youth League’s call for the nationalisation of mines.

Ruling alliance in happier times

Commentators and politicians are outdoing themselves announcing either the end or the permanence of the ANC/SACP/Cosatu alliance.

This is Jacob Zuma on the subject – at the Kwazulu-Natal ANC General Council on Friday:

I have read so many alliance obituaries. If leaders express their views, people think that we are fighting … The alliance will be with us for a very long time. (Catch that here)

And this is my (humble) opinion on the subject:

This strike –  as a culmination of other things but also in and of itself – is the death knell for the ruling alliance. (Catch that here)

This business about claiming that the alliance is about to break or will last until the Second Coming is something of a secret code for insiders in the political analysis business. “Insiders” are smugly convinced that the tripartite alliance benefits its constituent elements and these constituents will therefore never leave – and we love to use the analogy of a marriage where the couple fights endlessly but is bound by children, finances and habit so tightly that the partners will be together until death parts them.* I discuss some of the ties that bind here.

“Outsiders” – including those who have never belonged to any of the organisations concerned, as well as foreigners and supporters of parliamentary opposition parties – listen to the noise coming out of  ‘the alliance’ and they take the noise-makers at their word: the alliance is heading for the rocks; it is obvious to anyone with eyes and ears.

The “outsiders” have it.

Philosophically, I am one of those who believes we are what we do. Thus, it is not what Zuma, or Malema or Nzimande or Vavi claim, it is what they, and their organisations, do that counts.

The ruling alliance is not, primarily, a name. It is a description of a shared history, set of values and, most importantly, an accepted set of policies and an agreed upon process for deciding about such policies; and is also the formal forums and organisational structures through which such decisions are taken and implemented.

The only thing of significance that “the ruling alliance” did was throw Mbeki out of office and replace him with Jacob Zuma. Everything that has happened since needs to be seen through the “you are what you do” prism. The constituent organisations have done nothing together except violently disagree, actively try to undermine each other (and each other’s leadership ) – and they have agreed upon nothing and done nothing in concert.

Except for the media appeals tribunal (catch my criticism of Jeremy Cronin’s defence of that here) which, bizarrely, is the single thing that the ANC, the SACP and Cosatu have agreed upon – although Cosatu is wavering even on this as the damage done by the public sector wage strike to their relationship with the ANC deepens and intensifies.

It is as if they are saying: “We (as ‘the alliance’) have nothing to offer – but we have a plan to slap anyone down who point that out.” Frankly, I am not surprised.

* (note) What the “Insiders” are actually referring to is a sense of identity invested in the struggle against Apartheid under the broad leadership of the ANC and, crucially,  that traces its ideological lineage through to the “Congress Movement” – from the United Democratic Front, the Natal Indian Congress, South African Congress of Trade Unions, the South African Communist Party, the Congress of Democrats, the Transvaal Indian Congress and the African National Congress.

(Hmm, I am adding this half an hour after posting the above, just to make myself as clear as I am able, and in case anyone missed the point: If the structures don’t exist, if the decisions are not taken or implemented, if there is real and intense conflict over policy then ‘the alliance’ has already ended – and it makes no difference what the various leaders and commentators say. This is the de facto situation, even if it is still possible to argue that, de jure, the alliance continues on and on.)

Jeremy Cronin’s light defence of the proposed media tribunal couldn’t have come at a worse moment – a few hours before the showy arrest of the Sunday Times journalist Mzilikazi wa Afrika.

That’s a pity, because his comments were more sensible and readable than those of his comrades – although still misguided and, ultimately, dangerous, as I shall argue.

Jeremy Cronin - no longer a victim of the powerful

It’s difficult not to lump into one basket the various hostilities emanating from government and the ruling alliance towards the media.

Aside from the aforementioned arrest, and several high-profile verbal attacks on the press,  there is the Protection of Information Bill wending its way through parliament and the ANC’s own proposed ‘media tribunal’ up for discussion at that organisation’s National General Council in a few weeks time.

Here  for a link to the ANC’s extraordinarily badly written and poorly argued document (Media Diversity and Ownership) proposing the media tribunal. Here is Jeremy Gordon’s irritated criticism of the document on the happily trending rightward Politicsweb. Here, for those with time on their hands, is the tedious Protection of Information Bill.

I think the impression that the ANC and government are engaged in a concerted effort to make the media more compliant is indisputable. The fact that they are doing what governments, ruling parties and “the powerful” do in all places and at all times does not mean they should not be criticised and watched carefully and suspiciously. It just means that we should be less breathless and astonished when we do the criticising and watching.

So before Cronin’s piece gets drowned out by the sound of jackboots let us examine the points he makes.

Firstly he correctly points out that the major newspapers have had a nasty few weeks – he mentions Business Day apologising to General Nyanda for shoddy journalism in a story “alleging intended corruption in the suspension of his Director General”. He points out that The Times carried an apology for a story alleging that Blade Nzimande had called for the jailing of journalists (catch a cached version of the original stupid story here – frankly The Times deserves whatever punishment they it gets for that trashy headline!)

Cronin interestingly chooses not to mention the City Press being forced by the Ombudsman to apologise to ANC Treasurer General Mathews Phosa – see that here. It is possible that his deadline missed the release of the Ombudsman’s order, but he may not have mentioned it anyway because his point is that the self-regulatory mechanisms are inadequate – that what we need is a tribunal answerable to parliament.

Where Cronin deserves credit is he then lists the various problems he and his comrades have with the media that a media tribunal is not designed to address:

  • the  “narrowly anti-ANC oppositionist stance” of much of the “print media”;
  • failing to balance the “watch-dog” role with other roles like providing “ordinary citizens with accurate information”;
  • the centralised ownership of big newspaper “corporations” (a matter he thinks would be better addressed by the Competitions Commission);
  • The foreign ownership, especially of the “Independent” newspapers, which has resulted in working capital draining out of these organisations to support loss making operations in other countries;
  • the “trashy tabloid” character of much of the print media, that results from the profit imperative being imposed on the newsrooms.

For Cronin, the ‘media tribunal’ is somewhere that:

… members of the public, including (but not only) high-profile personalities, can take concerns around grievous misrepresentation and unethical reporting …

without having to go to the expense and difficulties of the courts.

Now if that was all there was to it we would all pat Jeremy (Cronin, not Gordin) warmly on the back and add our support to the tribunal. There are two linked issues, however, that I would like to take up with Cronin.

Firstly the tribunal is not argued in anything like the terms that Cronin argues in the gigabytes of documents and criticism that come from his comrades and their various organisations – just throw your eye (as certain South Africans are wont to say) over the aforementioned execrable Media Transformation, Ownership and Diversity document. In amongst all the bullying and bombast is every single argument that Cronin disavows.

So are we meant to accept the media tribunal for the sensible reason that Cronin advances or reject it for the outrageous and dangerous reasons his comrades advance?

The second issue I wish to take up with Jeremy Cronin is more subtle but actually gets my goat in a more profound way. In a thousand different ways Cronin presents himself and the ANC as the wronged victim of the powerful, centralised, foreign owned and corporate print media. This is big business imposing its arrogant will on the democratic movements of the people and the workers.

That is, quite frankly, rubbish. It is time that Cronin woke up to the reality that he is the powerful one and/or the representative of the powerful. I get that big business is going to be selling its line into the public consciousness every chance it gets, but it will take a lot more than Cronin’s innocent belief in his own good intentions and the good intentions of his comrades to convince me that they are, in fact, not the bigger of the problems that confront us and our media.

Herewith a note I wrote a week ago for a South African client concerning a recent whip around the London fund management industry

Foreign fund managers perceptions of South African political risk

I recently had an opportunity to interact with a few London-based global emerging market fund managers. These were generally from long-only equity funds, but included a smattering of everything else.

The main lessons I learned were

  • not to be overwhelmed by the negative news flow;
  • always think in relative terms – a negative and obsessive focus on South Africa is meaningless without realistic peer comparisons.

This was brought home to me again as the weekend news of the brutal killing of Eugene Terre’Blanche hit the local and international press. The media focus alone seemed to suggest that this was a potentially destabilising event. However the story has quickly descended into the squalid domestic tale it really is, and the over-the-top alarmism should be faintly embarrassing to those who trumpeted it over the holiday weekend.

Here are the main questions I raised in London and the main responses I received*:

The news explosion around Jacob Zuma’s latest romantic and similar engagements does not drive capital flows

This point did not need emphasising with the fund managers I saw. If anything they were faintly puzzled as to why I would bother to raise it. For them the emerging market universe has much colourful (and sometimes ugly) personal behaviour by the political leadership and other powerful members of society. Zuma’s polygamy and latest love child are way down the list of “transgressions” in that universe.

Conflict over economic policy making the investment and operating environment difficult

The point I was making was that Pravin Gordhan’s budget speech differed in important ways from both the DTI’s Rob Davies’ Industrial Policy Action Plan II and Ebrahim Patel’s Two Year Strategic Plan. My issue with this was that Jacob Zuma had not settled important policy conflicts within his cabinet.

The different emphases could be summarised as follows:

  • Pravin Gordhan supported fiscal restraint, inflation targeting, a segmented labour market and a competitive and unprotected manufacturing sector – and for this he was heavily criticised by Cosatu.
  • The policies espoused in IPAP 2 and the Two Year Strategic Plan from the Department of Economic Development implicitly called for monetary easing, a weaker currency and a vigorous programme of interventions into the domestic economy through the use of tariffs and taxes – policies strongly supported by Cosatu.

Several of the fund managers that I interacted with had recently (within the last few months) met with all the ministers concerned either as part of a marketing tour led by Jacob Zuma or while in South Africa themselves. The detailed interactions with all these departments had convinced them that the policies of government were the policies as espoused by Pravin Gordhan and further that the more activist policies from Patel and Davies were not uncommon in emerging markets and at least did not include new capital controls.

I am not convinced the policy confusion is ‘investment neutral’ – although I do not think is catastrophic. Cosatu and the SACP clearly believe they have a chance to set policy – including monetary and industrial policy – through the DTI and the new Department of Economic Development. Thus Jacob Zuma seems to be clearer and more decisive about these issues in front of foreign fund managers than he ever is in front of a domestic audience. He will reap high resistance and anger from Cosatu and “the left” when they realise they have been lied to again. I think it is clear we are seeing the first signs of this realisation – in, for example, the threatened strikes during the World Cup against Eskom increases.

Julius Malema and the Nationalisation of the Mines

Julius Malema provokes a lot of reaction wherever he is discussed. Not many fund managers take him seriously and again it is because they have met and dealt with senior government and party officials who have spoken of Malema with patronising indulgence and a touch of exasperation.

Susan Shabangu, Minister of Mining, has done good work in assuring fund managers throughout the world that there is no possibility that the South African government will consider the nationalisation of mines as a serious policy option; and I came across several people who had met her and been convinced by her assurances.

Cronyism and tenderpreneurial flair – the threat to service delivery, stability, the functioning of the parastatals

Continuing on the theme of Jacob Zuma’s inability to solve the big conflicts in his government I argued that cronyism, nepotism and tender abuse are:

  • important contributing reasons for the poor functioning of the State Owned Enterprises – the Eskom example reveals that enrichment agendas in tendering and the appointment of senior personnel damages the utility’s ability to do the job;
  • key to understanding the failures of local government and hence the ongoing violence of the service delivery protests.

There were few fund managers I met who disagreed with this assessment, although some, yet again, argued that in the universe that includes Russia, the Middle East and Brazil, South Africa stands out less than we would imagine.

The World Cup and the waiting Hangover

It is perverse to argue that the downside of the World Cup includes:

  • it could become the focus terrorist attacks;
  • it could be targeted by organised labour and taxi operators to strengthen their hand against government or employers;
  • it will inevitably entail a let-down or ‘hangover” period.

This would be a little like arguing that the downside of life is death and that it should therefore be avoided.

I never met a fund manager in London, or elsewhere for that matter, who disagreed.


*Please note that this is a subjective process, over determined by my own interpretation and by a selection processes out of my control. Any real collation of “the views” of fund managers must theoretically translate into their holdings and the prices at which they buy and sell.

The spat over Tokoyo Sexwale’s report criticising Gwede Mantashe for not stopping the booing and humiliation of Julius Malema at the SACP conference in December is more important than it seems.

The direction a country takes (economically, socially and culturally) emerges from the interplay of too many factors to make the future even vaguely predictable. But it is always useful to look at the big bets being made by the most focussed and voracious players in politics and business. So, one way of understanding what is happening in the ruling alliance (and I accept there may be other ways) starts by assuming Tokyo Sexwale’s actions are always and at all times directed towards becoming president of the ANC in 2012 or failing that, in 2017 – not a weak assumption in my opinion. Becoming president of the ANC is the same as becoming president of the country (in 2014 or 2019 respectively).

Tokyo is placing himself – carefully and precisely – within the contest and conflict between “nationalists” and “communists” in the ruling alliance and he is doing so because he believes he can ride one side to victory over the other – and then ride that horse on to almost any destination he wants to hop off at. I am not sure that he can get what he wants this time around, but I would bet a considerable amount of money that these are his intention.

The conflict (which Tokyo hopes to exploit) between “nationalists” and “communists” is, in turn – and again in my opinion – also a proxy conflict, although one closer to, but still not perfectly reflective of, the real world.

(Please note that I am doing my own lumping of people below and – to some degree – I am using very loose definitions of “nationalist” or “communist”. The individuals hereby lumped would be unlikely to support my categorization or any of the implications I draw. I justify using the categories because right now there appears to be a significant overlap of both the language, actions and how individuals line up around the issues dividing the alliance within each group – giving the terms and/or concepts ‘communist’ or ‘nationalist’  particular force and effect for analytical purposes here.)

The nationalists

The nationalists include in their ranks those who believe the ANC must seek to represent all classes of South Africans and that the recent relative strength of the communists is damaging this endeavour. Here too are the anti-communists (for practical and/or ideological reasons) as well as the right-wing hang-em-high populists. The main component – and or the main hangers-on, depending on your perspective – of this group are the “TenderCapitalists” and those who otherwise hope to leverage their political access to take as much economic advantage of the state or quasi-state bureaucracy as possible.  Those in this broad category include Fikile Mbalula, Julius Malema, Billy Masethla, Tony Yengeni, Winnie Madikezela Mandela, Siphiwe Nyanda, Dina Pule, Ngoako Ramatlhodi, Nomvula Mokonyane.

This group and anyone trying to lead them, can draw on a rich intellectual tradition in the ANC that has always emphasised the dangers of the organisation adopting too narrow an ideology and thereby losing its ability to provide leadership to other classes (in the terms generally used in this and the communist traditions in South Africa these ‘other classes’ include peasants, the lumpen proletariat {i.e. the unemployed and the youth}, professionals and aspirant bourgeoisie and, more controversially, the actual bourgeoisie.)

At this stage the two organisations clearly dominated by this group are the ANC Youth League and the Umkhonto we Sizwe Military Veterans Association.

The communists

The communists are less diverse, but probably range from those driven purely by ideology and an instinct for collectivism (or being rooted in collectivist organisations like Cosatu) to those genuinely motivated to get the best deal possible for the poorest South Africans – even if their economic theory is never going to deliver this result. Those within this group include Gwede Mantashe, Blade Nzimande, Jeremy Cronin, Zwelenzima Vavi  and a host of less well known individuals. Both Cosatu and the SACP are dominated by individuals from this group.

If the main show (politically) in town is actually, as I assert, the conflict between the nationalists (as described) and the communists (as described) then the outcome of the conflict can be in no doubt. The nationalists come closer to being an economic class or at least an extremely powerful group of people who have one overwhelming set of interests in common: their desire, preparedness and ability to use the state to get rich. The communists have a set of idealistic ideas and a trade union movement. They don’t have a hope of blocking the relentless march of those who have caught the heady scent of easy riches.

What is depressing is that the communists had an inkling of the dangers they would face after they had successfully allied with the nationalists to oust Mbeki at Polokwane. This from The SACP and State Power – The Alliance Post Polokwane – Ready to Govern:

A negative scenario in which the left fails to hegemonise the post-Polokwane reality, and instead (and particularly after national elections in 2009) a new alliance of “1996 class project floor-crossers”, “compradorists” and “fugitives from justice” coalesces around a programme of awarding influential posts, tenders and contracts to themselves, while the factional destabilisation (and not democratic transformation) of the state, including the criminal justice system, persists.

Tokyo?

So back to the original premise. I think it is becoming clear that Sexwale, having made his money through Mvelphanda after being stopped in his tracks by Mbeki in the late 90’s, is back in the running and he has chosen the steed he hopes to ride to the presidency.

Can he pull this off? I think he is tainted by how rich he is and will be more so as accusations emerge that he is using his wealth and Mvelephanda contracts to reward certain factions and king-makers he hopes to woo.  I don’t know if the accusations are true, but they are certainly being bruted about. I think a run for the presidency by Tokyo would be formidable – especially now that Mbeki is no longer there to stop him like he was stopped in the 90’s.

So the long and the short is: he could make it, he’s got the wiles and the stamina and the financial muscle. But a post-Polokwane ANC president with a silver spoon in his mouth is a real stretch and Tokyo Sexwale’s bid will be up against it, no matter how skilfully he rides his powerful but ugly horse.

Having  just returned from an idyllic holiday, I am forced to take stock of what I missed …

The Communists versus the TenderCapitalists

A “TenderCapitalist” is not an over-sensitive entrepreneur. It is a South African person, much loathed by the communists,  who uses his or her  race and/or political connection to win tenders from the state or from private companies hoping to fulfil their BBBEE requirements or just hoping to suck up to the ANC. The South African Communist Party has made it clear it thinks the ANC Youth League president Julius Malema is the ring-leader of this faction in the South African political economy.

The SACP conference and the booing of Julius Malema brought things to a head and throughout December and early January there has been something of a toing and froing between Julius Malema and Blade Nzimande.

The spat continued at the Slovo memorial in Soweto on Wednesday 6th of January when Nzimande said that “narrow African chauvinism” threatened Slovo’s non-racial vision and that the slogan: “liberation of blacks in general and Africans in particular” should not be “corrupted into a narrow anti-white African chauvinism” – quoted in Independent Online.

A few days later at the ANC 98th birthday rally in Kimberley Julius Malema suggested that there were “super-revolutionaries” that wanted to “co-govern” with the ANC. On Sunday, in a statement apparently coordinated with Malema, Jacob Zuma said in an SABC interview that the ANC does not “co-govern” with any other party. In response Blade Nzimande, quoted in The Times, said:

I don’t know who coined the term. It’s people’s figment of their imagination. This issue is manufactured by people who are anti-communists.”

The stage is set; let the theatre commence.

The death of Tshabalala Msimang

Manto Tshabalala Msimang died on December 16 of complications from a liver transplant. Msimang was minister of health from 1999-2008 and presided over a period of health policy uncertainty that began with Thabo Mbeki’s insistence that there was no evidence that HIV causes AIDS. A committed revolutionary who went into exile in 1962 under orders from the then banned ANC, Manto Tshabalala Msimang died as government policy and practice around the HIV/AIDS epidemic finally started to achieve traction.

Matric pass rate drops – again

On Thursday last week education minister Angie Motshekga announced the matric results which showed a two percentage point decline in the already dismal pass rate to 60.6. This is the sixth successive year of drops. The figures are, on closer examination, even worse than they first appear. The science pass rate (those who got above 30%)  dropped about 15 percentage points to 36.8 and the maths pass rate remained unchanged at 46 percent. Nothing is better predictive of future prosperity than improving education outcomes. Nothing (obvious) is more predictive of future troubles, on a number of fronts, than the converse.

Attack on Togo soccer team at CAF in Angola

On Friday January 8th the bus carrying the Togo soccer squad to CAF fixtures into the Kabina enclave in the extreme north of Angola. Several officials and players were injured. Rebels in the Kabinda enclave have been at war since the early 60’s (firstly against the Portuguese and later against independent Angola which has insisted that the oil rich territory stay incorporated as part of the country).

The South Africans have insisted that any suggestion that the security situation in northern Angola is in any way similar to that expected to obtain at the World Cup in South Africa later in the year is ludicrous and possibly racist. However all national security officials will have been reminded how easy it is to target an international sporting event to get maximum coverage for your cause, as I argued here. Watch this space …

President Zuma moves (way) up in the popularity stakes

Sapa reports (on South Africa – The Good News – and in many other places) that Jacob Zuma has increased in popularity amongst all groups but most notably amongst Indians, Coloureds and Whites since last April’s election. It’s a surprise, but mostly a good one.

Tomorrow morning at the crack of dawn I will begin travelling with my children for a respite after two years of my (it seems somehow personal) Great Recession.

We will be moving through some places that are less connected than others, so I will be posting irregularly for some time.

For this reason I wanted to say something  about  the South African Communist Party’s special conference in Polokwane before I go and before it finishes on Sunday.

Our red brethren have been meeting since Thursday and it seems they have been having an interesting and boisterous time.

Much of the media coverage has centred around a visit by Julius Malema, Billy Masetlha and Tony Yengeni during which the ANC Youth League president was booed and reportedly walked out in a huff, threatening to ‘tell on’ to the president.

But the underlying conflict that is playing itself out between the SACP and a powerful faction of the ANC is the main show in town.

And the SACP leadership is ‘on message’, constantly attacking what it sees as emerging black capitalists whose primary method of accumulation is tender abuse and looting of the state. It appears that the communists believe this “project” is THE real and immediate danger.

The coordinated attack emerges from even a cursory reading of (most importantly) the political report to the conference, but also from the opening address (some of these links are a little dicky – it seems to be a problem with the SACP’s site) by SACP chairman, Gwede Mantashe, a speech by Cosatu’s Zwelenzima Vavi and an address by the Young Communist’s Buti Manamela.

The political report says it most clearly (it’s a longish quote, but it gives one an excellent idea of the main issues in our politics):

This new tendency has its roots in what we might call “Kebble-ism” – in which some of the more roguish elements of capital, lumpen-white capitalists, handed out largesse and favours and generally sought to corrupt elements within our movement in order to secure their own personal accumulation agendas. Some of this largesse helped elements within our movement to emerge as capitalists in their own right.

(…)
In particular, these elements of BEE capital have been exploring a class axis between themselves and the great mass of marginalized, alienated, often unemployed black youth. The material glue of this axis is the politics of patronage, of messiahs, and its tentative ideological form is a demagogic African chauvinism. Because of its rhetorical militancy the media often portrays it as “radical” and “left-wing” – but it is fundamentally right-wing, even proto-fascist. While it is easy to dismiss the buffoonery of some of the leading lieutenants, we should not underestimate the resources made available to them, and the huge challenge we all have when it comes to millions of increasingly alienated, often unemployed youth who are potentially available for all kinds of demagogic mobilization.

We do not use the term proto-fascist lightly, nor for the moment should we exaggerate it. However, there are worrying tell-tale characteristics that need to be nipped in the bud. They include the demagogic appeal to ordinary people’s baser instincts (male chauvinism, paramilitary solutions to social problems, and racialised identity politics).

Now  I disagree with a host of the economic solutions that the communists seem to take as gospel and I am convinced that left to their own devices they would kill creativity and diminish personal liberty without commensurate social gains. However, it is the communists who appear to be most clearly identifying where we are going and what the dangers that confront us are.

They might be full of economic nonsense (i.e. stuff with which one disagrees) but you can always trust the reds to spot the fascists before even the fascists themselves know what they have become!

It is, inescapably, time for a little weekend editorialising.

Yesterday I summarised the main content of Jeremy Cronin’s criticism of  the ANC Youth League’s “nationalise the mines!” call. In as far as it is possible I summarised Julius Malema’s response to Cronin – his comments consisted primarily of  racial abuse and pompous meandering. This morning I woke filled with the urgent need to write something more and to use a tone that was ever so slightly sharper.

There are three conclusions or indicators that seem to me to shine (or rather ‘gleam balefully’) through this exchange.

1. The Zuma government and ANC are dangerously weak at the centre

Debate and the free flow of ideas is almost always a good thing.

But this isn’t debate or the free flow of ideas. Malema is not putting forward an argument. There are no ideas flowing freely between Cronin and Malema.  Malema is (essentially) racially abusing someone who has entered into the  ‘healthy public debate’ originally called for by the ANC Youth League. And there is no centre of leadership that seems able to repudiate this, to put some kind of limitation on Malema. Where is Jacob Zuma? Where is Blade Nzimande? Where is Gwede Mantashe? Why shouldn’t foreign investors,  fund managers,  and ordinary citizens not conclude that Malema represents the “real ANC”? He is ex-officio on the NEC and the NWC; he is clearly a powerful and influential ANC politician in his own right – as I argue here; he appears to have been blessed and anointed by Jacob Zuma on several occasions?

It is becoming inescapable: the reason for the level and tone of bullying racial abuse that passes for “debate” about race, nationalisation, black management in the parastatals – you name it – is that there are NO guiding ideas coming from the centre. At this level it is becoming clear that, indeed, the centre cannot hold.

2. Race to the finish

Jeremy Cronin is not some Jimmy-white-racist off the street that Malema should feel safe to abuse and dismiss. Cronin is a revered ANC and SACP leader, poet, intellectual, ex-political prisoner. If Malema can dismiss him as a “white Messiah” a “reactionary” and a racist – with the implicit support of the whole edifice of Zuma’s government and the ANC – why would any white South African, or white non-South African for that matter, believe that they might have something to offer up to the country, to the debate, to the future?

The “race card” played with such impunity by ANC and government leaders – and other important South Africans – is becoming a bizarre obscenity that has long undermined any legitimate attempt to combat racism. Crying wolf about racism means that we no-longer recognise it when we see it. It is becoming much safer to assume that the cry “racism” is an attempt to throw off pursuit or criticism.

3. Malema is a looter and Cronin an imperfect builder

It appears (to me anyway) that Malema represents those who hope to leverage their “race” (using the imperative for affirmative action, black economic empowerment and transformation more generally) and the general dominance of the ANC in government, to loot the state and ransack the economy.

The Eskom/Bobby Godsell/Jacob Maroga debacle, which I cover here exposed the Black Management Forum and the ANC Youth League as being on the side of crony capitalism and Cosatu as being on the side of development and the effective use of state assets. The clash between Malema and Cronin emphasises the point even more clearly. Everything that Malema argues (or rather bombastically threatens) implies that he claims to speak for “black people” as “black people” – with all the attendant historical disadvantage and current entitlement to redress.  Everything that Cronin says is about perfecting a developmental strategy to address poverty and unemployment.

Now a difficulty for me here is that I think Cronin’s premise is wrong and in any other situation I would rather argue about his implicit hostility to business and markets. However, my argument with Cronin is one about strategies and tactics – and I would have no quibble with the end goal of rolling-back poverty, inequality and unemployment and the creation of a better society.

Malema, on the other hand, wants nothing more than his and his cronies turn at the trough.  There is no evidence or reference to social goals in Malema’s bombast; there is only a threatening racial antagonism, a chauvinistic racial solidarity and a bullying demand to be given more of the assets of this state and economy to dispose of in consumption.

Late yesterday the  South African Communist Party came out in defence of its deputy secretary-general and it is probably appropriate to let them have the last word (and I will try not to quibble with the details):

20 November 2009

The SACP wishes to condemn in the strongest possible terms the insults that the President of the ANC Youth League hurled at our Deputy General Secretary, Cde Jeremy Cronin. We find it very strange and politically dishonest that whilst on the one hand the ANCYL calls for a debate on the question of nationalization yet, on the other hand, it throws insults on those who are taking up the debate.

As the SACP we shall not sink to this level of political and intellectual dishonesty, but instead we call upon the President of the ANCYL, or anyone for that matter, to engage the issues raised by Cde Cronin in a principled and comradely manner, without resorting to the Mbeki era type of insults against the leaders of our Party.

For the record, we invited the ANCYL to participate at our political school last month, to, amongst others, debate this matter of nationalization, but did not take up the invitation. We wish to further invite the ANCYL to feel free to respond in any of our publications to debate this and other matters, in a principled manner.

Issued by the SACP

Malesela Maleka
SACP Spokesperson – 082 226 1802

And from me (Nic) have a good weekend and thank you for your patience.

Jeremy Cronin argues in the SACP’s Umsebenzi Online that Julius Malema’s “off-the-wall sound-bites” give the impression that he is making up policy about nationalising mines “on the hoof” and “individualistically”. Jeremy then goes on to examine – and ultimately dismiss – Malema’s call for nationalisation of the mines. I examine his reasons below … but first:

Malema shot back, repudiating Jeremy Cronin’s statement as “openly reactionary, clothed in quasi-Marxist rhetoric, with potential to make a sorry and sad reflection of the true character of the South African Communist Party’s ideological steadfastness”. Catch that here as I fear it might be in the process of being removed from Julius’ official  Blog.

First Jeremy Cronin. He argues in his famously calm and persuasive manner that nationalisation doesn’t necessarily mean NATIONALISATION. Yes the call is rooted in the relevant paragraph of the Freedom Charter:

The People Shall Share in the Country’s Wealth!

    The national wealth of our country, the heritage of South Africans, shall be restored to the people;The mineral wealth beneath the soil, the Banks and monopoly industry shall be transferred to the ownership of the people as a whole;

Putting aside (my personal) question marks about the authenticity of the authoritative or democratic status of the Freedom Charter –  Jeremy Cronin says it is important to understand that the above paragraph was written in nationalisation’s heyday, including when “the apartheid regime was consolidating an extensive state-owned sector.”

For Cronin the Freedom Charter is most important in its assertion that “the people”, not “the government” shall govern.

Thus Cronin supports the idea that “the people” get the full benefit of the economic resources (not that there be a

narrow bureaucratic take-over by the state apparatus and the ruling party’s “deployees”

His choice words here clearly hints (in my opinion) that he thinks this is the version of nationalisation that Julius Malema is working towards.

The state owning important aspects of the economy says nothing, for Cronin, about whose interests are being served:

Hitler’s Nazi Germany, Mussolini’s fascist Italy, and Verwoerd’s apartheid South Africa all had extensive state ownership of key sectors of the economy.

So for Cronin the 2002 Mineral and Petroleum Resources Development Act has already gone some way to fulfilling the Freedom Charter’s objectives by explicitly stating:

that “South Africa’s mineral and petroleum resources belong to the nation and that the State is the custodian thereof ….  In other words, it is the “nation” (with the state as custodian) and not the mining companies that have legal ownership of the mineral resources beneath our soil.

Cronin argues nationalising:

mining houses in the current global and national recession might have the unintended consequence of simply bailing out indebted private capital, especially BEE mining interests

And further that:

Many of our gold mines in particular are increasingly depleted and unviable. Some reach costly depths of four kilometres below the surface. Recently the global gold price has bounced back, but it is telling that, unlike in the past, our gold output actually dropped by some 9% in the same period. Our gold mines are simply no longer able to respond dynamically to gold price rises.

Cronin (while making it clear he thinks “the people owe the mining houses absolutely nothing”) argues that the Bill of Rights sanctions expropriation but requires compensation at a price agreed by both parties or determined by the courts.

The bottom-line for Cronin is that nationalisation would do nothing to further the “national democratic struggle”. Rather it

would land the state with the burden of managing down many mining sectors in decline … burden the state with the responsibility for dealing with the massive (and historically ignored) cost of “externalities” – the grievous destruction that a century of robber-baron mining has inflicted on our environment. In the current conjuncture, nationalising the mining sector at this point would also probably unintentionally bale-out private capital, in a sector that is facing many challenges of sustainability. The problems of liquidity and indebtedness for BEE mining share-holders are particularly acute.

Malema’s angry response

Charmingly, Malema ends off his response with the comment:

We also do not need the permission of white political messiahs to think.

And before that closing paragraph there are oceans of vacuous rhetoric and bombastic bullying  you have to fight your way through to find an argument with which to engage.

Cronin is, according to Malema: White, reactionary, “counter progress”, not reflecting the views of the SACP, misunderstanding the Freedom Charter, “very sad”, guilty of isolating Malema from “the organisation” and he “reaches reactionary conclusions”.

I have picked Malema’s statement apart with some care and there is absolutely no content (that answers Cronin) except for bullying and vague appeals to authoritative historical ANC figures. This quote is a good summary of everything Julius Malema had to say:

It is sad that previously, those who look like us were considered intellectually inferior by the white supremacists, and today Comrade Jeremy reflects the same sentiment, even before he interacts with the views of the ANC YL.

Right near the end of his rambling abuse, Malema says (as if he has imperfectly copied it from somewhere else):

Part of the models we are considering as an approach to Nationalisation of Mines is the Botswana model where De Beers is a 50% partnership with the Botswana government and still pays royalties and tax.

Well that doesn’t sound too stupid (if you ignore the grammar) , but we will have to wait and see.

Conclusion

The great nationalisation debate is alive and well. Unfortunately the exchange examined here is between our most sensible communist and the exasperatingly gung-ho ANC Youth League leader – these are hardly realistic poles in the debate.

We will continue to focus on nationalisation and the state of the debate in the Ruling Alliance. But meanwhile, what is interesting in the exchange between Cronin and Malema is that both made it abundantly clear, that while they are not happy with the constraints, there would be no circumstances in which either would propose a solution that lies outside of  The Constitution and The Bill of Rights. How adult is that?

Today Pravin Gordhan presents his (and Jacob Zuma’s) first Medium Term Budget Policy Statement.

The post-Polokwane guillotine has been working overtime off late and we have seen the last remnants of the Ancien Régime flushed from the party, the state and government. The last man standing is Trevor Manuel, balancing precariously on a rapidly shrinking toe-hold.

Today we learn what Polokwane is going to mean for government plans to spend and raise money – which is often the most important thing that a government of the modern age can do.

The Great Recession combined with the extensive social commitments of Zuma’s backers means money is going to be in short supply – the Polokwane victors will have to find more (through taxation or borrowing) or they are going to have to cut their spending plans.

I think these are the questions that will reveal most about where our new government is leading us:

What level of budget deficit will Pravin Gordhan be prepared to run?

What level of tax increase does he (and our president and our president’s allies) estimate is bearable in the South African context?

Will Pravin give in to Cosatu/SACP’s plans for limitless support of loss making state enterprises?

Will Pravin Gordhan support expenditure of public-sector wage increases – to the degree that the trade union ally wants?

Will he find money for the unexpected increase in the A400M Airbus?

Will infrastructure continue to drive the economy and to what degree does the Polokwane victory for increasing the child grant to 18 year olds represent a shift in priorities?

In general, how much money can become available for social programmes?

It really is crunch time. I imagine many investors and business men and women have suspended judgement of the new management of the party and the state but have been increasingly concerned about how specific voices have come to dominate all public discourse. Let’s call these Vavi’s voice, Nzimande’s voice and  Malema’s voice.

Investors are not as easily spooked by political bombast as you may imagine. They tend to wait to see whether government puts our money where its mouth is first – remembering that this government and these politicians increasingly have a ‘potty mouth’ as Americans endearingly say.

Today financial markets will see for the first time into which mouth government will put our money. The conclusion investors in financial markets reach – which will ultimately be reflected in capital flows that aggregate their buying and selling decision – will be the Polokwane chickens coming home to roost.

I am an independent political analyst focusing on Southern Africa and I specialise in examining political and policy risks for financial markets.

A significant portion of my income is currently derived from BNP Paribas Cadiz Securities (Pty) Ltd.

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