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The appropriate comparison for J Arthur Brown’s visit to Khayelitsha yesterday is Jacob Zuma’s visit to Eldorado Park a few weeks ago – the president’s vist conducted ostensibly to free that neighborhood from the tyranny of crystal meth and tik.
Watching the visuals on eNCA (catch those here) of the white fraudster’s visit to the Cape township yesterday was surreal. Brown, louche, handsome and relaxed in tatty jeans and gelled hair being warmly welcomed by the community meeting; the elderly African audience in their Sunday best, anxious to please, respectful and sitting up straight in their seats. Brown lounging like a rock star being interviewed by Rolling Stone.
Afterwards outside: the crowd greeting him with Amandla! – everyone taking a turn to hug their last hope for the return of the money, the man who the state accused of stealing it in the first place.
Zuma’s trip to Eldorado Park is the same species of manipulation. It was supposedly prompted by an eloquent request by resident Dereleen James describing her desperate efforts to get her 17-year-old son off crystal meth. See that moving letter here.
Both these incidents have the classic elements of ‘big man’ politics and the worst features of populism.
What you do is take an issue that absolutely no-one could disagree with and then you march in as the good and heroic saviour. Even those who suspect your motivations are forced into silence. The poverty-stricken victims need all the help they can get, even if it is coming from people who are motivated by the need to repair their public image.
I don’t buy that, in exactly the same way as I don’t buy it when repressive governments argue that the internet needs censoring because of child pornography.
Anyone who argues against the populist measures is immediately cast as the villain: so what, are you in favour of drugs, child pornography and poverty? You are prepared to let these victims suffer just to satisfy some political principle of your own?
Julius Malema, Jacob Zuma and Winnie Mandela had one thing in common. They understood perfectly that you shouldn’t waste your time with actually solving the housing crisis, poverty, drug addiction (choose your perfect and sanctified issue.) All you need to do is go into the impoverished area and give someone a house. Do it with fanfare and praise singers. The community will come out, awed at your power and generosity, clear that you are the source of the goodies that make life possible, full of hope that their turn might come some time soon.
So maybe J Arthur Brown is going to stump up a few million rand, perhaps set up a fund for the people who have been robbed. Surely that is a good thing?
No, it’s not if it means that pressure is relieved on the more pervasive looting of pension and investment funds by people like J Arthur Brown.
How can we be anything but horrified when the fox volunteers to police the hen-house? Not for some vague political principal, but because our desire to save one chicken has endangered them all.
A few years ago it would have been the SACP and the ANC making these arguments and far more eloquently than I have here (catch an excellent interview with Jeremy Cronin several years ago doing precisely that – push through till he gets to the ‘big man’ and populism bit, it will be worth your while). Of the many things I regret about the present, the loss of that perspective from our politics is the one I feel most keenly.
Zuma’s visit to Eldorado Park is indistinguishable, in its deeper architectural structure, from J Arthur Brown’s visit to Khayelitsha. In both cases there will be immediate changes to local people’s lives, but changes that purely result in a displacement of the problems and temporary relief. Like the distribution of food parcels by politicians just before elections the temporary relief provided the hungry does not balance the harm done the society by the successful hoodwinking of the electorate by the ‘big man’.
I am struggling to make up my mind whether there really is a small accumulation of good news, clearly visible against the looming night … or if I am just desperate. Today’s Business Day story by the always interesting Carol Paton looking at Manuel and Sisulu on a stern clean up the public service drive must be positive, surely?
… and several points in my take on the political news in the English language weeklies from last week are postive:
The Sunday Times says Jacob Zuma is planning to axe Dina Pule, Minister of Communications and Lulu Xingwana, Minister of Women, Children and People with Disabilities. Pule’s tenure has “limped from one scandal to another – including the questionable millions paid to her boyfriend from sponsorship money meant for the ICT Indaba last year” – Sunday Times.
The Department of Communications has failed to unbundle the local loop, missed innumerable opportunities with Telkom, under-resourced the regulator Icasa and generally failed to appoint/settle/keep senior management … and has had three ministers in 3 years. Fixing this is a priority area in the National Development Plan and one of the key ‘bottlenecks’ or ‘obstacles to economic growth’ that need to be removed. So Pule’s removal has (if it actually happens) to be seen as a good thing.
(Interesting – to me – speculation on the side is that Zuma might move Thulas Nxesi (Public Works) to replace Angie Motshekga (Basic Education) and have Motshekga replace Xingwana. This means that Jeremy Cronin (deputy minister in Public Works) might then replace Nxesi. But, as the Sunday Times says “there are concerns in the Zuma camp about whether he (Cronin) can be relied on to protect the president from the repercussions over the controversial R206-milliion Nkandla upgrade.”
Lindiwe Sisulu (Minister of Public Service and Administration) is quoted in the Sunday times about planned amendments to the Public Service Act setting in place ways of stopping senior administrators benefiting from government contracts. She also promised a “super-director-general’ who would ensure that all heads of department adhere to performances linked reward systems.
Cosatu’s Zwelinzima Vavi lauded Sisulu plans, saying this would stop the “looting” of public funds by government employees. “We can only say halala (congratulations) to that!” he is quoted in the Sunday Times. I have to agree with Vavi. The biggest political failure that is actually in control of government in South Africa is the poor performance and monitoring systems – and therefore delivery failure and corruption – in government and public sector institutions. Sisulu’s intentions are to be welcomed – and she probably has the steel to follow through. So another plus.
Ramphele wanted DA to be dissolved
The Sunday Times quoted several DA members essentially claiming that Mamphela Ramphele almost joined forces with the DA, but wanted the party to be dissolved first and for her to have an equal share of a new institution. “She wanted a new political party and not to join the DA … she came with nothing but wanted an equal share” said one unnamed source.
The week has been beset with rumours about the impending announcement by the respected academic and business person Mamphela Ramphele that she is to set up a new opposition party. Speculation reached a climax when it was announced that she had resigned as Chairperson of Goldfieds on Wednesday last week. Ramphele would make an excellent addition to opposition parliamentary politics in South Africa – but the idea that one person, with no party structure or obvious constituency in hand, will change the South African game is hopeful at best. However, on the balance, this is undoubtedly another positive. (That’s three in a row for those who are counting.)
Several of the weeklies reported that Zimbabwe’s President Robert Mugabe issued an official proclamation on Friday setting March 16 as the date for a referendum on a draft constitution. Most expressed concern that local activists felt that that gave very little time to explain the draft constitution (it took 3 years of bickering to cobble together) to voters and that the draconian Public Order and Security Act would need to be suspended or repealed before campaigning for a ‘Yes’ or a ‘No’ vote could take place. All opposition parties have called for a referendum ‘Yes’ vote to allow the constitution to be accepted and signed into law without any further changes.
Zimbabwe’s stability and growth prospects impact on South Africa in a myriad ways, for example in the floods of economic refugees and the shifting size of the export and investment markets in Zimbabwe. An interesting story in the Sunday Times by senior editor Mondli Makhanya argued that Zanu-PF is likely to benefit from opposition disarray and an improving economy. “With the elections just months away, Zanu-PF is smiling and looking forward to strolling to victory. After having brazenly stolen four parliamentary and presidential elections between 2000 and 2008 Zanu-PF will not have to resort to violence and skulduggery this time.” If Makhanya is correct (which he may well be) it is going to stick in a lot of craws that through a combination of looting, patronage networks, repression and the chasing of the urban poor into the arms of the South African informal economy and welfare system, Zanu-PF might remain in power.
New Iran claims hit MTN
The jailing of Iranian born US citizen Mohammad Hajian for supplying “sensitive and potentially dangerous equipment to MTN’s mobile network in Iran” (Mail & Guardian) deepens MTN’s woes in relation to its Iranian operations.
“The conviction is damning for the South African mobile giant, as it provides judicial corroboration that the company used sanctions-busting networks to beef up its technical infrastructure in Iran” (M&G).
State of the Nation Assessment
Most reviews pointed to the key absence of any binding theme in Jacob Zuma’s State of the Nation Address.
City Press probably had the best coverage.
- It (CP) correctly points out that there was a specific “shift on land reform” – with a move from “willing buyer, willing seller” to a “just and equitable” formulation. This refers to the establishment of a “valuer-general who intervenes on behalf of the state … who then oversees land valuation …to keep the price … affordable for the state to redress” – CP quotes Gugile Nkwinti (Minister of Rural Development and Land Reform).
- It argues that the youth wage subsidy has been swept aside and that government, business and labour in negotiations through Nedlac will announce a plan soon whereby “growth industries with young workforces will attract state support to hire the young and jobless … unskilled young people will also be offered a second chance to write their matric exams”. So no across-the-board subsidy … but a directed one, only in selected industries.
- It picks away at the infrastructure programme and the various roles that will be played by Malusi Gigaba (Minister of Public Enterprises) and Ebrahim Patel (Minister of Economic Development). City Press interviewed the ‘up-and-coming’ Gigaba and asked him if Ebrahim Patel had left him much of a role to play. Gigaba replied: ““Economic Development is responsible for a broader plan. My department is responsible for three big infrastructure projects: the roll out of broadband, electricity infrastructure and logistics like rail. Other departments are responsible for roads, transport and dams.”
The State of the Nation address is always over-anticipated and usually bitterly lamented as not having been specific or visionary enough. This year, not unexpectedly, Zuma enumerated the successes of government and hyped the plans. Much of what Zuma and his government will do and say in the next while will be focused on the national election in 2014 – and expectations likely to be disappointed.
Bits and Pieces
- City Press reports that the department of fisheries, headed by Tina Joemat Pettersson is in “total free fall” – raising serious concerns about government’s ability to conduct research required to determine quotas of ‘allowable catch’ for key species.
- Sunday Times business section reports that industrial unrest and violence at the Medupi construction site make the “chances of the R91bn power station feeding power into South Africa’s overstretched grid by the end of this year … slim”.
- Sunday Times reports Harmony Gold made history by making individual workers at its Kusasulethu mine sign a treaty with the company in order to lock individual workers into a contract with the company. “This is quite a revolutionary move … (it) means that individual workers can now be taken to task when stepping over the line” says Peter Major, Cadiz mining analyst. Major argues, according to the report, that if similar agreements had been put in place a year ago when trouble first started brewing on the mines at Impala Platinum, a “Marikana” might have been prevented.
(Added as an afterthought: I realise I haven’t made any kind of conclusion given that the opening paragraph suggests I was going to indicate either that I am more positive than negative or vice versa. Frankly, I can’t make up my mind. Which probably makes me a fairly bog standard South African.)
Has the South African state become an instrument in the hands of the class of predators that dominate our politics?
Think a crowbar or a 9mm automatic and think of the Nkandla or Limpopo crews using that tool to rip or rob huge sections of provincial and national budgets.
Cosatu is clearly suspicious of the ANC dominated state, but believes that the struggle is not over.
Corruption Watch, launched by Zwelinzima Vavi Thursday last week is premised on, and shaped by, the assumption that the state is contested terrain; that if you put enough pressure on it you can slow the process of it becoming an “instrument” or a “tool” in the hands of the bad guys .. and perhaps reverse that process.
On the same day that Cosatu launched its initiative – Thursday last week – the SACP journal Umsebenzi Online published a “Red Alert” by deputy secretary general Jeremy Cronin critiquing
the liberal notion of society as being constituted by two realms – the “state” on the one hand, and a distinct “civil society”, on the other.
and, in particular
This anti-majoritarian liberalism (that) treats rights almost entirely as rights of citizens/civil society AGAINST the state – and not, for instance, the right of a democratic state (and the right of a democratic majority to actively HELP that state) to vigorously implement an electoral mandate in the face of equally vigorous opposition from powerful class forces lurking behind the fig-leave (obviously he means “leaf” – NB) of “civil society”.
Thus the SACP is deeply and supportively engaged with government and the state – indeed Jeremy Cronin is Deputy Minister of Transport – and appears to be directly backing Jacob Zuma for re-election at Mangaung in December. Clearly the SACP has made a practical estimation that Zuma is the better of some bad options.
Cosatu is also, ultimately, engaged with the state and government – and appears to have also given support to Zuma’s re-election – but in a far more conditional and ambiguous way than the more open-ended support offered by the communists.
Corruption Watch is indelibly stamped as a ‘civil society’ initiative – and one that has individuals in its leadership that skirt close to Cronin’s faintly Stalinist definition of “anti-majoritarian liberalism (that) treats rights almost entirely as rights of citizens/civil society AGAINST the state.”
Explore Corruption Watch’s website here - and decide if you are going to sign the pledge.
The Executive Director is David Lewis – ex-independent trade union movement in the 1970′s, constructor of SA’s competition framework and until recently chairperson of the Competition Tribunal.
The Chairperson Vuyiseka Dubula is also the Secretary General of that bastion of civil society and thorn in the ANC government’s flesh, the Treatment Action Campaign. She is also Chairperson of the board of directors in the AIDS Law Project.
The list of board members includes Bobby Godsell, Mary Metcalfe Supreme Court judge Kate O’Regan and Archbishop Njongonkulu Ndungane - just to give a sense that the initiative is likely to be a constant source of criticism of the spread of corruption in the ANC and government.
Cronin directly warns against some of the features of Cosatu’s previous “civil society” conference that caused so much anxiety in the ANC and the SACP last year (and I put the quote in full here because it speaks to the heart of the differences of emphasis between Cosatu and the SACP):
Obviously, the SACP expressed support for COSATU`s right to convene a conference that mobilized a range of social movements and NGOs to address, amongst other things, corruption in the state. However, we believed then, and we still believe now, that it was a mistake to exclude COSATU`s own party political alliance partners – as if there were something inherently pure about supposedly non-political “civil society” formations, and something inherently predatory about those more directly engaged with the state. It was a confusion that reflects the hegemony within our society of the liberal “civil society vs. the state” paradigm.
It is probably useful to read the full text of Cronin’s intervention, which you can see here.
As it happens ANC heavyweight and Minister of Justice Jeff Radebe spoke at the launch of Corruption Watch alongside thorn-in-the-ANC’s-flesh Public Protector Thuli Madonsela – thus tentatively addressing some of Jeremy Cronin’s and the SACP’s insecurity about Cosatu taking more and more oppositional stances in relation to the ANC and government.
The two main organisations within the ruling alliance to the left of the ANC appear to be launching something of a rescue bid to stop the ruling party slipping more unambiguously into the hands of a predatory political elite – although the SACP appears more concerned that the rescue bid stays out of the hands of “anti-majoritarian liberals” than it does about the success or otherwise of the endeavour.
Cosatu is the “bad cop” and the SACP is the “good cop” (vis-à-vis the ANC) but they are both operating under the assumption that there is something still worth saving in the state and the ruling party.
If the rescue bid fails and the ANC and government pass some abstract point of no return Cosatu is poised to give up on them first.
The SACP is likely to stick with its ally to the bitter and awful end.
The previous post was headlined “The ANC’s surprising return to form” and it stayed as the face of this website throughout a week in which we were reminded of the nest of corruption our president emerged from.
… oh yes, and a week when the ANC in parliament passed the Protection of Information Bill – with sneaky abstentions from three of their MPs. (Gloria Borman actually abstained, Ben Turok walked out and Salam Abram said he would have abstained if he could have made it to the sitting.)
… and a lot else has gone wrong such that it is difficult to even pierce the gloom.
Many of these issues have been done to death, but briefly on Mac Maharaj:
The Mail&Guardian weekly newspaper and the Sunday Times (and now City Press) revealed different pieces of evidence that appear to prove that French arms company Thales channeled money to Mac Maharaj, then Minister of Transport (also, crucially, architect of Zuma’s rise and key strategist behind Zuma government) a few months before Thales was awarded a credit card licence tender (worth about R265 million) by Maharaj’s department in 1996.
The more revealing points are that the alleged middleman, Zuma’s financial advisor Shabir Shaik, was sentenced to 15 years in prison for, amongst other things, securing a bribe from Thales for Jacob Zuma’s protection in the arms deal. Thales country manager Alain Thetard allegedly signed or originated both the agreement that channeled money to Maharaj through his wife Zarina as well as the encrypted fax spelling out the payment for Zuma and the protections and advocacy those payments were for.
The issue is Zuma only avoided prosecution for corruption and racketeering because it was shown that there was political meddling in the prosecution – not because there was not a prima facie case for him to answer (his financial advisor went to prison for securing the bribe for his boss … you don’t get more prima facie than that!)
The leaking of the evidence is undoubtedly linked to the conflict between Zuma and the faction of which Julius Malema is a part. In fact the Youth League has made it clear that it plans to raise issues associated with Zuma’s sexual conduct as well as the fact that his (Zuma’s) friends and family have benefited financially (and overwhelmingly) from his presidency. Some of Malema’s key backers were insiders to the arms deal scandal and it would have been an easy matter for evidence against Mac and Zuma to emerge from some of those quarters.
At the very least the accusation (and reminder) that the Zuma presidency is deeply tainted by this history will hurt his re-election bid at Mangaung.
… while the ANC itches to get more fingers on the economy
Late last week it emerged that there are proposals to tax ‘unbeneficiated’ mineral exports and to force the South African fund management industry to own a specific amount of government and SOE bonds in ‘draft of draft’ reports from the ANC Economic Transformation Committee – that were due to be discussed by the ANC NEC this weekend.
Both Bloomberg and Reuters have got hold of these, but the ‘final drafts’ take a less prescriptive approach, according to committee chair and key ANC economic policy strategist (and deputy minister Economic Development) Enoch Godongwana.
The ANC aches to get its hands on the
IDC’s Public Investment Corporation’s investment power – especially as assets under management (mostly public sector pensions) topped the 1 trillion Rand mark in March.
The prescribed assets idea and strategies to force beneficiation – all in the service of the jobs drive – have been on the fringes of government thinking for years and are flirted with in much of the motivation that led to the NGP.
I don’t think these proposals will ever be legislated in this form.
A pre-Mangaung policy conference (in May according to the Business Day and June according to Bloomberg/Reuters) will make recommendations but the decision will only be made in December 2012.
The ‘nationalisation of mines’ draft proposal was also expected to be delivered to the NEC this weekend. I haven’t seen it or read any reports about it, but I expect a shift in the tax regime, a tightening up of the Charter and a plan to strengthen the African Mining Exploration and Finance Company (AEMFC) – which is the much vaunted “state owned mining company”. Together these fall well short of the ANCYL nationalisation proposals, but still weaken the investment case for the industry as a whole.
(Note, that these ideas proposed by think-tanks within the ruling party are essentially grappling with ways to make the economy more supportive of the transformation project. The problem, though, is one of trust. Giving this ANC is led by the kind of people named in the first few paragraphs of this post, more control over central aspects of our lives feels stupid. I just don’t trust them any more.)
… Cabinet approved the publication of the Broad-Based Black Economic Empowerment Act Amendment Bill that plans to fine companies up to 10% of revenues for ‘fronting’- and allows for companies to lose points on one part of the balanced scorecard for failure to achieve targets on another.
This is the first major attempt to give B-BBEE serious teeth (outside of mining licensing where the legislative and regulatory teeth are already pretty sharp.)
My own feeling is that resources for ‘deracialising’ the SA economy are limited; cheating is a problem, but the fact that the process is too often indistinguishable from a bribe of the political class is the bigger failing the new amendments ignore.
There’s my happy little corrective for an early Monday morning.
In case anyone was wondering if I had disappeared into the ether: I have been seriously busy and have had no time to post on the blog.
If you were paying extra attention, you may have noticed that a post reviewing the nationalisation of mines debate appeared and disappeared a few weeks ago.
My mistake – it was bespoke for a month, and I jumped the gun. I am now able to publish it and you will find it below.
Meanwhile I am into my second reading of An Inconvenient Youth – Julius Malema and the ‘New” ANC by Fiona Forde. It is exceptionally good and I strongly recommend you go out and buy yourself a copy. I have begun a review which I will publish here during the course of the week.
But meanwhile, here is the month-old nationalisation update/review. My views haven’t changed much since I wrote it … and it is good to get it on the record … even if it is a little turgid and written in an overly formal tone.
The nationalisation of mines debate in South Africa is, as predicted, reaching new heights of sound and fury. Yesterday it appeared that Cosatu was officially supporting the Youth League call. This is a situation fraught with danger although I do not change my assessment that the ANC is unlikely to decide on mine nationalisation along anything like the lines proposed by its youth wing.
- Yesterday Cosatu economist Christopher Malikane argued that the ANC has accepted as fact that the mines would be nationalised and that it was only a question of “how” not “if”.
- This does not imply significant new risk although the markets are likely to interpret it as such.
- In reality Cosatu is significantly divided on the call and current shifts in Cosatu policy have more to do with (important) internal conflicts.
- Cosatu does not have the final or even main say over ANC economic policy and its current flirtation with the Youth League is actually about frustration with not achieving its policy aims with the ANC.
- The ANC and its left wing allies have been consistent and steadfast in their criticism of the call and I outline the history both of the Youth League call and of the critique of the call in this report.
- The nationalisation call has consistently been deployed in political battles for power within the ANC and in government which both gives the call unrealistic political energy and makes the threat difficult to interpret or assess.
- The ANC has set its Economic Transformation Committee the task of assessing the call and making proposals. I expect clarity to emerge in November this year but a final decision will only be made at the centenary national conference in December next year.
- Cost, international agreement, the Bill of Rights and the constitution make it inconceivable that the ANC attempt to nationalise the mines.
- However I think the party and government will use the threat as a stick to get a better deal out of the mining houses.
- Between now and the final decision the “sound and fury” will keep the issue alive and the threat present.
Cosatu shifts towards the ANC Youth League
Yesterday Congress of South African trade Unions economist Professor Christopher Malikane was reported to have said at a South African Chamber of Commerce and Industry forum that the group charged with discussing the nationalisation of mines in the ANC had moved beyond the issue of whether the mines should be nationalised and is now purely considering modalities to achieve this aim. “Investors are looking for certainty around the issue of nationalisation, well this is the certainty they need,” he said.
The ANC Youth League managed to place formally on the agenda of the ruling African National Congress (at the party’s National General Council in September 2010) the proposal that government consider nationalising a majority share of the mining industry – for report back and a decision at the party’s Mangaung elective centenary conference in December 2012.
The general noise gets louder
With the ANC and government leadership mired in controversy relating to poor service delivery, poor government performance and accusation of corruption – and the Zuma presidency as weak as it has ever been – the ANC Youth League and its supporters in government appear to have seized the initiative and are making all the running at a public level. Investors and other observers would be forgiven for thinking that the slogan “Economic Freedom in our lifetime!” and the calls to nationalise the mines, banks and the land (that last explicitly without compensation) were not government policy. I am of the view that owners of mining equity and other property in South Africa are starting to feel the heat.
My view has been that the ANC is highly unlikely to decide to nationalise the mines – although uncertainty in this regard will persist right up until December 2012 (although some clarity is expected to emerge after the ANC committee examining this issue reports back some time in November this year).
I think that the party and government will attempt to use the populist surge to discipline the mining companies to fulfil their social and Black Economic Empowerment obligations under the Mining Charter (which arises out of the 2002 Mineral and Petroleum Resources Development Act).
Additionally government and the party are likely to use the opportunity to change the tax and royalty regime to extract more revenue from the sector – particularly with the imposition of a tax on windfall profits.
Finally I think it likely that new obligations will be placed on the mining companies – especially with regard to some form of obligatory contribution to the building and maintenance of transport and power infrastructure near where the mining operations are located.
Brief History of the nationalisation call
The ANC Youth League on nationalisation of mines
Soon after the current leadership of the ANC came to power at the landmark Polokwane conference in December 2007 the ANC Youth League elected Julius Malema as its president (in April 2008).
By the end of that year Julius Malema and the Youth League began proposing that the mining industry be nationalised. This was the essential elements of that proposal:
* an immediate suspension of the issuing of mineral rights and permits;
* the establishment of a state owned mining company;
* the nationalisation – with or without compensation – of fifty percent of all mining operations;
* that licenses only be issued in future on the basis of a 60 percent equity stake being held by the state owned company.
The Youth League drew authority from the historic Freedom Charter document. The document, drawn up in a national consultative process led by the African National Congress in 1955 and adopted at the Congress of the People in Kliptown says of the economy:
“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”.
Criticism from the Left of the ANC Youth League call
The major critique of the ANC Youth League call was formulated by Jeremy Cronin, Deputy Minister of Transport and Deputy Secretary General of the South African Communist Party (and major ANC intellectual and ideologue).
It is my guess that Jeremy Cronin was deployed by the incumbent leadership of the ANC in the belief that a criticism of the nationalisation call articulated by leading communists would defuse the Youth Leagues claim of militancy and radicalism – and I therefore cover these arguments in detail here.
Cronin argued that the Freedom Charter passage 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” (all Cronin quotes in italics in this section from SACP’s Umsebenzi Online Volume 8, No. 20, 18 November 2009).
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 had 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 that the Youth Leagues proposal of 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”) points out that South Africa’s 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 bail-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.”
Opposition to and support of Youth League call
President Jacob Zuma, ANC Secretary General Gwede Mantashe (who is also SACP Chairman), and Minister of Mineral Resources Susan Shabangu have all explicitly rejected the ANC Youth League’s call – with Shabangu having famously said that the mines would only be nationalised “over my dead body”.
However despite this being the overwhelming position of the ANC and government, the Youth League scored a significant victory by having its proposal placed formally on the ANC’s policy agenda – achieved at the National General Council meeting in September last year.
At that conference Tokyo Sexwale (Mvelapanda Resources and Human Settlements minister) and Bridget Radebe (Mmakau Mining, wife of minister of Justice and Constitutional Development Jeff Radebe and sister of Patrice Motsepe) both came out in support of the ANC Youth League’s call – giving some weight to the now widespread allegation that the Youth League is operating with a hidden and funded agenda to have failing Black Economic Empowerment deals bailed out by government.
Arguing against the call were leading ANC intellectuals Joel Netshitenzhe, Jeremy Cronin and Trevor Manuel. However the ANC incumbent leadership failed to block the Youth League proposal and it is now formal policy of the ANC to investigate the matter and report back for a decision to be made at the centenary National Conference of the ANC which will be held at Mangaung (Bloem) in December 2012.
The ANC’s Economic Transformation Committee
The committee tasked with formulating the ANC’s position on the nationalisation of mines is the Economic Transformation Committee – which has the general brief of investigating the role of the state in economic development and is the natural forum in the ANC to develop a position on nationalisation.
There is not much in the public domain about the proceedings of the committee, but it is my information that Gwede Mantashe is overseeing the work of the committee which is formally headed by Enoch Godongwana (deputy minister of Economic Development and ANC NEC member).
The contributors thus far include those from the ANC Youth League, Joel Netshitenzhe, MZ Ngungunyane, Cosatu, Floyd Shivambu, Paul Jordaan and the National Union of Mineworkers. The full text of the initial contributions can be found in the last five issues of ANC’s internal discussion publication “Umrabulo” (find those on the ANC website at http://www.anc.org.za/list.php?t=Umrabulo).
It is my understanding that those opposed to the nationalisation call – for the reasons that have already been summarised in this report – are attempting to craft a compromise that will allow everyone to save face while allowing government to wrestle a better deal out of the mining companies – as stated in the “My view” section at the start of this report.
It is my understanding that the committee will report back in November this year and I expect the markets to get an indication of how the debate will pan out then. However, it should be borne in mind that the formal conclusion of this debate will only be reached at Mangaung in December 2012 and the noise is likely to continue right up until the last minute.
Cosatu’s shifting sands
The major change of external inputs into my assessment has been a struggle within the Congress of South African Trade Unions that has resulted in a shift away from the federation’s original position which was closely aligned with the view of the SACP and the incumbent leadership of the ANC – as articulated by Jeremy Cronin above.
The last unambiguous statement from Cosatu on this general issue came in the form of a joint communiqué with the SACP on the 24th of June 2011- I quote it here in full:
“… periods of capitalist crisis are also typically characterized by various forms of right-wing demagogic populist mobilization acting on behalf of various capitalist strata in crisis, but often masked behind a pseudo-left rhetoric. We believe that the same phenomenon is apparent in SA, finding a potential mass base amongst tens of thousands of unemployed and alienated youth in particular. However, behind this populism are often well-resourced business-people and politicians seeking to plunder public resources. We resolved as the SACP and COSATU to close ranks and to expose the true agenda of these tendencies and their connections to corruption and predatory behaviour in the state.”
However, at the Cosatu National Executive Committee meeting a week later a split appeared in Cosatu that has impacted on this debate.
The conflict is complicated but in a nutshell, it is between a faction led by powerful Cosatu Secretary General Zwelenzima Vavi and Irvin Jim of the National Union of Metal Workers (Numsa) of South Africa and a faction headed by leaders grouped around the National Union of Mineworkers (NUM) under Frans Baleni. Broadly the NUM/Baleni faction is supportive of the SACP and the Zuma leadership of the ANC while the Vavi/Jim/Numsa axis has become frustrated with broken promises (concerning both corruption and economic policy) of the Zuma/ANC leadership and would generally seek a more radical socialist or workerist political solution than is being offered by the ANC.
The Vavi/Jim/Numsa faction has over the last month begun courting the ANC Youth League, and attempting to harness the energy coming from this sector for its own ends. This is highly opportunistic as Vavi and Numsa have consistently characterized the Youth League leadership as “right-wing demagogic populist” and the League’s nationalisation call as fronting a corrupt BEE agenda looking to take a double bite out of resources available for transformation.
Rank opportunism or not, the crack in the Cosatu position is adding a new element to nationalisation debate. It is my understanding that the National Union of Mineworkers remains opposed to the ANC Youth League call, but the new element will undoubtedly add some confusion.
The point to remember about Cosatu – a point reiterated by the ANC and government leadership time and again – is that the federation represents a sectional interest. There are obvious reasons why some elements in Cosatu would want the mines nationalised – who wouldn’t want a guaranteed job for life as a Greek style (up until recently) government employee?
It is to NUM’s credit that its president Senzani Zokwana said in November last year that the Youth League was being reckless with the industry and that the League’s call was inspired by rich Black Economic Empowerment recipients looking to get failing deals bailed out by the state and Frans Baleni a month ago reiterated: “It is not only the private sector that has invested (in mines), but the workers with their pension and provident funds have also invested. We should have maturity and the debate should not have political undertones.”
It’s the law!
A key motivator of my view has been that South Africa is bound both formally and informally to agreements – including in the Constitution – that make it impossible to nationalise the mines without full compensation. Nationalising 50 percent of the mines would cost in the region of $130bn. There is no conceivable advantage – and an almost endless downside – for the government to nationalise the mines. Therefore it is not going to happen – although the end result might look like a compromise and might entail the establishment of a state owned mining company, although one with a much smaller asset base and agenda than conceived in the Youth League’s call.
Nothing material has changed that would allow me to change the view – although my confident smile has assumed a slightly brittle quality. Cosatu was never going to be the determining factor in this debate but the weakness of the ANC leadership – in particular the weakness of Jacob Zuma’s presidency – means that I am no longer certain that the centre of the Ruling Alliance can hold.
From the start the nationalisation of mines call has, in part, been a stalking horse for leadership challenges within the ANC and government. I have argued elsewhere that the call has been central to Tokyo Sexwale’s political ambitions and that he has covertly supported the Youth League in this regard for some time.
Now we have an element of Cosatu attempting to forge some form of alliance with the Youth League around the call clearly as part of a strategy to shift the leadership balance within the ANC.
The Youth League itself is using the call for its popular mobilization potential to help push its own candidates (particularly Fikile Mbalula – currently minister of sport) for higher office.
In this environment it would be foolhardy to be overconfident about the call. However it is my opinion that predicting the success of the Youth League call would be the same as predicting the imminent failure of the South African democratic project and state – a view I believe is too extreme and alarmist.
In many ways what is happening now is very much as predicted: the situation will be full of sound and fury right up until a decision is made at the end of 2012.
This is the first of three articles that look at the political and policy bloodline of the New Growth Path and the main criticisms that have emerged about the policy in the public domain over the last few days.
This first post is a summary – using quotes and paraphrasing – of Ruling Alliance statements about macro-economic policy since 1990.
To understand the policy we have to understand:
- firstly how the policy fits into the discussion/dog fight in the Alliance over the last 20 years;
- and secondly the fact that the policy comes from Minister of Economic Development, Ebrahim Patel, whose department and position, in my opinion, was a last-minute structural compromise to reward Cosatu (and to a lesser degree the SACP) for having backed Jacob Zuma against Mbeki.
So the big bulls (ANC and the SACP) have been butting heads for 20 years (see below) and now the little bull is trying to horn in on the action.
20 years in the trenches of the ideological squabble
Since the release of Mandela from prison in 1990 (and, in fact, well before that – mostly behind closed doors) different factions of the ANC, the SACP and Cosatu have had a sometimes productive and sometimes vicious policy debate about economic policy. At issue has always been the stance the state should take towards private business and the appropriate amount of persuasion and coercion required to achieve redress and redistribution.
The first sign of things to come was the speech Nelson Mandela made on his release from prison in 1990. After the excerpt from Mandela’s speech I will let the comments flow and tell their own story of the conflict within the Ruling Alliance.
A history of the conflict in quotes and paraphrases
“The nationalisation of mines, banks and monopoly industry is the policy of the ANC and the change or modification of our views in this regard is inconceivable”
Nelson Mandela paraphrasing the Freedom Charter on his release from prison in 1990
“We are convinced that neither a commandist central planning system nor an unfettered free market system can provide adequate solutions.”
The 48th ANC National Conference, July 1991 from a conference resolution
“It was a demand-led and internal infrastructural development proposal, which envisaged less immediate concern with budget deficit reduction and inflation.”
African Communist No 147, third quarter 1997 discussing the Macro Economic Research Group’s (MERG’s) proposals from 1993
“Of particular importance was the proposal to restructure the economy by way of a policy of ‘growth through redistribution in which redistribution acts as a spur to growth and in which the fruits of growth are redistributed to satisfy basic needs’. This proposal was predicated on the central policy idea that the state needed to boost demand, primarily by ensuring that greater amounts of income would be received by the poorer sections of the population, which in turn would stimulate output and hence economic growth.”
Dennis Davis in From the Freedom Charter to the Washington Consensus 2002 discussing the RDP proposal of 1993
“Despite its ideology while in opposition, once in power the ANC government implemented an orthodox macroeconomic policy which stressed deficit reduction and a tight monetary policy, combined with trade liberalisation. The stated purpose of this package (the Growth, Employment, and Redistribution programme, or GEAR) was to increase economic growth, with a 4.2% rate programmed for 1996-2000. At mid-term of the programme, growth remained far below this target. The GEAR’s lack of success cannot be explained by unfavourable external factors; rather, the disappointing performance seemed the result of fiscal contraction and excessively high interest rates”
A standard left criticism of GEAR from: Stuck in Low GEAR? Macroeconomic Policy in South Africa, 1996-98 John Weeks Cambridge Journal of Economics, 1999, vol. 23, issue 6, pages 795-811
“Faced with deepening unemployment, poverty, and inequality, and with disappointing growth and investment, the GEAR policy framework has met with persisting criticism from COSATU and the SACP in particular. From the side of its principal proponents within the government, there have been several adjustments in the face of disappointment. Increasingly, GEAR has been redefined as a conjunctural stabilization program and not what its acronym suggested it once aspired to be (a growth, employment and redistribution strategy). In this rereading, GEAR was necessitated by global turbulence and by a very precarious foreign currency reserve situation in 1996. Its “success” is now measured not in terms of growth, employment, and redistribution outcomes, but anecdotally and by way of comparison—“whatever our problems, South Africa’s economy is not in the same predicament as Argentina, or Turkey, or Zimbabwe,” or “GEAR has helped us to survive the worst of global turbulence” (which may not be completely incorrect).”
Jeremy Cronin rephrasing GEAR as a conjectural stabilisation strategy – 1998
In an address to the Socialist International October 2003 and then in various speeches in 2004, Thabo Mbeki argued that solving unemployment, poverty and low levels of black participation in ownership and control of the economy had become very urgent. Further, he argued that to solve these problems an effective, strong and interventionist developmental state was needed – just proving that there is nothing new in heaven and earth. He put the case for improving the public service and extending the state’s influence and ability to lead the economy. “Influence” meant keeping hold of strategic state assets (and therefore a partial withdrawal from the privatisation specified in GEAR) as well as a detailing of micro-reforms including BEE. He placed a strong emphasis on private public partnerships as well as on galvanising a collective consciousness about the “common good”. From this shift the Accelerated and Shared Growth Initiative for South Africa (AsgiSA) was codified in 2005/2006. While it set targets for growth and employment, Asgisa was primarily an infrastructure investment programme combined with various (mostly supply-side) measures to remove impediments to growth – much of which the economy continues to benefit from today.
My own summary of Thabo Mbeki’s initial motivations for AsgiSA
In the lead up to Polokwane this was the definitive statement from ‘the left’ attacking the direction that the Mbeki government had taken: “The post-1996 class project” was led by a “technocratic vanguardist” state with the mission for “a restoration of the conditions for capitalist profit accumulation on a new and supposedly sustainable basis” (as opposed to “a revolutionary … transformation … to resolve the .. contradictions in favour of .. the working class ..”). The document argued that “The post-1996 class project” rests on three pillars: Firstly, the ANC leadership has mistakenly bought into a myth of a gentler, kinder world, but imperialism is stronger and more hostile to popular democracy than ever; secondly, to fit into this world “the second pillar of the project is a powerful presidential centre” that necessarily installs a top state/ leadership group of state managers and ‘technocratically’-inclined ministers and (often overlapping with them) a new generation of black private sector BEE; and finally, the project calls for the organisational modernisation of the ANC … “to transform the ANC from a mobilising mass movement into a ‘modern’, centre- left, electoral party”. There is a “manifest inability of capitalist stabilisation and growth to resolve the deep-seated social and economic crises of unemployment, poverty and radical inequality in our society. The ravages to the ANC’s organisational capacity and coherence (are caused by) “the attempts to assert a managerialist, technocratic control over a mass movement, and in the crises of corruption, factionalism and personal careerism inherent in trying to build a leading cadre based on (explicit or implicit) capitalist values and on a symbiosis between the leading echelons of the state and emerging black capital.”
My paraphrasing of the SACP Central Committee Discussion Document. Bua Komanisi – Volume 5, Issue No1 May 2006 – difficult to read but a perfect summary of the position that exists to this day in the SACP
Then came the answer to the ‘left critique’ from the central ANC leadership: “…the trapeze act here is to co-opt the ANC, formally, as an organisation pursuing socialism; and then condemn it as having betrayed the socialist project”. First, and most importantly the ANC denies that it ever was or should have been an organisation whose objectives was to achieve socialism. The ANC, the document claims, is the organic result of the struggle of black South Africans for national liberation and redress for what they suffered and lost under Apartheid. Additionally the ANC prioritises the poor and the working class. Once this point is made, the ANC argues, all the rest of the SACP critique falls away. The ANC accuses the authors of the SACP document of “ahistoricism, subjectivism and voluntarism”. This is more than just name calling. In the argument of the authors of this document: ahistoricism refers to the SACP’s alleged failure to understand what led to the present conditions as well as the character of the historical moment in which they find themselves, subjectivism means that the SACP has used its own preconceptions to guide its views and has seen the world as they wish it to be rather than how it really is; voluntarism means the SACP believes that through pure force of will, hard work and determination it can achieve socialism in South Africa, whatever limitations the domestic or global environment and balance of forces, especially the strength of global capital markets, impose on possible outcomes.
Managing National Democratic Transformation – ANC response to SACP discussion document – probably the last time the ANC spoke plainly and confidently about economics and the class struggle – 19 June 2006 the official NWC response to the above quoted SACP Central Committee discussion document
The next post will summarise the actual policy contest (from an economists point of view) of the last 15 years. This will essentially be the actual macro-economic policy of the ANC (run from the Treasury) and the SACP’s consistent “industrialisation” alternative (proposed from the Department of Trade and Industry).
I phrase it like that deliberately to suggest that the Department of Economic Development and the New Growth Path Framework represents a new political assertion even if the policy formulation ultimately turns out to be a hodgepodge of previous proposals – as suggested by my summary of Thabo Mbeki’s AsgiSA policy above.
Jeremy Cronin’s criticism of Cosatu’s recent hosting of a “Civil Society Conference” is impossible to understand without understanding his – and the SACP’s – assumptions about the world and South Africa in November 2010.
Cronin’s premise is that “an enemy” is attempting to make the public debate about the future of South Africa focus on minor issues where “the enemy” believes it can score a victory over the ‘progressive forces’ (of which Cronin assumes he and his organisation and his government are a part).
Cronin and the SACP accept some version of the following as a true and accurate reflection of reality (although Cronin himself would probably not phrase things so crudely, mechanistically and deterministically, it amounts to the same story):
Global capitalism and its local allies are securing their ability to continue to accumulate wealth
The bad guys in Cronin’s universe are a complicated (and brilliantly disguised) set of global business interests linked to and by the interests of powerful Western countries, especially the USA and the UK. What this enemy wants and needs is a world in which it can make loads and loads of money – especially by paying the lowest possible wages and taking resources and wealth from the Third World and packing these tightly around themselves in the playgrounds and fortresses of the First World.
Any change in any society that puts checks and balances on its ability to make money must be opposed – destroyed even before it takes root. Thus, thoroughgoing transformation of South Africa would strengthen the hand of the poor and dispossessed relative the the global capitalist/imperialist elite and must, therefore, be stopped.
Global capital/imperialism are constrained from arguing directly in favour of the oppressive political systems and unequal economic arrangements required to support their ability to extract wealth.
Instead they weaken the existing popular governments in the Third World, encourage the spread of corruption and (crucially for our purposes here) divert real debates about change that would benefit the poor and marginalised into light-weight debates about the individual rights and freedoms of the small group of citizens who have moved on from being concerned about the basic conditions of survival. And they do this by hoodwinking essentially good people and organisations who have a weak understanding of the world.
If this is the enemy, who’s on Cronin’s side?
In this version of the universe the African National Congress, the South African Communist Party and the Congress of South African Trade Unions are the structural expressions of ordinary people’s struggles to be free and fed.
Because Cronin is constructing this version of the world wearing his South African Communist Party beret, we must understand that Cronin assumes himself and his organisation to be part of a long-term plan that will overthrow the global yoke of capitalism and imperialism and construct a society based on human imperatives other than profit.
So what’s wrong with that?
Communists like Jeremy Cronin are not misguided in fearing and distrusting global corporations of private enterprise. Left to their own devices humans will extract as much from each other – or from groups other than the group to which they feel they belong – as is possible.
They will take until they are stopped. This is reflected in every business cycle and it is reflected in every attempt to re-regulate markets after bubbles (always caused by a feeding frenzy) have burst.
Additionally big global corporations will spend billions of dollars sucking up to politicians especially in the most powerful nations on earth – or more directly manipulating the political process.
However, there are two significant things wrong with Jeremy Cronin’s (and the SACP’s) version of the world:
Firstly, the communists’ (and all tight party organisations and religious groups’) vision is obscured by their need to see the world as completely structured by two big gangs that are at war – the white hats and the black hats, the good and the evil, the oppressor and the victims.
There are more complex political choices to make than just to pick a side and back it to the hilt and defend its doctrines against all comers.
Global markets and trade and international relations are structured by hugely complex forces, not the least of which are government and supra-governmental organisations attempting to regulate various forms of behaviour. i.e democratic political processes attempting to subdue, moderate and direct the functioning of human fear and greed.
“Picking sides” in such a complex world is no easy matter.
Secondly, the communists fail to see that they and their organisations are subject to the same raging impulses of greed and terror that structure global capitalism – in fact they are structured into it, (only subject to no shareholder and less accountable and regulated than your standard global business).
The conference that Cronin criticises was precisely an attempt to discuss the best ways to regulate those impulses because they appear to have become the dominant impulses within government and the ruling party.
It is fine for Cronin to dispute this, but it is not fine for him to argue that his allies accept the functioning of criminal greed in his government and organisation because his government and organisation is struggling to combat these matters at a higher level.
We do not live in a simple world. It is my belief that the enemy is not out there in his serried ranks on the plains, he is in here with us, in our homes, in our families and in our beds. The enemy is right inside us, in our own hearts and in our own heads.
Until we realise this our best politicians will continue this Quixotic tilting at windmills.
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.
My sister was a famous model and in that capacity was invited to judge the Miss World competition at Sun City in 1995.
She asked me to accompany her as her official partner for a whole weekend of glitzy celebration and judging.
The event was interesting to me for a number of different reasons but the only aspect that might apply to a column on politics and investment risk is the astonishing effect that being treated as a celebrity can have on one’s moral and intellectual soul.
I had been living alone on a farm in the Southern Cape for 5 years when Josie invited me to accompany her to the competition.
I had spent the 1980′s involved in “the struggle” in various capacities. By 1990 I’d had enough and I left politics and my myriad comrades and friends as they got on with the business of negotiating the peace and then running the country.
Of course I had some contact from afar with previous friends, but those who had moved into the ethereal realms of Mandela’s first cabinet seemed to have been lifted body and soul out of the social networks they had previously occupied .
I would only meet again those of my old friends who had become senior politicians in government a year and a half after the Miss World competition when I returned to ‘civilisation’ to become a father and take up a permanent position as a political analyst for a Cape Town based investment broker.
At the Miss World competition we stayed in the The Palace of the Lost City at Sun City (a big step for me because we had spent the 1980′s promoting the boycott of the resort that was built in the then bantustan of Bophuthatswana).
The point I wanted to make about all of this is that from early morning to late at night the organisers of the event and the hotel treated me as if I was a celebrity. It was a peculiar but not altogether unpleasant experience. I couldn’t walk out of my room without a dapper assistant type person reaching for my arm to accompany me to waiting vehicles or parties of fabulously beautiful women sipping at drinks.
Every second of the day there was someone right beside me nodding with interest at everything I said and did. Everything was paid for. It was like being in a dream where the lights swirl around you and you are the centre of the attention of some vast organisation of doormen, waiters and compliant and beautiful people.
An air-conditioned limousine (there really is such a thing – it is not just a cliché in bad spy novels) delivered me to Jan Smuts airport for my trip back to the farm after the celebrations were finally over.
What I remember most vividly about the whole weekend was standing alone with my bag just in the entrance to the airport.
“Hello!” I might have thought shrilly to myself . “Excuse me? I’m here – where the hell is everybody?”
Two years later I met again, mostly in their formal capacities, my previous friends who had become ministers and deputy ministers, ambassadors and persons of similar august standing in society.
I was never shocked and surprised at the grandiosity and extraordinary pomposity most of them came to exhibit.
I have since sat around tables with men I had previously watched fight Apartheid police with their fists and feet and watched as they lean back from the table, eyes closed, their voices drawling as their massive new brains formulate positions that keep all of those present silent as the great man speaks.
I have sat with ambassadors at formal dinners where the guest are subjected to a reading by the said ambassador of her extremely bad poetry. We all sit in silence and most nod in awed approval.
This is a different world they inhabit.
Their whole lives, every moment of the waking day, is spent surrounded by a system that takes them extremely seriously. They travel first class and they are met at the plane by luxury vehicles driven by people trained to give the impression that this is the most precious cargo they have ever carried.
Everyone they interact with confirms the lived reality that they are, in fact, a different kind of person: cleverer, more interesting and more valuable.
There is often a faux gentleness and compassion that goes along with this kind of celebrity. When someone with whom you might once have thrown stones at the police as you dodged through billowing clouds of tear gas puts her hand on your arm and looks into your eyes and says “we really appreciate the work you are doing” you don’t screw up your face and ask “what work?” You just nod.
I believe there is something intrinsically harmful to ourselves and our society in the way we elevate our politicians. I recommend taking every opportunity to deflate the individuals, prick the bubble that we have surrounded them with.
I do not think it is inevitable that politicians, ministers or even super models become pompous wind bags but I can name very few who have escaped the corroding effects of celebrity and power.
I still see Jeremy Cronin flying with real people on the plane and chatting like a normal human being (what will we do if that stalwart ever goes over to the dark side?)
And my lovely sister Josie seems to have escaped with her humility and charm intact – although I rather suspect that is because even as whole restaurants full of New Yorkers would break into spontaneous applause as she entered in the 1980′s she never quite lost the sense that there had been some huge and embarrassing mistake – one she was just too polite and sweet to correct.
*from the poem: Heron Rex by Michael Ondaatje in The Cinnamon Peeler – Selected Poems – 1989 … my long time favourite collection of poetry.
I have been sickly and trying to pay the bills.
All my ‘paid for’ commentary on the NGC is done and I can finally get back to home ground where I feel more comfortable to make some wild accusations – and I will, finally, be more explicit in this post about who I think the bad guys are and who I think the less bad guys are.
At the outset, forgive me; this is long and requires a degree of effort to plough through. I believe your efforts will be rewarded in the end – but I would think that, wouldn’t I?
The NGC, just like the world itself, becomes a cacophony, impossible to follow and impossible to interpret, without a guiding theory or a framing shape to look through.
The “theory” I am going to use here is that the NGC was the terrain on which two broad factions in the ruling alliance clashed. How you slice-and-dice a thing, conceptually, is always important for what you conclude, so much of what appears below is an attempt to unpick what and who those ‘factions’ consist of.
To think that what was happening at the NGC was “about” the nationalisation of mines call will lead to ‘error’ (you can see Lenin in my heritage when I use terms like that). Instead the NGC was “about” a more fundamental and complex power struggle.
The picture is additionally complicated when we consider that there were over 2000 delegates at the NGC (1500 from branches, 500 from the leagues/Cosatu/SACP/SANCO/PECs and 800 deployees/non-NEC ministers/DGs/premiers/CEO’s of SOE’s) and the interplay was vast and varied.
So instead of trying to cover everything I am going to look through the prism of an alleged power struggle between two broad factions or groups of interest. This will ultimately be another attempt to “follow the money”.
Here then is the prism through which I believe it is most useful to look:
- The ‘nationalisation of mines’ (NOM) call was always a “stalking horse”. The term “stalking horse” refers originally to “a horse behind which a hunter hides while stalking game” (WordNet) and is defined in Wikipedia as “a person who tests a concept with someone or mounts a challenge against them on behalf of an anonymous third-party … if the idea proves viable and/or popular, the anonymous figure can then declare their interest and advance the concept with little risk of failure … if the concept fails, the anonymous party will not be tainted by association and can either drop the idea completely or bide their time and wait until a better moment for launching an attack.” Oh yes, I love the language.
- The ‘nationalisation of mines’ call (hereafter called NOM because in fact, it has less do with policy and more to do with power) is best understood as the political platform of a particular alliance of groups and individuals and interests that has as its objective the winning to power in the commanding heights of the ANC and the South African State. The NOM is therefore something more (and less) than a policy proposal. It is a contingent strategy for winning power – and getting the ANC to nationalise the mines would be a desirable side-affect for some of the participants.
- The first part of the NOM is the Youth League’s own specific ambitions, which have most obviously been expressed as a campaign to elevate Fikile Mbalula to the position of Secretary General of the ANC – the position currently occupied by Gwede Mantashe. Mantashe is despised by the League for a number of reasons, but mainly because he is part of those who believe the ANC Youth League is part of an ambitious rent seeking agenda. The League considers itself to be a “king maker” in ANC electoral processes and the organisation has energy and mobility and time to move quickly around the country to influence decisions at a branch and provincial level – a feature it demonstrated successfully at and in the lead-up to Polokwane.
- The second part of the NOM are those mining tycoons who want their BEE deals bailed out by the taxpayer. Who could have failed to notice the unified voices of those gleaming billionaire siblings Patrice Motsepe and Bridget Radebe as well as Minister of Housing Tokyo Sexwale backing the NOM in the lead-up to the NGC or at the conference itself?
- The third part of the NOM is the election campaign of Tokyo Sexwale to succeed Jacob Zuma. Has he specifically funded and backed the ANC Youth League so that it can be deployed in its traditional role of “king-maker” on his behalf – or because he wants his BEE deals bailed out … or both? It is impossible to prove – either that he has passed money/business/tenders the way of the League or why he might have done so – but that he has done so – with the intention of becoming president – is clearly the view of most of “the left” in the tripartite alliance.
- The clearest unifying principle behind the NOM and the most distinct characteristics of its participants is that they are first in the queue to gouge a rent out of the ANC’s economic transformation agenda. The nationalisation of mines call is tailor-made for the broader agenda of the NOM: there are real material benefits for the backers, it allows the policy bereft Youth League to appear radical and pro-poor – and anti-white capitalist – to its potential supporters; it forces the current top leadership under Zuma (for the sake of investment and economic stability) to deploy itself to defend against something that would naturally appeal to the rank-and- file’s populist instincts.
- So who is the NOM challenging? Essentially “the incumbents”, which at one level just means Jacob Zuma, but at another level means everyone who has assumed a leadership role in government, party and the Tripartite Alliance as a consequence of Jacob Zuma’s elevation as well as the ideas and policies that have come to be crafted by that incumbent group.
- The “incumbents” should also be conceived of as including all those tenderprenuers, Nkandla hangers-on and Zuma family members whose fortunes are linked to the fortunes of the incumbent leadership.
- Do the members of the NOM even know who they are or what they are part of? Mostly they do – because there is an increasingly bitter conflict, for example, between the ANC Youth League and the SACP. When powerful factions clash, they strengthen themselves, make themselves more defined; they force anyone and any issue into the framework of their clash. We saw this in the Cold War, but more recently and specific to the groups here, we saw this in the struggle to stop Mbeki and elevate Zuma. eventually everyone knew whether they were “for” or “against” the motion. Attempts to stay sane, principled and above the fray are inevitably MIA in this kind of overblown factional dispute.
Given that framework, what actually happened?
Firstly, the NOM did extensive (but insufficient) spade work around the policy that fronts their agenda. Julius Malema and Floyd Shivambu have been on an extended road trip, selling the idea for over a year. They have written for newspapers and addressed conferences. Malema threatened to withdraw Youth League support from any leader who did not support the call. The Youth League attended all provincial preparation conferences for the NGC and was successful in getting its view represented in every delegation from every part of the country. There are extensive reports that members were instructed to infiltrate ANC branches and emerge later as NGC delegates. The style associated with “winning” this view at various conferences was a combination of exclusive focus on the issue and heckling, booing and threatening any opposition – in the now time-honoured traditions of the League and its members.
What the financial backers of the NOM and members of the broader NOM agenda were doing in the lead-up to the NGC should not be underestimated. Individual backers of the NOM have extremely extensive resources. Such wealth and power gives individuals the ability to reach people and process far from themselves – and snap them like a twig.
It is difficult to say how much work the incumbents did. I have made the assumption that securing the Tripartite Alliance was key to the incumbents preparing for the onslaught they knew was coming at the NGC. In this context the brokering of the ending of the public sector strike and the carefully worded apology from Cosatu to the Zuma/government for the language workers and their leaders had used during the strike was, in part, an attempt to establish the ground for a united front against the NOM agenda at the NGC. Comprises and certain concession were probably made to “the left” – but I will discuss this in the conclusion.
The NGC opening – political and organisational reports
Jacob Zuma’s Political Report and Gwede Mantashe’s organisational report were interesting for a number of important reasons but what is relevant for this post is both reports were correctly interpreted as a significant shot across the bows of the NOM. We can all delight in the fact that Winnie Mandela had to physically comfort the distraught Julius Malema after the dressing down he received during Jacob Zuma’s opening Political Report and take to heart her now immortal words ” … every parent is allowed to talk to their children … Every organisation is like a parent.”
Commission 5 victory and then plenary defeat
The sighs of relief ‘the incumbents’ might have breathed after the NOM’s early humiliation were soon replaced by anxiety when the NOM decided to put all of its eggs in one basket (this is one time that cliché is justified) by sending 45 of the Youth League’s 66 delegates to the Wednesday economic transformation commission. It appears that all supporters of the NOM including Tokyo Sexwale and several other BEE mining tycoons flooded the commission to ensure a particular outcome. The best article in the public domain I have seen about the commission is by Moipone Malefane and Caiphus Kgosana in The Sunday Times of September 26 – catch it here.
Joel Netshitezhe , Lesetja Kganyago (DG in the Treasury),Trevor Manuel, Enoch Godongwana (Deputy Minister Public Enterprises) and old stalwart on this issue, Jeremy Cronin, were amongst the key ANC intellectual and economic thinkers who tried to hold the line at the meeting. Their appeal for thoughtfulness and care around an issue likely to costs government hundreds of billions of Rand were reportedly overwhelmed with bullying, heckling and unthinking repetition of the demand: adopt the call, as we have defined it, as policy!
Without having seen the exact statement that emerged from this commission it is clear that the Youth League (and everyone else present) was under the impression that they had scored a clear victory and the inner cabal reportedly headed off to the Hilton Hotel to celebrate victory in the style to which they had become accustomed.
The ANC Youth League’s (and the NOM’s) celebration was premature. The next day at the plenary session of the NGC Minister Geoff Radebe (husband of Patrice Motsepe’s sister, Bridget, and someone who had expressed support for the basic premise of NOM earlier) delivered a watered down version of the results of Commission 5 – and the ANC Youth League leaders exploded, ultimately sealing their fate by appearing to storm the stage in an aggressive manner.
Ultimately, through the support of delegates from across the alliance at the plenary, a watered down version of Commission 5 carried – essentially calling for thorough cross-country comparison and analysis of nationalisation as part of government’s ability to influence economic growth patterns in favour of the poor and unemployed. This study was mandated to report back to the 2012 Bloemfontein/Mangaung 100th centenary elective National Conference.
In the end it was not ‘the incumbents’ that were overwhelmed by the “shock and awe” campaign of the NOM. In the end it was the NOM that lost the skirmish – they overestimated the efficacy of their own preparation and they underestimated the coherency of the opposition – as well as degree of anger that is now widespread towards the ANC YL and its leaders.
The paucity of facts in the public domain does not relieve us of the obligation to think about what may be going on and develop a view as to the potential risks involved in any situation. Wile E Coyote might have said ‘what we don’t know can’t hurt us’, as he wandered over another cliff, but in the real world what we don’t know can sometimes be deeply threatening. So the explanations I have given here are my best attempts to muster an explanation for as much of the story as possible. I am sure that at some point in the future some of the guesswork and necessary assumptions might prove misguided – but that is life in the threat analysis business.
Three final points;
Firstly, it is okay to delight in the set-back of a particularly voracious self-enrichment agenda at the ANC NGC. But it is important not forget that the conference left unscathed similar agendas in many other places in ANC and affiliated ranks, including in the Zuma family itself.
Secondly, the defeat of the NOM is a tactical, tangential issue. Like the Governator, they’ll be back.
Finally, the victory was bought at the expense of some kind of compromise with “the left”. I expect the upcoming Cabinet review of a New Growth Path to be more sympathetic to a host of issues traditionally seen as part of an SACP or Cosatu platform (including Rand policy, inflation targeting, downward pressure on interest rates, nationalisation of the SARB, tax on short-term capital flows, industrial policy, National Health Insurance and the establishment of a state-owned bank.) The consensus within “the incumbents” is inexorably moving towards a rejection of some of the basic tenants of the Growth, Employment and Redistribution Macro-Economic Policy as defined by Mbeki and Manuel.
Our future is full of as yet undefined state intervention. I wouldn’t feel so bad about this if I didn’t agree with Cosatu that this state, in this place and time, is rapidly becoming a predator.
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.)
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.
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.