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  • Important defection from the ANC to the EFF, and the DA launches robust campaign in Soweto – but it is probably not yet enough to scare the ANC
  • Appropriate concern grows at the Promotion of Investment and Protection Bill
  • Stunning victory in eastern DRC is becoming a feather in Zuma’s cap … 
  • … while the chaos in the SAPS and crime intelligence is a serious indictment of South Africa’s political leaders – and is threatening the investment environment

Herewith my latest news summary and analysis.

As I have mentioned previously, I write these updates very early on Monday mornings for the paying clients of BNP Paribas Cadiz Securities. So thanks to those good people for allowing me to republish a few days later here (and thanks to them for giving me a fairly loose rein as to the style I am allowed to use).

Dali Mpofu announces defection from ANC to EFF
Dali Mpofu, advocate of the miners who were killed by the police in Marikana and a former CEO of the SABC, announced over the weekend that he was leaving the ANC and joining the Economic Freedom Fighters. While this is not completely unexpected (he represented Julius Malema in the ANC disciplinary hearings against the former ANCYL chairperson) Mpofu is perhaps the most mainstream figure to formally defect from the ANC and declare for the EFF.

So what?

This is my ‘shifting target’ predictions for the 2014 national election as of Friday November 1 (click on the graphic to see the details … and note the cute child sucking her thumb which is a graphic metaphor indicating I am making this up as I go along):

elecjpg

Some of you who saw those estimates in September might notice that I have massaged the EFF upwards and AgangSA downwards.

My Democratic Alliance results are probably too generous, although the pictures published in Afrikaans weekly Rapport on Sunday (11/03/2013) of the DA’s Gauteng premier candidate Mmusi Maimane’s launch of his campaign in the Walter Sisulu Square in Kliptown, Soweto on Saturday indicate a surprisingly robust start.

Mmusi

My caution about the upside for the DA is based on the history of outcomes in the four national elections since the advent of democracy in South Africa in 1994 (again click on the graphic for a version large enough to read … note DA at 16.66% in 2009 and ANC at 65.9% … hmm):

Elec history

One would have to suggest that the DA has set itself too difficult a task in declaring that it hopes to achieve 30% of the national vote and be in a position to form a provincial government in Gauteng in an alliance with other opposition parties after elections in 2014. The EFF and AgangSA are likely to eat into ANC support but the challengers have a mountain to climb and the incumbent has to fall a long way before the climbers even catch sight of their objective.

Concern grows at the Promotion of Investment and Protection Bill

Legislation designed to replace a number of bilateral investment treaties that South Africa has maintained with over a hundred trade and investment partners was published in the government gazette on Friday and is starting to raise concerns among investors. Already Minister of Finance Pravin Gordhan has angrily blamed “lawyers serving the private sector” for increasing uncertainty in South Africa’s investment environment with regard to this legislation (in a deeply unhelpful statement he made on the side-lines of the African Economic Conference at Montecasino in Johannesburg last Monday – Business Day 28/03/2013).

So what?

At the height of the campaign for the nationalisation of mines during 2012 (by Julius Malema and the ANC Youth League) it was South Africa’s myriad bilateral investment protection treaties that were the strongest argument of reassurance for foreign investors. The problem is less the new legislation, and more that fact that existing treaties will not be renewed. Business Day in its front page lead story this morning says the decision not to renew the treaties has been criticised “by a range of groups, from foreign business to credit agencies for causing uncertainty over the security of future foreign investment”.  An informed legal opinion would be a requirement for the proper assessment of the risk here, but it is appropriate to approach this policy and legislative shift with caution.

Jacob Zuma attempts to fill the Great Lakes power vacuum

In the light of a stunning and quick Congolese army (FARDC) victory over the occupying M23 rebels last week, Jacob Zuma has moved quickly to reinforce South Africa’s apparent sovereign advances in the region. Today he will host a joint summit of southern African and Great Lakes leaders in Pretoria to seek ways of consolidating this week’s victory by the FARDC and its Southern African allies … and on Tuesday he will chair another summit designed to kick-start an African Union plan for volunteer governments to form “coalitions of the willing” to tackle continental conflicts – Sunday Independent 03/11/2013.

So what?

The contending interests in and around the Eastern Congo are extraordinarily complex, but from a South African perspective the apparent defeat of the M23 is a success for the SADC Force Intervention Brigade (FIB) to which South Africa has contributed more than 1 300 troops alongside 1700 from Tanzania and Malawi. The M23 is backed by Rwanda which in turn is an ally of the US and the UK in the region. Crucially, those Western powers have warned Rwanda’s President Paul Kagame to back off supporting the M23 – which is probably what left the rebels vulnerable last week (Sunday Independent and other several other sources).

There are significant mineral resources in the region and the Inga hydroelectric projects might become decisive to economic development in several southern African countries. Stability in the eastern DRC impacts on Uganda, Tanzania, Rwanda, Sudan and even Angola, Zimbabwe and South Africa. Jacob Zuma has managed to shift significant obstacles out of the way of reformatting alliances in the region – an objective that eluded Thabo Mbeki. The situation is delicate and tentative but Jacob Zuma’s decisive follow-up indicates he is seizing the historical moment and the initiative in a manner that we would have thought unlikely a year ago.

The DRC is a Zuma plus but Crime Intelligence and the SAPS is deepening minus

The main domestic weekly newspapers (Mail & Guardian, Sunday Times, Sunday Independent and City Press) all attempted (unsuccessfully) to make sense of the damaging disarray and conflict in various aspects of the South African security services, most importantly in Crime Intelligence, the Hawks and the top echelons of the South African Police Services itself.

Last Monday the national police commissioner Riah Phiyega issued a suspension letter to the acting Crime Intelligence head, Chris Ngcobo (on the basis that there is some unspecified problem with Ngcobo’s qualifications).  Almost immediately afterwards a spy tape emerged and was leaked to the press that indicated Riah Phiyega was guilty of a crime by having “tipped off Western Cape police boss Arno Lamoer about a crime intelligence investigation linked to him” – Mail & Guardian.

So what?

You have to go to the source code for what is happening here because the details of each claim and counter-claim are impossible to follow. Essentially the police, and particularly Crime Intelligence, have been profoundly damaged by having been drawn into high-level political contests, particularly those between former president Thabo Mbeki and then challenger Jacob Zuma. Significant parts of these apparatuses have become semi-criminal and out-of-control, pursuing sometimes arcane political (and worse) agendas. The top echelons of our political establishment are directly implicated in and linked to this chaos – having deployed these institutions in their internecine battles. No individual institutional failing in South Africa is more serious and more threatening for those seeking stability and certainty in the regulatory and institutional environment.

I have been on the road without respite for close to 4 weeks … so here is brief selection of some of my news commentary over the last few weeks, just to show that I am alive and working, albeit a little frenetically. Apologies for the out of date bits and the bits that history has caught up on already.

  • Terror attack in Nairobi is the leading-edge of an expanding band across West, North and East Africa
  • The conflict in Cosatu is serious for financial markets for several reasons, and while there are some narrow paths out of the quagmire it is increasingly unlikely that these will be the roads travelled by the incumbent leadership of the Ruling Alliance
  • The mining regulatory instability is the tip of an iceberg of hostile policy that investors need to start putting at the centre of their vision.

Nairobi terror attack part of a developing African front

The death toll in an attack on a shopping mall in Kenya’s capital city, Nairobi, rose to 59 by the time of writing this morning. The attack began on Saturday morning and appears to have been carried out by an international unit affiliated to Somali’s al-Qaeda linked al-Shabaab movement and is retaliation for Kenya deployment of 4000 troops to back the Somali government against the rebel army. On the same weekend 80 people were killed in Northeast Nigeria in a series of Boko Haram attacks.

So what?

al-Shabaab, joins Mali’s AQIM (al-Qaeda in the Islamic Maghreb), Nigeria’s Boko Haram and similar movement in Tunisia and Algeria in a thickening arc (across the whole of West, North and East Africa) of a specific al-Qaeda franchised brand of jihadist rebellion linked to the Wahabi or Salafi traditions that have their origin in Saudi Arabia. This arc of organisations is likely to play a significantly destabilising role, pushing both North and South in the years ahead. The jihadists will be looking for equivalents of Chechnya and Afghanistan as safe ground on which to train and equip international brigades (as they did in Mali up until the French intervened in January this year but might be still doing in territory outside of government and French control) and world powers will be looking to stop them. This will become an increasingly important element of investment decision across the whole band of countries affected. Kenya, Nigeria and Uganda are not necessarily mortally injured by events like the one at the Westgate Mall in Nairobi (that is still on-going as I write this) but the signal is that we need to have this matter more central in our assessments of the region.

 

Cosatu ructions have potentially serious implications for investors

The trade union ally of the ruling African National Congress continues to suffer a debilitating leadership struggle.  Cosatu’s Central Executive Committee has received letters from the requisite quorum of unions insisting that a special congress of the federation be held. The weekly newspapers are full of speculation as to whether such a congress would reinstate Zwelinzima Vavi and get rid of Cosatu president Sdumo Dlamini, deputy secretary general Bheki Ntshalintshali; and Cosatu’s second deputy president Zingiswa Losi – who are Vavi’s main foes and Zuma’s main friends (simplification alert) amongst Cosatu’s NOBs (National Office Bearers).

So what?

It is possible that Sdumo Dlamini will attempt to block the special congress by arguing that several administrative and technical barriers (time, money and the upcoming national elections) make it too difficult to hold. This is what is at stake:

  • Based on previous voting patterns a special congress of Cosatu is likely to reinstate Vavi and it is conceivable that such a congress could expel the ANC and SACP loyalists from the federation’s top structure.
  • However an alternative outcome could be the reinstatement of Vavi, and the recovery of a fragile unity in the federation prior to next year’s election. This would require the top ANC leadership and its allies in Cosatu backing off their attempts to shaft Vavi. It appears this requirement would be difficult for the Zuma leadership of The Alliance to meet. Zuma’s leadership is increasingly characterised by a (essentially weak) reliance on force and the driving out of critics – as opposed to (an essentially strong) ability to provide leadership and establish hegemony over an unruly and contested alliance of forces.
  • Thus if the ruling group fails to find an accommodation with Vavi it is a real possibility that Vavi and his allies will be forced out of Cosatu. This result could be catastrophic for both the ANC and for industrial relations stability as a whole. Numsa would go with Vavi and Numsa would have the capacity to compete successfully with a host of other Cosatu unions, particularly the National Union of Mineworkers (Num). The disastrous consequences of the contest between Num and Amcu could be a template for similar contests between Numsa and several other Cosatu unions.
  • A split Cosatu could conceivable lead to the formation of a new ‘worker’ or ‘left’ political party or alliance that could, ultimately, challenge the ANC at the polls. There are a number of reasons why The Alliance has maintained its integrity for so long – and generally those who have been expelled or who have left of their own volition have shrivelled in the cold. However this conflict in Cosatu, driven as it is by the Zuma leadership’s attempt to supress criticism of corruption and dissent about policy, is changing the equation.
  • Vavi and his allies accuse the Zuma leadership of attempting to make Cosatu into a ‘labour desk’ of the ANC. It seems to me that this accusation is essentially correct and that the solution that would work best for the ANC and for industrial relations (in the short to medium term) would be to allow Cosatu to make its own decision about leadership at a special congress.

 

Mining regulatory instability is the tip of an iceberg of hostile policy

To understand how increasingly hostile is the stance of government towards business in South Africa, listen to the words of Chamber of Mines head Bheki Sibiya talking about the proposed mining law amendments after public hearings on the matter ended last week (in the Sunday Times, 22/09/2013 and Business Day of 20/09/2013).

He points out that the Mineral and Petroleum Resources Amendment Bill of 2013 intends to significantly empower the minister to intervene in the sector – specifically with regard to ownership and pricing. “Mining is long term. Once one is not so sure about one’s rights in the long term, one would rather say let’s cut our losses now. This is what investors will do … If pricing is not going to be decided by the markets but by some individual, then when you do your projections you’re shooting in the dark” he said.

Sibiya specifically bemoans the recent process of business engagement in various amendments to the Labour Relations Act and the Basic Conditions of Employment Act. In those cases years of proposals were essentially ignored by government and it (government) went ahead with what it wanted and what its alliance partner Cosatu wanted.

Business Day took these observations a little further this morning when it republished a quote from last week by Thami ka Plaatje, head of research at the ANC and an adviser to Public Service Minister Lindiwe Sisulu: “We are still wresting control from the white capitalist economy. We still reel under the oppressive yoke of all-pervading oligopolistic and monopolistic forms of the white economy.”

So what?

Regulation and policy in a complex, modern, small and open economy like South Africa’s requires a degree of sophistication that seems increasingly absent from this government. Policy and political risk is inevitably escalating as a government with a diminishing capacity develops an expanding agenda.

…. and then, from even further back, for those with an interest in ancient history …. like 4 weeks ago:

 

  • Strike wave breaks across the country – there are both normal and abnormal drivers
  • Alliance Summit – ANC’s inevitable schizophrenia on economic policy is leaving everyone dissatisfied, The tension is evident in mining minister Shabangu’s comments in Australia versus deputy president Motlanthe’s efforts at the Mining Lekgotla in Johannesburg
  • The criminal justice system is ever more appropriately named 
  • Editor in hiding from GuptaTV – comic relief tinged with embarrassment

Strikes – turbulence as the cycle hits the secular trend

Num (the National Union of Mineworkers) has served notice on the Chamber of Mines (COM) of its intention to strike across the gold sector, beginning with the Tuesday night shift this week. Num represents 72,000 of the country’s 120,000 goldmine workers. The Chamber made a final offer of a 6-6.5% wage increase, while Num is holding out for 60%. Amcu, which is also represented in the gold sector (now 19% of workforce according to the COM, but probably as high as 30% according to Adrian Hammond, gold analyst on the BNP Paribas Cadiz Securities) wants a 150% increase but has not announced that it intends to strike, and nor have Solidarity and Uasa.

There are ongoing strikes by workers in auto manufacturing, construction and aviation services and threatened strikes among textile workers and petrol station employees – but these strikes are, at this stage, part of the normal cycle.

So what?

We have mentioned previously:

“South Africa has a predictable strike season, the timing of which coincides with the expiration of bargaining chamber agreements in different sectors of the economy. Every year it appears that a wave of strikes is enveloping the country, but at some time during the gloom, journalists twig to the fact that this happens every year – much of the flurry in normal and predictable” – SA Politics, April 29 2013.

Several such ‘predictable’ strikes are happening or about to happen as I write this.

However, the gold sector breakdown is outside of the normal cycle both in how far the negotiating parties are away from each (6-6.5% versus 60-150%) and in the complex game being played between Num and Amcu. Amcu has quietly welcomed the impending strike as a chance to prove that, in fact, Num does not represent the majority of workers at key mines. On Friday, Amcu president Joseph Mathunjwa said Num’s strike would “qualify” its official representivity of more than 60%. He urged that everyone should: “watch this space”.

Business Report in the Sunday Independent argues that South Africa’s four biggest gold producers are hoarding cash and lining up access to more in preparing for an industry wide strike. “If we are, let’s say, bullied into a situation that we don’t like, we can ride out the storm for a very long period of time,” said Sibanye chief executive Neal Froneman in the Bloomberg sourced story.

The essence of the gamesmanship between Num and Amcu is Num must demand and win an increase via strike action that is satisfactory to its membership, and Amcu must try and undermine the strike action and argue that, anyway, the ‘demand’ in the Num led strike is inadequate. On mines where Amcu dominates (in the Carletonville region at AngloGold, Harmony Gold and Sibanye Gold, according to Adrian Hammond BNP Paribas Cadiz Securities gold analyst – see his note “Wage Negotiations – The Final Round? August 28 2013) Amcu must attempt to force mines out of the central bargaining process by ensuring that no central agreement can achieve a sustainable settlement at the local mine or company level.

Lock-out

An interesting discussion in today’s Business Day by the always excellent Carol Paton suggests that employers with large Amcu membership, specifically at Amcu strongholds at AngloGold Ashanti’s Mponeng mine; Harmony’s Kusasalethu and Sibanye’s Driefonteing favour a lock-out because they believe Amcu will sit out the Num strike and then strike themselves once that is settled. Paton’s story suggests that by locking workers out employers force all workers into one camp. “By declaring a lockout, employers would get around this problem, through forcing Amcu into the dispute now and exhausting workers’ resources to endure a strike.”

 

Alliance Summit

The African National Congress, the South African Communist Party, the Congress of South African Trade Unions and the South African National Civics Organisation met in a long postponed summit over the weekend to discuss and agree upon economic policy. The premise of the discussion was “unless we make significant inroads in addressing the challenges of poverty, inequality and unemployment, the democratic constitutional gains of the first phase of our transition will themselves be eroded” – from the Summit Declaration

The Declaration situated the discussion by arguing that

“… stagnation continues to characterise the developed economies, there has now been a significant slowing of growth in key developing economies, including China, India and Brazil. The commodity super-cycle of the recent past is now over. This has had an impact on economies dependent upon the export of industrial minerals and coal. The attempts to refloat growth in the US with a loose money policy have created further turbulence in many developing economies like SA.”

The Summit went to some lengths to defend against the accusation that poor economic performance was in any way related failures of “the South African government, or the labour movement”. Instead, the summit declaration lists achievements in infrastructure build, land reform and youth and labour market reform.

On macroeconomic policy the summit called for:

“bold forms of state intervention, including through:

  • Financial regulation and control;
  • Progressive and redistributive taxation
  • Wage and income policies and progressive competition policies that promote decent work, growth and address poverty and inequality.
  • A well-resourced state-led industrial and trade policy
  • Increased state ownership and control in strategic sectors, where deemed appropriate on the balance of evidence,
  • and the more effective use of state-owned enterprises

So what?

The Alliance Summit used all the right language to keep the different elements of the alliance together but said nothing that might reassure spooked investors. The opposite is probably true. Just look at the words: “progressive and redistributive taxation”, “well-resourced state-led industrial and trade policy”, “increased state ownership” and “wage and income policies … that … promote decent work, growth and address poverty and inequality.” This is not the language that Kgalema Motlanthe used as he attempted to pacify investors at the presidential mining lekgotla in Johannesburg last week, but it is precisely the atmosphere of mining minister Susan Shabangu’s words at the Africa Down Under mining conference Perth, Western Australia, where she said investors had to “moderate” the rates of return they expected to earn on their investments so as to allow for the social expenditures that need to be made (Business Day August 28). The ANC and government are increasingly schizophrenic in their attempts to keep everyone (constituents, allies and investors) happy. In trying to keep everyone happy the ANC and the government seem more likely to achieve generalised dissatisfaction.

 

Criminal justice system appropriately named

The lead stories in the Weeklies were indicative of a growing anxiety about the criminal justice system. The Sunday Times led with “Magistrates: drunks, thieves and killers” and the other papers all discussed National Police Commissioner General Riah Phiyega’s embarrassment after she announced the appointment of a Major-General Mondli Zuma and then quickly reversed that when she was told that Zuma (whose relationship to the President is unknown to me) was being tried for driving under the influence of alcohol,  failing to comply with a traffic officer’s instructions to stop at a roadblock, escaping lawful custody, defeating the ends of justice and refusing to have a blood alcohol sample taken.

So what

This might look like a circus but there is a darker element to the state of the criminal justice system than is not immediately obvious in these comical stories. In the Sunday Independent, journalist Nathi Oliphant writes about the security and justice sector: “President Jacob Zuma has unflinchingly stuck to his guns in promoting ‘his own ’into key positions”. The security apparatuses and the criminal justice system more generally has been profoundly weakened by political interference and the dismaying newspaper headlines about criminality amongst magistrates and senior police generals is just the visible tip of the problem of Thabo Mbeki’s and Jacob Zuma’s serious fiddling in the security and justice clusters and institutions.

 

 

Editor flees from Gupta TV

“Visibly terrified and hiding in a Johannesburg hotel room, the former consulting editor at ANN7 has made explosive claims about visits by channel bosses to President Jacob Zuma, where Zuma made editorial recommendations and was ‘given assurances by the Guptas this channel was going to be pro-ANC’” – reads the lead story in City Press.

So what

Nothing, really. ANN7, or GuptaTV as it has been named in much of the South African media, continues to provide comic relief and excruciating embarrassment, in about equal measures. Jacob Zuma’s relationship with the Gupta brothers is probably no laughing matter, but I wouldn’t hold my breath waiting for the criminal justice system to test whether Zuma’s relationship with the Gupta brothers is in anyway similar to his relationship with the Shaik brothers.

Imagine you are the producer of a major and successful television soap-opera.

Gradually, for reasons that are not immediately apparent, market research begins to indicate your share of the prime-time television audience is diminishing – and, further, that the declines are accelerating.

I suspect what you do is try to work out whether the viewers are being tempted away by a better soap, whether the quality of your show is slipping and/or whether your product is losing its appeal because the ‘demographic’ that follows your production is shrinking … or some combination of those.

Perhaps you try to adapt your trashy product to follow the shifting demographic; change the time-slot, perhaps kill off the older actors … have the Elizabethan extended family that has been the central theme be infiltrated by shape-shifting aliens who teleport the stately manor out of the English countryside and into a future post-apocalyptic New York … change the name to Downtown Abyss? Ok, maybe not.

Or you do a serious quality overhaul of your existing production, get better writers and introduce more popular and skilled actors, win back the defecting viewers … stick to your knitting, trust the product … and all those other management-speak exhortations.

I think the ANC is facing a crisis similar to that faced by the producers of this imaginary soap-opera. I suspect that the ANC, Agang and the DA do market research that is indicating and projecting significant voter swings away from the ANC . But I have nothing firmly in my hands other than rumours, leaks and hints.

So forgive me if I float an untested (and untestable at this time) hypothesis; one we are all going to hear bruted about soon: that it is ‘true’ that on current trends the ANC will get less than 59 percent of the vote next year but more than 52 percent, and further, that the ANC will receive less than 50 percent of the vote in 2019 (thumbsuck alerts all round).

The assumption is untestable (by me) because I don’t have the bespoke polling data and (by anybody else, in my opinion) because such data do not take adequately into account the myriad subjective and objective factors that might  impact on the trend.

But among the reasons I take seriously the possibility that this is, in fact, the trend is, for example, the rapid growth of Amcu and the concomitant shrinking of  Num. Another is this public domain ranking of Zuma’s approval rating amongst urban Africans by TNS Research published in the Sunday Times on 12/03/13:

%

Apr

‘09

Jun

‘09

Sep

‘09

Nov

‘09

Feb

‘10

May

‘10

Sep

‘10

Nov

‘10

Feb

‘11

Mar

‘11

Sep

‘11

O/N

‘11

Feb

‘12

Apr

‘12

Aug

‘12

Feb

‘13

Approve

52

57

53

58

43

51

42

49

49

48

45

55

55

46

48

41

Disapprove

29

13

19

23

41

33

44

34

35

38

41

38

35

46

44

51

Don’t know

19

31

28

12

17

16

15

17

16

14

14

14

10

8

8

9

Net positives

+23

+24

+34

+35

+2

+18

+2

+18

+2

+15

+14

+1

+20

0

+4

-10

 

… and updated by TNS this Monday (1/7/13) indicating a slight improvement in favour of Zuma (read from the top: 42, 50, 9 and -8). The point is there is a significant drop in Zuma’s approval ratings and concomitant rise in his disapproval ratings from February last year. It is reasonable to consider the possibility that this applies to the ANC (although, again, and at the risk of being pedantic, there is no established corollary between Zuma’s ratings and the ANC’s … but as a personal aside, I would imagine he must represent a specific liability.)

When I think of Mandela’s ill health and what I see as signs of how destabilising for the ANC his passing be may be (although the opposite could also be true), when I consider the anti-Zuma noises coming from Winnie Mandela and the frisson of mischievous excitement around Julius Malema’s proposed Economic Freedom Fighters … and when I put a whole mess of hints, trends, rumours and suppositions together with other metaphorical canaries that I use and which are dying around me like flies, I feel confident, for the first time since 1994, to at least consider how things might be when and if the ANC is clinging to an electoral majority, or perhaps even losing one.

As I begun to consider this (and helped along by a good and irritatingly insistent friend) I discovered that I still, subconsciously, conduct my professional duties under the burden of a normative (as in relating to an ‘ideal standard or model’)  assumption that has remained unchanged and largely unexamined since about 1994.

This normative assumption goes, roughly, something like this:

South African society is shaped by irresolvable contradictions. Most obviously between the poor, largely African, majority and the propertied white minority. Only an African National Congress, held comfortably in power by the trust and momentum established by its role and identity as leader of the liberation struggle, and by its clearly ‘African-led’ character, could possibly negotiate the perilous path between the imperative to deliver radical redress to the African majority and the absolute requirements to operate within the disciplines of global capital markets and to keep whites engaged and invested.

There are so many assumptions – and slippery phrases – in that statement, that I am not sure where to begin.

But briefly (in as far as that is possible):

Firstly I am implicitly using a (somewhat antiquated) theoretical model of society that is based on the idea that the competition between  groups with closely aligned economic interests acts as some kind of driver that interacts with and shapes other features of society, including the state and formal party political contests. This is a (hopefully sophisticated) version of the base/superstructure model of Marxist theory. As a rough, working model, I will continue to employ this system in political analysis – even if it is purely as a way of organising my thoughts. It is an elaboration of the injunction to follow the money which I consistently find the most useful hand-axe in the tool kit I use to help me work out, to my own satisfaction if no-one else’s, what the hell is going on.

Secondly, I am weighting the racial divide, its historical features, its ideological characteristics, the materiality of its ongoing consequences – including the radical disparity in wealth and income – more heavily than any other feature of South African society. ‘Politics’ occurs around such contradictions and our politics remains overdetermined by this structural feature. I think this remains true – but less true than it was 18 years ago. Primarily because class development, including the development of a black wealthy/property-owning class, a black middle-class and a sophisticated and slightly wealthier working class (driven by the changing character and function of labour processes and the relative growth of the services sector) dilutes the central contradiction and adds competing fissures.

Thirdly, I continue to assume it is imperative to keep whites “on board”… and that we have to keep within the discipline of global capital markets. I am also assuming (or perhaps estimating that on balance) the ANC still sees these as fundamental constraints. Those are brave (wild?) assumptions, I know, but I do not have all night. So moving swiftly along …

Finally, the aspect of my normative assumption about which I am most uncertain is the central one. Who says the ANC cannot fall below 50 percent, that an alliance of opposition parties will not get above 50 percent? And that if both those bridges are crossed we are into the game mode where  “(o)nly (the) African National Congress  … could possibly negotiate the perilous path”. Which means?

I  appear to be saying that in the event that those barriers are crossed we will fail to negotiate that path.

That we collapse in a heap? That the ANC morphs into Zanu-PF – but with even scarier tribalist and repressive features – to recapture the political initiative? That the ANC embarks on an ever more expansive looting of private and public assets to feed a patronage system that comes to replace all other mechanism that establish stability, but a system that is absolutely limited by the availability of such lootable assets? Or perhaps that our future will look something like what (might be) happening in Cairo tonight? … I will get to that as soon as I hit “publish”.

If a democratic election goes against the ANC why am I so uncertain that the party or party’s that the same election goes in favour of will be unable to govern?

I suspect I actually believe that without the ANC in a comfortable majority that things fall apart, that the centre cannot hold, that

Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed*

Thus, this is little more that my personal failure to imagine a future significantly different from the present, yes?

It appears that I am constrained by my own habits of thought and prejudices. Now there’s a big surprise.

So, back to the soap opera.

If the ANC is slipping in the ratings, it can chase the shifting demographic by attempting to spread its skirts ever more widely – although I think it is already beyond the limits of the possible with that indecorous exercise.

… or it can do the political equivalent of the narrative device of having space aliens infiltrate the family (hmm, that might have happened already – ed).  I am not sure what a radical discontinuity in the ANC’s brand might look like – I think it could go one of two general directions, but I would imagine that the ANC strategists defining ‘the message’ for the upcoming elections must envy the clean simplicity of the Economic Freedom Fighters emerging platform.

… or the ANC could improve its character and performance by sticking to its knitting: cleaning up its leadership and improving its governance performance and winning back the trust of its purportedly defecting support. My impression is the ANC is going in precisely the opposite direction, but who’s to say they wont turn it around in response to a mild shock in 2014?

I  do not hold to the popular notion that “anything is possible”, but I am prepared to accept that a lot more things will come to pass than I have been able to imagine.

* As always, the best poetic accompaniment to fretting about the future of our politics is William Butler YeatsThe Second Coming … catch the incomparable poem here.

I am in Serbia on a social visit and I thought I would record here some of my initial observations about stuff we might learn from this country about some aspects of SA politics and culture.

Cultural Betrayal

Firstly, I am in Belgrade – a city of 1.6 million people built on the confluence of the Danube and the Sava – and a peculiar mixture of modern flash, Soviet-era bland and medieval tatty. The scars of the Nato bombings are still dramatically evident in a sort of carefully preserved tableau, a series of monuments to that seminal betrayal, that you can’t miss on your way in from the airport

Serbian/Yugoslav Army HQ? Taken a few minutes ago (thanks Jaimo) – I will double-check what the building’s original function was … before it (and a few of its neighbours) were bombed on May 1 1999, becoming (permanent?) monuments to Western perfidy

Why betrayal? Because everyone my age here has the same (as me)  … memealogy? (okay, I made it up – memes are cultural genes and you can work it backwards from genealogy). The cultural literacy is all Rolling Stones, Sam Peckinpah, Bruce Springsteen, Warren Zevon, The Alien, Bob Dylan, The Beatles and Billy Joel (you dredge up the cultural icon from the 60s, 70’s and 80’s and I bet I share it with Serbians of an appropriate age – except they are more culturally literate. Interestingly, just like in Yugoslavia, in SA we got this stuff a few years late – in SA because of apartheid and National Party awfulness, in Yugoslavia because of a slightly different set of transgressions.)

… and then one day their beloved Americans and English cultural tutors bombed them and killed the firemen trying to save people from the buildings – ostensibly to stop some new, particularly ugly, transgressions. Oh the treachery, the faithlessness …

Ethnic uniformity

The second thing that strikes me is the populace is ethnically identical. They are all white. There are no black people, no Arabic looking people; no any kind of people who are in any way different looking from what I think of as Slavic – which is just a minute variation on your bog standard white person – the men with chiseled features and the women with unusually long legs and everyone with white skin … not olive or dusky or anything, but white – in the old Apartheid conception of the skin colour.

“The city was more cosmopolitan”, my Serbian friend tells me, “before the disaster of Slobodan Milošević – before then you could see more  Croats, Bosnians, Macedonians, Montenegrins, Muslims, Slovaks …”

We are wandering down a medieval street crammed with crowds of handsome young people. I ask him to show me some individual examples of these groups that survived the virtual and literal ethnic cleansing that accompanied the collapse of Yugoslavia.

His attempt seems half-hearted, even dispirited.

“Hmm maybe she is Croat,” he says indicating a woman flicking through some blouses at a street kiosk. She is one of the tall, long-legged, light-brown haired, chiseled cheek-boned and haughty beauties that shoal in these alleys, as ubiquitous as sardines at the right time in Durban.

“Ok, maybe not” he shrugs as I frown at him in confusion.

We finally manage to agree that “those gypsies” selling knock-off Ray-Bans look ethnically dissimilar to the majority. But to me  it’s a margin call – any one of them could have been my old ‘Leb’ Catholic chinas in the Johannesburg of my youth; definitely ‘white’ under apartheid’s racial taxonomy.

Remember it took the terror of ethnic cleansing to create this level of uniformity, but even before that, in the old Yugoslavia, the full range of ethnic diversity could have been encompassed by the differences between, say Rafael Nadel and Charlize Theron …

Let’s compare monstrous barbarisms

Everyone here above a certain age seems haunted by what happened after the collapse of Yugoslavia. You would think that this lot would be immunised to bombs, betrayals, racial and religious purging and radical disjuncture in their social organisation.

It started with the Celts invading  the “Paleo-Balkan tribes” in 50 000 BCE  (okay, I’m exaggerating) who in their turn were replaced by an endless Roman occupation; sacked by Attila the Hun in 442 and then one thousand five hundred years of bloody, impossible to follow conquest, resistance, sacking, rapine, pillage … I could go on and on. It was the Byzantines, the Franks, the Bulgarians, the Kingdom of Hungary, the Crusades, the Serbian Empire (briefly) the Hungarians again, the Ottomans (for five hundred years! … and yes, they did persecute the Christians but not half as badly as the Christians did to almost anyone of any other faith during the Crusades … and there are a whole lot of beautiful and ancient churches that the Ottoman-Turk conquerors and rulers left standing) and the Austrians.

And of course, that is only before the First World War, and as you know all the important stuff happened since then.

I know our African and South African histories are important and it is appropriate that we wrestle as long as it takes – which will be forever, obviously – with the ongoing consequences of slavery, colonialism and apartheid.

But being here does tempt me to wish my countrymen and women had a slightly less myopic view of our own trials and tribulations.  I read this morning that Belgrade is trying to scrape together the finances to build a memorial to Judenlager Semlin, the largest German-run concentration camp in Southeast Europe where in May 1942 the Nazi’s proudly announced one of their first major European campaign successes: Serbia was “Judenfrei”. The men had been executed earlier, but the last 7000 Jewish women and children were killed in the camp in the first few months of 1942.

By May Serbia was Judenfrei.

And this is not a The Holocaust trumps all kind of statement – I just mention it  in the context of the previous 2000 years of European history. The Germans might have achieved a unique scale with their technological and organisational excellence, but the great rivers of cruelty and tears are old, deep and cold here and they flow through every valley of this geography – and not only to and from the mighty lake that was The Holocaust.

The Economy and the European Debt Crisis

The Serbian economy has hit the wall and the government is trying to decide on a balance between cutting public sector wages and salaries by about 6% and increasing VAT to about 22%. The options are limited and there is an absolute consensus that extremely hard times have arrived. This is the European debt crises writ slightly smaller – because Serbia is not part of the European Union.

But what I see are people eating and drinking in restaurants – and partying as hard and as healthily as it gets.

There are almost no beggars – and those that there are are obviously professionals with studied acts:

  • the near-sighted (with ridiculously cute thick glasses) slightly retarded child playing – very badly – the violin, every item of clothing and scuff on his thick medical black shoes a carefully choreographed act that everyone consents to and ignores.
  • An old hunched-backed crone, her nose not six inches from the floor, tapping along on a short, gnarled staff, an arthritis crippled hand held out blindly above her … I am convinced she is a 22-year-old actress who couldn’t find a waitressing job.

The point is there are none of the streams of dead-eyed, exhausted people searching and researching the refuse; people you will find in any South African city. There is a medieval character to Belgrade, which means there are a million nooks and crannies and little hollows in ancient buildings and monuments everywhere. In South Africa those would all be occupied – where they were fenced, the fences would be broken and tunneled under – there would be evidence that someone was eking out an existence in every hollow, in every gap.

But here, nothing.

Sure, there is an occasional drunk sleeping on a park bench, but that is pretty much as bad as it gets. I have absolutely no doubt that I am not seeing the whole picture and certainly there are large areas of the city with awful Soviet-era council housing-type tenements, covered for 10 metres from street level with graffiti that looks to me just like Cape Town’s gang signs.

In South Africa we feel like we are bursting out of our seams, with the poor competing intensely for the leavings of the rich and thereby driving some kind of desperate but highly energetic economy. Here it feels older and emptier, certainly dowdy in places, but calm and stoic.

Everyone has time for a coffee and a rakia.

Don’t get me wrong. These people descend from women who have thrown their babies onto invader’s spears; their forefathers and mothers have eaten dogs and rats and stones to stave off the inevitable rape and slaughter that awaits the fall of the castle walls; they have catapulted the last live chickens at their enemies who have besieged them for years, and successfully convinced the invaders to just give up and go home.

So I  am not exactly saying that this is tired old Europe with nothing left to do but casually sip a coffee in the shade, sneering at the inevitable heat death that comes with impossible debt, dipping personal income and stagnant growth – of the economy and the population.

I am also not exactly saying that we are fresh and chaotic and ready to burst onto the global stage with the vigour and desperate energy of youth.

But there’s something in there, some little kernel or nugget – maybe a hope that I haven’t quite allowed myself to feel yet …

But it’s mid-afternoon and so hot that it is impossible to process this any further. Time for my first rakia and 4th double espresso – I’ll think about this tomorrow.

Doesn’t the Julius Malema saga feel so familiar?

Remember how the Jacob Zuma campaign seemed to transform each new obstacle placed in his path into fuel for his political train that eventually steamed triumphant into Polokwane in December 2007?

The fact that he was known far and wide as hopelessly incapable of moderating his sexual behaviour and as being on the take from, at least, Shabir Shaik, seemed to make almost no difference to the eventual outcome … unless the legal and other processes to charge him actually strengthened his claim to the presidency.

He was the victim of Mbeki’s shenanigans and he was heading a column of pro-poor ANC alliance cadres that were coming to take the ANC back from the pro-monopoly capital “1996 class project” – and every deed or word against that was coming from the privileged few defending their privilege. The marching column was irresistible and Polokwane was its destiny. Or at least that was the narrative that seemed to win out.

With the benefit of hindsight it is clear that Zuma’s success was all about momentum – and its inevitability is a post hoc construction.

I remember a movie from my childhood where the hero escapes almost certain death (it was either Indiana Jones or one of the Bonds ) by running across about fifty metres of crocodile infested waters by … yes, you guessed it: stepping on the back of each starving crocodile but with such speed that he was on his way to the next one before they snapped at him or sunk.*

That is probably a better metaphor for Zuma’s perilous progress towards Polokwane than the one that has him steaming towards that conference as if it was his manifest destiny. The second post of this blog was called The Accidental President and in it I argued that Zuma’s presidency was a result of an unlikely set of circumstances and he was not a character that many could have previously imagined in the role.

On closer examination it becomes clear that Zuma, on several occasions, almost crashed and burned – and came close to going to prison. Ultimately it was only the forward momentum of his campaign that allowed him to escape the snapping crocodiles at his heals.

In fact, I would put it even more strongly: for Jacob Zuma the only way to avoid ignominy and prison was to win the presidency.

And that is where the comparison with Julius Malema becomes so compelling – especially in his weekend attempt to boost the Economic Freedom in Our Lifetime campaign into the mouths and minds of the genuinely marginalised and poverty-stricken in places like Diepsloot and Bantu Bonke.

Just as his disciplinary hearing comes to a head.

Just as his questionable personal finances start to be ‘put to the question’ by various authorities.

Just as he prepares to lead the marches on the Chamber of Mines and the Johannesburg Stock Exchange.

He told those audiences: “They [the whites] found us here. They did not bring any land nor did they bring any minerals.”

And: “”We are here for every one of you. We will not rest until you stop worrying about where your next meal will come from.”

Woven into every word and phrase is the argument that the incumbent leadership of the ANC has failed the poor. That Julius Malema’s fight against Jacob Zuma is actually a fight to have the needs of the poor and dispossessed met.

Can Julius Malema, engorged as he and his comrades apparently are from sucking the marrow from the bones of Limpopo’s  (amongst others) public purse skeletal public finances (some bad metaphors are impossible to fix – ed)  hope to pull off this audacious argument?

Clearly he can.

Clearly he is betting on himself to be sitting up in the cab of a triumphant train steaming into Mangaung; to have turned all obstacles aside and spun the narrative of the little guy standing up against the incumbents, standing up for the poor and dispossessed.

The parallels are not perfect. Julius Malema is not the apex of a push for the presidency of the ANC – he is too young, untested and controversial to aspire to those lofty heights this time around. He is rather part of the campaign of other powerful contenders – although he hopes to be nested near the centre of a new ruling configuration of the ANC.

Finally, Zuma had the backing of the SACP, Cosatu and a host of ANC democrats exhausted by Mbeki’s stale centralism – as well as a swathe of aspirant BEE wannabes who felt excluded from the previous gravy train.

Julius Malema (and those who hope to benefit from his campaigning) have nothing like the mighty alliance of those disaffected by Mbeki’s presidency.

After yesterday’s radical cabinet reshuffle and Zuma’s apparent ability to reinvent himself as an anti-corruption and responsive president I would have to bet on the incumbents and against the invaders at the castle gate.

This is the week, however, when Malema’s gamble will either pay off or fail.  On Wednesday his disciplinary hearing resumes. On Thursday and Friday the marches on the JSE and the Chamber of Mines will take place.

This is not an accident of timing.

This is about planning, planning by individuals and groups with large appetites for risk – especially when the prize is so rich and the price of failure so high.

*I have a terrible feeling that someone has used that metaphor for Zuma’s march to Polokwane before … so let me apologise in advance if I stole it … and while on the textual commentary – I found this in Wikipedia while trying to check if the image had, in fact, been used for Polokwane before:

“Ross Kanaga as James Bond used four crocodiles as stepping stones to reach safety on the other side. Kananga, who owned the crocodile farm seen in the film, and after whom the main villain is named, did the stunt five times wearing the same crocodile skin shoes as his character had chosen to wear. During the fourth attempt, the last crocodile bit through the shoe and into his foot.The fifth attempt is one seen on film, with the tied-down crocodiles snapping at his feet as he passed over them.”

Two brief thoughts – on a rainy Cape Town Sunday:

Firstly – a by-product of Malema’s (possible) retreat

I have a feeling that debates ranging from mine nationalisation, land distribution and continued white economic dominance in the South African economy have just been saved from the gangsters in the ANC Youth League who have been using these as a cover for looting.

It has been difficult not to lump every statement about ongoing race based inequality with the smokescreen slogans used by the ANC Youth League leadership – and many equally corrupt politicians.

The latest Commission of Employment Equity Annual Report says whites still occupy 73.1 percent of top management positions – and blacks 12.7, Indians 6.8 and coloureds 4.6?  Yeah, well they would say that wouldn’t they – after all, that is (one of) Jimmy Manyi’s old outfits and he is the grandmaster of running racial interference for pillaging resources destined for development!

Willing-seller, willing buyer policy of land distribution responsible for only 5 percent of redistribution targets met? Yeah, well, guess who are trying to get themselves a portfolio of farms a la Zanu-PF?

Nationalise the mines? Yeah, so you can rescue your BEE backers and get a piece of the action yourself?

But that was last week.

Those issues are back on the agenda, but this time the discussion might be led by people genuinely looking to harness the country’s resources for development and transformation – not looters, corrupt tenderpreneurs and “demagogic populists” disguising their true intentions.

If anyone thought we could go on with the levels of unemployment, inequality, poverty and racially skewed distribution of ownership and control of this economy I suspect they will find they have been very much mistaken.

One of the consequences of the retreat of the Malema agenda is that we will all have to deal with the issues we have, up until now, been able to dismiss or deflect because they were ‘owned” and propagated by thugs.

Itumeleng Mahabane says it like it is

In a similar vein – and my favourite read of the week – was Itumeleng Mahabane’s column in Friday’s Business Day.

He deals with a variety of aspects of the country’s debates about development and transformation.

In tones that have been tightly stripped – of anger, I suspect – Mahabane appeals for the debate to lose the “prejudicial invectives” and that participants should “desist from creating cardboard villains”.

He makes 4 main points (actually he makes a whole lot more, and it is not impossible that I misinterpret him here – and he is certainly more subtle and nuanced than my summary below – so read the original column – the link again.)

Firstly he suggests (although in the form of a question, not the statement as I have it here) that we have to acknowledge the damage our Apartheid past has done our country, leaving “the inequity of our income distribution and the historic systematic destruction of black capability”.

Secondly he hints that the state cannot assume more economic responsibility before we have fixed accountability – and thereby arrested corruption.

Thirdly he appeals for a sophistication of our views on the labour market – I think by suggesting that a degree of duality is crucial.

But, he warns:

I do not subscribe to the simplistic and questionable idea that the inability to hire and fire people is the core cause of structural unemployment. The balanced high growth would create demand for labour, regardless of labour rigidity.

Fourthly he asked us analysts why:

we casually, without considering the social implications, vilify workers and the working class, making them useful villains for complex economic challenges? We almost never give view to the body of evidence that shows that market rigidity and anticompetitive behaviour is a significant factor in deterring investment and output and that, in fact, it contributes to SA’s excessive business and skilled-labour rents.

Those are important views – and an important corrective to aspects of our debate about development.

I am back from my travels where I spent much time discussing the ANC Youth League’s “nationalisation of mines” call with investors.

The long and the short of my views are that I don’t think the ANC will decide to nationalise the mines at its December 2012 elective conference in Mangaung. I do, however, think the ANC will attempt to use the populist surge to beat a better deal out of the miners (in terms of the companies’  social obligations, obligations to contribute to infrastructure development as well as the likely imposition as a special tax on windfall profits.)

However I also think that markets will remain anxious about nationalisation and will tend to counter-track the rise and fall of Malema’s personal fortunes.

With this in mind I think the Youth League and its President are in a degree of trouble.

Monday morning  one time radio show host, sometime actor and columnist Eric Miyeni was published in the Sowetan saying of Ferial Haffejee, editor of City Press:

Who the devil is she anyway if not a black snake in the grass, deployed by white capital to sow discord among blacks? In the 80s she’d probably have had a burning tyre around her neck.

That evening ANC Youth League spokesman Floyd Shivambu sent out a statement that read:

The ANC Youth League agrees with Eric Miyeni’s column … He should continue to be an honest, fearless activist who speaks his mind and not fall into the trap of those who blindly support interests of apartheid beneficiaries.

On Sunday Julius Malema accused President Ian Khama of Botswana of being “a foot stool of imperialism, a security threat to Africa and always under constant puppetry of the United States” and further that the “ANC Youth League will also establish a Botswana command team, which will work towards uniting all oppositional forces in Botswana to oppose the puppet regime”.

On Tuesday Jackson Mthembu, ANC spokesman, said:

The ANC would like to totally reject and publicly rebuke the ANCYL on its extremely thoughtless and embarrassing pronouncements on ‘regime change’ in Botswana … This insult and disrespect to the President (Honourable Ian Khama), the government and the people of Botswana and a threat to destabilize and effect regime change in Botswana is a clear demonstration that the ANCYL’s ill discipline has clearly crossed the political line.

Surely we are into injury time by now – even the jellyfish Zuma leadership must have reached the end of its tolerance?

Two weeks ago previous key backer Tokyo Sexwale described Malema as a “loud-mouth young man”. Even Malema’s long term defender Mathews Phosa appeared to agree that the nationalisation debate had been handled badly and that the ANC had “dropped the ball” with regard to reconciliation and nation building.

Does this not leave Julius defended by only his organisation and a few wannabe intellectuals of the Miyeni stripe ?

Malema does not head an army of disenfranchised, unemployed and angry black youth. He has courted this crucial fraction of our society – usually as a deployed voice of the ANC itself – but in reality he lives a life of the überflash, so far removed from the unemployed and disenfranchised that his claims to the contrary smack of the worst and most dangerous forms of manipulative populism.

The point?

Markets should interpret what is happening as serious headwinds for the “Malema agenda” and that means much of the sound and fury will be removed from the nationalisation debate … a good thing for our politics and our economy.

Arrived late last night in New York from London (and Edinburgh and Frankfurt)  and the lag means I am only going to want to fall asleep at exactly the time it will be most unsuitable to do so.

I have been travelling (for Indian owned Religare Capital Markets, where I have a new berth) with the excellent Michael Kavanagh who is a mining and metals specialists. We have a story which interestingly balances the South African political risk (especially associated with nationalisation) and the long-term bullish outlook for  platinum. We are half way through a global tour talking to fund managers who specialise in investing either in mining stocks or emerging markets … or both.

South Africans at the point of weeping and pulling their hair out because of the latest ANC Youth League posture, or the newest tender scandal or Jacob Zuma’s increasingly hopeless grasp on the complexities need to spend a little time with people whose job it is to compare South Africa as an investment destination with its peers.

Oh yes, they worry faintly about Julius Malema’s antics but their universe of comparison is huge and diverse … and if the worst comes to the worst the money they manage can shift very easily and early.

(Our parochialism causes us to believe) we have no-one with whom to compare our populists, gangsters, thugs and incompetents.

Trust me (or rather trust the fund managers with whom I have been speaking), ours are no worse than the equivalents in Russia, Brazil, India, China … and a host of similar investment destinations between which the money flicks and flitters.

One of my slides that might not charm a domestic audience causes nothing more than a wry smile here. This is par for the course for investors who concentrate on global emerging markets; some light relief before going back to worrying about whether Israel is going to bomb the Iranian nuclear fuels development programme or not.

We might as well smile – both because we are not as bad as we could be, but also because when you look further than the grotesque, our earnestness is almost sweet and crazy … to my mind, anyway.

I think both the DA and the ANC might be on the verge of an evolutionary spurt that will change what they are and thus see them shifting into new ecological  niches in our political landscape.

I also think that the landscape itself changes much slower than we think or hope.

Voluntarism is a term for a species of political error – and I dredge this up from the gleaming days of my youthful involvement in the ‘mass democratic movement’ in South Africa. The taxonomic system we developed for naming and defining ‘mistaken beliefs’ was tiresomely thorough and self-righteous, but I have to confess that I still dip into that frame of reference and find there useful analogies and ways of understanding the world.

Voluntarism  means believing that through pure force of will, cleverness of organisation, brilliance of strategy, accuracy of tactics and shear hope, anything could be achieved no matter what the inherent conditions.

I am convinced that the Democratic Alliance foray into the townships and squatter camps is either a form of voluntarism or it will result in the DA becoming something else entirely – and ultimately something very similar to what the ANC has become.

This somewhat pessimistic view of politics is based on the assumption that politicians and political parties do not have a free hand to sell what they like to whoever (whomever?) they like.

The racial divide in South Africa and the racial solidarity of the groups which face each other across that divide is a deep structural phenomenon and not a casual consumer preference.

When Julius Malema talks about “the Madam and her tea girl” referring to DA chief Helen Zille and the DA MP and national spokesperson Lindiwe Mazibuko he finds a resonance.

This ‘resonance’ is not something created by clever marketing and it is also not something that can be got rid of like Vodacom changing its colours from blue to red.

Groups of people, their ideology, culture and attitudes can be changed – particularly in the powerfully denaturing environment of modern industrial cities. This is how an African peasantry became  the urban proletariat of South Africa’s modern capitalism. And it was this process that created the possibility of an ANC that represented all black Africans in the country and not just specific tribal groups.

But do not overestimate the power and speed of this process. Think of the ethnic boroughs in New York; think of the Xhosa/Zulu tussle in the ANC and think of the unbridgeable divide between the black and white experience in South Africa.

South Africa’s history, including colonialism and Apartheid, has a powerful momentum in our lives today. I think this means that the hope that the DA with more black faces and branches (but essentially the same ideology , structure and principles) could make a serious electoral challenge will remain just that – a hope.

A party still called the Democratic Alliance could displace the ANC, but only by becoming something very similar to its foe i.e. led by black people with a history of opposition to Apartheid and primarily about redressing the past,  directing state resources to benefit black people and  channelling wealth towards the emerging black elite.

The “rump” of the DA are good old white liberals (in the best sense of the word) who have their ideological roots in the closing years of Apartheid.

A party with such a “rump” will never (in any time frame that could be relevant to us) represent a majority of black South Africans – even urban professionals, even a significant minority. To represent those people the DA would have to be of those people, run by those people and be an instrument to further the interests of those people.

I do think urban African professionals are in the process of defecting, with disgust, from the ANC.

But I will be looking for a Movement for Democratic Change lookalike (to the ANC’s ZANU-PF) to emerge from the South African political dynamic.

That ultimately means I am still looking for an organised defection by the industrial working class and their middle class allies that will emerge from a split in the Ruling Alliance – that would probably put Cosatu on one side and the ANC on another.

On this basis the ANC could lose control of the cities to a political formation like the MDC –  although not one that could be portrayed, as the MDC has been by ZANU-PF and by the ANC (which can already sense the threat), as having been funded and set up by white farmers and other ‘enemies of national liberation’.

There is a part of me that hopes I am wrong … that we have it within ourselves to escape the awful gravity of our history; that we really are free to choose our future.

My view, however, is that the choices we do have are all within a narrow band of possibilities confined by the deep structural features of our past and present.

Thus the ecology of our society and our politics remains the same – or at least changes extremely slowly – but the creatures that inhabit the landscape are modified by natural selection and drift and displace each other in the niches that are available to them.

(My next post will deal with the question of what the ANC is becoming as it changes its niche as the party narrows and shifts – geographically, ideologically and socially.)

This added after publication:

The über-troll of South African political analysis R.W. Johnson added this gentle corrective to the version of the above article published on Politicsweb: “Am I the only person astonished by the fact that Mr Borain can’t spell voluntarism ?” He’s quite right about this – as he is about so much – although he is usually also interesting. He was, appropriately, hanging out with the racist bullies in Politicsweb’s comments section, so I shouldn’t be terribly surprised at his sneering tone.

The word is voluntarism (not volunterism, as I originally had it … I got it wrong because I mistakenly thought ‘we’  had made it up and I could therefore spell it as I pleased) and it means: “any theory that regards will as the fundamental agency or principle, in metaphysics, epistemology, or psychology”  – from Dictionary.com.

I am feeling the welcome pressure of a flood of paid work.

The only drawback to this happy state of affairs is I have not been able to put as much effort into updating this website as I would like.

In future I will generally be posting the quirkier side of politics and investment risk – occasionally from a more personal perspective.

I will not be telling you about what I had for breakfast, my deep and interesting views on Islay single malts or the fascinating behaviour of my small brown dog. I expect more posts to have the character of Saturday’s Rowan Atkinson skit – which could have been made for this election – or this one from a few months ago on celebrity culture and the rise of grandiosity in our politics.

Meanwhile here is a summary of some of my views on the lead-up to Wednesday’s vote.

(Note: just before the dog ate my homework my finger slipped on a small streak of high dudgeon that had somehow spilled on my keyboard and I pressed the “publish” link before I had a chance to edit the following piece. I have now cleaned it up slightly, but feel free to email me at nic.borain@gmail.com to point out any mistakes I missed – or to engage me about the article.)

Julius Malema

If the ANC Youth League president was a stock traded on the JSE I would be calling: “buy, buy, buy –  fill your boots! “

He’s under-priced because of the hammering he has taken over the last 6 months, and the market – as reflected in what the ANC likes to call “the print media” – has not adequately woken to the fact that he is the star of the election.

I have argued before that Malema is the coming man in the ANC and, perhaps, the country. I will not be entirely charmed to have been proven right – although a lot can go awry ‘twixt now and the time of full accounting. But let there be no mistaking or underestimating Malema’s current cachet.

He appears to have done the hard work – personally, in his own name and own voice – in mobilising the constituencies most likely not to have bothered to vote on Wednesday.

This doesn’t even have to be true. It appears to be true, and that is all that matters.

He stuck one in the eye of ‘the madams’ and ‘the masters’ and, as difficult as it is for me to swallow, I am fairly certain that for this reason alone there are millions of South Africans whose hearts swell with pride as they think about their Juju’s audacity and bravery.

Whatever else happens he will be remembered by the loyal party workers and bureaucrats as having turned pro when the going got tough – and taking the fight to the Democratic Alliance just as the Official Opposition was  looking scary.

And this was all building on – and in addition to – the enormous public relations coup of the “kill the boer” trial – which united the party, its leaders and its faithful behind him.

I do think that a party and a country in which a young populist of the streak and character of Julius Malema is so strongly ascendant is in all kinds of trouble in the long term … but that, so to speak, is another story.

I also think financial market sentiment – particularly as effected by the ‘nationalisation of mines’ debate – will counter track his rising and falling fortunes.

Jacob Zuma

Jacob Zuma has had a fair to good election. This activity is his strength and as with Malema he has earned loyalty points from the party faithful for his tireless commitment and skill in working the crowd.

I am interested in the nature and extent of pressure that he appears to be under – particularly pressure emanating from the Youth League and those that hope to ride that organisation to power and even greater wealth.

President Zuma, to my mind, is awkwardly caught in a relationship of mutual dependence with the sections of the Ruling Alliance with whom he shares the least ideological and cultural ground.

Zuma is the natural Nkandla patriarch, dispensing largesse and spreading his seed in as a wide a circle as possible. These are the attributes that Cosatu and the ANC’s leftwing most despise yet Zuma is their champion and they his.

The confirmation of post-Polokwane populism

I miss the arrogant and austere Thabo Mbeki who would have been ashamed to use the kind of underhand tactics implicit in some of the  ANC election posters – I am assured this one is the genuine article, but I still have difficulty believing it.

For me the word “populism” has a meaning that implies a combination of characteristics, including clever mixing of fact and fiction, appealing to the most base human emotions as well as the manipulation of the fears, greed and anger of oppressed and vulnerable people.

At first this image made me laugh out loud – it is a photograph, so inescapably true, as well as being strangely familiar. Until I paused and realised how manipulative and abusive it actually is – using the image of happy children playing together (in circumstances we cannot know but are encouraged to imagine) to evoke hatred, rage and fear.

The ANC conducted the 2009 election campaign in the style of  a televangelical rally spiced with hotdogs and wet t-shirts.

It is probably arrogant and elitist to hate this kind of politics as profoundly as I do – but I would rather have that defence than for there to be any possibility of being swept up into either the sexy razzmatazz or into the fear and hatred.

This election has given the faintest hint of what a cornered ANC might be capable of and the kinds of appeals it might be prepared to make to the most base elements of its constituency.

Not, mind you, that the DA is guiltless of softer versions of both the ‘sexy razzmatazz’ and the ‘fear and loathing’ populism. But the “Fight Back”slogan seems to have receded and Helen Zille’s sex appeal is such a specialist taste that I am less bothered by the DA’s mass-marketing strategy than I am by the ANC’s.

Helen Zille also rises

My own view is that Helen Zille, for all her preppy awkwardness, jolly-hockey sticks enthusiasm and excruciating body language,  is the Iron Lady of our recent history and has struck at the heart of ANC complacency and tolerance for corruption and failure.

Whatever happens to the DA’s feisty campaign in this election, Helen Zille herself has achieved an extraordinary place in our history. She has personally shaped her party and pushed it into new territory – against history and against personal limitations – where it is, in my estimation, going to play a growing role in the politics of a post-Apartheid South Africa. This would be a phenomenal and transcending achievement for party that originated in the last white parliament.

Results – counting chickens and pigs in pokes

I strongly suspect that ANC panic and DA overreach is going to leave a lot of people slightly shamefaced or deeply relieved.

There is no realistic or publicly available polling data but my thumbsuck guess – unlike that of Allister Sparks – is that the DA does less well than the hype has led us to believe and that the ANC does not go much below 60 % no matter how big the stayaway vote from the party’s angry and disillusioned supporters.

The DA seems to have set its supporters and party workers up for disappointment. Who cannot think that the party will not do considerably better than it did in the 2009 General Election or the  Municipal vote in 2006? But the way it is being spun, anything short of 4 metros and 40 percent of the vote (a vanishingly unlikely outcome) is going to feel like defeat.

Will the ANC lose enough urban African support to scare it into cleaning up its act?

I am ever hopeful, but I am breathing while I wait.

The cacophony – let it stop!!

It is perhaps slightly pretentious to hate exclamation marks as much as I claim to – but I think the sheer awfulness and triviality of the the political debate deep into election time calls for more than one of the flashy little symbols of overstatement and hyperbole.

I refuse to discuss the toilets any further. I promise I will never talk about the ANC’s leaders ‘snuffling’, ‘grunting’  or ‘squealing’ at the trough ever again, no matter how extreme the provocation.

It is an arms race of metaphor and hyperbole and eventually the language cannot adequately express the appropriate range of feelings.

I look forward to a period of calm understatement, starting next week Monday, as we recover from Sunday’s last gush of whining, triumphalism and sage and important thoughts from the analytic establishment.

As the cannonade and sharp retorts of the Municipal Election become deafening, it strikes me how alike are elections and wars.

Both these human endeavours are faced with comparable technological, communication, infrastructural and personnel challenges.

Generals preparing for war and political leaders for elections have this in common:

  • They must have a game plan and clear objectives, including a realistic view of the chances of success and the costs involved in achieving objectives.
  • There must be lots of money available.
  • They must have a clear understanding of the enemy and the enemy’s resources and capabilities.
  • They must have precise information about the terrain upon which the battles will take place and the loyalties of the citizens who inhabit that terrain.
  • They must have a complex and balanced organisation at their disposal which contains the full capabilities and capacities that might be required – from senior management down to foot-soldiers, and encompassing every specialist skill that might be applicable to the proposed campaign as well as the most varied arsenal possible.
  • They must have systems of supply and replenishment – allowing funds and resources to flow to where they are needed.
  • They must have a system of communicating to every level of the force and auxiliary services;
  • They must have a system of communicating to the world and general public not directly involved in the war.

I suspect one could search for more complex similarities, but the issue of interest to me is how both elections and war require – or cause, I am not sure which –  propaganda and distortion of the truth.

We have all heard the notion: “The first casualty in war is the truth” – (Aeschylus 525 BC – 456 BC) and it is apparent listening to what  the principal players in our election say of themselves and each other that “the truth” seems infinitely elastic and vague.

The most obvious contravention of the rules of engagement have been Julius Malema’s comments in Kimberly over the weekend: “We must take the land without paying. They took our land without paying. Once we agree they stole our land, we can agree they are criminals and must be treated as such.”

But Malema is just a weapon that gets deployed in the battle, and I doubt any one army in this conflict is innocent of the impulse to use every single weapon in its arsenal.

And we shouldn’t be surprised.

For the strategists and generals are up to their necks in the campaign, it is all they think about, all day and all night, sleeping, eating and on the toilet. As the final day comes closer, every possible advantage, every weakness of the enemy, every inch of ground, every weapon in the arsenal … becomes important and worthy of exploitation.

A kind of frenzy takes over the leadership and all caution or higher feeling gets brushed aside.

It’s win at all costs … and that is pretty much where we are right now.

And that is the problem.

In nine days time we are all going to look up from the carnage and find a world very slightly changed by the battle that has been fought.

It is only myopic politicians and generals who could possibly believe their little war/election justified the distortions and propaganda they have deployed.

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.

The raging race debate forces me to think about how we become culpable.

I came across an obscene argument the other day. Perhaps you have seen something similar?

It went like this: the Japanese are reaping what they have sown; the earthquake, the tsunamis, the nuclear threat and the unseasonal blizzards in the north are a karmic balancing for the killing of whales and the popularity of whale meat amongst the Japanese citizenry.

Think about this.

But first control for the sentimentalised ranking of some mammals over others in the general lovability stakes.

So consider countries that kill and eat stinky old cows (instead of noble and graceful whales) in the mass-produced beef industry.

Would anyone suggest that tragedies involving suffering and death of the citizens in countries that eat a lot of McDonald’s hamburgers (we could have spun this differently and made it KFC’s horrifyingly produced raw material) are somehow the just desserts of those people who form part of the relevant consumer demographic?

The idea is outrageous and its reasoning as deeply flawed as it is repulsive.

There are extraordinary and moving photographs of stoic Japanese citizens being rescued or tested for radiation as they are being evacuated from near Fukushima. Here’s one – and I hesitate to do this – and not only because it is not my property. The main reason is I do not want to be too manipulative:


I could have used this one, but I thought it might be pushing the bounds of good taste:

I do not want to go further down this path.

Only those whose lives revolve around sinister religious fairytales could believe any version of the idea that what has happened in Japan is some form of divine retribution.

I am more interested in the underlying fallacy that is much more common and certainly prevalent in our political discourse: collective guilt and the appropriateness of collective punishment – or at least collective responsibility.

Are whites the culpable beneficiaries of Apartheid? Do their children inherit this culpability and therefore the responsibility for redress? Are blacks (and, to a lesser degree) Coloureds and Indians victims of Apartheid? Are their children the inheritors of this disadvantage?

These issues are deeply unresolved in our political life – and, I believe, they are deeply unresolved in our law and in our minds.

Two startling contributions to the raging race debate – from below and slightly behind, so to speak.

White (male) drivers

The first is a letter to the editor of the increasingly excellent Business Day from one Oscar Mosito in Rosslyn

His issue is with white male drivers.

What is most endearing about Mr Mosito’s letter is his calm restraint that profoundly fails to hide his seething stew of road rage with a racial twist (or perhaps race rage on the twisted road – or twisted rage in the race … no, that’s enough … sorry.)

“For years since the dawn of democracy,” Oscar calmly begins “I have observed the behaviour of white (male) drivers on our roads, particularly on the freeway.”

“I am not sure if I should call it frustration by white people and their difficulty in accepting that black people are in power,” he continues “… or whether it is caused by the fact the Democratic Alliance is not opposition enough to defeat the African National Congress in elections, but there is a lot of frustration in most white male drivers. It is directed towards taxi drivers or our leaders …”

There follows a delightfully unconscious diatribe against white male (drivers) not respecting black political leadership, driving in the yellow line to prevent noble taxi drivers getting past on the inside lane (?) and continuously showing disrespect to “ministers, MECs, the deputy president or the president himself.”

Heaven forbid!

I have even noticed that every time they see a black person driving a luxury car, they give him a certain kind of look, but when the same black person is in a taxi, they hardly look. So, it is my plea for all white drivers who do not want to accept change to respect our leaders, whether on the road, boardroom or in sports. It’s time you accepted change … I just hope that next time you see a convoy of BMWs, you give way and know that those are your leaders …  Please set a good example for your innocent children.

Oh Joy!

It is so perfect I fear to say anything more in case I break its spell. Let’s just point out the innocence of the “convoy of BMWs” … which made me think for a while that it was a DA hoax, but then the rest convinced me otherwise … but maybe it’s still a hoax … I dunno? Maybe I am naive, maybe I am too hopeful …

In the hope that this is not a hoax (and that Oscar is a real black man and not a clever white racist trying to cause trouble) I would just like to take this opportunity to agree with him.

The white male drivers that I encounter on the roads of Cape Town are ignorant, unreasonable, arrogant, entitled oafs that I feel deeply homicidal towards.

But then so are the white women.

And the coloured men? Don’t even start me.

Oh, yeah and the black men and the coloured women and the black women … I told you, don’t get me started!

And the occasional Indians – of all genders – that mistakenly find their way here … where did they buy their licences, I ask you?

Okay, there – I feel better now.

Cape Town drivers are enough to get the blood pumping. They are a wonderful example of multi-ethnic unity – they all drive like Oscar’s very own vision of white males.

Catch the full text of Oscar’s spirited letter here.

The other example is even more delightful.

“Do not be friends with white people – they will Satinise you”

(My spell check keeps trying to change that to “Sanitise” – which is a racist little wordplay joke in itself.)

But anyway …

Stalwart Sadtu (South African Democratic Teachers Union) Chairperson Moss Senye who is also the principal of Meadowlands High, addressing 1000 teachers in Soweto in the lead-up to his trial for assaulting a 17 year old pupil said (and I pull it all out of this Sowetan article but I indicate how I have stitched it together with the dot … dot … dot):

Whether Barbara (Creecy) likes it or not, we will have our meetings. Despite Barbara, we will vote for the ANC during the elections and they will remove her. Let us not embrace satanic people. Down with Satanism. You cannot be friends with white people, they will Satanise you …The bank called and asked when I would pay for my car. I cannot pay and I do not care. They can repossess it. We must show strength as a region. Barbara is trying to destroy us. Angie (Motshekga tried and now she is gone. Mary (Metcalfe) tried and now she has vanished. People have tried to destroy the union and failed. At no stage should you be friends with white people, they will satanise you … Our region has 10,000 members and only 75 of them are white. This is a non-racial union. We welcome everyone. We have never had a problem with Indian teachers. They have always been our members. There are two white learners at Meadowlands High. Barbara is not happy about this. She wants them to go to Parktown and other schools in the suburbs.

Again, what could I add to that that would make it any more hilarious and horrifying than it already is?

Jimmy Manyi - "Especially Africans" ... doing quite well out of the transition, thank you

I’ve been itching to get in my two cents worth about Jimmy Manyi’s various comments concerning ethnic minorities (here for his original statement on YouTube, here for Trevor Manuel’s robust criticism, here for the ANCYL’s counter-attack on Manuel  and defence of Manyi, here for ANC Secretary General Gwede Mantashe’s implicit criticism of Manuel … “we won’t get in the mud with him”. Here‘s Cosatu joining the attack on Manyi and here‘s the SACP criticising Manyi but warning not to become part of the agenda of Afriforum and Solidarity - probably implying that Manuel has become part of that agenda.)

So much for curating the spat …  now I want to say something about it.

I’ve written about Jimmy Manyi and the various endeavours by both the Black Management Forum and the ANC Youth League to gouge economic advantage out of transformation – catch that here and here for how that agenda was expressed as support for Eskom’s Jacob Maroga.

Jimmy Manyi’s comments about Coloured people must be understood in the context of the interests of the constituency he represents.

Jimmy Manyi is the quintessential spokesman of those who have got rich (or hope to get rich) through Black Economic Empowerment – including racially weighted tendering procedures – and Employment Equity regulations.

Those who define themselves as the beneficiaries of these processes are encouraged to express themselves in ever more racially chauvinistic and exclusive terms.

These Black Management Forum and the ANC Youth League leaders increasingly draw a distinction between themselves and any other ethnic group that also might have suffered under Apartheid i.e. they need to argue that they suffered the most, that everyone else was a relative beneficiary of the oppression of Africans.

The moral high ground of “non-racialism” was built and defended at great cost and effort by the ANC and its allies during  the struggle against Apartheid. Apartheid planners and architects did everything they could to emphasise  differences and spread fear and hatred betwixt and between as many ethnic identities as possible. This is one of the most important keys to understanding how and why that system worked and survived as long as it did.

Which is precisely why the ANC always understood its main ideological task as combating these attempts.

This is the reason Trever Manuel quotes that famous and moving last paragraph of Mandela’s speech from the dock in 1964:

During my lifetime I have dedicated myself to this struggle of the African people. I have fought against white domination, and I have fought against black domination. I have cherished the ideal of a democratic and free society in which all persons live together in harmony and with equal opportunities. It is an ideal which I hope to live for and to achieve. But if needs be, it is an ideal for which I am prepared to die.

The Jimmy Manyi’s and Julius Malema’s are a post 1994 phenomenon not contemplated by the great men and women who sacrificed so much in the struggle against Aparthied.

They are parasites of transformation, emphasising and nurturing an exclusive African racial identity because it benefits their imperative to extract a rent out of the economy.

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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