Opportunity Lost?

As the national elections loom on the South African horizon and post-Mandela disillusionment sets in, UK journalist John Pilger offers a perceptive account of why so little economic progress has been made during the first 20 years of South Africa's democracy. Simply put, the ANC sold out and took the only path that remained after the fall of the Berlin Wall: neo-liberalism, the alluring but unrealistic belief that by making the rich richer (BEE, anyone?) wealth will begin to trickle down to the masses. Well, as Pope Francis wrote, "the excluded are still waiting". What is of particular interest is Pilger's brief description of what kind of programs could have been implemented to ensure that the end of apartheid meant not only the right for the majority of South Africans to vote, but also the right to a decent and dignified livelihood: 

[H]ad the ANC invested in [the majority of South Africans] and in their "informal economy", it could have actually transformed the lives of millions. Land could have been purchased and reclaimed for small-scale farming by the dispossessed, run in the co-operative spirit of African agriculture. Millions of houses could have been built, better health and education would have been possible. A small-scale credit system could have opened the way for affordable goods and services for the majority. None of this would have required the import of equipment or raw materials, and the investment would have created millions of jobs. As they grew more prosperous, communities would have developed their own industries and an independent national economy.

A reinvigorated—and skilled—peasantry that fosters the bonds most essential to a healthy society is crucial to liberating South Africa from its colonial and apartheid past that shattered the peasant class and tore families—the real fabric of society—to pieces. This is the basis of distributism in South Africa. 

The change that occurred in the early nineties put our country in a perfect position to transcend the ideological warfare that plagued the 20th century and embark on a new journey towards economic, political and social freedom. Instead the ANC revealed itself to be little more than an ideological playground for the black middle class, and South Africans—most of whom were not yet even born in 1994—are still waiting for real freedom to arrive.

Global Wealth Inequality

Political decay, poor farming and agricultural methods, a shrinking population, weakening military forces and a gradual decline in economic activity are some of the reasons why the Roman Empire fell. These are often presented alongside statistical or anecdotal evidence illustrating the extent to which Roman civilization had degenerated before eventually succumbing to the relentless barbarian invasions. It is tempting to look back upon the failures of past eras with a modern smugness that ignores the signs of our own decline. How will the fact that the combined wealth of today's richest 300 humans exceeds that of the poorest 3 billion be remembered by future generations as they learn about our era? 

The accumulation of such a vast amount of wealth (equal to the combined wealth of China, India, Brazil and the US) in the hands of such a small group of individuals is unprecedented, and has only been made possible by the rise of globalised free-market capitalism, which allows capital to extricate itself from its historically more permanent commitment to the labour it supplies. Before the invention of money, the interests of capital and labour could only be separated as far as one could carry one's pig to the local market. The replacement of bartering with a widespread currency created a level of fluidity between capital and labour that allowed economies to flourish, but nevertheless ensured that capital's interest (excuse the pun!) was still somewhat bound up in that of labour.   But in a post-industrial age, capital's ability to tap into and out of markets with such remarkable volatility threatens to produce the kind of economic absurdities that future generations may well look back on with the same smugness that we have towards those foolish Romans.  

South Africa can be seen a microcosm of the world's problems in this regard.  The solution clearly isn't to obliterate capital by means of nationalisation, which merely replaces one ruling class of capitalists with another (something that the ANC foresaw would be the chief challenge of post-apartheid South Africa), but rather to find ways of successfully recapitalising the people.  So far our government, via strategies like BEE, has accomplished transferring capital to a new black ruling class (as well as a brain drain of white professionals), but has failed dismally to reunite capital with labour, with the fruits of such a failure being on display to the whole world throughout the duration of last year's strikes.

'Big Society' offers South Africa a way past tired old dichotomies

‘Big Society’, the selling point of the Conservative Party in their successful 2010 general election campaign in Britain, is an attempt to reframe British politics beyond the liberal/conservative paradigm mapped out by the worn-out dichotomy of big business (on the right) and big government (on the left). As an on-going strategy it aims to empower citizens and their communities by engaging decentralized local government with community work and social enterprise. In light of recent calls from Julius Malema (pictured above) for nationalisation in South Africa, it’s time the Distributist alternative, embodied by many of the ‘Big Society’ ideas circulating around Britain, entered the local debate. In a June 2010 article for BusinessDay, Chris Waldburger argues that instead of nationalising our country’s assets into a vague emanation of ‘the people’, we should recapitalise the people themselves, and allow South Africans to become the true stakeholders in their own future:

When the Soccer World Cup recedes into memory and South African public life begins again, there is no doubt that the debate over nationalisation will recommence.

It was African National Congress (ANC) Youth League President Julius Malema who sparked these fires, and what concerns many investors is the fact that Malema was also the first to demand the recall of former president Thabo Mbeki . And with Malema declaring Mugabe’s land-grab a success, one wonders if nationalisation is the next logical step for an ANC propelled by a fatalistic momentum outside the control of party moderates. 

But if truth be told, Malema was not the first politician to urge nationalisation. As he himself has pointed out, Nelson Mandela as late as the early 1990s was calling for nationalisation of the mines. And perhaps the chief source for the debate is the Freedom Charter, which declared that “mineral wealth beneath the soil, the banks and monopoly industry shall be transferred to the ownership of the people as a whole; all other industry and trade shall be controlled to assist the wellbeing of the people”. 

Mandela would vociferously and somewhat paradoxically contend that the document was not a blueprint for socialism, yet before the fall of the Berlin Wall (and the rise of the New Left in the shape of Bill Clinton, Tony Blair and indeed Mbeki), nationalisation remained firmly on the ANC agenda. 

And now the ANC, in the face of widespread discontent at the failure of Mbeki’s neoliberal Gear policies to provide meaningful gains in standard of living for the poor, finds itself in an internal wrestling match for its doctrinal future. The general argument against nationalisation runs along the lines that since para-statals such as Eskom are failing, why would government intervention in the mining sector fare any better? Can the state possibly extend itself even further when health, education, and energy already seem like time bombs waiting to explode? Let efficient and competitive private corporations do what they do best — make profit — and then we will see the inevitable trickle-down benefits of supply- side economics. 

Those in agreement with Malema, however, contend that monopolies were created in the mineral industries by imperialist henchmen such as Cecil John Rhodes — a figure who notoriously allowed fires to burn in De Beers’ mines for eight hours before he sounded the alarm, all for the sake of turnover, which mostly found its way into foreign banks. Such exhibitions of corporate power will always insist on the enrichment of the few at the expense of the working-class many, activists contend. 

And so, depending on your background and political bent, it seems that is predetermined to favour one of these two options. 

But what if there was another option — an option other than the devil or the deep blue sea that could marry the concerns of the poor, with the innovation and competitiveness of the free market? As South Africans hash out an age-old, and a seemingly anachronistic, debate, it may be useful to broaden the horizons of our economic thinking.

Read the rest of the article here.