Anthea Jeffery replies to Ebrahim Harvey: There’s no mistaking NDR’s enormous damage - News24
Anthea Jeffery
Ebrahim Harvey claims that I fail to understand the National Democratic Revolution (NDR) in my book Countdown to Socialism. In his view, the NDR has "never had any explicit socialist objectives" and, in any event, came to an end ("was consummated") with the 1994 elections.
Since then, he says, the ANC has allowed monopoly capital to "call the shots", especially on macroeconomic policies, which is also what it did during negotiations. As a result, South Africa's "neoliberal constitutional democracy" has brought about "the greatest poverty and unemployment" the country has ever known, along with conditions in black townships that are "incomparably worse than they were under apartheid".
Harvey is right about the enormous suffering that worsening unemployment, poverty, and incompetent governance have brought over some 30 years of ANC misrule – but wrong about everything else.
The SACP, the ANC's dominant ally, has repeatedly described the NDR as providing the "most direct route" to socialism. In July 2022, moreover, President Cyril Ramaphosa told the SACP's 15th national congress that the ANC was "determined to defeat each and every effort to derail the NDR", which was "the shared programme" of the ANC and the SACP and "the reason for the existence of our alliance".
Far from allowing the private sector to "call the shots", either on macroeconomic policy or elsewhere, the ANC has long identified "monopoly capital" as “the primary enemy of the NDR". It is also determined to "discipline" and "direct" it.
No autonomy for private sector
Since 1994 the ANC has been using state power to achieve these aims. It is well aware of the tools at its command, which include "licensing and regulation, taxation, procurement, and activism by competition authorities". If necessary, "straightforward compulsion and even expropriation" may also be used, it says.
All these coercive tools have long been deployed against business. In addition, the private sector now faces increased "compulsion" under the Employment Equity Amendment Act, which empowers the state to ignore skills deficits in setting binding racial quotas for senior appointments. Business also confronts the looming danger of expropriation without compensation (EWC) under the Expropriation Bill now proceeding through Parliament.
The private sector has already lost much of its autonomy, while its capacity to survive is coming under threat. Contrary to what Harvey implies, it has no power to dictate monetary policy to the South African Reserve Bank (SARB) – whose necessarily cautious decisions on inflation, interest rates, and the money supply have long been castigated by the SACP.
The SACP wants to prevent supposedly "neoliberal" monetary policy from standing in the way of greatly increased state spending on the National Health Insurance system (free healthcare for all), the National Social Security Fund (compulsory state pensions and life cover), a universal basic income grant (monthly cash grants for adults), free tertiary education, a mass public employment programme, a major infrastructure build, a comprehensive programme of "state-led (re)industrialisation", and "a just green transition".
According to the SACP, none of these NDR interventions should be held back by the current mantra of the government having to cut back on spending and "make difficult trade-offs". Instead, the Communist Party assumes that the SARB can "print" or "electronically inject" massive amounts of money into the financial system with nothing but benign effects, provided the spending thus made possible is "socially transformative".
The underlying NDR goal is to "delink" people from the capitalist economy and the prosperity and self-reliance that this fosters. Instead, all South Africans – as the socialist script requires – are to become entirely dependent on the state for all their core needs, from healthcare, education, and welfare to permanent public employment.
Massive expenditure
Harvey assumes that business has also been dictating fiscal policy and so curtailing state spending. In fact, the private sector has been powerless to prevent a massive upsurge in expenditure and public debt since 2009. Public debt totalled a relatively meagre R800 billion (32% of GDP) that year, but rose rapidly thereafter to almost R4.7 trillion (71% of GDP) in 2022. It is projected to rise to R5.8 trillion (74% of GDP) in 2025 – a more than seven-fold increase on the 2009 figure.
Annual debt service costs have also risen fast. They have gone up from R180 billion in 2018 (when Ramaphosa became president) to R316 billion in 2023, and will rise to more than R400 billion in 2025. More than R1 trillion is thus to be spent solely on debt-service costs over the next three years. This will inevitably crowd out spending on education and other core needs – but this is hardly the fault of "monopoly capital".
Nor is business to blame, as Harvey implies, for the compromises allegedly forced on the ANC during the negotiations. This claim ignores the ANC's "famous victory" in the talks, as SACP chair Joe Slovo described it in 1993. According to Slovo, the ANC scored "16 out of 16" on its core objectives when the interim constitution was agreed. This victory paved the way for a final Constitution carefully crafted to help advance the NDR.
Harvey nevertheless blames South Africa's supposedly “neoliberal constitutional democracy" for a massive increase in unemployment and poverty since 1994. This analysis is absurd.
Since the political transition, the liberal elements in the 1996 Constitution have often been weakened to facilitate NDR interventions at odds with the text. These NDR interventions have deterred direct investment, prevented rapid growth, made millions of people unemployable, mired the fiscus in unsustainable debt, and encouraged an upsurge in corruption and crime.
The NDR has also blinded the ANC to a globally proven formula for prosperity and upward mobility. According to the Economic Freedom of the World Index of the Fraser Institute in Canada, the most free countries – those where governments intervene little and allow capitalist markets to function – had average per-capita GDP of $48 250 in 2020. This was more than seven times greater than the equivalent figure of $6 500 in the least free nations, many of which are socialist states.
In the most free countries, moreover, the average annual income of the poorest 10% was $14 200, as opposed to $1 700 in the last free countries. In addition, only 2% of the population in the freest countries lived in extreme poverty (on $1.90 a day), whereas 31% of people in the least free nations were extremely poor.
Far from heeding these lessons, the ANC has been busily implementing the NDR in some 17 different spheres. It has not yet introduced the macroeconomic policies the SACP desires but has nevertheless made major progress towards its socialist end goal. Harvey does South Africans no favour in discounting this incremental revolution – and in blaming business and the Constitution for the enormous damage that the NDR has done.
Anthea Jeffery is Head of Policy Research at the Institute of Race Relations, and author of Countdown to Socialism, The National Democratic Revolution in South Africa since 1994.