The perilous state we’re in - Politicsweb, 24 April 2017

By Johan Kane-Berman 

The state we are in is perilous, socially, economically, and politically. Several years ago the National Development Plan warned of the destabilising consequences of churning out more and more people with degrees but few job prospects. Even before the recent cabinet changes there was no sign that the government had any serious intention to deal with unemployment, which has more than doubled in numbers since the African National Congress (ANC) came to power.  

Everyone is now wondering what is meant by "radical economic transformation". Having frightened all the horses by his initial comments when he was appointed, the new finance minister seems to be avoiding the phrase in favour of "inclusive growth". Mr Cyril Ramaphosa says they are the same thing. Radical economic transformation could of course mean adopting policies to push our economic growth rate up to 6%, or 7%, or 8%, but there is little sign that such policies are on the agenda. In practice, "radical economic transformation" is simply a new term for the long-established policy of bringing about a national democratic revolution.

This means racial preferencing, redistribution of income and assets, and capture of all "centres of power". This is not a "big-bang" revolution from below, but a programme of transformation implemented incrementally from above through legislation and bureaucratic power – just as the National Party (NP) implemented its apartheid system. The ultimate objective is a socialist state which promotes African nationalism. Scrutiny of the Statute Book shows that the ANC has gone quite far in achieving these objectives. Most commentators ignore them or play them down. If they occasionally report bits of them, they don't connect all the dots.  

I am reminded of how Stalin refused to believe all the intelligence that Hitler would invade Russia in June 1941. Similarly, British and American generals ignored all the warnings of Hitler's last great counter-attack in the Battle of the Bulge in December 1944. Perhaps the explanation is simple: people resist believing anything that does not fit their paradigms. But the lesson is clear: unless more attention is paid to what the ruling party's overriding economic agenda is, efforts to counter the further implementation of destructive policies will not be very successful.

The president of this country is a sinister figure, full of menace. For a start, even though he enjoys VIP protection he seems to have his own private army. What is it for? To intimidate some of the top guns at Luthuli House? To what other purposes might it be put? It would be prudent to assume that, having captured the state's security agencies and the prosecution service, Mr Zuma will in due course move in on the Independent Electoral Commission, the Judicial Service Commission, and the Constitutional Court. It would also be prudent to assume that even if Mr Zuma or the ANC were to be voted out of power, they might not go quietly.   

It would be wise to remember various other things too. One is that many of those who would like to get rid of Mr Zuma, would like also to get rid of what they call "white monopoly capital". The ruling party and its communist and trade union allies contain many such people. So do universities and non-governmental organisations.

Talk of getting rid of white monopoly capital, extinguishing property rights, and so on is often dismissed as "populist". This suggests that the politicians uttering these words do not mean them but are mouthing them to curry favour with the "masses" or to steal the thunder of the Economic Freedom Fighters. Opinion surveys by the Institute of Race Relations dating back some 15 years show, however, that the great majority of South Africans of all races are much more concerned about unemployment and crime than about race or land reform.

The real impetus for radical economic transformation is coming not from the grassroots but from Luthuli House and the middle class. So also, the main impetus for stepping up race-based policies is coming not from the grassroots but from the country's political leadership. Radical economic transformation, in other words, is driven not by populism, but by ideology.  

So much for the state we are in. How do we get out of it? What can we learn from our own history?

Even with hindsight, it is seldom clear how political change comes about. As Winston Churchill said during the Second World War, "All things are always on the move simultaneously". He meant that it was impossible to determine which strategies to defeat the Third Reich were most likely to be successful. You should not put all your eggs into one basket. The "only plan", he said, was to "persevere".

If we remember that "all things are always on the move simultaneously", and that the NP changed, we must not dismiss the possibility that the ANC will change. But there is an enormous proviso: it must be subjected to a great deal more pressure. At the moment most of the pressure is for it to jettison its president. But it is unlikely to do so unless all those ANC supporters who want to get rid of Mr Zuma abandon the paralysing position of "my party right or wrong" and start to mobilise against their party. They must raise the electoral costs of continuing to support Mr Zuma. And they must get on the job immediately, given that the next election is but two years away. If they leave it too late they might find themselves outmanoeuvred so that Mr Zuma continues to rule courtesy of Mrs Dlamini-Zuma.

The exit of Mr Zuma would be a blessing. But, to quote Churchill again, it would merely be the end of the beginning, as he said after the Battle of Alamein.

Mr Zuma is not the origin of the interventionist policies that are doing so much economic damage. He did not launch the blitzkrieg against the mining industry. Nor is he the author of the decision to terminate 13 treaties with countries on whom we depend heavily for trade and investment. He is not the author, either, of the labour policies that help to keep unemployment so high. These date back to the presidency of Nelson Mandela, and to the sojourn at the ministry of labour of Tito Mboweni, who is reputed to have subsequently put them down to what he called the "sins of my youth".

Getting rid of Mr Zuma will not reduce the stranglehold that trade unions have over our schooling system. Mr Ramaphosa, some people's favourite to succeed Mr Zuma, has said little to indicate any fundamental disagreement with the ANC's key policies. Still less any of the other candidates, including the one who seems to think black people need to go to a Model-C school to discover that her party is corrupt.

Getting rid of Mr Zuma is therefore a necessary but not a sufficient condition of reversing our downward slide. Organised business and organised labour, with the exclusionary labour policies they support, are as much to blame for shutting young people out of the labour market as is the ANC. The growing numbers of business lobbies clamouring for protection and localisation may claim that they are preserving jobs; what they are really doing is empowering bureaucrats, undermining competitiveness, building inefficiencies into the economy, penalising consumers, and helping to entrench inflation. 

Beyond Mr Zuma, we face four big challenges. One is to preserve the free-market system. It makes capitalism and economic dynamism possible. Business thinks it can defend them by advertising what it has done for black economic empowerment. But BEE has done nothing for the unemployed. Nor have the billions spent on BEE reduced hostility to "white monopoly capitalism", which is on the increase. Business is now speaking up against "state capture". But it does next to nothing by way of public education to proclaim the merits of the free-market system.

The second challenge is to stop the runaway train of racial requirements. Recently a judge was reported as ordering high court staff to record the race and sex of every advocate appearing in the motion court. Where is this leading to? Must white males stop studying law? Is "inclusive growth" going to be promoted by trying to exclude racial minorities?

The third challenge is to counteract the fraud of so-called "empowerment". It is nothing of the kind. It has made some people rich. In the end, however, it empowers not individuals, but the state. Real empowerment for ordinary people would come from decent schooling and industrial training and removing barriers to market entry. We do not do that.   

The fourth challenge is to preserve democratic rights. Citizens of all races are on the march again –  prompted by the dismissal of a finance minister and the subsequent relegation of the government's credit rating to so-called junk status! Matters that a few years ago would have been regarded as esoteric are now the subject of popular outrage! Long may it last! 

Power is built on law and coercion, but also on moral authority. The ANC's capture of the moral high ground was a key bridgehead in its march to power. But the use of that power for corrupt and criminal purposes is destroying the party's most important asset. When 94-year-old Emily Mohapi, battling with sore knees, leaves home in Soweto at 6 am to catch a bus to join the recent protests in Pretoria because she says "Zuma is destroying the country", then perhaps the worm is finally beginning to turn.    

One thing struck me especially powerfully as I wrote my memoirs, which are being launched here tonight. This was how vitally important it was throughout the apartheid years that South Africa remained an open society. It did so notwithstanding the then government's attempts to control the flow of information and ideas. Every aspect of apartheid was exposed to the light of day. The same is happening to the ANC. It can intimidate its own officials, as well as would-be rebels among its MPs. But it cannot silence its critics. Nor can it stop all the whistleblowers who are keeping a hungry media fed with the information that is helping to destroy the party's reputation.  

*John Kane-Berman is a policy fellow at the IRR, a think-tank that promotes political and economic freedom. This article is based on a talk he gave in Johannesburg on 24th April at the launch of his memoirs, Between Two Fires - Holding the Liberal Centre in South African Politics, which are published by Jonathan Ball. 

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