26 April 2009

By Khadija Sharife

It’s that time of year again: shiny posters attached to lampposts (beckoning people toward the light?); politicians pole dancing for votes, faces (and hands) scrubbed clean of deception; the largely uninformed and inactive flesh-and-blood electorate prying open “magic-voting-button” boxes to retrieve dusty, moth-bitten cloaks of idealism, stapled with old newspaper cuttings and dented dreams (it’s a little banged up, but now is your time!).

But the duct tape is coming loose; the dream, unravelling — and this, far from the madding crowd – for those swept up in the heady sensationalised narrative of the Mbeki-Zuma drama and fatally reducing the inherited and endorsed economic legacy of apartheid to a leadership clash between two factions vying for the alpha-male’s throne (seated atop the same system, so does it really make a difference?)…

Yet, if the alpha male is prepared to banish or eliminate any serious contender, it would be more correct to say that Mbeki — who refused to directly challenge the decision to oust him — did not fit the profile, attempting instead to protect the ANC-led government from Zuma’s alleged threats of disclosure: that the deliberately bankrupted government allegedly accepted payments from the rigged arms deal as a collective, in order to finance the reality of political liberation (via the 1999 elections). That same year saw the government breaking under the weight of apartheid-era debts that had ballooned to more than R376 billion, despite having auctioned dozens of state-owned firms to service part of the debt.

This debt, along with corporate blanket amnesty, symbolises the economic capitulation that facilitated our political liberation. It all goes back to the secret preconditions (or “historic compromises” in Mbeki’s own words) that defined the nature and limitations of our emancipation, and the role of our government, whose economic policies were described by the UNDP at one point as “no different” from that of apartheid.

What prompted the UNDP to phrase it as such, and how can this be if the female driver who almost flattened myself and a homeless one-legged dude yesterday with her BMW (flicking the finger from a hand covered in gold) was … black?

In 1988, Sanlam’s Fred du Plessis, one of Botha’s top corporate economic advisors, advocated for economic reform to stave off the revolution via the creation of a divisive political buffer: a black middle class. This was an underlying objective taken one step further via black economic empowerment used to create a small owning elite. “I will speak only to the question of the challenge of the formation of a black capitalist class,” said Mbeki. “This is and must be an important part of the deracialisation of the ownership of productive property in our country.”

This type of selective deracialisation feeds into the broader system of global apartheid, deliberately suppressing the socio-economic reality of “free trade imperialism” through a small manufactured and preserved class of kneepad-people — a token economic tribe conveniently used as an example of “change”, acting as the protective gear for prostrating governments.

Because apartheid was reduced to a state of pigmentocracy, the illusion of liberation depends on the perceived legitimacy of black power — preferably political, preferably limited.

This may be because the same corporate heavyweights that were instrumental in defining the contours of apartheid, such as Anglo-American’s Harry Oppenheimer, were first in line to alter and adjust the ANC’s Reconstruction and Development Programme (RDP).

Of course, the “South” collaborates. Davison Budhoo — the IMF’s chief structural adjustment architect described the Fund as creating “rivers of blood”, labelling “Third World” ministers of finance as going home satisfied, having “connived in all our trickery, participants in our game”.

In SA, Oppenheimer’s Brenthurst Group fingered Trevor Manuel for the OK as finance minister in March 1996. In late 1995, plans were made to dump the already inadequate RDP in favour of the Growth, Employment and Redistribution (Gear) programme, formulated by a team of economists who worked under the watchful eye of the World Bank and IMF. Gear was characterised by its similarity to the Washington Consensus, ranging from trade liberalisation to financial deregulation, mass privatisation etc

Despite the fact that South Africa lost more than R70 billion in tax cuts during the first decade, the burden of corporate tax has been shifted to bracket the middle and low-income groups.

The new liberation government also agreed to follow in the footsteps of the apartheid regime by ratifying the Gatt-sledgehammer (later WTO) and accepting the IMF’s Christmas gift (December 1993) — an $850 million loan, preconditioned by the prevailing structural adjustment orthodoxy.

Gear was unveiled in mid-June 1996; at the launch Mbeki would whisper “just call me a Thatcherite” directly into the ear of the market. Mandela stated, “I confess that even the ANC learned of Gear far too late, when it was already complete”. Madiba magic was a crucial factor in legitimising these policies to the nation; he would later describe the feeling of retirement as similar to that of leaving prison a second time.

The walls of these negotiated prisons were constructed as early as 1985, when the stock market crashed and the South African government imposed a standstill on $14 billion of the $23.5 billion in outstanding foreign debt. The South African economy had been on the decline since the 1970s. Though foreign banking corporations did their utmost to sustain the economy (eg in 1985, 260 banks rescheduled outstanding loans on easy terms, in addition to the 400% increase in loans, and would continue doing so as late as 1990) the Rand Lords were getting jittery.

Mbeki — an economist trained in Thatchers own land — may or may not have believed in the religion of neoliberal market fundamentalism (read: protectionism for “First Worlds” combined with the structural exploitation of “Third Worlds”), but he seized the opportunity to directly negotiate with the kings of capital — much to Botha’s dismay. Mbeki understood that foreign corporations did not support apartheid because they were racist. Their reasoning — business as usual — has been successfully applied to numerous military regimes from Burma, Angola, Sudan and Nigeria as well as other non-military but similarly despotic regimes.

The only foreign power willing to extend a lifeline to the ANC, the Soviet Union, agreed to withhold arms and financial support “to foment a revolution in South Africa” according to the terms of the 1986 Reykjavik Summit negotiated by Gorbachev and Reagan. The former, it may be said, supported the ANC as a means of legitimising their Soviet expansionist brand in Third World countries, while the latter, the architect of “constructive engagement”, was a pillar bolstering the apartheid regime’s power.

It is possible that Mbeki caught wind of this change prior to the September 1985 meeting — (the so-called corporate safaris) hosted by former Zambian president Kenneth Kaunda at the Mfuwe Game Lodge, attended by then-Anglo American chairperson Gavin Relly among others, as well as several business journalists. The home of Anglo’s Zambian manager would serve as the neutral base for further meetings between Mbeki and the corporations. Anglo’s support was vital to the success of this approach; during the late 1980s the company employed more than 250 000 miners and was renowned as a central pillar of apartheid. By 1994, Anglo was one of five companies controlling more than 85% of the JSE. Former prime minister Verwoerd described Anglo’s power by saying, “With all that monetary power, and with his powerful machine which is spread all over the country, he can — if he so chooses, exercise an enormous influence against the government and the state”.

Oliver Tambo, the rudder of the ANC, backed Mbeki’s approach and would testify in 1986 on behalf of the ANC, before the Foreign Affairs Committee in London that they did not intend to destroy the economic system, but merely to reform it. Tambo’s stroke would see Mbeki rise within the movement as the new controlling agent.

His support was crucial to the legitimacy of Mbeki’s stance. The reductionism of the ANC from that of a national movement (still experienced via the ANC culture so intimately intertwined with fabric of our society), to an almost unilaterally designed pro-trickle down political party in the early 1990s alienated many ANC members.

Sadly, South Africa’s socio-economic condition is not unique, and remains one more local snapshot of the global economy.

The bizarre concept of measuring economic “growth” through specialised tools such as GDP (the scorecard for overall economic activity) marginalises the most pressing and crucial needs of “Third World” economies: development.

Though Mbeki recognised that the “automatic so-called trickle-down effect” was a myth, he proceeded to devise a structural disconnect between cause and effect stating: “The task we face is to … implement a strategy to intervene in the ‘Third World economy’ and not assume that the interventions we make with regard to the ‘First World economy’ are necessarily relevant to the former.”

But neither economy exists in isolation: rather, government intervention related to the “First World” economy directly undermines the rights-based system negating the concept of an active democracy, save for the corporate electorate.

Even though GDP informs us of a growing economy, the reality of the trickle-down system appears to have been designed (forgive my rudeness) for urinals only (drip drip drip) from a sickly body with a cosmetically enhanced face. GDP is extremely useful for its specific purpose — quantitative economic activity, but it does not inform us of where, when and how wealth is being made and distributed, the quality of such wealth, externalised factors and the long and short-term repercussions.

One solution swirling around (the dysfunctional brown pile) in my head is that the role of government must be redefined, moving away from the false premise of government as “owners” of natural resources, toward government as the managers via democratised public-asset portfolios (as opposed to privatised or nationalised portfolios).

The free market, dissociated from its source — the ecology, operates in a fantasy-land; corporations plunder finite resources, exhausting potentially sustainable resources. The health of the ecology is entirely divorced from the health of the “economy” — despite the latter being a “reality” that is totally dependent on the former.

This could change if the value of natural “capital” was recognised as a primary source of wealth, and integrated with traditional forms of capital (financial, produced, intangible). However, if we do not simultaneously recognise the legal innate rights of the ecology to health and restorative justice, the consequence of integrating natural capital will result in commoditising natural resources, and marginalising the value of intact ecosystem services — discarded as of no real economic worth (eg the intact value of a hectare of mangrove in Thailand is $1000, in contrast to the $200 when converted into aquaculture or cash crops).

It has been well documented that the revenues derived from corporate exploitation of finite resources constitute a pittance of real wealth when compared to the costs of pollution, the loss of ecosystem services and sustainable exploitation. Growth must thus be contextualised as secondary to development and the concept of wealth redefined.

Third World-ist governments recite verbatim that the only option available to us is the golden stream of “number one” — trickle-down growth — grazing our bald spots; politicians telling us to thank God that “number two” — best symbolised by flying plastic toilets in other parts of Africa, is not our fate.

In South Africa, at the end of the day, it makes little difference which captain steers the ANC vehicle (with an estimated 65% of votes) if the policies of the now global economic apartheid regime constitute the bricks of our economy. After all is said and done, thanks to the ANC — and Mbeki, we now have the political freedom to decide the type of democracy we want ie: active or passive. Without it, elections are merely plays scripted by idiots, “full of sound and fury, signifying nothing”.

Above all, it is the system that needs to be interrogated by the media and citizenry, not the personality.