GETTING TO THE ROOTS OF CRISIS (10.04.2008)

One of the great problems with the politics of protest is that it all too often targets the symptoms of an ill rather than the cause. In other words, much protest aims to prune the possibly poisonous twigs and branches of a noxious plant, without getting to the stem, let alone the root.

This is something Cosatu and other trade unions should bear in mind as rolling mass action again looms.

Farmers, price-rigging producers and profiteering retailers as well as Eskom are clearly in the sights of the promised protest action. Deservedly in several cases, especially where there has been collusion to fleece consumers.

But the roots of the malaise of joblessness, rising prices and interest rates lies beyond such overt manifestations of greed; these merely sprout from a core of national policy that encourages rapid acquisition and accumulation.

This was clearly outlined at a three-day seminar in Cape Town last weekend. Hosted by the left-wing magazine, Amandla, it featured a range of high-powered speakers including KwaZulu-Natal’s Ashwin Desai and Patrick Bond and Ben Fine of London’s School of Oriental and African Studies.

There were very few trade unionists present, perhaps because this was advertised as a “Colloquium on the Continuity and Discontinuity of Capitalism in the Post-apartheid South Africa”. However, it could just as readily have been signposted: “The Facts about how post-apartheid South Africa is being ripped off.”

Most speakers underlined the fact that the natural wealth of this country still lies within the soil, in platinum, coal, iron ore, gold and other minerals. It has long been argued within the labour movement that such wealth, when extracted, should benefit largely the people of the country and, eventually, the region and continent.

It has also long been argued that a considerable portion of that wealth should also be ploughed back to encourage the growth of more sustainable and renewable wealth. After all, once the minerals are mined, what we are left with are holes in the ground.

Instead, we have a situation where vast riches continue to be extracted, mostly to disappear beyond our borders. Patrick Bond produced an interesting sum: if the value of exported and non-renewable mineral wealth is factored into calculations of economic growth, South Africa is going backwards. We are losing wealth, not gaining it.

Ben Fine was one of the economists roped in by the ANC 25 years ago to assist that organisation’s Macro-economic Research Group (Merg) headed by the late Vella Pillay. Soon after the 1994 elections, he and Merg warned of the consequences that could result if “business-friendly” economic policies were pursued.

They were castigated by ANC-supporting “pragmatist” economists who maintained that required investment, growth and sustainable job creation had to be underpinned business-friendly economic policies. Last weekend Fine would have been justified in crowing: I told you so.

Because business-friendly policies were introduced — and continue in place. Yet the investments have not come. But high interest rates, while harming most of the local populace, have encouraged fickle portfolio capital onto the JSE which, for the moment, precariously balances the burgeoning capital account deficit.

As Witwatersrand University economist, Siraj Mohammed pointed out, capital poured into major conglomerates, such as Anglo, Old Mutual, Sasol and SAB when they listed abroad. But this mostly resulted in further outward investment and acquisitions. He also pointed out that local economic growth is “debt driven, consumption-led and mostly jobless” with inequality growing.

These are the reasons that Cosatu has listed as justification for mass action. But instead of only strikes and protests about profiteering, the labour movement could perhaps dust off and update the Merg proposals — and put forward a coherent set of alternative policies as well.