SA Inc and the search for a real alternative

Posted on June 21, 2012


South Africa Inc is a “fronting” exercise in which the people of the country are the hapless stooges giving credibility to a governing elite. That is one of the reactions within the labour movement following the announcement of the government’s $2 billion pledge to the International Monetary Fund (IMF).

“Fronting” has become notorious in recent years as a way of circumventing the demands of the Black Economic Empowerment (BEE) policy. Nominal black owners are recruited to an enterprise over which they exercise no control, are not consulted and from which they gain very little or no benefit.

This week’s $2 billion (R16 billion-plus) pledge to the IMF has underlined for many in the labour movement and beyond that government acts as it pleases while claiming to represent the will of the people of South Africa. Even what might be regarded as the non-executive directors on the government board — the ANC executive and alliance partners, Cosatu and the SA Communist Party — had no say in the decision.

“COSATU wants to know which ANC Conference resolutions give [the government] a mandate for such a contribution to the IMF. Were the alliance partners, or even the ANC NEC consulted over the decision?” the federation demanded, while admitting that no such consultation took place.

Such, however, is the nature of representative democracy which is made all the more remote in South Africa by the fact that a party list system operates. This makes elected representatives answerable only to the party and its leaders and not to the electorate, something that concerns many trade unionists.

But of greater concern to many more is the fact that the IMF is the recipient of such apparent largesse, since most of the labour movement regards this institution as one of the causes of the present global crisis. According to the unions, the IMF, which has pressured governments, especially in the developing world, to adopt policies of wholesale privatisation and the cutting of social spending, has been responsible for untold suffering.

The announcement about the pledge to the IMF also came at a time when, according to the public sector unions, the government was “pleading poverty” and had delivered a wage claim ultimatum to their 1.3 million members: a non-negotiable 6.5 per cent pay rise. The unions had initially demanded a 10 per cent across-the-board increase and were prepared to reduce this to no less than 7.5 to 8 per cent.

“Then we hear they have R16 billion plus to lend to the IMF,” says Chris Klopper of the Independent Labour Caucus, “you could have knocked me down with a feather.”

Cosatu too, was taken aback by the sudden announcement that $2 billion in “reserves” had been offered to the IMF. “How does this decision square with the repeated Treasury assurances that the government has absolutely no money to meet the public-sector wage claim or to pay off SA National Roads Agency’s debts?” asks Cosatu’s Patrick Craven.

That President Jacob Zuma described the $2 billion as “an investment” has also neither assuaged the anger nor stemmed the number of suggested alternative ways in which that money could be spent. These have ranged from “build more than 30 000 houses” to “give every family in the country R35 000”.

However, some serious thinking about the relationship between political organisation and economic policies has arisen amid these suggestions, debates and arguments. This has resulted in a still limited, but growing realisation that the division between the two is false; that political transformation is the horse that must be put before the cart of economic policy.

It has also started to bring toward centre stage a document that many see as a truly transformative political programme: the Bill of Rights. The 32 clauses in this document stress the need for a diverse, yet egalitarian society “based on human dignity, equality and freedom”. It provides the ideological framework within which policies can be formulated.

Rights include adequate housing, access to health care, sufficient food and water and social security. These rights have, however, to be realised “within available resources”.

But, as various unions have, from time to time, pointed out, South Africa has more than enough resources to provide for all of this. They have argued that the political will does not exist to transform a grossly unequal economic reality supported by the likes of the IMF to something that would benefit the bulk of society.

One argument is that the present system of representative democracy, even in an improved, constituency-based form, cannot possibly deliver. There is some irony in the fact that this is an argument that is increasingly rife in the Greece of today — as it was also, some 2 000 years ago.

It is the argument about which is most desirable and possible: participatory or representative democracy. The participative variety is the democratic ideal, giving all citizens the right to have a say in, and to decide on, all matters that affect them.

Examples of this form of extended democracy existed at different times not only in the Athenian city state, and the ancient Althing of Iceland, but also in a number of African communities. But however desirable it may be, is it possible in our much more complex society, let alone in a world of teeming billions?

In another ironic twist, the very microchip revolution that has made for surplus productivity with less labour has created, in terms of communication, a world village. Could this signal the potential for a new political dispensation that might lead to economic policies based on need rather than profit? These are questions that are being asked.

“But these questions and these ideas won’t surface at the ANC policy conference next week,” notes a cynical SA Municipal Workers’ Union member who is currently involved in the pay deadlock with local government authorities. In his view, too many politicians and aspirant office holders have too much of a vested interest in the status quo.