Reconciliation and economic reaction: flaws in South Africa's elite transition.

AuthorBond, Patrick
PositionTHE DIFFICULT ROAD TO RECONCILIATION

Was South Africa's post-apartheid transition compromised by an intra-elite, so-called economic reconciliation that generally worsened poverty, unemployment and ecological degradation, while exacerbating racial, gender and geographical differences? Did the governments of Nelson Mandela and Thabo Mbeki fail to redistribute the country's wealth? Did the transition extend South Africa's reach into the region at the expense of the interests of other African nations and peoples?

If the answers are broadly affirmative, we may as a result now be witnessing a double-movement reaction to the truncated character of liberation. With intensified commoditization has come a vast upsurge of social unrest, in the manner Karl Polanyi might have predicted. (1) A new popular opposition to the excesses of elite reconciliation began to emerge around 2000. (2) By late 2005, Safety and Security Minister Charles Nqakula recorded 5,085 protests over the prior year, of which he considered 881 to be "illegal." (3)

No peace without justice, no reconciliation without redistribution. These themes reflect the problem of the early 21st century world order that David Harvey calls "accumulation by dispossession," i.e., a new stage of voracious penetration of market forces into areas of society and nature that were not previously commodified. (4) The phenomenon represents an Achilles' heel for writers such as Guillermo Schmitter, Phillippe O'Donnell and their brethren in South African think tanks, universities and centrist non-governmental organizations (NGOs such as the Centre for Development and Enterprise, the South African Institute for International Affairs and the Centre for Policy Studies). Indeed, many crucial middle-income sites of elite-pacted compromise in so-called democratic transitions now appear locked in perpetual conflict: Brazil, Argentina and other Latin American countries; South Korea, Taiwan, the Philippines and Indonesia in Asia; much of Eastern Europe, Central Asia and the Middle East; and Africa, most notably in Nigeria and South Africa. All witnessed the passage from the dictatorships of the 1960s and 1970s to the democracies of the 1990s. Yet, these are unstable because neo-liberalism was applied and often imposed upon new governments under conditions of what Barry Gills, Joel Rocamora and Richard Wilson term "low-intensity democracy" or Thandeka Mkandawire calls "choiceless democracy," namely the inability to change socio-economic parameters because the basic substance of economic and even social policy is considered off-limits by international agencies and capital. (5)

As a result, in South Africa, ongoing economic inequality is the cause of durable conflicts between the state and capital on the one hand and the lower-income and oppressed sectors of society on the other. It is hard to conceive of inequality actually worsening in the wake of apartheid, but a major study published in October 2002 by Statistics South Africa, a state agency, showed that in real terms, average black African household income declined 19 percent from 1995 to 2000, while white household income increased by 15 percent. Households with less than $100 per month income--mainly those of black African, colored (mixed-race) or Asian descent--increased from 20 percent to 28 percent of the population from 1995 to 2000. The poorest half of all South Africans claimed a mere 9.7 percent of national income in 2000, down from 11.4 percent in 1995, while the richest fifth grabbed 65 percent. (6) Meanwhile, the official measure of unemployment rose from 16 percent in 1995 to 31.5 percent in 2002. Add to that figure frustrated job-seekers and the percentage of unemployed people rises to 43 percent. (7)

Post-apartheid social policy has failed low-income people in many areas, including healthcare, water access and land tenure. Anti-retroviral treatment for HIV/AIDS was denied to millions who needed it, as a result of the ruling party's denialist stance (not conceding the link between HIV and AIDS) and the pressure from pharmaceutical corporations to refrain from licensing generic replacements for high-profit branded drugs. As discussed below, water and electricity disconnections affected millions and price increases forced dramatic declines in low-income people's consumption. Rural land tenure in the ten years after liberation was so insecure that one-third more people were displaced than during the decade prior to apartheid's fall. (8) The Landless People's Movement observed that from 1994 to 2004, the African National Congress (ANC) failed to deliver on its promise to redistribute 30 percent of the country's agricultural land from 60,000 white farmers to more than 19 million poor and landless rural and 7 million poor and landless urban black people within five years. Indeed just over 2.3 percent of the country's land changed hands through land reform in that period. (9) Still, there are some commentators who would argue that social democracy is gradually being constructed in South Africa, thanks to the ruling party's so-called national democratic revolution, and the leading politicians' purported commitment to a developmental state.

DEFENDING THE NATIONAL DEMOCRATIC REVOLUTION

Local celebratory variants of the Schmitter/O'Donnell/Whitehead thesis on transitions from authoritarian rule have finally begun to emerge in published form. (10) An example is from Alan Hirsch's recently published book-length survey of the ANC's consistent economic philosophy:

[A]t the centre is a social democratic approach to social reform--it is the state's job to underwrite the improvement in the quality of life of the poor and to reduce inequalities, but with a firmly entrenched fear of the risks of personal dependency on the state and of the emergence of entitlement attitudes.... The ANC's approach is sometimes summarized as elements of a Northern European approach to social development combined with elements of Asian approaches to economic growth, within conservative macroeconomic parameters. This remains the intellectual paradigm within which the ANC operates ... [B]ecause the ANC was confident of electoral success for at least 10 to 15 years, reaping the liberation political dividend, it did not feel forced to introduce risky, populist economic or fiscal policies to retain electoral support. Long-term growth prospects are brighter today in South Africa than at any other time in its recent history The macroeconomy is in good shape and is well managed; new state and civic institutions are growing in authority and competence; developmental strategies have been tested and modified and are now malting headway The country is stable and the government has elicited new levels of trust and confidence ... Government and businesses in South Africa have learned to manipulate the levers of growth, and redistributive policies are reinforcing the positive growth trajectory. Where the ceiling is no one really knows. (11) It is hard to know what to believe from Hirsch's account, given his role as a former leftist and then presidential-policy advisor. Self-servingly, he remarks, "IT]he political miracle was neither a miracle nor easy, but rather the result of extraordinary leadership." On the one hand, he insists that for the 1994 to 2002 period, "[L]ong-term and direct foreign investment entered South Africa in significant volumes." On the other, Hirsch also provides data that show the very opposite, namely, until 2001, only the year 1997 witnessed more than a paltry $1.4 billion foreign investment inflow (the year of state phone company Telkom's partial and ultimately unsuccessful privatization), as compared to an average $4 billion a year for financial inflows and outflows. As for the $8 billion that flowed during 2001, Hirsch concedes in an explanatory note, "The high figures in the direct investment columns for 2001 result from a transaction between Anglo American and De Beers, which resulted in Anglo American moving its domicile to London." (12) In other words, it is only by considering Anglo American as foreign capital that foreign investment has risen. Aside from expansion of temporary auto components and the subsequent purchases of existing enterprises by Barclays and Vodafone, the amount of foreign direct investment in South Africa has been paltry, in turn reflecting the excess idle capacity in most South African manufacturing industries due to local oligopolization, product uncompetitiveness and earlier periods of overinvestment.

The ruling party's defenders include not only those like Hirsch who are based in the presidency, cabinet, parliament and ANC. In addition, a respected liberal-left judge, Dennis Davis, attacked a new intelligentsia of upper-income, white government supporters who at best, argue about the need for change rather than transformation, the imperative of trickle-down economics, the irrelevance of class and the need for the construction of a mighty black bourgeoisie and, in some cases, even AIDS denial. He adds to these "cheerleaders," as he terms them, as a group of "careerist" supporters, "many of whom represented the very best of our struggle for a non-racial democracy, [who] have now become consultants to our government and to foreign governments.... Not for this group any further engagement in the intellectual life of the country." (13)

The latter may be an unfair allegation (as witnessed especially by Hirsch's effort), because under the banners of nuance and balance, there did arise, in the mid-2000s, a critical mass of state officials and consultants, joined by sympathetic academics and journalists, who openly defended the elite transition, in no small part by distorting the left critique. For example, contributors to a widely read 2003 issue of the journal Development Update sought to place themselves "somewhere between the 'miracle' and the 'sell-out'" perspectives on post-apartheid South Africa, as David Everatt and Vincent Maphai averred...

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