The question for all SA’s corporate leaders is not only whether they will actively join the struggle against corruption (from which a minority of them and their businesses have benefited) but, equally important, encourage fundamental economic transformation.
It is not credibly possible to do the first without also doing the second, and there needs to be a discussion between the government, business, the unions and civil society on how best to achieve it.
Ownership should certainly be spread much more deeply into the workforce so that the number of stakeholders in the economy is expanded exponentially.
Focusing on board level and BEE initiatives alone has not spread wealth and ownership widely enough (and the concentration of ownership in a few hands remains a huge problem in Britain and most other countries). Equally, risk takers and entrepreneurs deserve to be rewarded because they create jobs and prosperity.
As part of this project, the state needs to be transformed as well. There are about 900 state-owned enterprises (SOEs) — most inefficient, many bankrupt and leeches on taxpayers who should be funding other things such as better education, health and housing.
But a neoliberal, small state is not the answer either in the modern age — if it ever was. In the most successful economies the state plays a vital role, not simply to provide high-quality public services, but in encouraging economic growth, in part by actively promoting innovation. A smarter, interventionist, risk-taking state is therefore the answer.
My iPhone’s smart technologies were not invented by Apple: the internet, GPS, touchscreen display and the Siri voice-activated facility all originated from US state-funded research & development programmes. But a private, risk-taking entrepreneurial company such as Apple was needed to bring them to the market in a way that the state could never have done.
As John Maynard Keynes wrote in 1926, “The important thing for government is not to do things which individuals are doing already, and to do them a little better or a little worse; but to do those things which at present are not done at all.”
To succeed, the Left (including the ANC, whose better elements are on the Left) needs to redefine its stance on the state, not least as a credible alternative to the neoliberal “small state” which will otherwise continue to sweep the board.
But in order to retain taxpayer support, the state needs to be efficient, effective, honest and responsive to public demand, not bloated, hopeless, corrupt and indifferent to citizens’ needs as the SA state has become.
It simply is unsustainable for 70% of tax revenues to go on funding public wages and servicing the national debt. SA’s citizens, black and white, will not tolerate continued inflation-busting pay rises for public sector workers while the state’s productivity and delivery collapse and private sector workers suffer real wage declines.
Then there is the role of trade unions — vital in any genuinely free and democratic society which in SA played an important role in the freedom struggle. As a lifelong trade unionist I have been on both sides of the negotiating table, sometimes bargaining on behalf of union members or lobbying for their cause, sometimes representing government as a cabinet minister.
Before being elected an MP in 1991, I spent 14 years as a research officer helping Britain’s Communication Workers Union, involved in tough negotiations, brinkmanship and the occasional strike when we had to take a stand and defend our members’ interests through confrontation rather than co-operation.
But it seems to me that many of SA’s union leaders are not dealing with the key issues. They can see how Jacob Zuma bled the Treasury dry through corruption and patronage, some having supported his candidacy for president.
And that was before the Covid-19 whiplash. In the 2020 public sector workers’ dispute, unions insisted on sticking to a 2018 agreement based on growth expectations for the economy that had meanwhile fallen through the floor.
Yet when the finance minister stood firm, Cosatu even talked of “an act of provocation” akin to “a declaration of war”, and others rejected what they called an attempt to resolve the crisis of capitalism at the expense of public service workers. But neither tackled the root causes of the problem: a country on the brink of bankruptcy. The SA economy had grown disastrously slowly in recent years, even before Covid-19, hitting tax revenues hard and setting government borrowing on a rising path.
The better life which the ANC has promised them for decades remains a distant and doubtful prospect, always over the horizon no matter how hard they strive to reach it
And slow or negative growth makes SA’s struggle to bring her public finances into balance almost impossible. Higher public debt due to a bigger budget deficit makes potential business investors nervous, causing firms to postpone expansion plans and to hesitate before hiring new workers.
So potential jobs fail to materialise and millions of people have to suffer lousy living standards from which they are aching to escape. The better life which the ANC has promised them for decades remains a distant and doubtful prospect, always over the horizon no matter how hard they strive to reach it.
If the trade unions don’t face up to this, they will haemorrhage members, as Britain’s experience shows. In the mid to late 1970s, Britain’s newly elected Labour government faced a shock fourfold jump in the world oil price in 1974, triggering soaring inflation rates worldwide and forcing it to scurry to the IMF for a loan bailout on tough terms.
The trade unions responded with public sector strikes and the notorious “winter of discontent” in 1978-1979, when rubbish rotted on the streets and essential services were paralysed. I well recall at the time as a union research officer and Left-wing party activist feeling betrayed by my own Labour government.
But the culmination of that confrontation was not the shift to the Left I wanted. It was the election of a Right-wing government led by Margaret Thatcher, a neoliberal crash programme of huge cuts, decimation of mining and manufacturing, appalling rises in poverty and record levels of post-World War 2 unemployment — and a trade union membership plummeting to under half of its 1979 peak when she came to power.
Both the trade unions and the country paid a heavy price for clinging to an outdated adversarial industrial relations system characterised by conflict and mutual suspicion. And SA is heading the same way, which, as night follows day, will see a collapse in its trade union membership as well as economic stagnation.
Both countries would be better served by following the German unions where robust co-operation with employers is routine and no-one calls it betrayal. But German union representatives are not industrial pacifists. Far from being “soft”, they are hard-headed and tough.
At the height of the 2009 global financial crisis they negotiated earnings freezes or even pay cuts in return for commitments to maintain jobs. Such flexibility can be a boost to a company facing lost orders and cash flow problems as recession takes hold, and the German economy and German workers weathered that global crisis much better than Britain’s.
The German model of industrial democracy or co-determination has never become the norm for British bosses either. Yet the German results speak for themselves: higher living standards, greater export success, stronger manufacturing, world-class training and skills, better social cohesion and stronger trade unions.
Forty years ago Britain’s unions represented 50% of the UK workforce. Since then they have lost over half their members and two-thirds of their workplace representatives. The union share of the workforce is now 21% and still falling remorselessly, with a miserly 13% in the private sector.
Yet Britain’s unions have never really faced up to their shrinking support. Blaming globalisation or capitalism or government or greedy bosses will not revive their fortunes or deliver the kind of deals that working people want from unions. SA’s unions follow the UK example at their peril.
In democracies all ruling parties need to face the threat of losing to be kept true. The DA-EFF opposition inflicted defeats in 2017 on the Zuma-led ANC, especially at city and municipal government level, encouraging his ejection from office. Worry about losing the 2019 presidential and parliamentary elections was a factor in the switch from Zuma to Cyril Ramaphosa in December 2017, its then chief whip, the late Jackson Mthembu, once a Zuma supporter, told me afterwards.
Admittedly, the DA lost its way once Ramaphosa became president in early 2018 and its neoliberal economic agenda will never answer SA’s needs or win majority support. Aside from its flawed and confused leadership and lack of clarity about what it really stands for, the DA’s economic policy will ultimately prove to be an epitaph unless it changes that.
Julius Malema’s EFF are deeply damaged populists, its leaders exposed for corrupt dealings and its antiwhite, anti-Coloured, anti-Indian version of Africanism so far away from Nelson Mandela’s nonracial vision (or Robert Sobukwe’s or Steve Biko’s) that it will never be trusted to run the country. The EFF’s menacing attacks on journalists is a symptom of an ugly totalitarianism. Notwithstanding its pro-poor/anti-elite rhetoric, the EFF is on the Right of the Left-Right spectrum.
But there is fertile soil for the emergence of a capable opposition if it rejects the DA’s neoliberal economics and the EFF’s populist opportunism. For unless the ANC reinvents itself, it will die and it will deserve to do so, even if that takes a while yet — or at least until it is challenged by a credible opposition.
The ANC may well limp on in office with declining support on a dwindling electoral turnout as voters try to get on with their lives despite bad governance and the absence of a credible alternative. But unless it genuinely renews — the hardest thing for any party in power as I experienced when a cabinet minister before Labour become too complacent and we lost in 2010 — the party is on borrowed time.
Nevertheless, never forget the progress SA has made from the evil days of apartheid. When Siya Kolisi captained the Springboks to be 2019 Rugby World Cup winners followed by the recent victory over the British Lions, he buried white rugby chief Danie Craven’s infamous pledge during our Stop the Tour campaign I had led in Britain half a century earlier: “There will be a black Springbok over my dead body.”
South Africans of all colours often ask me despairingly: “What can I do when we have so many bad politicians and lazy or incompetent public servants?”
My reply is to sympathise but to gently correct by saying that there are good politicians despite the bad ones, the gangsters and the chancers. There are many dedicated, honest and able public servants — and that everyone can try to be a good teacher, a good nurse, a good business-person, a good parent, a good sales assistant, a good waiter: in short to do their best whatever they do in life, because aggregated, that will change things over time.
When teaching on leadership and conflict resolution since 2017, first at Wits Business School and then at the University of Pretoria’s Gordon Institute of Business Science, I have been struck by the numbers of vibrant, bright students — the majority young black citizens including hugely talented women — who have the potential to be future leaders of the country, in whatever roles they can play. The question to be fought for is whether the country will allow them and so many others to express that full potential.
Meanwhile, I commend what my dad told me in 1965 as I sat next to him in the passenger seat as he drove our VW Kombi: “If change was easy it would have happened a long time ago. Stick there for the long haul.”
We were returning home to Pretoria at the time and his advice encouraged me both to remain active in politics for six decades and to keep trying to make a difference.
• ‘A Pretoria Boy: SA’s Public Enemy Number One”’ has just been published by Jonathan Ball
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