It’s desperate watching an accident happen. Everything slows down. Everything goes quiet. If it’s out in the open, at a distance, you can’t hear the crunching. All you see is a cloud of dust and then the wreckage.
Most accidents happen because lessons have not been learned; signs not heeded. So it was at the weekend when President Cyril Ramaphosa wrapped up a busy few ANC days — first a meeting of the national executive committee and then a wider lekgotla that included its alliance partners, the communists and the unions.
The wrap showed Ramaphosa still in mid-accident. There’s a cabinet lekgotla and a state of the nation address to come. None of the wording will change in the slightest. And even though you still can’t be sure how the wreckage lands, Ramaphosa is on permanent repeat.
“The meeting noted,” he said in closing the lekgotla, “that the world is undergoing a serious economic and social crisis, with unemployment rising, widening inequality and deepening poverty.”
Step out of the Ramaphosa slo-mo and that turns out to be not wholly true. The US labour market is on fire. In the UK there are desperate shortages of labour. We have no jobs because of poor economic policy, not Covid-19, as the government likes to claim.
“The challenge is to lead all sectors of SA towards a new and resilient social compact,” he said, “building an inclusive economy that brings a change in the quality of life for all South Africans. An effective social compact will require give and take by all parties.”
Not true (and boring). Ramaphosa went into the pandemic with exactly such a compact in his pocket and threw it away with despotic Covid lockdowns and rules that destroyed businesses and business confidence. Any CEO who trusts him now needs his or her head read.
“The compact should set out a collective commitment to implement measures and targets to place our nation on a higher and more inclusive growth path aimed at addressing our common national challenges of poverty, unemployment and inequality.”
If the ANC doesn’t know by now it can’t solve unemployment, poverty and inequality at the same time and with the same solution, then it never will.
“The terms and trade-offs of a social compact would require give and take by all parties ... Business would need to make real, verifiable commitments to expand investment, and support localisation and black empowerment.”
Yeah, right. An army of bureaucrats swarming over businesses, measuring everything from the CEO’s carpet to the local content of bottle tops in the boardroom water. A terrific way to fire up investment. Do improvements in labour productivity get verified? By whom? Does Ramaphosa’s promise to be “effective in guiding the restructuring of network industries as well as improving law and order and security for communities” get verified? By whom?
Naturally, the government has been able to corral some business leaders behind its localisation plans. In return they get protection from imports. But what a miserable pose to strike in the face of a mountain of unemployed. Does the government seriously believe the companies it has “signed up” are going to splash out on new jobs?
After Covid-19, responsible business will be leaner than ever. What makes a job “sustainable” is an employer’s ability to generate enough cash to keep money in the bank to pay that job’s salary for five months rolling. Does anyone in the government know how hard that is to do?
Localisation may help temporarily retain jobs that already exist. That would certainly be the core impulse of the trade unionist driving the policy. As a significant job creator it is certain to miscarry.
For all the advice it has at its disposal, it is astonishing just how determined the ANC is to live in a dream world. Just this week, opening a mining conference in the Northern Cape, ANC chair and minerals & energy minister Gwede Mantashe told his audience: “I always ask one question on new deals presented to me: how many black capitalists have you produced with this deal?”
That is probably why exploration for new deposits in this resource-abundant country is virtually zero. The guy in charge doesn’t understand what his job is.
What is it? It is to ensure that as much mining investment as possible is driven into SA soil, that we become an investment destination of choice. Deals don’t produce capitalists, for crying out loud. Capitalists produce deals. Without investment there’s no transformation, no jobs, no equality.
Obviously there are moments of relief. Ramaphosa forcing through the liberalisation of private-sector generated power was one. His dispatching of the heads of the tax and prosecutions services he inherited was another. His winning trench warfare with the public protector is endlessly cheering. As is the government holding the line on fiscal consolidation.
But the topsoil is thin and big promises are a poor fertiliser. Nonetheless, this is an ANC election year. Anyone expecting an actual shift in policy to meet our utterly changed post-Covid world is going to be disappointed all year long.
• Bruce is a former editor of Business Day and the Financial Mail.
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