At the height of Pravin Gordhan's raging battle against his boss, former president Jacob Zuma, I had to often remind myself not to get lost in the personality clashes and to focus on the importance of the office of finance minister. Backers of the former president pushed the narrative that Gordhan was undermining Zuma and fanned the flames of this battle royale between the supposed "white monopoly capital" defender-in-chief and a president fighting the good battle of "radical economic transformation". This argument only served to blind us to their real motives as we've come to learn.
What was lost in this battle was just how important stability was in this most senior cabinet position, and perhaps, secondly, the personality. This is especially the case for a small emerging-market country such as ours, so heavily reliant on foreign sources of capital. A change of Treasury head at any of the world's larger economies such as the US or Japan hardly registers as a threat to their fiscal stability because of their sheer size and their ability to fund themselves internally.
Of all the own goals SA has scored in recent years, the biggest faux pas has been the musical chairs in the Treasury. Over the past decade we've had eight changes in that seat. That makes for a rather difficult investment case to sell. Bad politics has also afflicted Brazil and Argentina, which have also had their fair share of changes to finance ministers.
The Treasury was dragged into SA's bad politics as global markets zeroed in on the most vulnerable of emerging-market nations in light of the US Federal Reserve's policy normalisation. The higher yield offered by these nations would no longer be as lucrative, with growth in the US and especially in their tech stocks offering better prospects.
Our fundamentals mattered again, and when your desperate president has grandiose nuclear plans with his close friends the biggest beneficiaries, we were singled out as a bad apple. It damaged our credibility and if not for the resilience of institutions such as the central bank and courts it would be a much darker story.
With the appointment of Tito Mboweni, the sixth man at the helm of the Treasury in the past three years, one hopes these battles around the office cease in this period of heightened scrutiny of emerging markets. In the decade before the global recession of 2008, the Treasury was led by Trevor Manuel. His term began in 1996 and ended in 2009, among the longest of any finance minister in the world.
While such a term would perhaps suggest this was a period where Manuel and his team were left unchallenged politically, it quite simply was the opposite. Policy spats were the order of the day, with Treasury at the centre of implementing some of the most unpopular macroeconomic policies of the Mbeki era such as the Growth, Employment and Redistribution (Gear) policy. The policy, which among other things championed inflation targeting, caused much friction in the tripartite alliance and would eventually lead to the backing of Mbeki's deputy against him by both the SACP and Cosatu.
Despite these heated policy battles, Manuel's position at the helm of Treasury was defended by a boss who remained resilient despite his falling popularity.
But in so doing the office remained shielded from necessary policy battles in Luthuli House, with no one doubting the many budget commitments made in the 12 years of Manuel's tenure. It's this level of support that Mboweni will have to be afforded if SA is to regain the confidence of stakeholders.
We are all still living with the effects of the tectonic shifts in the global system after the last recession, shifts that have disrupted our politics and unleashed a populist wave that has been accentuated by the growth of social media. In this era, some rather ill-considered economics are brought to the fore without any depth to the argument. It's for President Cyril Ramaphosa to be strong and for his cabinet to defend the Treasury against the mud thrown their way in what is clearly an austere season for the state.
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