Tuesday, May 13, 2014

Patrick Bond - CELEBRATING THE 20TH BIRTHDAY - Questioning South Africa’s 'very good story'

Two decades ago, liberation was won in South Africa. In a few days, the final results of the May 7 election will confirm the popularity of the African National Congress (ANC) with a landslide victory. But times are changing: a serious leftist party – the Economic Freedom Fighters, founded by ousted ANC youth leader Julius Malema – has appeared on the landscape. In addition, the largest union in the country, the 340,000-strong National Union of Metalworkers (Numsa), has refused to support the ANC on the grounds that it has sold out, especially in the wake of the August 2012 Marikana massacre, where mine-workers were killed by police on behalf of the platinum mining corporation Lonmin.

What kind of patronage system now exists, to help explain why the ANC gets votes in spite of disastrous pro-business economic policies that worsened the already world-leading levels of inequality and unemployment which existed in 1994? Post-apartheid social policy – especially 15 million new grants, mainly for the mothers of poor children – is the main plot within what president Jacob Zuma calls the ANC’s ‘very good story’. In reality, it’s a tall tale of tokenism, once we get to know the devil in the details. 

But hyperbole rules in this election year. Government has adopted ‘a northern European approach to social development’, according to Alan Hirsch in Season of Hope, the main insider survey of post-apartheid policy to date. Aside from welfare grants, the provision of Free Basic Water and the roll-out of essential services are also the subject of wild claims by the government and its backers, including the South African Institute of Race Relations (SAIRR).

The claim that we have an operative social democracy is contradicted by the relatively small amount spent on grants: R118 billion (US$10.9 billion) in 2013/14 against an expected R2.1 trillion (US$194 billion) GDP. If we were really Northern European in approach, that spending would rise by a factor of nearly five. 

South Africa spends more on society in relation to GDP than only India, China, Mexico and South Korea amongst the world’s 40 main economies, in spite of having much higher levels of inequality. The ANC government spends less than half as much as Brazil and Russia in relative terms, according to a 2011 survey by the  Organisation for Economic Cooperation and Development. This sort of tokenism in social policy occurs not because the government has hit a fiscal ceiling. Overall, the public sector’s annual deficit and total domestic debt are relatively modest in comparison to peer economies.