CAPE TOWN — First, we had Finance Minister Tito Mboweni speaking in direct contradiction of his own party’s socialist policies during his recent mid-term budget speech, now we have President Cyril Ramaphosa disavowing the idea of White Monopoly Capital (WMC). Both leaders are blatantly swimming against prevailing ruling party policy and legislative tide. Does this represent an incipient sea-change in how the party is adapting to our mounting economic crisis? Is the ruling party learning from its debilitating mistakes, (it seems Mboweni and Ramaphosa are), or are these just polished political seductions aimed at woo-ing global investors? If the latter is true it’s a dangerous game because it will white-ant trust and compound the long-term cost. This timely analysis by the IRR’s Project Manager, Terence Corrigan, tries to make sense of the dramatic contradictions. The political pair are making unaccustomed clarion calls, but whether the mind-washed troops will follow the disruptors out of the ideological trenches is anyone’s guess. The real leadership test will surely come in convincing the party faithful that they’re not selling out to the evil capitalists but adopting a pragmatic strategy that will help them deliver on the principles of the Freedom Charter. It’s literally a change in ideological view. – Chris Bateman
By Terence Corrigan*
An important detail of the recent Investment Summit was President Ramaphosa’s disavowal of the idea of White Monopoly Capital, and (presumably) all that adheres to the label.
In widely-reported remarks he expressed regret at the manner in which business and government had interacted, and for the attitude that some of his colleagues had vocally adopted. ‘We treated them like enemies and … White Monopoly Capital, and all that … that must end today,’ he said.
For a country accustomed to accusation, grievance and self-justification, Ramaphosa’s words were a surprise.
It is also, potentially, deeply meaningful. Despite elaborate architecture to facilitate dialogue among the ‘social partners’, the relationship between South African business and government has long been a strained one.
Much of this is a consequence of the political and ideological commitments of the ruling African National Congress (ANC). Identifying itself firmly as a party of the ‘left’, intimately tied to trade union and communist allies, and deeply influenced in its thinking by a strong strain of Marxism, an ambivalent, even hostile, orientation towards business has been hardwired into the ANC’s DNA. In its 2012 Strategy and Tactics document, for example, it put this clearly: ‘The relationship between the national democratic state and private capital is one of unity and struggle, co-operation and contestation’.
Thus, while acknowledging the need for the benefits that business confers on society – employment, taxes and so on – ANC spokespeople have often been intemperate in their rhetoric around it. ‘White Monopoly Capital’ is but one such insulting formulation, and hardly the most extreme. Early last year, for example, in response to revelations about collusion between banks, the ANC Women’s League denounced the institutions’ ‘typical capitalist bloodsucking character’. A revealing remark indeed, and one that is not unique to this instance.
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Its master narrative, the so-called National Democratic Revolution (NDR), envisages South Africa being transformed by a mighty state under the aegis of a hegemonic ruling party. While capitalism, and thus private enterprise, might not be destroyed – indeed, prudent statecraft would in theory ensure that it would have opportunities to thrive – it would be disciplined and controlled. (The ANC’s union and communist allies, incidentally, view this merely as a waypoint on the path to a socialist and ultimately a full-blooded communist society.) ‘Capital’ – read ‘business’ – is essentially a necessary but dangerous tool. ‘Monopoly Capital’ was identified as the dread foe of the NDR.
It is of course doubtful whether White Monopoly Capital ever referred to anything analytically useful. It was rather an amalgam of vulgarised Marxism and racial nationalism, later becoming the justification for the Radical Economic Transformation agenda. None of this has been helpful to the economy or political system. President Ramaphosa is right to wish to be rid of it.
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It takes no great imagination to foresee that getting some of President Ramaphosa’s colleagues to join him in abandoning it will be difficult. Its lack of real utility aside, White Monopoly Capital is a wonderfully evocative idea, a handy fantasy, at once a visible behemoth and a hidden conspiracy. It is personification of the stuff of a deeply troubled politics.
More to the point, is the president’s call merely to dispose of a phrase, or an intent to change the ideological assumptions that have produced it? Undertaking the latter would be far-reaching indeed, since the self-conception of the ANC would be at stake.
The idea that on some level, stated or not, business is more opponent than partner has been integral to much policy making. Indeed, even in heralding the ‘New Dawn’ in his State of the Nation Address earlier this year, the president himself promised to ‘deal decisively with companies that resist transformation’.
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The mining industry has been one prominent target of rhetorical hostility. It has had to contend with a heavy and shifting regulatory burden, often ineptly implemented, along with frequent demands for it to divest itself of part of its assets – even campaigns for the nationalisation of the industry. In 2016, the labour court was moved to condemn the excessive use of Section 54 shutdowns and the damage they were doing.
But it is also expected to invest, to generate revenue and to create jobs. Steve Phiri, chief executive of Royal Bafokeng Platinum, commented in 2014: ‘You cannot attack the industry consistently and expect the providers of capital to continue putting money into the same industry that is under attack.’
The agriculture sector has suffered from, if anything, more extreme condemnation. Reckless language and sinister signification have produced an unparalleled degree of stigmatisation – the ‘farmer’ as a stand-in villain in South Africa’s rural parts. Today the sector faces the prospect of a campaign of expropriation without compensation, even though the failings of land reform have never been shown to have arisen from the requirement to pay compensation.
If the president’s rejection of White Monopoly Capital, and an embrace of cooperation with business is to have substantive meaning, it must be expressed in a turn away from the destructive policy paths that this narrative has produced. It is difficult to imagine that a basis for such cooperation would exist without such political and ideological recalibration. Whether it will follow is uncertain – but if it should, it would represent a radical economic transformation on a truly monumental scale.
- Terence Corrigan is a project manager at the Institute of Race Relations. Readers are invited to join the Institute of Race Relations sending an SMS to 32823 (SMSes cost R1, Ts and Cs apply).
