Practical Reason blog

This blog contains some of my opinion pieces and short essays about politics. I will also place topical personal and political writing here.

Some of my books and edited collections are listed in the sidebar to the right. I have tried to indicate their intended audiences.

The picture on the home page was taken during the 2016 local government election campaign. ANC leaders have fortunately since stopped wearing horizontal stripes.

In the 2014 photo above, taken at the Presidential Guesthouse, President Zuma had just returned from Moscow, amidst rumours of illness or even poisoning. He seemed fragile and vulnerable. This did not last.

Anthony Butler

The poor may finally take centre stage in 2019

In a democracy, the votes of the poor and the rich should have equal weight. In post-apartheid SA, however, elections have revolved around the preoccupations of the middle class rather than those of the far more numerous poor.

The middle class lobbies hard on its own behalf. It is now more black than white. Many of its members are vulnerable, lacking assets to plan for the future or bounce back from shocks such as redundancy or illness. The loss of one job is often enough to plunge an entire family into poverty.

The pathways to middle-class life, through suburban schools and permanent employment, are narrow and often inhospitable to the children of the poor. Some of the key motors of stable employment growth, notably the public sector and parastatals, face major cutbacks.

The whole middle class, black and white alike, is experiencing slow income growth. Free from extreme poverty, the middle class nevertheless lacks a ladder of social and economic opportunity. Yet the small and consumerist elite above them keeps forging ahead. Though much of the middle class may work in the public sector, its primary drive is to escape public services — public hospitals, township schools, public policing — rather than to improve them.

Middle-class electors are impatient with politicians who do not listen to them, and they register and vote in provinces where there is real competition for power. The economic heartland of the country, Gauteng, is now theirs to fight over. And they have the knowledge and resources to voice their numerous grievances.

They readily evade or avoid taxes. They refuse to pay user charges for services if they view those charges as illegitimate. Despite the public resources ploughed into their education, many are prepared to emigrate, taking their skills and intangible assets with them.

When it comes to the poor, by contrast, political leaders rarely respond to their grievances, even when an election is just around the corner. This is a surprise because about half of the population can reasonably be described as chronically poor — and therefore they have lots of votes to cast.

One classic stereotype concerning this half of the population was on display in a controversial opinion piece written by Moeletsi Mbeki in 2011. Warning of SA’s impending “Tunisia Day”, Mbeki argued that the ANC uses social grants — which today account for more than half of the income of poverty-stricken households — to “placate the black poor and get their votes”. When the money runs out, the masses will apparently “rise up”.

There are many reasons why the poor are unlikely to rise up, of course, and these are closely related to their inability to secure a fair hearing from political parties. One is that popular protest is still met by the implacable use of state coercion. City planning and policing approaches continue to facilitate the containment of discontented urban populations.

The poor are also disproportionately young, often too young to vote. A majority of them live in former Bantustans or deep rural areas, where political competition is limited. Most poor people live in female-headed households whose voice is ignored. They lack access to the infrastructure of nongovernmental organisations, local parties and interest groups that is needed to realise the promise of constitutional democracy.

While the major political parties have focused on the concerns of the middle class, the poor have had to improve their own prospects. One strategy has been to make ends meet in survivalist rural livelihoods. Another has been to move to the towns and the cities in search of work and better public services.

One favour the EFF has done for the country in advance of the 2019 elections is to broaden debate on land reform so it now embraces the concerns of the poor. The exploitative behaviour of many traditional authorities, and the failure of policies that could make urban land accessible to the poor, will probably be prominent themes in the campaign. The interests of the poor, for the first time, may take centre stage.

• Butler teaches public policy at the University of Cape Town.

The ANC’s billion Rand election

Revelations of a R500,000 donation towards Cyril Ramaphosa’s expenses for his campaign for the ANC presidency in 2017 have generated a minor public outcry.

The electoral contest held at Nasrec in Johannesburg was not just about money. Ramaphosa’s team emphasised the candidate’s trade union and business pedigrees, and consistently advanced the myth that a deputy president always goes on to become ANC president.

Ramaphosa’s adversary, Nkosazana Dlamini-Zuma, traded on her experience in government, and on the seniority she had acquired as chair of the AU Commission. The ANC’s potential vulnerability in the 2019 national and provincial elections was another key campaign issue, and so too were various policy differences about the character of radical economic transformation.

Money was nevertheless central to the campaigns. There were many decent people involved in Ramaphosa’s team and they tried to draw clear lines about ethical campaigning. Insiders have said there was meant to be no direct vote- buying by their camp, and no provision of personal benefits for activists.

Campaign fixer Bejani Chauke, who was responsible for much of the day-to-day organisation, is a wily politician but reputedly not a corrupt one. The “political committee” that met on the sidelines of the ANC’s regular national executive committee meetings, to co-ordinate and drive the campaign, was co-chaired by ANC stalwart Joe Phaahla and, perhaps less reassuringly, Gauteng chair Paul Mashatile.

Other members of this committee included the ANC’s economic transformation head, Enoch Godongwana, redoubtable former finance ministers Pravin Gordhan and Mcebisi Jonas, and other widely respected government leaders including Angie Motshekga and Aaron Motsoaledi.

The political committee was insulated from fundraising and financial management issues. Chauke’s claim that Ramaphosa was not aware of the origins of particular donations is therefore plausible.

Ramaphosa also reportedly instructed his fundraisers not to negotiate with donors, and he insisted that he would not do so himself: there were to be “no deals”. To the chagrin of some businesspeople, donors were merely promised “good governance” in the event of a Ramaphosa victory, on the basis of a very vague 10-point leadership plan.

Chauke has said there were “more than 200 donors” to the campaign’s central account. No doubt many of them were businesspeople seeking to curry favour. But others were wealthy citizens, often ANC-aligned, who saw the conference as a last chance to save the liberation movement. Some were patriots fearful of an effective continuation of Zuma-era looting and institutional destruction. Controversial African Global Operations’ CEO Gavin Watson, source of the controversial R500,000 donation, probably fell into all three categories.

Prominent ANC-linked businesspeople and financiers were seen at various campaign events. One change from previous internal contests, however, was a consequence of a tightening of other countries’ party funding regulations: big businesses that were listed overseas simply did not donate at all.

The administration of the Ramaphosa faction’s campaign funds appears to have been relatively tight when it came to monies managed at the centre. The great bulk of expenditure was on routine campaign activities. Each faction had to find many tens of millions of rand to pay for membership renewals in branches deemed to be “theirs”. Other major expenses included accommodation, the hire of venues, and the aircraft, cars and buses needed to transport politicians and organisers around the country.

Both sides had extensive communications costs, including social media and marketing expenditures. Catering, branded hats and shirts, and campaign posters were deemed necessities. During the conference itself, both factions hired buses to transport their delegates to and from the venues. They also put supporters up in hotels where they could be isolated from the inducements — or arguments — that might be offered by their opponents.

Despite all these efforts to run a reasonably clean race, money pathologies inevitably infected both campaigns. One real problem was the sheer sums involved. Insiders claim the Ramaphosa team spent as much as R500m on its campaign. The Dlamini-Zuma faction almost certainly spent far more. This was undoubtedly the ANC’s first billion-rand election.

The resulting need to fuel ever-hungry campaign machines was probably more of a problem for Dlamini-Zuma than for Ramaphosa. The unpalatability of her “radical” economic policy proposals, and a fear that she was associated too closely with the Zuma era, deterred legitimate businesspeople from donating to her cause.

Rumours of suitcases stuffed with banknotes, meetings with members of the criminal underworld and a last-minute payment of R20m to secure one particular top six position, all swirled around the Dlamini-Zuma campaign.

Yet Ramaphosa’s camp also included controversial figures, such as Philly Mapulane, a politician from the North West universally known as “Mr Cash”. Despite the claims of his admirers, Mapulane bears little resemblance to Johnny Cash, the legendary US crooner. His nickname can instead be traced to his days as mayor of Madibeng municipality, where he was reputed to keep bundles of banknotes in the drawers of his desk.

Only half of the Ramaphosa faction’s overall funds passed through the campaign’s central trust fund. The rest was raised and spent in provinces where controls were lax or nonexistent. Provincial chairs in the Eastern Cape and Limpopo who backed the Ramaphosa campaign had long extracted resources from provincial state coffers, ploughing them back to build up their personal power bases.

Where the Ramaphosa faction had only a minority presence, local campaigners unleashed no-holds-barred campaigns to extract a share of final delegate counts. Vote-buying or the bribing of party auditors were certainly feasible. Millions of rand handed over to cover legitimate party membership renewals may have been used instead to summon up “ghost members” who could be deployed to boost delegate numbers.

The ANC continues to face a crisis concerning the relationship between money and politics. The party funding bill that awaits Ramaphosa’s signature will do little or nothing to end this state of affairs. Indeed, greater regulation of formal elections increases the incentives for unscrupulous donors to focus on poorly regulated and sprawling internal contests.

Donors wanting to back a party faction can use a variety of conduits or proxies to channel resources. Trusts whose beneficiaries may be interest groups, NGOs, political foundations or think-tanks can serve as fronts to circumscribe funding regulations. It would be impractical — and disastrous for democracy — for civil society organisations and private associations as a whole to be placed under regulatory control.

The ANC cannot hide behind a largely ineffectual new law forever. It needs to reshape its own internal electoral processes to make them less vulnerable to the influence of money.

 

• Butler teaches public policy at the University of Cape Town. This article is drawn from a new edition of his biography of Ramaphosa, to be published by Jacana in 2019.

Lawyers and state capture

One of the most alarming aspects of the unfolding “state capture” saga has been the discovery that once-reputable professions facilitated the looting.

The boards and senior managements of crooked companies and state-owned enterprises (SOEs) were heavily populated with chartered accountants who failed to discharge their oversight responsibilities. The SA Institute of Chartered Accountants (Saica), the bean counters’ professional body, then proved inept or impotent when it came to sanctioning accountants implicated in abuses at Steinhoff, Transnet, or Gupta-owned companies.

Citizens were perhaps only a little surprised by the lamentable behaviour of so many accountants. They have been more deeply shocked by the role allegedly played by lawyers in the perpetration of looting and the obstruction of justice.

Lawyers, it is true, have not been popular since at least the late 1500s in Western Europe. Their spread to the colonies, somewhat in the manner of a plague, was never destined to end well. Little wonder even reprehensible lawyer jokes continue to be so popular around the world. Question: What should you do if you run over a lawyer? Answer: Back over him just to be sure. Question: How do you save a lawyer from drowning? Answer: Take your foot off his head.

Ordinary citizens perceive an asymmetry in the application of the law in recent years. It has seemed largely impotent in the face of a large-scale looting. Indeed, lawyers apparently facilitated appalling behaviour, rendering immoral actions legal, and laundering legal opinions for looters in exchange for inflated fees.

Once journalists and politicians had exposed the malfeasance, however, lawyers suddenly became effective; but primarily, it seems, at protecting the wrongdoers from prosecution. Worse still, commissions of inquiry run by judges are now widely viewed as whitewashes or hatchet jobs. What’s the difference between a good judge and a bad judge? A bad judge will let a commission of inquiry drag out for several years. A good judge can make it last even longer.

The Law Society of SA is a trade union preoccupied with fending off competition from foreign lawyers who might undercut the local feeding trough. It will no doubt battle in the years ahead to stop citizens accessing new legal technologies that in other countries will dramatically undercut conveyancing, commercial, and family law fees.

Money lies at the centre of the profession’s preoccupations. A lawyer dies and finds herself at the gates of Heaven. “There must be a mistake,” the lawyer complains. “I’m only 50. I’m too young to die.” “Fifty?” says Saint Peter. “According to our calculations, you’re 82. We added up your billing sheets.”

The Law Society of SA does little to promote pro bono work or to make the law accessible to poorer citizens. Instead it celebrates the Road Accident Fund (RAF) racket, which makes middling lawyers rich and is paid for by ordinary people through the fuel levy. Only a personal injury lawyer, the association claims, can reliably negotiate the impenetrable protocols surrounding an RAF claim.

Lawyers have evaded the historical reckoning that might have punctured their steady complacency. Apartheid, after all, was a form of institutionalised and legalised oppression. Rather than reflect on the significance of their role in this historical abomination, most advocates vaguely trace their lineage to the brave but marginal battles of a relatively few lawyers in the struggle against apartheid.

This humbug is institutionalised in the Law Society of SA’s Legal Practice Council, which is dominated by the National Association of Democratic Lawyers and the Black Lawyers Association. The former believes that even ambulance chasers are inherently “progressive”. The latter wants black lawyers to be overpaid by exactly the same amount as white counsel.

The association seems entirely unable to communicate any sense of the law as a vocation. Like the mafia and the ANC, the Law Society of SA is instead dedicated to the promotion of “unity” among its own constituent membership. This perpetuates the omertà, or code of silence, that discourages criticism of one lawyer by another, and allows unprofessional behaviour to continue unchecked. Question: What do you get when you cross the Godfather with a lawyer? Answer: An offer you can’t understand.

 

• Butler teaches public policy at the University of Cape Town.

Pathways to land reform

There are genuine reasons for anxiety about expropriation without compensation (EWC), among them proliferating land invasions, nervous international investors and vulnerable financial institutions. But policy contests tend to fade over time as citizens tire of the complexity of setting the world to rights. There is every chance that the heat will have left the expropriation issue before the end of May 2019.

EWC started out confusingly  due to mixed messages in the ANC’s Nasrec conference resolutions. That confusion has now been deepened by the creation of overlapping processes for deliberating on the modalities of EWC.

Parliament’s joint constitutional review committee has solicited public submissions on how to facilitate expropriation. President Cyril Ramaphosa has created an interministerial committee on land reform to provide political oversight and “co-ordinate, integrate and ensure accelerated implementation of the recommendations of the joint committee”. In addition, the presidency has appointed a broadly conservative advisory panel to review and research implementation models.

The ANC leadership’s message has been that section 25 of the constitution should be amended for essentially political reasons, regardless of the necessity of such an amendment. Both Ramaphosa’s statements and the terms of reference of the committees and advisory bodies limit discussion to land reform and so exclude other asset classes or property types.

Both the constitution and international agreements to which SA is party require appropriate compensation in the event of expropriation. A broad range of relevant factors can be invoked, including “market value”; how, or whether, the land is currently used; how it was acquired; historical state subsidies; the purpose of the expropriation; and levels of investment by owners and consequent indebtedness.

Speaking at the Cape Town Press Club on Tuesday, Prof Ruth Hall, a member of the expert advisory panel, suggested that consensus may be emerging about a model for graduated compensation, which would systematically weigh these relevant factors. If this is true, the ANC will go into national elections having met its commitment to make EWC possible, but before the constitutionality of its compensation model has been tested.

Ramaphosa can throw in additional promises, such as agricultural assistance for smallholder farmers, transfers of agricultural land to black farmers, and title deed initiatives in urban areas.

Such an approach would place considerable pressure on the main opposition parties. The EFF’s proposed “expropriation of everything” does not enjoy popular support. The red berets may find it politically costly either to support or to reject more modest ANC proposals.

The DA’s likely opposition to reforms will be presented by the ANC as motivated by selfish donors in agribusiness, commercial farming, and property development. Defeat of an ANC constitutional reform proposal will harm the opposition parties that have blocked it far more than it will harm the ANC.

After the elections, there will be tough decisions to take, and these will have to be taken regardless of the outcome of the constitutional process. Ramaphosa cannot continue with two government departments — agriculture, forestry & fisheries, and rural development & land reform — that advance dramatically different land reform policies. Since land reform will clearly not succeed without the active co-operation of commercial farmers, he will also have to embrace a partnership model.

Traditional leaders who deny their subjects control over their own land will have to be confronted, for electoral as well as developmental reasons. The attempted reverse takeover of the ANC by these conservative actors has presumably come to an end.

Land in SA is largely an urban and peri-urban issue. Most people do not want to farm but rather to make a home close to urban employment. Making a real difference here will require institutional reforms: an expanded mandate for the department of human settlements or an empowering of metropolitan authorities. It will also require a sustained drive to overcome legal obstacles to pro-poor land-use planning. There must also be a programme to exploit strategically located land controlled by government departments and parastatals.

None of this will be easy to accomplish. But the prospects of success are very little affected either by leftist doctrines of expropriation or by liberal preoccupations with the defence of the constitution.

 

• Butler teaches public policy at the University of Cape Town.

Anti-immigrant sentiment

Anti-immigrant posturing now seems certain to play a significant role in the 2019 national and provincial elections. The ANC government was first off the mark with its 2017 white paper on international migration. The document recognised that skilled migration is essential for economic growth, but its broader message was that high border fences and detention centres for asylum seekers are needed to protect the country from a “flood” of unskilled migrants.

In September the National Council of Provinces and the Gauteng provincial legislature joined forces to present anecdotal evidence about the “swamping” of Gauteng’s health, education and policing systems by an “influx” of irregular cross-border migrants. The DA’s Jacques Julius this week threw himself into the anti-immigrant quagmire, blaming “porous borders” and a “collapse” of the immigration system for cross-border crime, human trafficking, stock theft, drug smuggling and public service delivery failures.

On the face of it, this rise of anti-immigrant sentiment is curious. According to the International Organisation of Migration (IOM), just 3.3% of the world’s population are migrants, up from 2.9% in 1990.

Credible estimates of SA’s migrant population are in line with the global average, and the country stands in stark contrast to high migration countries such as the US (15%) or Australia (28%).

It is difficult to model the impact of migration on destination countries. Particular groups, such as local business owners, will suffer from competition. Migrants concentrate in cities, and insufficient resources are often provided to improve urban migration governance. But most current research suggests the overall impact of in-migration on employment and wages tends to be positive.

Why, then, are ANC and DA politicians turning to the apartheid-era rhetoric of “swamping” and “influxes”? A first factor is the government confusion. Treasury and the department of trade & industry doubtless understand the importance of skilled immigration for growth, and the wide-ranging benefits brought by young and entrepreneurial foreigners. Home affairs, in contrast, has a “Fortress SA” mentality, while labour department officials view themselves as the guardians of local workers.

Second, poor planning has created educational and public health shortfalls in some of the urban areas in which migrants are concentrated. Corruption and inefficiency at home affairs  has resulted in an absence of reliable data about migrants’ locations.

Third, EU migration flows have polarised and destabilised political competition on that continent, fuelling anti-immigrant parties and resurgent nationalism.

The EU has thrown more than €10bn at tackling the “root causes” of migrant flows in countries such as Nigeria, Mali and Ethiopia, and billions more paying border states to stop refugee transit.

“Fortress Europe” has also beefed up border protection, pursued traffickers, strengthened screening systems and aggressively returned economic migrants. Many of home affairs minister Malusi Gigaba’s policy initiatives from 2016 and early 2017 merely mimicked the EU ideas that were designed for a dramatically different context.

There is legitimate uncertainty about future patterns of south-south migration. Migration flows are already unstable within Africa because of a high incidence of conflict and relatively extreme economic cycles. Now demographers predict that more than half of global population growth over the next three decades will occur in sub-Saharan Africa. Meanwhile, the anticipated fallout from global climate change will include negative repercussions for farming and economic development on the continent.

The World Bank reported earlier in 2018 that there could be as many as 86-million “climate migrants” in sub-Saharan Africa by 2050. But most such impacts will occur in countries a long way from SA’s borders, and four fifths of south-south migration currently takes place between neighbouring countries.

In the end, much of the growing climate of hostility towards immigrants is probably best explained politically. After all, we can expect a close electoral competition in Gauteng in 2019, where migrant numbers are largest and where citizens inevitably interpret foreign arrivals as immediate competitors for jobs and services.

Around the world, citizens of host countries suffer from misconceptions about the scale of migrant flows. Economic downturns stoke anti-immigrant sentiment, and so too does avoidable competition for public services, brought about by poor planning and weak governance.

It is perhaps not surprising that the politicians responsible for governance shortfalls in Gauteng and its cities have decided to blame immigrants for their own failings.

 

• Butler teaches public policy at the University of Cape Town.

Finance ministers under fire

Finance minister Nhlanhla Nene’s testimony to the Zondo commission of inquiry into state capture was certainly gripping.

Nene testified that he repeatedly refused to sign a letter committing SA to a Russian nuclear build programme. He detailed how the finance ministry denied government guarantees to PetroSA that would have enabled the parastatal to purchase assets from Malaysian giant Petronas. He also explained that his veto over former SAA chair Dudu Myeni’s proposals to manipulate an Airbus contract deeply antogonised then president Jacob Zuma.

Nevertheless, despite the impression Nene’s testimony has created, the embattled situation of the National Treasury is more or less a permanent condition. It is true that Zuma helped the Gupta family climb to the top of SA’s dung heap of corruption and rent-seeking. But the dung pile itself predates — and will certainly postdate — his presidency.

The Treasury has always been a target for hostility. It denies politicians opportunities to boost their personal patronage powers. It engages in bilateral wars of attrition with departments that leave a residue of bitterness. Critics on the left love to take potshots at Treasury policy priorities such as fiscal and monetary stability.

Long before the Zuptarian revolution, finance ministers were obliged to engage in endless political horse trading. Under one former finance minister, Trevor Manuel, the Treasury was awarded top prize in the International Budget Partnership’s open budget index for its transparency. Despite such international acclaim, however, the ostensible legal strictures that prevented Nene from signing off on a nuclear deal did not deter Manuel from adding his signature to the strategic arms procurement package.

Links between the fundraising machine in Luthuli House, ANC-aligned business vehicle Chancellor House and huge investments in coal generation plant would surely not have escaped the finance minister’s attention.

Manuel’s successor, Pravin Gordhan, was another public servant of exceptional intelligence and integrity. On his watch, however, the cost of Transnet’s Johannesburg to Durban pipeline escalated from R10bn to R25bn in the space of two years. Hundreds of billions were committed to rail rolling stock and port infrastructure.

In the face of such parastatal extravagence, Gordhan approved the extension of loan guarantees of R350bn to Eskom in October 2011. SA’s high level of contingent liabilities has since contributed to ratings downgrades and escalating borrowing costs. The guarantee framework subordinated the rights of the government to those of all other creditors.

Gordhan and the Eskom board were predictably swept aside. The rot quickly spread from secretive construction contracts at Kusile, Medupi and Ingula to inflated operational expenditures, most notably in the coal supply chain. These disastrous outcomes were not initiated by Zuma or the Gupta family. Indeed, they had roots in well-intended ANC policy documents, such as the New Growth Path, which portrayed state-owned enterprises as the key to state-led growth.

In 2010, newly appointed public enterprises minister Malusi Gigaba told the presidential commission of inquiry into state-owned enterprises — another waste of time and money — that massive loans and guarantees to such enterprises would “double the rate of economic growth”.

The Guptas were not the first entrepreneurs to try to “capture” government and parastatal procurement, to subordinate financial intelligence and revenue services, to access the funds managed by the Public Investment Corporation or to secure state loan guarantees for huge and opaque expenditures. Nor will they be the last.

Nene is the latest in a line of capable finance ministers who have been as honest and forthcoming as their circumstances allow. The predicament of Nene’s successors will not be resolved by shining a spotlight on a single president or by demonising one adroit and opportunistic family.

 

• Butler teaches public policy at the University of Cape Town.

SA needs accountability to citizens

As “public service month” drags unnoticed to its dismal close, the post-apartheid state bureaucracy remains troubled. The strain on the fiscus imposed by 2-million public service and parastatal employees is widely remarked.

But public sector unions are powerful, the public service is a key driver of the creation of a black middle class, and pay or employment freezes antagonise key frontline workers. The government probably has to focus on improving public servants’ performance rather than on reducing their number.

The post-apartheid bureaucracy was built on the twin foundations of a white supremacist state and a set of corrupt and tribalist Bantustan bureaucracies. Little wonder it is not working well. Efforts to improve performance have enjoyed only partial success.

The public service code of conduct extols virtue but provides little disincentive to vice. Recently amended public service regulations have not stopped public servants’ private companies from doing business with the state.

Since 1994, the governing ANC has placed too much faith in accountability mechanisms within the state: cadre-bureaucrats keeping an eye on other cadre-bureaucrats. This has largely failed. Alongside these top-down instruments of control, government has insisted that the “batho pele” principles introduced by president Nelson Mandela in 1997 should continue to guide the conduct of SA’s public servants.

Batho pele (“people first”) ostensibly instils favourable dispositions in officials: they must consult with citizens, treat them courteously, provide accurate information, operate openly and transparently, pursue high standards, and secure value for money.

Incoming President Cyril Ramaphosa granted fresh life to this wishful thinking in his February state of the nation address, when he enjoined civil servants to “put our people first”.

Sentimentalists now enjoin government employees to “care”. Hence public service month has laboured under a theme of multifaceted implausibility: “Thuma Mina — Taking Public Service to the People: Batho Pele: We Belong, We Care, We Serve.” Rather than celebrating the 21st birthday of batho pele next month, the government should ditch it and put in its place a combination of hard skills development and citizen accountability.

We need analytically accomplished graduates, many of them engineers and scientists, at the top of the service, in career paths that are prestigious and well remunerated. A back-to-basics approach to municipal appointments in engineering and finance departments should be complemented by schemes to train personnel. Above all, what the public service needs is more exposure to people power.

State-centred accountability mechanisms work poorly on their own. Ordinary people are often those best placed to judge what has gone wrong. Citizens should be told how nurses, teachers and municipal officials are legally obliged to act. They should also be informed how local schools, clinics and municipal offices actually perform. In public “league tables”, data about the performance of almost all public agencies can be made available to citizen users.

Cellphone apps can meanwhile help citizens to express satisfaction or dissatisfaction with public services in real time.

Citizen scorecards are relatively cheap to set up and can be adapted for use in schools, clinics and government offices. They can be designed to ring alarm bells in management before citizens turn to violence. They can also place immediate pressure on underperforming or corrupt government officials.

SA is a democracy and it does not need an army of spies to oversee citizen grievances, identify antiparty agitators or arrest dissenters. Nevertheless, no state can afford to trust government officials to regulate their own behaviour.

• Butler teaches public policy at the University of Cape Town.

SA’s unsavoury investment partners

SA’s descent into a technical recession has come as a blow to President Cyril Ramaphosa’s economic hopes. Given limited fiscal space, heavily indebted parastatals and a nervous private sector, Ramaphosa will now need to make good on his promises with regard to foreign direct investment.

He will come under heavy pressure to conjure up some good news at the investment conference scheduled for October. Ramaphosa initially claimed the tidy sum of about $100bn in new investment would be raised over five years.

The investment drive has become the signature theme of Ramaphosa’s tenure in the Union Buildings. He has sought out investment partners on the African continent, in the Middle East, across the global South, and among the countries of the Organisation of Economic Co-operation and Development.

This week he has been in China, where opaque energy sector loans have already been promised for the ailing Eskom. SA is now also pursuing Chinese funds for infrastructure investment and for the creation of special economic zones.

Earlier in the year the president celebrated investment accords in the Middle East, including two ostensible $10bn commitments from the United Arab Emirates (UAE) and Saudi Arabia. These deals were controversial, not least because little detail was provided about their substance.

It seems likely the key area for collaboration is defence and security. A February 2017 memorandum of understanding between umbrella organisations in SA and the UAE suggests that troubled state-owned enterprise Denel, and Paramount Group, Africa’s largest private sector defence contractor, are SA’s coveted players.

Paramount sells not just weapons systems but also “solutions”. Yet SA pledged in the aftermath of apartheid not to supply weapons to foreign parties that might use them systematically to violate human rights. It is difficult to see the current behaviour of Saudi Arabia and UAE in Yemen as conforming to this promise.

Bellingcat, an international non-profit organisation, has noted that the Hodeidah hospital attack in Yemen on August 2, which claimed the lives of dozens of civilians, was probably the result of a mortar strike from Saudi or UAE forces. According to Bellingcat, the munition fragments “appear to share characteristics with munitions manufactured by Rheinmetall Denel Munition”, a German-SA consortium-of-convenience that came to prominence last week as a result of a devastating explosion in its Somerset West plant.

In some eyes, even such unsavoury business partners are less unpalatable than the former colonial power, which inconveniently remains SA’s largest foreign investor. The UK is oozing fake humility as a result of the Brexit disaster: SA is a key pillar in the Conservative government’s strategy to forge ostensible post-European Union trading and investment relationships through a largely imaginary Commonwealth portal.

The residual EU is even more important for SA’s prospects. The eurozone – not China — is SA’s largest trading partner by far. It also contains major investors such as Germany, whose Mercedes-Benz confirmed in June that it would invest €600m in expanding its SA operations.

The commitments of international carmakers are precarious, however, dependent as they are on our costly motor industry support programme and on the Great Satan’s African Growth and Opportunity Act, which allows tariff-free export of cars assembled in SA to the US.

These are difficult times indeed. Ramaphosa needs to seek out partners wherever they can be found. Pride, anticolonial sentiment and moral scruples will all have to wait for better days.

• Butler teaches public policy at the University of Cape Town.

 

Bellingcat analysis can be found at

Dangers of the Zondo Commission

 

Sceptics complain that the Zondo commission of inquiry into allegations of state capture, corruption and fraud in the public sector is a waste of time and money. It could turn out to be much worse than that.

President Cyril Ramaphosa’s New Dawn narrative can be sustained only by portraying the new ANC as distinct from the old. Unfortunately, the party recently elected a national executive committee at least as questionable in its probity and moral integrity as its predecessor.

Given impending national and provincial elections, Luthuli House has fallen back on familiar theatrics. Parliamentarians have been woken from their slumbers to exhale moral hot air over selected officials. In their “oversight” committees, ANC MPs have suddenly discovered obvious but previously overlooked truths.

What does a commission of inquiry add? It allows the president and his allies to pass responsibility for politically costly decisions to a judicial body. It helps protect the ANC from popular anger by pushing back the “time of reckoning” to 2020, or even 2021, by which time the Gupta family will be a distant memory.

Commissions of inquiry also insulate powerful politicians against prosecution by justifying deferral of prosecutions. Justice delayed means a comfortable retirement for most miscreants. Worse still, crooks are forced by a commission to testify under oath that they and others are innocent. This makes it all but impossible to turn offenders into state witnesses, because perjurers cannot later present credible testimony.

With the passing of time, the prospects of prosecuting the big fish will fade. Officials further down the food chain — those who put their signatures to documents or wrote compromising e-mails at the behest of their political principals — will take the rap (on the knuckles).

There may be ministerial scapegoats too, for example three or four fired ministers who have been unnaturally quiet in recent months. But it takes work to pin down politicians as actors who were demonstrably responsible for voluntary actions that made corruption possible.

A commission of inquiry instead tends to dwell on the general background conditions to any event. The terminology employed in the Zondo commission’s terms of reference is especially infelicitous, because the idea of “state capture” is open to myriad interpretations.

At a theoretical level, state capture has been explored by scholars of governance over the past two decades. But it has not yet proved to be a very illuminating concept. Corruption involves directly breaking the law, whereas state capture involves the (often legal) shaping of laws, regulations and procurement decisions to the benefit of private actors.

Scholars view state capture as a systemic phenomenon, in which members of political and business elites appropriate certain state functions to access resources. Unlike a near-equivalent term, “crony capitalism”, which turns our minds towards exactly who the cronies were and what they did, state capture evokes “a system”.

In a line of analysis popular among many South African intellectuals, the capitalist state is “always captured” by business. And state capture is indeed often alarmingly hard to separate from lobbying.

The commission is ably staffed and led. Such talented legal practitioners’ extended reflections on post-apartheid history, the nature of global capitalism and the relationships between corruption and state capture, will no doubt be illuminating.

But many citizens will hope the commission will focus primarily on the corrupt actions of political principals, on urgent referrals for criminal investigation and on the imperative that the commission’s work does not unwittingly impose constraints on future prosecutions.

• Butler teaches public policy at the University of Cape Town.

Disaffection with BEE on left and right alike

It has been another difficult week for the DA. This time, the party’s internal conflicts concern black economic empowerment. The DA’s federal council in July rubbished ANC empowerment policies.

The government has sought to increase ownership, management, and control of businesses by blacks, and to use preferential procurement to spread empowerment. But the costly and fronting-prone policy has satisfied neither black nor white businesspeople.

BEE has discouraged investment and decreased the efficiency of government expenditure. Empowerment has facilitated patronage relationships between party, state, and business. Ditching the ANC approach may be easy, but identifying a credible alternative is harder. The task fell to the DA’s newly appointed federal policy head, Gwen Ngwenya, a former Institute of Race Relations policy wonk.

Her reported preference for disadvantage — rather than race-targeted interventions — has apparently generated controversy in the party. A statement on Monday from Ngwenya and DA federal chair James Selfe quoted DA leader Mmusi Maimane: “We need … to move away from race-based policies that enable elite enrichment, towards policies that fundamentally break down the system of deprivation.”

But, beyond untested disadvantage-targeting, the policy proposals so far on offer have been limited to a national contributory pension scheme, a “black tax” credit for people supporting adult dependants, and employee share ownership programmes. The DA’s ideological opponents in the SACP have also been rethinking BEE. Recent issues of African Communist, the SACP’s forum for ostensibly Marxist-Leninist ideas, have dwelt on the limitations of BEE policy.

The SACP describes the Mandela and Mbeki presidencies as the “first phase of postapartheid primitive accumulation”, intended to “normalise” or “deracialise” the existing capitalist system.

The creation of a black “patriotic bourgeoisie” was to be accomplished by early BEE policies that used state regulatory power to extract encumbered (debt-financed) shares from businesses. This all formed part of an implicit deal between business and the ANC leadership, in which one side got investor-friendly policies and the other secured politically mediated access to economic opportunities. The SACP likes to describe black businesspeople involved in this trade-off as a “comprador bourgeoisie”.

The Party, as much as the DA, now recoils at the resources poured into such empowerment partnerships. A second process that also began under Mbeki was “petty-bourgeois primitive accumulation”, organised around state procurement.

Low-end political entrepreneurs made money from deals with municipalities and provinces, and then invested their gains back into party elections to secure further deals.

The SACP describes the black business people involved as a “parasitic bourgeoisie”. This does not seem to be a commendatory appellation. Under Jacob Zuma, patriotic and petty bourgeois accumulation continued, as new public sector procurement regulations, designed to support black-owned smaller businesses, in reality further empowered politically connected entrepreneurs.

Despite the vast ideological gulf that separates the DA and the SACP, there is a remarkable congruence in interpretation of the failings of ANC policy. Both parties condemn the milking of public resources by a parasitical business class. Communists and liberals alike are deeply sceptical that “elite enrichment”, or the building of a “comprador bourgeoisie”, are sustainable objectives. And there is concern that current policy frameworks have significantly worsened unemployment and poverty.

So the DA is not alone in its scepticism about BEE. But nor is it alone in its failure to advance a credible alternative vision.

• Butler teaches public policy at the University of Cape Town.