The London School of Economics Deborah James examines the effects of the world-wide credit crunch on ordinary South Africans in her new book, Money From Nothing: Indebtedness and Aspiration in South Africa. In this excerpt, James explores the aspirational motivation behind personal debt accumulation among Soweto residents.

Critical accounts of consumption [were prompted during] a period in the mid- to late-1990s, well before the worldwide credit crunch. At this time there was a sense that too much credit had been offered, too freely, by South African financial institutions. Frank Pule, a Sowetan, points out that South African firms were “throwing credit” at people. “When we bought our house, we then qualified for R500,000,” he tells me. But he and his wife decided to buy a house which cost only R130,000. The bank insisted “here is R500,000, it’s up to you how you use it.” Ours is that we want it paid back. But you have a credit of R300,000—if you want to buy a car, a house, this and that, or if you want to go on holiday, or go to the World Cup—they will give it to you.

While acknowledging the very real sense of pressure—both from friends and acquaintances and from financial institutions—which these examples suggest, one should be careful about accepting stereotypes too readily. Informants in Sunview decry in abstract terms the problems of excessive consumerism. But … they talk of the need to practice prudent financial acumen in particular cases. If they have taken out personal loans, these are often to pay for their own or their children’s education rather than because of yielding to the pressures of “competition” over possession of sofas or shoes with brand names. “The quest for things” observes Posel “can be an expression of care and support for others, as much as a crass self-absorption” (2010:162): one might add that the quest for ready money may be driven by care and obligation rather than being driven, simply, by the wish for “things.” This is where credit, in many cases, has played its part in enabling the upward trajectory of the new middle class.

The case of Soweto resident Mrs Ngunyula is a good example. She, like her husband, is a waged employee of the transport corporation Transnet, a parastatal. They have two children of schoolgoing age and one who is studying at university. She speaks with frustration of the way she has been bombarded with offers of store cards, insurance deals and “free” airtime by a variety of companies. But she has not proved easy prey. Although she often feels uncertain about her consumer rights, and especially ignorant of how to take action to uphold these in the face of bombardment by advertisers, she is aware—and critical—of the dangers of rampant consumerism and of getting into debt in order to participate in it:

“At my work place, there are people who have wallets full of cards—Foschini, Truworths— and it is a problem when the end of the month comes. People are mad. People must wait for credit, take it and get it again. They only earn R3,000 a month. Go to Truworths, they wear nice clothes, fashions … now, it is summer, there are winter sales. You will be buying things for R3,000. After, when you look at it, there will be summer sales. One person in Truworths has R5,000 credit, at Foschini another R3,000. When they count, they will owe R50,000. When it comes to groceries, it is the 15th, 16th, they will have no money.”

She has observed people’s readiness—here expressed as “I” but meant by way of an abstract example—to buy even small everyday items of foodstuff on credit: “I need peanut butter. I will go to Shoprite, and swipe the card, even for bread.”Such items, she insists, ought only be bought for cash, even if this means abstemiousness:

“If we have no bread, I tell the children they’ll have to eat soft porridge and morogo (wild spinach), I have no money for bread until I get paid. But if I have a credit card I will go and get the littlest thing, and swipe it. I see a lot of women, they are crazy … they must pay this, pay that. The shops will phone you, “ma’am, you know that you must come and pay us R850. You owe it, you did not pay last month.”

In contrast to this all-too-ready commodity consumption which she condemns among her peers, Mrs Ngunyula has chosen to pursue a prudent strategy of investing in the education of her children above all else, despite slights from her neighbours and acquaintances.

“My first priority is that ‘you must go to school. I want to be proud of you.’ They criticise me for what I wear. But when I have given you something I feel better … Some at my workplace have shoes for R1,000, but their children don’t even have shoes. I want to be proud of my children. I try by all means to pay the little money I can.”

But even such priorities, she notes, can carry the danger of landing one in debt. At one point, keen to help educate the children, she was persuaded by a salesman to buy a series of school mathematics guides on hire purchase. After almost completing their instalments, the debit orders mysteriously ceased, only to recommence some years later:

“We paid until there was only R800 to pay. Then they no longer took installments. … after about 4 or 5 years, people came, saying ‘you owe the company for the book.’ We said, ‘yes, but we have not heard about you, what you were doing, what was going on?’ In our pay slip at the bank … they dropped it, for 4 years, we don’t know why. When he came back, it said we owe again R5,000.”

There is clear evidence here of level-headed opposition to the whirlwind of attractive branded items and to the pressures to buy this flood of capitalist offerings. The juxtaposition between a desire to participate and a resistance to “giving in” is reminiscent of the ambivalent feelings experienced by sub-prime mortgage borrowers in the US. But even the more far-sighted expenditures—on school or university fees or educational books—have the very real potential to get people into trouble, especially when combined with illicit ways of recouping payments. In their attempts to meet these obligations, they are often forced into further indebtedness at the hands of moneylenders.

Elsewhere on the social spectrum one can see the same paradoxical combination. Profligacy is acknowledged, but is disavowed in particular cases. Statements of this kind are made not only by members of lower-middle class waged families in the township, like Mrs Ngunyula, but also by those in the class of more rapidly upwardly mobile people now living in the suburbs: that is, members of the new middle class in the more commonly understood sense of the word. People recently employed in high-ranking positions in government departments, like Abigail Mlate, speak to me disparagingly of the bad borrowing habits of their peers, and of how these peers put pressure on them. She withstands these pressures, for the most part. But she admits to having an inconstant response. The time disconnect evident in the “buy now, pay later” ethos features in her remarks:

“[I]t depends on my mind-set whether I give in … You find yourself really wanting to … keep up with the Joneses. So you find yourself going for expensive things, furniture, because, when they visit me, I want them to see these couches … So you start using your credit card, and at the end of the day it is to your detriment. Because they come and see those couches, and it’s only at that point in time they will say ‘it’s nice’ and then forget about it—and you are the one that’s left with the debt … Giving in is just not on.”

In a later conversation, her friend Geoff Matlatsi, also a government employee, tells me about the skewed value system that has led his cousins to spend huge amounts on prestige items like expensive cars while continuing to live crammed together in cramped township houses. They in turn mock him for continuing to drive an old Toyota rather than buying a Mercedes. Despite his relatively well paid and important position, he prefers, he says, a more modest style of living. He chooses to invest in the building of a house back in the rural area that he hails from, and to contribute to the education of his niece. His account counterposes a quest for “things” against “care” in a stark dichotomy, disparaging the former (Posel 2010: 162).

In similar vein, lecturer Bongile Cengimbo points to the way her neighbors in the informal settlement Orange Farm, although living in shacks, buy expensive appliances and branded clothes on credit. They too mock her for failing to spend the money she now earns on items of opulent display. Unable to accept that she prefers a simple lifestyle and is not keen on consumer goods, they ask “now you have a job, when are you going to buy a car, when are you going to buy your own house?”

She is ridiculed by her friends at university, too, for the fact that she eats simple food, associated with her rural background, like samp (maize) and chicken giblets. They protest “But you could eat whatever you like!” Why, they wonder, does she not spend time sitting around tables in cafes, eating expensive meals, as they do? For Bongile, as for Geoff, it is the obligation to help pay for relatives’ education that takes first place. Her insistence on doing so is not, or not simply, a sign that she is choosing to act out of philanthropic motives, but rather is indicative of far-sighted future orientation. There is little option but to help put her two younger sisters through college, she says, since they will likely be asking her for money later in any case. Better to help them get educated now, so that they can eventually earn their own living (see Stauffer 2010).

Main Gif by Dean Hutton


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