The Poverty of Commentary: This article was written on December 11 2015, before President Jacob Zuma’s dramatic climb down on Sunday night, with the announcement that Pravin Gordhan would be restored as Finance Minister. Zuma’s flipflop was mirrored by much of the commentariat who shifted seamlessly from declaring that the president had solidified his absolute hold on power to celebrating his revealed weakness, with no mea culpa for the blatant inconsistency. These latest developments probably bear out the caution sounded in the article above – that last week Wednesday’s events could be read in many ways and just as likely reflect Zuma’s weakness as his strength. The unprecedented backtracking would suggest the former. On the other hand it may vindicate something else that was mooted – that any attempt to frame his actions in terms of strategic considerations may be hopeless from the start. The man seems to have lost his way.
The choice of Gordhan is revealing. Zuma reportedly came under intense pressure from all sectors, from business and foreign ambassadors to the nominal left in the Tri-partite Alliance. Not all lobbyists in the ruling party are equal, however. Gordhan is the business candidate par excellence – as shown in the dramatic surge in bank equity prices on Monday morning. Its not likely he would have been Zuma’s first choice either – some think that his exile to the department of co-operative governance and efforts to implicate him in the scandals afflicting SARS are punishment for crossing Zuma in similar ways to those that had Nene axed in the first place.
I think we may all have something to celebrate in Zuma’s defeat – if he had been unreversed it may have meant the consolidation of a personal machinery of power that would have spelled the end for common democratic institutions which are already on their last legs. But the power that repulsed him did not advance working class interests, and Gordhan’s resurrection will not arrest the crisis. The Left will have nothing to win if we pick a common front with austerity against parasitism.
In what many think to be his most outrageous move yet, President Jacob Zuma has replaced the country’s well regarded finance minister Nhlanhla Nene, with an unknown yes man. There seems little reason to doubt what almost everyone agrees is his immediate motivation: the outgoing Nene had drawn a line in front of flagrant looting of the national airliner, South African Aitrways, by a close Zuma ally, its chief executive, Dudu Myeni, and thrown fiscal water on trillion dollar plans for nuclear power plants built by Russia that were likely to be riddled with corruption.
Bold and utterly conspicuous venality is hardly alien to Zuma’s tenure, but this time the effects are bigger. His promotion and protection of cronies has put the macroeconomic stability of the country in jeopardy according to a popular perception. Markets and business groups, predictably, reacted with horror and the rand nosedived after the late night announcement on December 9.
These developments certainly represent a new terrain in the complex power struggles conflicting a party enmeshed with the state. Zuma’s previous efforts to exert his personal control of relatively autonomous state bodies had centred on the judiciary and the security cluster. With last Wednesday’s “redeployment” he is opening a confrontation with an altogether different sphere of power, crossing a line that no democratic administration has yet tampered with.
The national treasury, it is well known, represents the lynchpin in the accord between capital and the incoming ANC government which gave form to the post-apartheid dispensation. Along with an independent central bank its positioning at one remove from ordinary government protocols was intended to insulate economic management from political oversight and ensure that it fit with the narrow degrees of freedom allowed by international financial markets.
By design, therefore, the treasury grew up differently to other ministries. It cultivated its own very powerful internal culture, appointments were primarily grown within its own ranks and not subjected to ‘cadre-deployment’ of other areas of government. It forged close links with international financial institution and foreign economic departments – imbricating into the powerful networks that manage the shadowy system of international finance.
Within government it plays a sort of supra-ministerial role- confining and guiding the activities of other sectors through its control over the purse strings. The policy papers of its highly trained staff carry serious weight – as we’ve seen in its effective re-authorship of the National Development Plan. In this South Africa has followed a familiar model, implemented around the world to ensure that hard-nosed, technocratic methods guard economic policy from the pressures of “populism”.
In reality of course the “independence” is always one-sided – limiting access to economic policy from labour or social movements whilst ensuring that treasury responds quickly to the prerogatives of business as transmitted through ‘market signals’ or directly through close personal relationships.
The treasury has thus been the guarantor, for capital, that government’s involvement in ownership and redistribution would remain constrained, and that macroeconomic balances vital for the smooth accumulation of capital and its free movement would remain intact. Even as other parts of the liberal order some under serious fire, as long as the treasury remained strong and independent, capital may sleep soundly at night.
The personal affliction of business leaders for Nene’s dismissal is therefore predictable. Yet, it is difficult to understand why so many progressives have inflated their outrage with hagiographies of Nene’s competence and ability. Perhaps these absolute minimum standards are the new normal – but we seem quick to forget that technocratic good sense has always provided the cover for class-biased economic policies that have been disastrous for South Africa’s poor.
Lets not forget that the credit ratings agencies, on which middle class South Africa seems to hang its self-image, issued their downgrade before Nene’s axing. We shouldn’t pretend that Zuma’s obstinacy created an economic crisis where none previously existed.
It will certainly help to accelerate it – capital outflows last month reached record levels and Nene’s departure will add some wind to their sails.
But the disaster was already here before he left and it was, in truth, a consummate outcome of the treasury’s own failed policies over the last 20 years. Yes, those same policies, feted in the halls of the International Monetary Fund and Washington for delivering “macroeconomic stability”, which actually imposed all the costs of supposed stability on South Africa’s poor through tight budgets, whilst opening the economy to the wild vicissitudes of short-term investors, in whose lethally fickle embrace we are now trapped.
Nene was a creature cut from the treasury’s own true cloth – honest and competent enough and willing to toe the line with brutal austerity, including vicious cuts in social grants – in the name of a contented faith that the market will eventually reward our “prudence”. He had a tough job no doubt, holding down the treasury corner in an increasingly fractious political climate – but one, for which we can be certain, the private sector will offer just rewards once Nene is out of government. .
Anyone who thinks the crisis in SA involves something more than Zuma’s misbehaviour should have little to mourn with Nene’s departure, which is not to say that we have anything to celebrate in his replacement. The political marionette which Zuma dumped in his seat for four days was not put there to replace austerity with the Peoples Budget demanded by various civil society groups – but to lubricate the channels of private profit.
What we cannot say at this stage is that this latest affront represents Zuma’s “now complete capture of the state” as one commentator put it. For now, we simply do not know the exact composite of forces which pushed him into so drastic a move or how the outcomes will impact power balances.
Unless the delusions and alienation of power have totally cut his link with reality he should certainly understand just how drastic a step this was and what its immediate effects are likely to be. Now its certainly possible to interpret events, in this light, as a sign of Zuma’s absolute dominance over the conduits of power within the state – a demonstration of his complete impunity and a warning to possible contenders.
On the hand it seems equally possible that his hand was forced from a position of weakness, not of strength.
At this stage we should be reminded that, however odious, what Zuma did on Wednesday did not reveal some new extension of his authority over a domain from which it was previously absent – what he did was simply a prerogative of the power which he already possessed, for better or for worse (definitely worse), as president. These events, in other words, do not by themselves tell us whether Zuma was any more or less powerful than he was a week or a month ago.
From all reports it was a decision taken with little or no consultation – which Zuma must have known would rankle key Tripartite Alliance structures and some allies. Again, unless his long-honed political acumen has been completely impaired, he must also have been aware that this is likely to add to the mounting complications that ANC cadres face in selling ANC policy to an angry and disaffected base.
He must have been aware, in other words, that such a drastic step probably involves a notable trade-off – a rebalancing and narrowing of his power base from broad appeal to his own patronage networks – a trend which we can visibly perceive in Zuma’s trajectory over the last decade.
Ultimately that does not seem like a sensible long-term strategy, whatever the parlous state of democracy within the ANC and whatever the dominance of a middle-class who respond more to personal reward than political principle – the organisation still has a mass base that possesses, at least, the potential to decide the power plays of its factional elite (as Zuma’s own rise to power, albeit a long time ago, should remind us). Popularity with the rank and file, and hence electoral security – may still underpin the ability to dispense the benefits of office.
Zuma’s actions are also likely to generate tensions within the different sections of the ANC’s upper echelon – notably between groups whose social position derives from different relationships to the state-capital nexus. On one side are those for whom direct access to state resources and authority, at national and local level, has been the basis for accumulation and for forcing open the avenues for profit in the closed world of white dominated business.
On the other, more sparse but more lucrative, is a group whose path to privilege was granted by the existing business community itself, for whom boards and directorships were opened consensually in the name of “transformation”. This group now moves freely in the clubs of South Africa’s corporate elite – its draws from the same pool of obscene profits produced by an apartheid economic structure married to financial globalisation.
Naturally, along with a taste for golf, the latter has imbibed the same political outlook that informs “monopoly capital” – the wisdom of an economic cluster free from democratic influence and the absolute deference to market ‘fundamentals’ as a route to growth.
Nene’s dismissal could well be, in other words, a shot-fired in an impending clash between the Cyril Ramaphosa and Zuma/ Nkosazana Dlamini-Zuma factions. In taking on the treasury, Zuma may have opened a new front in this battle.
The craven defence of corrupt allies may reflect desperation – the need to stitch up personal support through ever more brazen gifts at the great expense of public image and economic instability that may weaken Zuma’s ultimate bases of power. It may tip the balance of forces at the ANC’s grassroots and rally those elements in the party who still have a strong stake in the old accord which sets strict limits on the ANC’s actual command of economic policy.
Or it may represent Zuma’s growing confidence in his own network of control, a message that his power extends everywhere and that the privilege in the ‘state-party machine’ (to use Roger Southall’s term) is at his discretion and only guaranteed by absolute fidelity to his personal will. It may represent not simply Zuma’s own power, but that of the so-called Premier League whose fingerprints are all over this incident.
At this stage we can only really speculate. Perhaps such attempts to impute a strategic calculus to Zuma are misconceived entirely in an internal ANC environment ruled by cut-throat factions and outright greed. The picture of ANC currents sketched above is a caricatured one – for now we can’t see that such clearly delineated groups exist or that they will coalesce around opposing platforms with real differences in policy and strategy.
But the broader point is that as long as the crisis in South Africa persists, and persist it will, the state elite will be drawn to ever more brazen acts as its public support weakens and economic resources contract – subjecting the ANC to ever stronger centrifugal forces.
Corporate elites, treasury officials and “white Twitter” will be rooting for a Ramaphosa victory in 2017. Perhaps his accession would put a slight cap on open looting of state assets and restore some temporary favour from markets.
But, Ramaphosa, the “Butcher of Marikana” and a restored treasury offer no real way out of the current impasse – an entrenched social crisis which is the product, ultimately, of the economic framework of which they were key sponsors.
Those hoping for a radical new alternative do need to monitor inter-elite conflicts closely for they will shape the power dynamics of the unfolding crises, but we shouldn’t be led into camp-ism. Our outrage at Zuma’s Mafia-sation of the state should be matched by our denunciation of capital’s institutionalised power and its violent effects.