Closer to the brink of a new political realignment - News24

16 July 2021 - In May of 1976, the chairperson of the West Rand Administration Board, which had taken over the administration of Soweto three years earlier, told the Rand Daily Mail that "the broad masses of Soweto are perfectly content, perfectly happy". In June of that year, Soweto erupted.

Frans Cronje
In May of 1976, the chairperson of the West Rand Administration Board, which had taken over the administration of Soweto three years earlier, told the Rand Daily Mail that "the broad masses of Soweto are perfectly content, perfectly happy". In June of that year, Soweto erupted.

On 16 June this year, President Cyril Ramaphosa told an event marking that occasion that "on this day 45 years ago, brave young women and men… came out in their numbers… and lit a fire of resistance that the racist government of Pretoria would not be able to extinguish, no matter how hard they tried". 

His remarks acknowledged the harsh present economic conditions and specifically the youth unemployment rate, and he said that his government had adopted "a range of priority actions to boost youth employment", that it was "putting young people at the centre of our national recovery", and that it "will build on all of these successes". 

His words reflected a fine sentiment and would have been fitting in the immediate aftermath of his defeat of Jacob Zuma at Nasrec. But three years have come and gone, and fine words are no longer adequate to hold back the chain of events that we have long predicted.  

It could have been very different. 

A good run 

The ANC in government had a good run from 1994 to December of 2007. The party inherited the economic wreckage of the latter two decades of apartheid, after the high growth rates of the 1950s and 1960s had stumbled into the political instability of the 1970s and 1980s, before that system collapsed under the weight of its primary contradiction; a once expanding economy that sought to deny its people full participation therein. 

The events of 1976 culminated in the 1985 decision of American bank Chase Manhattan to call in South Africa's loans, whereafter, formally bankrupt and politically adrift, the country waited for an external inflection point – which came in the collapse of the Berlin Wall – to sling it into a new political order.  

The ANC, and Thabo Mbeki who was personally central to shaping that new order, never received due credit for what happened next. At odds with the mainstream narrative of failed service delivery and jobless growth, conditions within the country improved markedly between 1994 and 2007. 

We have often cited the fact that through those years, the proportion of households with access to water, electricity, and other services rose sharply, progress borne out best in the fact that through much of that era ten formal houses were being built in South Africa for every newly erected shack. Jobless growth was a myth – the number of people with jobs roughly doubled between 1994 and 2007. All of that was made possible as the rate of economic growth rose to average 5% between 2004 and 2007, which was the first time that number had been sustained for four consecutive years since the 1960s. 

Perhaps most impressive of all is that it took just 13 years for the ANC to cut apartheid-era debt levels in half and turn the deep budget deficits of the 1990s into a budget surplus. At the same time, and what is most extraordinary, rolling out what would become the most substantive welfare programme of any emerging market. 

The political and social consequences were greatly interesting to us, and saw popular confidence in the future of the country rising while levels of protest action abated. Most striking is that in the election of 2004, as the recovery was really picking up speed, the ANC recorded a result of seven percentage points stronger than when Mr Mandela had led it to victory in 1994.    

But none of this was to last. 

End of post-1994 recovery

Mbeki's departure as ANC leader in 2007 saw the party jettison its relative economic policy pragmatism while, separately, democratic institutions were being eroded. When both phenomena later coincided with the global financial crisis of 2008, South Africa's post-1994 recovery was over.  

In the aftermath of the financial crisis we saw a spectrum of living-standard markers plateau, while some even began to deteriorate (such as that for the proportion of people living in a shack). Job growth stagnated to such an extent that, by the middle of last year, there were fewer people employed in South Africa than when Mbeki left office, a predicament exacerbated by a slowing social grants rollout, and that the value of those grants had increased at levels below the rate of inflation as experienced in poor communities.   

Stagnating living standards delivered the inverse of the political and social patterns we had seen in the first democratic decade. Polls suggest that confidence in the country's future collapsed under Zuma, rallied around the victory of Cyril Ramaphosa, and slumped again as reform efforts spluttered. Protest levels increased sharply to reach their present immeasurable extent.

By 2019, when the spluttering reform efforts were already apparent, the ANC saw its electoral support level come in twelve percentage points below the zenith to when Mbeki had led it. Since then, we read polls to show that support for the ANC has fallen to below 50% among people aged 15-50, who will be the bulk of the voting bloc of the next decade, and on demographic trends alone. Therefore, the political endgame writes itself.  

Lack of reform

We remain prominent sceptics of Ramaphosa's reform credentials, while his government is in any event incapable of accepting, let alone implementing, the profound and sweeping reform plan that would be necessary to see the ANC replicate its earlier successes. Instead, as happened to those of the 1970s and 1980s, we see the present administration trapped in a fundamental contradiction; this time, between the need to grow the economy, while at the same time affording considerable prominence to policies of expropriation and race-based edicts that serve as a brake on investment. 

This week's events are an inevitable and expected result of that contradiction and has brought South Africa closer to the brink of a new political realignment. If that is right, then we will come to read the events of this week as one of the more prominent markers of "a fire of resistance that the government of Pretoria was not able to extinguish". 

While what lies ahead will be unpleasant at times, there is a case to be made that you need not be unduly afraid. Our country remains a free and open society. We must never forget that we achieved that so that, if we ever reach the point, as we have now, where the country is not well governed to the advantage of the majority of its people, and is distant, citizens might remove it from power. 

My firm advice, unchanged since it first appeared in print in 2014, is that the ANC in its present guise may not see out the 2020s as South Africa's governing party, and that it is poised now to lose the election of either 2024 or 2029 – likely following a global inflection point of equivalent importance to the collapse of the Soviet Union, and which I think will come via a global economic contraction.

Thereafter under a new administration, and with the world also rebuilding, South Africa would have a reasonable prospect of resuming the economic and social trajectory it was last on in the decade after 1994. 

Dr Frans Cronje is the outgoing CEO of the IRR and directs the Centre for Risk Analysis.

https://www.news24.com/news24/opinions/fridaybriefing/frans-cronje-closer-to-the-brink-of-a-new-political-realignment-20210715

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