Business 21.9.2016 12:44 pm

What the ANC needs to do to survive

An ANC supporter hold's the party's flag. File photo. 
Image: STRINGER Reuters

An ANC supporter hold's the party's flag. File photo. Image: STRINGER Reuters

The Institute of Race Relations has analysed the three factions in the ruling party and the prospects each of them has in years to come.

This is the third article in a four-part series penned by the Institute of Race Relation’s Dr Frans Cronje. Two scenarios are sketched, one which Cronje believes will emerge within the next 12 to 24 months

The current forces, following the recent municipal elections suggest an environment primed for a high degree of change.

From an analyst perspective it seems foolish for the ANC in government not to appreciate that its political mandate rested in large part on its economic performance. In sacrificing that performance in pursuit of ideological goals, the ANC created rising new demand for a political alternative.

The absence of an obvious political rival to the ANC started to matter a great deal and the implication of the destruction of its former black rivals therefore took on a new degree of importance.

What is the newly emerging political alternative to the ANC? From which political quarter may the ANC now face defeat?

Before we get there, must the ANC now necessarily face defeat? Has it passed the point of no political return?

Economic reformation

Our view is that the only way for the ruling party’s national majority to survive another decade in power is to pull off an economic reformation. It will have to introduce policy reforms sufficient to draw massive amounts of new capital investment into the economy, in order to raise growth rates to levels sustainably approaching 5% of GDP. At home, many South African analysts and economists are sceptical that this can be done. Their scepticism is well founded in that the economic crisis facing South Africa is a self-made crisis, crafted in the cabinet, and in the face of well-argued criticism and advice that the “developmental state” policy framework adopted by the government after 2007 could have but one set of consequences. Now that these consequences are in evidence, there is still no concerted effort on the part of the cabinet to change policy direction.

In fact, a number of ministers are continuing to push for interventions that will harm sectors ranging from education to healthcare, security, mining, agriculture, tourism, high-tech services, banking and financial services, and manufacturing. Or take the example of a recent proposal by the ANC itself, following a series of meetings to assess its poor electoral performance, that the government move quickly to introduce a new national minimum wage.

The ANC is losing support because of low growth and high unemployment and part of its response is to raise wage levels.

How is this possible, we are often asked by outside observers? Why does a country with such obvious potential continue to promote policies that are so harmful to its economy and the prosperity of its people?

Much of the answer emerges in appreciating the factionalised structure or nature of the ruling party. Reality is never so neat and tidy but an analysis of South Africa today is greatly aided by conceiving of its ruling political class (whether in party politics or the government itself) as being split into three groups.

Ruling political class split into three groups

The first group are the communists and the left. They emerged out of the trade union movement, the communist party, and various bits of academia and civil society; their star rose in the aftermath of the political changes that took place at the ruling party conference in December of 2007. They have sought to force a dated, and long discredited, form of ideological policy dogma onto the country. This is one that resents private enterprise, regards western countries as outposts of colonial aggression, denounces “CIA inspired” plots to stir revolution, and prioritises state-led wealth redistribution over investment-led economic growth. It is their pursuit of ideology that created the economic circumstances that in turn set in motion the now growing political opposition to the ANC.

The second group are the traditionalists. They come out of the more rural and ethnically homogenous strongholds of the ruling party. Strong believers in the importance of traditional leadership structures, they regard western forms of liberal democracy as an unnecessary and colonial extravagance. They are largely out of touch with the aspirations of younger South Africans. When an artist painted a portrait, later displayed in a prominent gallery, of the president in a strident Lenin pose but with his private parts exposed, this group were apoplectic in their rage at the disrespect displayed to the country’s leader. This group is quite authoritarian, often frighteningly corrupt, and has little understanding of economics. In many respects they represent the bombastic “big-man” style politics that so many African countries have suffered through.

For the past six or seven years these two camps have got on fairly well.

On a number of areas of policy, the communists have found it easy to take advantage of the policy and economic naiveté, as well as the greed, of the traditionalists and have essentially duped (deceived would be just as good a word) them into endorsing policies that have done much harm to South Africa’s economy. It is difficult, I am sure, to grasp just what a hold the traditionalist camp has over South Africa’s politics.

Together the leftist and traditionalist camps have held the balance of power in the government for the past six or seven years. However, as growth has reduced and deficits have increased, together with rising popular dissatisfaction with the ruling party, the traditionalists seem to be losing confidence in the advice they have been receiving from their leftist comrades.

The traditionalists do not hold firm ideological views. Their politics is about power and patronage. Protests and anti-government activism frighten them – and increasingly they blame the leftists for the economic crisis that now threatens their political mandate and therefore the fiefdoms of patronage they worked so hard to craft. This is a most important development.

The leftists, worried at losing their political influence, do not have much room to manoeuvre. They have overplayed the political hand they were dealt in 2007 and, in creating the circumstances that have brought about a decline in support for the ANC, are now in a very vulnerable political position.

This presents an opportunity for the third faction of the ANC – the modernists. The comfortable relations between the leftists and the traditionalists have been exasperating for the modernists or reformists in the ruling party. This modernist camp is made up of a new class of successful black entrepreneurs, the emerging urban black middle class, and a cross-section of older party stalwarts who, despite being raised and schooled in Marxism, are beginning to understand that policy reform will be necessary to secure the future of what they see as Africa’s grandest liberation movement.

This faction is often overlooked in analyses of South Africa. Some argue that no such group exists, or that it has been swallowed up by the arrogance and corruption of the party. We believe that this is selling the ANC short.

If the modernist factions of the ruling party can eject the leftists and form a new balance of power with the traditionalists, then a new range of reformist scenarios are open to South Africa. This new camp will be neither democrats nor leftist ideologues. Coinciding with a commodity comeback and stable global economic conditions, this camp could conceivably secure the economic turnaround that the ruling party would need in order to head off what will otherwise be a future electoral defeat.

Keep in mind the two opening points on which this analysis rests. First, that the ANC is not a fundamentally democratic movement and retains a capacity for extreme ruthlessness. Second, that it once showed a propensity for sound economics. If those two points remain correct, this opens the way to an alliance between the traditionalists and the modernists and it is this that we term the “rise of the new right” in South Africa’s politics.

Brought to you by Moneyweb

today in print