Globalization Made Them Do It

The market has neutered South Africa's ANC government more effectively than apartheid did.

Tompaine.com, August 2002

Remember when apartheid in South Africa ended? Remember when Nelson Mandela walked out of jail and into the presidential palace? We thought the people of South Africa had been liberated. We thought that their lives could only get better. We were wrong.

Globalisation - the process of extending the American version of consumer capitalism to every nation on Earth - is destroying the lives of South Africa's poorest people as effectively as apartheid ever did. Globalisation, pushed by some of the biggest and most powerful private corporations in history, is placing the pursuit of trade, profits and economic growth before poverty alleviation, environmental protection and the pursuit of social justice.

When the African National Congress (ANC) took power in 1994, it promised to take action to right the wrongs of apartheid. Those wrongs were deeply ingrained. The top 5 percent of the population - all white - consumed more than the bottom 85 percent, and income inequality in the country was up there with Brazil and Nigeria as the worst in the world. A rich, white elite controlled most of the land, the capital and the economy, more than half of the country's black citizens lived in dire poverty, and less than a third of them had access to basic services. The ANC had a tough job on its hands.

It initially chose to tackle this job through something called the Reconstruction and Development Program, or RDP. It was a government-led program to rebuild a shattered nation, and its "first priority [was] to begin to meet the basic needs of people - jobs, land, housing, water, electricity, telecommunications, transport." The list went on. This was to be achieved through programmes to redistribute land to the landless, build a million new homes and provide free basic services to all. It was unequivocal stuff. It was also short-lived.

By 1996, the RDP was dead, most of its targets unmet, the ministry set up to oversee it closed down. In its place came a new economic plan - the Growth Employment and Redistribution program - or GEAR. GEAR was drawn up by 15 economists, two of them from the World Bank, the others were from various African banks, the Reserve Bank of South Africa, neoliberal think tanks and corporations. Only one economist had any footing in the South African Democratic movement, and only one was black.

The World Bank, the IMF and the U.S. government - the three pillars of the 'Washington consensus' upon which the ideology of globalisation rests - were very pleased with the strategies of this new economic plan. GEAR represented a swift and brutal change of direction for the ANC - a change that most of its citizens are still coming to terms with. The government, which had come to power with such grand ideas about reconstructing its dazed nation had, after just two years, effectively given up. GEAR was the ANC's white flag: from now on, the markets would decide the fate of South Africa's people.

Where the RDP had promised basic services for all, GEAR promised public-private sector partnerships based on cost recovery. Translated, this meant the privatisation of utilities and increased water, electricity and rent bills for some of the poorest South Africans. Where the RDP set targets for reducing unemployment, GEAR called for "greater labour market flexibility." And where the RDP made a great show of highlighting the systematically enforced racial divisions in the economy, and the system's structural inequalities, GEAR talked about "economic stability," "cost recovery," "sound fiscal policy," "foreign direct investment" and "strong export performance".

The results on the ground are now making themselves clear. Patrick Bond, a Johannesburg academic, was involved in drawing up the original RDP and is now a firm opponent of GEAR. The author of several books on what he calls the country's "elite transition" from apartheid to neoliberalism, Bond said he believes, like many other South Africans, that GEAR is "a capitulation to the markets … a very one-sided Faustian pact."

According to Bond, almost a million jobs have been lost to GEAR. South Africa's unemployment rate is now conservatively estimated at 25 percent - and may be as high as 40 percent. Twenty-two million South Africans, out of a population of 42 million, still live in absolute poverty, according to widely reported estimates.

Recent research showed that GEAR has led to 10 million South Africans having their water cut off, 10 million having their electricity cut off, and 2 million being evicted from their homes - all for non-payment of bills which, in a country in which half the population gets by on around $2 a day, they simply cannot pay.

But the struggle that South Africans employed so effectively against the evil of apartheid is now being rallied against the neo-liberal policies of the new, centre-right ANC. In the former townships, resistance to what is increasingly being called the ANC's 'sell-out' is gathering pace.
In Soweto, the vast Johannesburg township that was the cradle of resistance to apartheid, community groups opposing the ANC's policies - and their effects on the people there - are growing in number.

Trevor Ngwane, a former ANC councillor for Soweto, was expelled from the party for opposing its privatisation plans. He, and others, set up the Johannesburg Anti-Privatisation Forum in response and are now touring the country drumming up support for their resistance.

"The ANC are worried about us," Ngwane told me when I visited South Africa last November. "There is no doubt in my mind. More and more people are no longer listening to them. We are speaking out against this privatisation."

Privatisation of basic services is the key to this new battle. The World Bank and IMF demand privatisation wherever they go. It is the key to corporate control and corporate profits, and is a major plank of ANC policy, according to government documents that outline the GEAR program.

The World Bank says that the South African government should recover its costs for services such as water and electricity. This means that bills go up, and in places like Soweto - which has 70 percent unemployment - people simply cannot pay. The result: services are cut. The Sowetans' response: they reconnect them.

This, Dudu Mphenyeke said, is the latest form of resistance in Soweto. Mphenyeke is one of the founders of the Soweto Electricity Crisis Committee, a group of 5,000 Soweto residents who rebelled against the electricity company, Eskom, and its move to cut off supplies to the poorest people in the name of the free market. They have trained a group of illegal 'reconnectors' who roam Soweto reconnecting the electricity of people who have been cut off. It is a desperate measure, says Dudu, but a necessary one, for the government, egged on by the markets and the powerful corporate lobby, simply doesn't listen.

Mphenyeke said that life in Soweto has not improved in the post-apartheid era. "The government is making things easier for business people and making it more difficult for workers. We don't have freedom yet in South Africa, and we feel deceived."

This is a feeling that is growing all over the country. Anti-Privatisation Forums and groups of illegal reconnectors are spreading to every township in the nation. The Congress of South African Trade Unions has called for a general strike in October to protest against the government's privatisation plans. Marches, rallies and protests against everything from the World Trade Organisation to retrenchment are now almost a weekly occurrence. They will step up a notch when the delegates to Earth Summit 2 begin arriving in town for the start of the summit on August 26. Activists plan to rally to protest the corporate takeover of both the UN and their own government.

All this worries the ANC. But the party believes it has no choice. Globalisation, they say, made them do it. I asked Michael Sachs, the party's head of policy and research, why the ANC was following the Washington line, despite the suffering such policies were causing.

"We achieved democracy in 1994, and immediately had to confront the issue of globalisation," he said. "We see ourselves as being in government to deliver a national democratic revolution, but no revolutionary movement has ever taken power in such unfavourable global conditions - such an unbridled victory for finance capitalism, such a unipolar world, with the U.S. at its head.

"You can't just go and redistribute things in this era. You've got to play the game. You've got to ensure you don't go on some adventure -- you know, you will be defeated. They were defeated in Chile. They were defeated in Nicaragua.... You can't do it now."

Rarely have I heard such a stark admission of governmental powerlessness in the face of the global markets. Whether the ANC is being realistic or cowardly is a moot point, but one certainty is that the U.S. government, and the markets, love them for it either way. So much so that President George W. Bush, along with British Prime Minister Tony Blair and other Western leaders, recently lined up to promote South African President Thabo Mbeki's New Economic Partnership for African Development - NEPAD - a continent-wide development plan, which many South Africans are calling "GEAR for Africa."

The once-radical ANC is now toeing the free-market line. If it continues to do so, as Sachs conceded is likely, the South African government will keep getting pats on the back from President Bush and his corporate buddies. But what it gets from its own people may be something entirely different.