Dear comrades
After reading Comrade Jeremy Cronin’s public response to my address on 21 November 2014 at the ceremony to mark the 40 years of the South African Labour Bulletin on the topic “Is the labour movement at the turning point?”, I was convinced that a public debate was necessary, not just with comrade Jeremy but with the entire leadership and membership of the SACP. I am doing this not just as a General Secretary of COSATU but also as a member of the SACP.
I know I am taking a risk in that, as is fashionable in the current poisoned environment, some will choose to conveniently ignore the pertinent political and ideological issues I am raising and play the man – so yes I expect insults and questioning of my bona-fides from the usual suspects. Time has arrived however for certain uncomfortable truths be stated at this historic conjuncture.
You are all aware that COSATU, and therefore the organised section of workers, are going through the most painful period in our history – a period of divisions, factionalism and paralysis which will continue to haunt the working class for many years to come. All our best efforts to arrest these developments have so far been frustrated.
In times like this, the mature and considered council of the South African Communist Party (SACP) has generally been invaluable in helping to navigate the challenges facing the organised working class.
Therefore it is especially painful that the vanguard party of the working class, the party which is supposed to lead and unite the working class, is this time deeply involved in these divisions.
In the heat of such conflicts, rationality and sober political reflection often go out of the window. Comrades do and say things which in normal circumstances would be completely foreign to our revolutionary political culture. Labelling, rumour-mongering and character assassination become the order of the day. This is in itself a potential prelude to the unthinkable – physical conflict between the members and leaders of the working class.
Unfortunately, instead of calming the situation down, and assisting the Federation to resolve its difficulties, the Party leadership’s interventions have in many cases exacerbated the problem and added fuel to the fire. The fact that some in our ranks may have made reckless statements aimed at the Party, sometimes (but not always) in response to these interventions of the SACP, has not helped matters. We expected the SACP to rise above this but have been utterly disappointed.
Many statements have been made recently by the SACP about the crisis in COSATU by both the Polit Bureau and Central Committee, in the December 2013 African Communist and in a series of polemics in Umsebenzi Online. We have had serious disagreements with many of these, and have often been shocked by their sectarian character.
I have refrained from responding, for fear of worsening the situation. I have confined myself to focusing on explaining my approach to addressing the crisis in COSATU.
But the point has now been reached where certain matters need to be placed on record, specifically in relation to questions relating to the SACP.
I do this not only in defence of the members we represent, but also out of genuine concern that if the Party does not change course, it will increasingly discredit itself amongst organised workers, and forever lose its ability to unite and lead the working class.
I therefore outline the emerging alienation of workers from the SACP, not to attack or snipe at the Party, but as constructive criticism. This aims to assist the Party in holding up a mirror, to assist in a sober, deeply ideological reflection on how to correct the serious disjuncture which has emerged.
Often when we are engaged in a fierce political battle, our emotions and loyalty do not allow us to clearly see our role in the unfolding conflict. I therefore appeal to all concerned to step back and carefully consider the nature of the challenges COSATU is confronting, and also to understand that the SACP itself may face a crisis, if it fails to arrest some of the developments outlined below.
Going to the root of the problem
Despite the historical loyalty of many workers to the SACP, and the fact that we have been together in the trenches on a number of campaigns, questions have increasingly been asked about the direction of the Party, and whose interests it is representing.
What is at the root of these negative perceptions, which have emerged amongst many workers about the role of the Party, particularly since 1994?
All mass formations have faced fundamental political questions of how to relate to both the opportunities and challenges of the 1994 democratic breakthrough, especially the implications of direct access to, and participation in, the democratic state and all its institutions.
This political challenge was especially acute for our Alliance formations. The ANC, SACP and COSATU have all had to grapple in our own way with the organisational, political and ideological ramifications of this new reality. But it is not an exaggeration to say that the challenges of power and incumbency have had the greatest impact on the ANC and the SACP, who have been most affected, in an organisational and ideological way, by these historical developments.
It would be helpful for the Party to conduct a frank class introspection on how this proximity to the state has impacted on it over the last 20 years – organisationally, ideologically, and in terms of material interests. There is no doubt that the relationship has been complex, and gone through different phases. So we won’t attempt to conduct a detailed analysis here. That is the role of the Party itself.
But what informs the negative perceptions of workers about the role of the Party on particular issues, despite the many good things the Party has done?
It is informed by the following key issues:
• The changing impact of the Party’s relationship with the ANC and its leadership, and that of government;
• The impact of these political relationships on the SACP’s response to critical issues confronting the working class;
• The role of individual Party leaders in driving policies hostile to the working class;
• The balance between the SACP leadership’s participation in the state and political organisation and mobilisation of the working class.
• The necessary debates about the state of the NDR and whether the current trajectory can ever herald a seamless movement towards socialism as per the Party slogan – ‘Socialism is the future; build it now!’
Some would like to believe that the SACP has been able to manage its leadership role of the working class – and combine this with its relationship with the ANC and government – in a seamless and unproblematic way. However the Party’s response to key issues affecting the working class post-1994, and the emergence of some serious contradictions and anomalies, suggests that this has not been the case at all.
Part I: Underlying Policy Differences
On key issues confronting the working class post-1994, the SACP’s response has often been found wanting. If the Party has corrected this, it has usually only done so after COSATU and other progressive civil society formations have taken a clear stand, or has mobilised workers and communities on the issue.
The perception is that the Party’s failure to respond is because it is conflicted and unable to manage the balance of being a vanguard for a struggle for socialism but with many of its senior leaders also being leaders of the multi-class ANC, as well as the essentially democratic but capitalist state. This failure to manage this dynamic and at times conflictual role has at times undermined its role as a reliable ally of workers, let alone a vanguard of the working class.
Issue 1: GEAR
The best known example of this relates to the SACP’s response to the unilateral announcement of the GEAR macroeconomic framework in June 1996. It is worth quoting the SACP press statement in full:
Growth, Employment and Redistribution Macro-Economic Policy[1], 14 June 1996
“The South African Communist Party welcomes the government’s Growth, Employment and Redistribution Macro-Economic Policy. We fully back the objectives of this macro-economic strategy and note, in particular, the following key features:
“Contrary to certain attempts to use the macro-economic debate to shift government away from its electoral mandate, the strategy announced today firmly and explicitly situates itself as a framework for the RDP.
“Resisting free market dogmatism, the strategy envisages a key economic role for the public sector, including in productive investment. “On the restructuring of state assets, the strategy reaffirms and reinforces the bilateral (between government and unions) National Framework Agreement process.
“On labour markets, the new macro-economic-strategy envisages the extension of a regulated market and it introduces an innovative approach to flexibility. It rejects laisser-faire market-driven flexibility and instead calls for negotiated regional and sectoral flexibility.
“The most important contribution of the strategy is its consistent endeavour to integrate different element of policy and, in particular, it provides a clear frame work within which monetary and interest rate policy must work.
“The SACP, in the context of our tripartite alliance with the ANC and COSATU, intends to take forward discussions, elaboration and debate on this path-breaking macro-economic strategy. All the questions of detail and of implementation require ongoing scrutiny. We have every intention of making an ongoing and constructive contribution to this process.” http://www.sacp.org.za/main.php?ID=363
History will record that, on this critical issue of GEAR, which was to divide the movement for many years to come, virtually every line of this statement proved to be incorrect and problematic, and the SACP itself subsequently came to realise this fact. This is important because it raises the question as to how such a fundamental error of judgement could be made, on such a vital question for the working class.
The only explanation which makes any sense is that a decision had been made to give political cover to a policy which the ANC and SACP leadership knew at the time would be highly controversial and unacceptable to the working class.
The issuing of the statement immediately after GEAR’s release made it clear that no opportunity had been given to Party or ANC structures to discuss this major policy departure, and that the intention was to ram it through. The SACP only later acknowledged its error.
The SACP statement on every key topic makes assertions, which would later be exposed as the opposite of the truth, by claiming that:
• GEAR “firmly and explicitly situates itself as a framework for the RDP”. It is now history that GEAR sought to replace and overturn the RDP;
• GEAR “resists free market dogmatism, and envisages a key economic role for the public sector”, when we know that GEAR espoused market fundamentalism, and sought to slash the public sector;
• GEAR “extends a regulated labour market”, when it in fact aimed to remove key rights of workers in the labour market;
• GEAR “provides a clear frame work within which monetary and interest rate policy must work” and is a “path-breaking macro-economic strategy”. We now know that the ‘clear framework’ it provided was a comprehensive neo-liberal macroeconomic strategy, which the Party was later to denounce as the 1996 Class Project.
This is this still relevant because it was seen by the working class as a major betrayal of trust in the SACP’s responsibility as a leadership, rooted in its attempt to retain its proximity to power. Others on the left of the SACP argue that this was not a misjudgement but a political choice and have from that time written off the SACP. It didn’t help that a leader of the SACP, Cde Alec Erwin, was a prominent driver of the GEAR strategy.
It is also worth recording that COSATU, together with the National Institute for Economic Policy, had issued a detailed critique of the strategy within a month of GEAR being released. It issued a statement on 19 July 1996, which said:
“Key areas of concern with aspects of the Framework were identified, which in the view of the Executive, would take us in a direction diametrically opposed to the economic growth path outlined in the RDP.
These areas included the proposals on rapidly slashing the budget deficit; contractionary monetary policy and the lifting of exchange controls; labour market policy and unemployment; investment and industrial policy; and trade and tariffs…
“These conservative models are not going to bring about the envisaged creation of … new jobs, nor going to deliver the social needs of our people. At the most it will increase the gap between the poor and the rich, and condemn the homeless and jobless into extreme levels of poverty… COSATU is committed to the elaboration of a Macro-Economic Framework which first and foremost addresses the national priorities and interests of our people.”
The SACP had thus failed to play its role as a vanguard, Marxist/Leninist leadership on a critical issue for the working class, and left it to COSATU to fill the vacuum so that the trade unions had to step in and make the ideological intervention that the party should have been making. Later some in the SACP were to complain that COSATU was attempting to position itself as a vanguard, which later developed into the current accusation that some in COSATU are syndicalists or are harbouring ambitions to form a workers’ party. This failure to play a vanguard role remains a source of divisions to this moment.
Issue 2: The 1995 6-pack and privatisation
In 1995, then Deputy President Mbeki announced a set of policies, which was to be the forerunner to GEAR. It was the so-called ‘six pack’ of measures, which included proposals for privatisation of state assets and cutbacks, or ‘downsizing’, in the public service.
COSATU led a programme of resistance to these initiatives, including national strike action, engagement with government and in the Alliance, engagement at Nedlac etc. COSATU’s response on the restructuring of state assets were contained in a detailed statement issued on 7 December 1995.
The SACP again sent out confusing and mixed signals on this issue. At one level, three prominent SACP leaders (together with Cde Thabo Mbeki) were entrusted with spearheading implementation of this neoliberal package: Alec Erwin (Deputy Minister of Finance), Jeff Radebe (Public Enterprises Minister) and Geraldine Fraser Moleketi (Public Services Minister). So in the negotiations on privatisation for example, the government position was advanced by Cde Radebe.
At another level, the SACP articulated a confusing position, at times appearing to support COSATU, and at times supporting government. Indeed Umsebenzi in February 1996 even complained that “Some journalists have said the SACP supports the government against COSATU. Others have claimed the exact opposite, saying the SACP and COSATU stand together against the ANC”!
Yet the confusion and contradiction was clearly expressed in Umsebenzi of February 1996, which stated “Comrade Mbeki’s announcement … approached the question of restructuring from the perspective of the RDP and the provision of services. Contrary to many press reports, the GNU position actually calls for the basic retention of Telkom, Transnet, SAA, etc. in public hands, while allowing for some minority strategic partnerships with private companies to bring in technology, capital, or other advantages (e.g. SAA co-operating with one or more international airlines on routes and schedules).”
“The SACP has welcomed this basic, developmental starting point. We see in it a rejection of mindless privatisation that simply takes the resources of the country out of the hands of the people. We also welcomed comrade Mbeki’s very clear statement that the positions were a point of departure for negotiations, in particular with labour.”
While stating support for some of the principles articulated by COSATU, the Party appeared to straddle the fence by claiming that government in essence was not opposed to what COSATU was arguing, despite the fact that COSATU had completely rejected government’s announcement, and undertaken to embark on national mass action to resist it. The reality was that COSATU had major problems with the content of government’s proposals, including on SOE restructuring, which led to massive battles.
The SACP attempted to position itself as an arbiter in what was a class-based conflict between COSATU and government. It was only later, once the extent of resistance became clear, and the extent of the problems with government’s proposals apparent, that the SACP came out more clearly in support of COSATU’s campaign.
But it was the exercise of power by the Federation’s membership, which in the end partly halted the privatisation drive in its tracks. Areas which the SACP, perhaps naively, encouraged COSATU to consider (although COSATU never accepted this argument), such as the private equity partner for Telkom, were subsequently imposed in a way which made it clear that this ‘privatisation through the back door’ route, was equally a disaster for the developmental agenda of our democratic state. Today workers at Telkom and other SOEs are still paying a heavy price of private equity partnerships and commercialisation and therefore neoliberalism.
Some may argue that these episodes – GEAR, the 6-pack etc. – represent a different era, and that the SACP of 2014 is different from that of 1996. Yes and no. Yes, contestation in the Alliance, and in the SACP itself, led to the SACP shifting significantly from some of these positions. But no, the proximity of the SACP leadership to government continues to this day to stifle the ability of the Party to take vigorous, independent positions, when the interests of the working class are under threat.
Let us fast forward to 2014, and recent years, and we see why the allegation of the SACP being ‘missing in action’ in key areas of working class struggle, continues to have strong resonance amongst workers. On the one hand, the SACP has taken up some important campaigns such as on the Financial Sector and land reform. But deeper analysis suggests that it has studiously avoided anything, which could be construed as taking on the state, or taking on capital in the state. It has tended to steer clear of issues which would ruffle the feathers of its partner in government, and where it has raised criticisms they have tended to be muted, or so ‘nuanced’ as to be ineffective or simply sending out confusing messages.
Issue 3: The National Development Plan
Following the launch of the NDP in August 2012 there was silence from the Party about the ideological and class problems within it. Despite the fact that the NDP had been endorsed by Cabinet, in which the top leaders of the Party are members – which then suggests that comrades in government must have engaged with the content – there appeared to be complete denial, or at best ignorance, of its massive problems.
The impression given by the SACP’s statements was that it either didn’t have a major problem with the document, or was reluctant to raise its concerns’.
Cde Jeremy Cronin wrote in Umsebenzi in 13 Dec 2012: “In principle, we should all be happy if leading sectors of business throw in their weight behind the NDP and contribute to building a broad national consensus on a more equitable, inclusive society.… Cabinet collectively has endorsed … the NDP, the NGP and IPAP. There are strong and welcome convergences between all three…
“However, they are of course also different documents in their scope, objectives, time-frames and status… The NDP is intended to be a broad, society-wide vision. It is not that it is necessarily less state interventionist than the NGP or IPAP, but it seeks to envision what ALL South Africans should contribute to a better SA by 2030.
“On the other hand, the NGP and IPAP are essentially government policy documents and their emphasis is likely therefore to be more (but not exclusively) on what government has to do. Also for the record, the ANC in Parliament has endorsed the NDP, while the SACP has welcomed its broad vision, without necessarily agreeing with every detail.”
The SACP 2012 End of Year Message stated: “Whilst we welcome government’s New Growth Path and the National Development Plan, the SACP will continue to fight for our macro-economic policies to be better aligned to these important micro economic interventions.”
But this strange statement ignores two things: firstly that the NDP (nor for that matter the NGP) is not a micro-economic intervention, and more seriously that the NDP proposes both macro- and micro-economic policies which are at odds with progressive elements of the NGP and IPAP.
It was only once COSATU began to raise its concerns at Mangaung, and after it drafted a detailed discussion paper critiquing the NDP in February 2013, that the Party began to articulate a critical position. In May 2013, the SACP issued a paper endorsing COSATU’s strong critique of the NDP, which specifically rejected the NDP’s economic strategy and approach to employment.
While this was welcome, it was again worrying, as with GEAR, that the Party’s approach to a fundamentally anti-working class agenda was to be seemingly blinded by not just its close relationship with government but the presence of its top leaders in government, and only able to grasp the real issues once the Federation began to expose them. If the Party was the vanguard, why was it constantly taking up a position at the rear? It is extremely worrying that the Party seems to have failed to learn anything from the GEAR experience.
Further, even after having endorsed COSATU’s critique, the Party appeared to lack the political will, or courage, to take the battle on the NDP to its conclusion. It was only because of COSATU’s persistence at the 2013 Alliance Summit, that an agreement was reached to realign the economic proposals of the NDP with Alliance policy positions. But the SACP has shown no real determination to take this forward.
In fact the Party’s latest Discussion Document “Going to the Root” (October 2014 – see Annexure below), which focuses on the need for a radical phase of economic transformation, entirely fails to address this central challenge of reversing the neoliberal economic prescripts of the NDP, and acts as if the NDP is not an issue, effectively ignoring it in the document, despite the fact that government has announced that all policies and programmes will be aligned to the NDP over the next term.
Instead the document claims that “the policy fundamentals for these programmatic priorities to place our society onto a new growth and development path are already basically in place”, citing the NGP, IPAP etc, and ignoring the fact that the NDP, which is the flagship programme of government, completely contradicts the approach taken by those policy documents.
The price paid by the working class in this process is immeasurable. A pro-business economic strategy will now run till 2030 unless a major pro-left political rupture takes place within the ANC and the Alliance.
Frankly I see no possibility of this happening inside the government or even the ANC in the near future. COSATU has found itself completely isolated, as many government leaders, in particular the President, have repeatedly told the world that there is sufficient consensus to implement the NDP. But this “national consensus” excludes the working class.
This is thanks to SACP’s statement that “we should be happy that business has thrown in its weight behind the NDP and contributed in building a broad national consensus”.
Hell yes! How would business not throw its weight in behind the NDP when it represents such a major policy coup – snatching victory from the jaws of defeat! After the 2013 Alliance Summit we were told implementation of the NDP will continue minus areas where debates are still necessary; but our reality is that there is no such debate and the NDP is being implemented as a whole. Insofar as some of its most reactionary and anti-worker labour market policies are not being taken forward it is only thanks to fear of the reaction this will cause.
Issue 4: Macro-economic policy
The Party has appeared to have a blind spot on macro-economic policy in several ways:
Approaching macro-economic policy as if it is a marginal issue:
In the face of COSATU’s consistent battle to shift macro-economic policy after GEAR, the line of the SACP has been that macro-economic policy is not the major issue, but that we must rather focus on micro-economic policy, industrial policy, etc. In this respect the Party has shared common ground with many conservatives inside and outside the state, who have also advanced a similar line.
The two key problems with this is that, firstly, macro-economic policy is the state’s major economic lever to drive development and, secondly, progressive industrial policy cannot succeed in the context of inappropriate macro-economic policies. The last few years have confirmed this: our progressive IPAP policy has failed to stem deindustrialisation, despite the best efforts of Cde Rob Davies, because the incorrect macro-economic policies are in place.
To change this macro-economic policy requires a massive struggle, because it expresses the entrenched interests of capital, particularly finance capital, in the state. So the Party’s occasional reference to the need for appropriate policies, such as in ‘Going to the Root’ is entirely inadequate, as it is dealt with as an add-on, and not a fundamental issue of contestation. The Party has shown no seriousness on this matter.
Failure to fight for implementation of Alliance agreements on economy:
Alliance Summits have repeatedly agreed to broad statements of intent and processes aimed at forging a new direction on macro-economic policy and Alliance task teams have been set up to take this forward, but invariably they have not been convened. These processes have been used as a mechanism to avoid engagement on the issues, particularly on macro-economic policy, which has been regarded by the ANC as a holy cow.
The 2013 Alliance Summit made some progress in agreeing to a more detailed resolution on the economy, but again it was put into a task team, which has not been given the necessary political support. COSATU has effectively stood alone in trying to push for these processes to happen, and while the SACP has not opposed us, it hasn’t shown any real determination or political will to drive these processes. The inescapable conclusion has been that the Party regards it as tactically inappropriate to push on this matter.
Spinning budgets:
Directly linked to the above, the SACP has repeatedly sought to give a positive spin to the Minister of Finance’s budget statements and to Treasury’s fiscal policies, in the face of COSATU’s sustained campaigns against the fiscal policy direction of government. While the struggles of workers and communities managed to force a mildly expansionary shift in government’s fiscal policy in the early to mid 2000s, this fell far short of what we were demanding.
But the SACP’s posture has remained consistently positive, even when, as in the last two years, the Minister has presented an austerity budget, involving real cutbacks in spending, despite the massive economic and social crisis. The Party has given credence to the notion that government is pursuing a ‘counter-cyclical’ macro-economic stance (which should mean using aggressive macro-economic stimulus when the economy slows down, and reining in the stimulus when the economy ‘overheats’).
But the reality is very different; if anything the budgets are ‘pro-cyclical’, reinforcing the cycle of economic stagnation. Analysis of recent budgets and the 3-year MTBPSs shows that contractionary macro-economic policy continues to have a stranglehold on our economy. Compare the SACP and COSATU’s reactions to the austerity budget of 2013.
The SACP’s response stated:
“…We welcome the fact that, despite reduced revenue, many of the major pillars of expenditure including infrastructure, education and health-care are maintained. Although the Minister did not explicitly say so, the budget`s stance has rejected a path of austerity disastrously followed by many countries in Europe. However, the SACP is concerned that there was an overemphasis in the Minister`s remarks that maintaining such a stance is dependent upon achieving growth rates of 5%. We believe that maintaining a contra-cyclical stance is precisely the means for achieving sustained, inclusive growth.”
COSATU’s response to the 2013 and 2014 budgets, and MTBPSs reveal a more brutal reality for the working class, and reaches the opposite conclusion to the SACP statement: “Far from ‘rejecting the path of austerity’, Treasury is pursuing it in a major way. COSATU’s response to the 2014 MTBPS (which provides for massive real spending cuts, after taking population growth into account) lays this reality bare. The massive reduction in the budget deficit from 4.1% in 2014 to 2.5% by 2017 is achieved through real spending cuts, which can only cause the economy to further stagnate. The extent of the cut is seen in the MTBPS:
“The decline in ‘real growth’ of spending to 1.3% in 2015 (from 10.8% in 2009), is lower than the level of population growth, and therefore a real cut in spending, at a time when we have a desperate need to stimulate our economy, deliver services in underserviced areas, and invest in employment creation. This is a disaster! We are following European/IMF austerity policies, which have only plunged Europe deeper into crisis, where we should be following the US stimulus approach which is leading to recovery of their economy.”
The evidence is clear that the SACP is still making the fundamental errors we saw in the 1990s, that of muffling any criticism of government’s right-wing macro-economic policies, as we see again the next section.
Issue 5: Taking a minimalist approach to transformation
In line with the argument that ‘the NDR is on track’, many SACP interventions, particularly post-2009, suggest that we have the correct policies, but all we need is more effective implementation and co-ordination.
This minimalist approach to transformation creates a major contradiction for the Party: on the one hand the campaign, driven in significant part by COSATU, for a radical shift in economic policy, or a ‘Lula Moment’, has now been embraced on paper by the ANC’s notion of a ‘second radical phase of the transition’, which is supported by the Party; but on the other hand, this suggests a radical break with current policies; how do we achieve fundamentally different results with the same strategy?
If the government programmes the SACP cites (such as IPAP, NGP, the NIP) have been in place for the last 5 years, why has this radical shift not yet taken place? Yet the SACP’s ‘Going to the Root’ on P22 lists a series of precisely these existing government policies (omitting mention of the NDP) which it argues constitute the basis for this radical economic shift.
Having stated that “the policy fundamentals for these programmatic priorities to place our society onto a new growth and development path are already basically in place”, and lists these interventions, the document then concludes: “the second radical phase of the NDR is not something we are just talking about. Many of its key elements are already under implementation. What is required is a more decisive and more coherent effort.”
Now it may be that there are progressive elements of government policy, which COSATU has consistently supported, such as the IPAP, and aspects of the NGP. But this is very different from saying that in themselves these create the ‘policy fundamentals’ for a radical economic shift. A radical shift would require radical reforms of existing policy, which have failed to fundamentally shift the existing economic trajectory.
Secondly the perspective articulated by the SACP in ‘Going to the Root’ creates the impression that it is so embedded in government, that it is unable to have an independent critical perspective either on what additional interventions and policy shifts are required, or to be able to reflect critically on the fact that some of the existing policies have serious weaknesses and contradictions.
For example, COSATU has raised some serious concerns with the NGP, but the Party appears to embrace it uncritically. While we support the IPAP, the Party doesn’t seem to be asking hard questions as to why it is failing to stop deindustrialisation, and what policy interventions are required, outside a broad analytical take on financialisation of the economy.
Thirdly, the SACP embraces the Infrastructure Plan more or less uncritically, but doesn’t consider, or respond to, some of the critiques which suggest it is reinforcing aspects of the minerals/energy complex, and what is needed to radicalise it.
The SACP also doesn’t acknowledge that many of the ‘government policies’ they cite in ‘Going to the Root’ are subject to massive contradictions, and contestation. Rhetoric is confused with policy. For example there is no coherent beneficiation or minerals policy, as is claimed, and the government itself has failed to take forward the proposals of the ANC SIMs document, cited by the SACP.
Contrary to their claims, there is no coherent policy to transform the financial sector, or agreed measures to compel productive investment. Prescribed assets are not government policy and there is no coherent development agenda for DFIs in place (see for example the commercialisation of the DBSA).
The claims about a sustainable energy policy disregard the fact that this is the site of massive contestation in government and the ANC, and the energy policy debates have not been settled. The same applies to the claim that there is a coherent policy to transform BBEEE, to ensure that it is developmental and promotes the productive sector. Rhetoric yes, coherent policy, no.
So not only are many of the ‘key elements of the 2nd radical phase of the NDR’ not ‘under implementation’, as the SACP claims, but there is no clarity yet as to what they are, because they are the subject of massive class contestation, outside and inside the state. Where COSATU has been providing clarity, the party spreads confusion and contradiction.
Issue 6: Failure to effectively take on monopoly capital in the state
One of the themes taken up by the Party is that of “taking responsibility for the revolution”, and being present and active in all sites of struggle.
This has in part been a response to the criticism of SACP leaders being swallowed up in government, something I return to below. The argument by the SACP is that they won’t criticise from the sidelines, but will take the battles up inside, and outside, the state.
To the extent that this is being done, this is obviously correct, and all revolutionaries would support that. It also recognises that class contestation takes place throughout society, and that the state itself is a critical site of class struggle.
COSATU, while not formally participating in state institutions (except where there is tripartite representation) has consistently taken the view that it will engage in strategic contestation in and around the state and has attempted to use all possible levers to this end. But we have also argued that it is about balancing the sites and terrains of struggle, and sought to ensure that we constantly try to combine engagement from above with mobilisation from below.
Leaving aside for now the question of whether the Party has got this balance right, the question we pose is whether the SACP has effectively waged this class struggle in the state (bearing in mind that it is not possible to do this effectively without mobilising the working class as a social and political force).
Given that politically the three most assertive fractions of capital in the state have been monopoly capital (dominated by the white minority), the BEE elite (parasitic), and the tenderpreneurs (corrupt), the question is what the SACP has done to contest the influence and power of each of these elements of capital in the state (and we may add, in the Alliance).
It is important to note that the Party has played an important role in campaigning against the rise of tenderpreneurs in the state, a campaign COSATU has actively supported, and will continue to support. But while not minimising the tenderpreneurs’ political (and indeed corrupting) influence, I only focus here on the role of monopoly capital, as this is the core driver of capital’s interests in the state.
There has indeed been a very effective class struggle waged in the South African state by monopoly capital and its allies over the last 20 years (to paraphrase billionaire Warren Buffet: ‘there is a class war, and my class is winning!’).
Of course this has taken place with all the contradictions and complexities which characterise such contestation, so it is not always a crude and obvious line-up of forces. But the broad direction of these forces is clear: to embed the interests of capital, particularly in key ministries and economic institutions of the state, to project these interests as the interests of the nation as a whole and to contest, and confine, those areas of the state in which popular forces gain a toehold, to limit their broader impact on the states programmes.
In this war of position by capital, certain economic ministries and state institutions (including the Reserve Bank, strategic SOEs etc.) are key, with the Presidency as the coordinating centre. But the institutional engine for monopoly capital in the state is the National Treasury, which uses its control of the purse strings, frequently under the guise of technocratic procedures and requirements, to attempt to shape, drive, and often frustrate the policy agenda in the state.
It also uses its access to the Presidency to extend this reach to all levels and institutions of state. While the extent of this control by Treasury is often hidden from the public, those inside the state, both political leaders and technocrats, are acutely aware of it, and it is widely talked about, and often resented. So SACP leaders in the state would be acutely aware of the extent of this phenomenon.
This undemocratic control of policy by Treasury (as well as institutions such as the Reserve Bank) is something that COSATU has agitated and campaigned around for many years.
So while we are not suggesting that other institutions of state don’t also advance capital’s agenda, it is important to focus on Treasury’s role as the central driver of their agenda in the state, which goes way beyond the promotion of problematic macro-economic policies; it effectively acts as a state within a state.
COSATU has documented the extent of Treasury’s role in driving economic policy, and intervening in a host of policy areas in the state, outside its formal mandate, and it paints a frightening picture of subversion of the democratic mandate (see below).
Equally worrying is the extent to which the ANC, and more surprisingly, the SACP leadership in government, have allowed this to take place and have failed to mobilise the popular forces against this systematic subversion by capital of the policies of the movement.
Our battles with Treasury, and with their allies in the state, have included:
• Fighting for a more appropriate macro-economic policy and against fiscal austerity, overly restrictive monetary policy and obsession with inflation targeting.
• Supporting measures to counter capital flight, including capital controls,
• Opposing loosening exchange controls, including the recent exchange control amnesty;
• Backing measures to counter tax havens and to compel banks to lend to the productive sector;
• Demanding action against the investment strike and to penalise speculation;
• Opposing Treasury’s management of the PIC and the GEPF;
• Arguing for leveraging the massive financial power of public and private sector funds for transformation and for prescribed assets.
On all these issues, Treasury has opposed workers’ demands.
Outside of Treasury’s ‘core competency’ of macro-economic policy, it has meddled in a host of areas, particularly where progressive forces in the state and society are advancing an alternative to neo-liberalism. ‘Non-macroeconomic’ areas where it has actively undermined progressive elements of government or ANC policy include:
• Blocking Comprehensive Social Protection as advanced by the Department of Social Development, which would extend protection to uncovered workers, and attempting to unilaterally implement restructuring of retirement funds, which would increase the vulnerability of retrenched workers;
• Opposing the National Health Insurance (NHI), and when they were unable to completely block it, sabotage of the Health Department’s White Paper on NHI, and refusal to make provision for financing of the NHI’s rollout;
• Opposing aspects of Industrial Policy by initially opposing, and then undermining, local procurement policies, resisting implementation of measures to advance beneficiation and refusing to adequately fund the IPAP industrial strategy;
• Undermining labour market policy through consistent promotion of labour market deregulation, and the introduction of anti-labour policies. While organised labour has successfully resisted much of this, there are worrying signs of Treasury making advances in its anti-worker agenda, including Treasury-drafted proposals in the NDP[2] to dilute aspects of labour market regulation, proposals to lower wages, particularly for first-time workers and introduction of the youth wage subsidy;
• Driving the ‘User Pays’ approach, and continued commercialisation of SOEs, which has fundamentally undermined their public development mandate. Concerns have also arisen about the commercialisation agenda driven by Treasury in DFIs, including the recent restructuring of the DBSA.
COSATU has, from outside of the state, identified these and other Treasury manoeuvres, and over the years attempted to expose and campaign against them. The 11th Congress Declaration stated that “institutionally, the Treasury, which constitutes the biggest obstacle to the government`s economic programme, needs to be urgently realigned”.
We have taken up battles against Treasury on retirement funds and social protection, NHI, labour market policy, industrial policy, fiscal and monetary policy, capital and exchange controls, etc. Our proposals in key social dialogue institutions, such as the 1998 Jobs Summit, the 2003 Growth and Development Summit, etc., have been systematically opposed by Treasury, and we have had to seek broader social support, as well as support inside the state, to defeat Treasury on a number of issues. Where we have succeeded in doing so it has only been through major mobilisation and perseverance.
The Party occasionally refers to the problems being caused by Treasury and related institutions. But they have waged no sustained or focused campaign on the issues raised above, either at a public level or within the Alliance. This is the case even where the Party’s own campaigns can’t move forward because of the role of Treasury, such as NHI implementation and transformation of the financial sector.
The Party seems to continue to have a blind spot, or a reluctance to take Treasury on, as we have seen with its ‘friendly’ statements in response to austerity budgets.
A powerful example of this apparent blindness to the centrality of Treasury’s role is contained in Umsebenzi of 9 October 2014, focusing on the campaign to transform the financial sector. In the main article on the campaign, eleven very good demands are made which broaden the focus on the banks, to look at broader strategic financial and economic issues.
But on virtually every one of the eleven issues, National Treasury remains a major obstacle to what the Party is proposing. Yet nothing is said in the Umsebenzi lead article or in numerous other statements by the Party, about the severity of this problem, or what will be done to address it.
Yet in the same issue a letter from a reader states, in relation to a recent court judgment on exchange controls, that “This court ruling occurred in the backdrop of the gross mismanagement of financial transactions involving capital outflows, especially capital controls, by the National Treasury. The mismanagement was not naïve – the National Treasury is not marching in step with our revolution – it is obsessed with neoliberalism, and represents one of the key centres of power that we have to take seriously. It is clear without a major reshuffle in that department that efforts to transform the financial sector to serve the people and to move on with the second, more radical phase of SA’s transition, will be sabotaged and resisted from within the state.”
Precisely! Which makes the Party’s silence on this matter even more puzzling.
The offensive by capital within the state expresses a reality around how the ruling class uses the state to entrench class domination, subject to the battles, which the working class wages in society and the state.
Lenin gave a stark warning about this reality as follows, which effectively suggests that not only does capital use the state to exercise domination, but that once capital has entrenched its domination in the state, the capitalist state tends to transform whoever comes into, rather than the reverse: “A democratic republic is the best possible political shell for capitalism, and, therefore, once capital has gained possession of this very best shell, it establishes its power so securely, so firmly, that no change of persons, institutions or parties in the bourgeois-democratic republic can shake it.”(Lenin, The State and Revolution, 1917)
COSATU has not received the active support of ANC or SACP leaders in government, in many of these battles with the Treasury. If anything the Treasury’s view is usually given more weight than that of other departments. This is true even at the level of Alliance and Manifesto processes, where transformative proposals on macroeconomic policy are usually blocked or watered down, to advance, or at least insulate, Treasury’s perspective.
The failure to contest capital in the state can either take place through remaining outside, and refusing to engage in the struggle in the state, or by going into the state, and failing to effectively contest capital. Both routes are equally problematic. A pertinent question arises: Who captured who? Have SACP captured the state or the state captured the SACP?
Issue 7: Apparent abandonment of the fight for income redistribution
When compared to the GEAR years, as a result of mass pressure, and the growing social reality of rising poverty and unemployment, the mid-2000s saw greater fiscal expansion and greater labour absorption. This shift was consolidated at Polokwane. But, while it was a shift relative to GEAR, it didn’t begin to drive the structural economic changes, including the challenge of income redistribution, which were required.
The current trajectory remains negative. All indicators on wage share, unemployment, inequality and poverty demonstrate the non-redistributive nature of the shifts. Such indicators include:
On working poverty
• The latest median wage figure was R3033 (for 2013) i.e. 50% of all formal workers earned below this. (StatsSA Labour Market Dynamics 2014) The median wage has consistently increased below the level of inflation, and actually decreased in absolute terms in 2012-2013, compared to increases in the average wage that have consistently been above inflation. This is because the wages of high income earners massively distorts the average figure. The median wage would have to increase by at least 12% to reduce inequality (M&G 20.6.14)
• Stats SA has produced what they refer to as an ‘upper bound poverty line’ which combines basic food and non-food items. These are not figures which COSATU believes are sufficiently verified, either scientifically or subjectively by those who live in poverty, to count as an official Minimum Living Level, but in the absence of other researched figures we can use this as an indicative benchmark. For a family of four the figure is R2948 in 2014 prices. Compared to the median wage of R3033 we can see that almost half the formal South African workforce lives below this very conservative estimate of poverty.
• In 2013 45% of all workers earned below 2/3 of the median i.e. less than R2020 per month (StatsSA Labour Market Dynamics 2014)
• There has been a real decline of 11% in the wages of semi skilled workers from 1994 to 2012.
On the wage share
The wage share of GDP has declined considerably since 1995. Between 1995 and 2010 the wage share declined from 54% to 47% (The Peoples Budget 2010).
The most marked decline has been experienced since 2000. The fall in the wage share has been most starkly felt in the construction industry where it fell from 60.6% in 2000 to 36.6% in 2011 – a fall of a staggering 24% (StatsSA, GDP Reports). This was in a period where the construction industry was engaged in massive rollout of infrastructure including the World Cup stadiums.
The decrease in the wage share by definition means that real wages have been increasing less than the gains in labour productivity. This is reflective of a growing increase in power inequality in determining workers’ income.
On unemployment
Our expanded rate of unemployment (which includes those who no longer register to seek work) continues to grow. In the third quarter of 2014 officially it stood at a shocking 35.8% – the highest rate ever. In 1994 the expanded rate was 31.5%.
On hunger
Of South Africa’s 53 million people, around 13 million face hunger on a regular basis. This is one in four people. And more than half the population lives in such precarious circumstances with such unreliable and low sources of income, that they are constantly at risk of going hungry. They find themselves squeezed between low, intermittent and unreliable income and an unfair, expensive and wasteful system of food production dominated by a few large companies.
All of the above is despite South Africa being considered a food secure nation, producing enough to feed all of its population. And it is despite the expanded reach of social grants. Imagine what the picture would be like without these grants!
Poor households spend 34% of their total household expenditure on food in contrast to non-poor households, which spend only 10% of their household expenditure on food. (StatsSA Poverty Trends Report April 2014.) This tells us that not only are the non-poor consuming the lion’s share of our food, but their food spending is a negligible portion of their overall spend. Increases in food prices are therefore not felt in the same way.
What has been absent for some years has been any enthusiastic engagement by the SACP on these issues of working poverty, the wage share, unemployment or hunger. While it might not contest or deny the indicators of poverty (including working poverty) and inequality, these do not feature high on the visible agenda or campaigns of the SACP.
The question begging an answer is why does a vanguard not articulate and mobilise society around what effectively has meant distribution from the poor to the rich? Why is the Party for socialism so mute about the catastrophic levels of unemployment, which have deepened in the past twenty years?
The emphasis by and large has been on the redistributive success stories in the expansion of service delivery. The SACP statement on the 20th Anniversary of democracy 27 April 2014 re-stated the post-1994 achievements, including 3.3 million RDP houses built, 7 million more houses electrified, potable water to 92% of population (compared to 60% in 1994), NSF Aid to 1.4 million students, the post Polokwane HIV treatment rollout, and an increase of people receiving social grants from 3 to 16 million.
I have no quarrel with acknowledging these successes. But these gains must be properly located, first in the context of an acknowledgement that the successes in some areas (in particular water and electricity) have been massively compromised by commodification and the growth of unemployment and poverty, resulting in the inability to pay for services. Second, they must be located in the context of the bigger picture of the underlying causes of poverty and inequality.
It is my view that there has been an over-focus on issues of reproduction. The connection is not made between redistribution of services and redistribution of wealth and income. This leads the SACP into a cul de sac of supporting the World Bank conclusion that South Africa has been more effective at redistribution than left states in Latin America, despite the fact that they have been massively more successful than us in reducing poverty, unemployment and inequality.
Comrade Jeremy Cronin went some way to qualify the argument when he spoke at a Conference on Social Equality at UCT in September this year, when he conceded that “the redistribution is going into a spatial reality and other realities that reproduce all of these problems”. But this is a rare concession, and it has not been translated into SACP programmes and statements.
Of all the almost daily press statements released by the SACP and posted on its website in the course of 2014, not a single one has:
• Supported the wage struggles of any workers (including the long metal and engineering workers’ strike or the postal strike);
• Engaged with all the evidence that COSATU has been producing on poverty wages, the falling wage share of GDP etc.;
• Supported COSATU’s efforts at organising the most vulnerable workers including own-account workers such as street traders;
• Commented on the release of hunger statistics; or
• Commented on continuing outrageous levels of unemployment.
Indeed in the SACP Statement on the 20th Anniversary of democracy, 27 April 2014, the only reference to unemployment was the claim that “employment is now higher than ever with 14 million people working”. This claim dies not:
a) Explain that the 14 million includes the 4.5 m work opportunities (not jobs) created through EPWP which programme currently pays its ‘volunteers’ a measly R67 a day,
b) Make reference to the rate of unemployment, and thus tries to spin a good story in the face of devastating evidence.
This assertion of growing employment was made repeatedly by both the ANC and the SACP in the period running up to the 2014 national elections, in contradiction to the dictum of the great Amilcar Cabral: “Hide nothing from the masses of our people. Tell no lies. Expose lies wherever they are told. Mask no difficulties, mistakes, failures.
Claim no easy victories”. The pretence of 14 million jobs constitutes an attempt to hide the biggest crisis facing the working class.
We are certain that in answering this criticism, the SACP leadership will be able to quote from a speech or article or two that mentions one or more of these issues in passing. It is however inescapable that these issues are not a primary focus.
How can it be that these issues, which are so palpable for the working class, are not a key focus of the SACP? It is difficult not to conclude that the over-focus on redistribution of services (on reproduction) is deliberate in that reproduction is a safe area, both in relation to capital and the state. It does not fundamentally challenge the structures of economic ownership and control, in the same way that a focus on redistribution of income and ownership does.
This area has a greater impact on the current divisions in the broader movement. The SACP has joined the song that there is a good story when evidence mounts that the capitalist class is not only disproportionately benefiting from working class delivered democracy but turned the screws of super exploitation and super profiteering.
Issue 8: e-tolls
The SACP has adopted a strange stance on e-tolls. Despite all the evidence that e-tolls are hugely unpopular across all classes, the SACP has repeatedly declined to support the call for scrapping them, and in particular has opposed the call for e-tolls not to be paid.
The SACP has adopted a position which basically argues:
a) The GPFIP programme of freeway improvement in Gauteng should not have been pursued in the first place,
b) The same money should have been put into public transport and other services,
c) But the GFIP was pursued and is a reality, and R20bn of debt has been incurred by SANRAL,
d) The debt must be paid back not through a fuel levy or any other means but through maintaining the e-tolls.
In an article in Umsebenzi Online 15 March 2012, the Deputy General Secretary Jeremy Cronin argued explicitly that the “don’t pay” call was inappropriate. A Central Committee statement of February 2012 argued that tolls are not the problem; the road project is. Successive statements of the SACP Gauteng PEC have called for “a deeper investigation on the history and genesis of this crisis” (Dec 2012), “investigating SANRAL’s poor management of the eToll system” (Feb 2014), and similar. The SACP has always fallen short of calling for a scrapping of e-tolls.
We do not disagree with the critique of a mega million road project. Neither do we disagree with the argument in favour of a greater spend on public transport. Indeed this has been one of our core campaigns for many years. Nor do we disagree with the argument for a rational instrument to move freight to rail.
What we find questionable is the SACP’s distancing itself from COSATU’s call for the e-tolls to be scrapped and its further call for defiance of eBills. Surely this was an opportunity to consolidate a cross-class strategy against e-tolls and in favour of public transport?
What we find distasteful is the repeated suggestion that in calling for the scrapping of e-tolls COSATU has allied itself with neoliberal elements including the DA. We have certainly established a tactical alliance with OUTA (and not the DA), but this organisation is issue-specific and does not constitute a political force of any hue. Isn’t the formation of tactical alliances central to any transformative project and broadening of the people’s camp?
It is difficult not to conclude that in opposing the call for the scrapping of e-tolls and by opposing the payment boycott tactic, the SACP chose to go soft on the state’s policy of commodification and privatization of public spaces. A question again arises, is the SACP zigzags and confusing mixed signals on this not influenced by the reality that this project was driven by SACP leaders in government?
The SACP must appreciate that it has some influence on some in the layer of COSATU leaders. Every time it adopts obfuscation, zigzags, or even supports outright anti-working class policies, those who believe in the SACP take these confusing statements into the unions, leading to tensions that we have witnessed recently. I have already seen a statement by one union calling this campaign ‘anarchist’.
Issue 9: Corruption
The SACP’s statement on the 20th Anniversary of Democracy 27th April 2014 stated that “It is the SACP that took up the campaign against corruption as a struggle to be fought through societal mobilisation”. While it is true that the SACP launched this campaign, notably and significantly before 2009 or before almost all its current leaders joined the government, since the message that has consistently been sent out is ambivalent, and mixed with criticisms of other parties – from the Public Protector to the DA.
The May 2014 SACP statement delivered by the SACP General Secretary sums up the approach : “Yes, we must root out corruption in the state – but have you noticed how silent the opposition is about the multi-billion rand theft of public resources by the big private construction companies? Have you noticed how quickly they have forgotten the role of the bread cartel in literally stealing bread out of the mouths of the poor? Have you heard them campaigning against tax evasion and the illegal export of capital out of our country?”
There is always a BUT, which sends out a very mixed message to the public at large, and the working class in particular.
What we need from a party that represents the working class is a completely unequivocal position against corruption, wherever it is found, and whoever else is opposed to corruption.
At times the party has adopted an inconsistent line such as being very vocal in support of the Public Protector’s report and recommendations when its political opponents such as former leaders of the ANCYL were on the receiving end of the PP reports but silent on others on those it considers its political friends.
Linked to the SACP’s apparent ambivalence and inconsistency on the question of corruption, is its clear opposition to any suggestion that those who benefit from corruption – even unknowingly – should be accountable in some way for what they have benefitted.
The particular case in point is of course that of President Zuma, who was found to have unduly benefitted from the non-security related aspects of the upgrading of his home and was called upon to make some contribution to paying back what he had benefitted.
Why has it been so impossible for the SACP to call for the President to concede the Public Protector’s ruling that he should pay “a portion” (not even the full amount) of the costs of the non-security aspects of the Inkandla upgrade? I can only conclude that this is in part due to the fact that the deputy chairperson of the SACP happens to be the Minister of Public Works and that the deputy general secretary happens to be his Deputy Minister.
Why has the Public Protector repeatedly been vilified as part of a “band of anti-majoritarian liberals” (SACP Statement 26 October 2014), implying that all those including COSATU who have called for her report to be implemented in full are political pariahs in the eyes of the Party?
What we need from a party that represents the working class is an unequivocal position on accountability of those who have benefitted from corruption – even unknowingly. Again divisions at COSATU emanate from such issues. Despite COSATU having adopted such a strong line, increasingly some leaders of our unions have been tailing the Party’s ambivalent and inconsistent line or hostility to the Public Protector instead of hostility to looting of the state resources which is essentially an anti-working class project.
Part II: Understanding the political roots of the differences, and reaching agreement on how to manage these differences
1. Historical role of the SACP in building worker unity
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