Category: Economics

(Written 18 June 2012)

Dear All,

If it is true that the ANC wants to find ways to solve the problems facing the country in 2012, why do they not simply start with the work done by the State’s  National Planning Commission? After all, that Commission was established in 2010 to investigate exactly those issues that plague South Africa and their first (perhaps only?) report was published in November 2011. As I understood it, the findings of the NPC were meant to inform the policy deliberations at the ANC’s policy conference at the end of June this year, so what is the role of Jacob Zuma’s ‘second transition’ document?

Report on South African development

Why does Zuma need a second transition document?

I have written, on 19 March 2010, about the ‘zuma manuva’, a phrase that describes a political manoeuvre in which the leader presents to the followers ideas or promises in such a way that every individual can interpret what he or she heard as if what they wanted was being offered to them, but in truth nothing is being offered to anyone. Jacob Zuma, after whom the strategy has been named, is the arch-practitioner of the zuma manuva and so it comes as no surprise to me that there should have been leaked to the press a set of discussion documents that the ANC has dubbed the “second transition”. (Drawn up incidentally, also, to protect the ANC from those who want to steal it from the masses. A story well know to students of the history of Liberation.)

Indeed, the president and various ministers and officials have alluded to the importance of the second transition in recent speeches but from the pieces on the topic published so far, it is not possible for the public, nor the Deputy-President it seems,  to work out from what and to what the second transition may be. Come to think of it, I don’t recall a first transition in the ANC, but that is of no consequence because the only important thing about this document is that it lacks specifics; you see, obfuscation is the hallmark of a zuma manuva.

The ultimate purpose of the second transition document is to prepare for the ANC’s Mangaung presidential election at the end of 2012 and so the timing of the leaking of the second transition documents – before the ANC’s June policy conference, but not too long before in case it is recognised as a nonsense – is a key part of the strategy. Unlike the work of the National Planning Commission which has a brief to point in some particular way to a better future, the purpose of the second transition document is to point in every possible different way at once… that is the essence of the zuma manuva. And by the time Mangaung arrives, the Zuma camp will make the claim that their second transitional plan was ratified by the ANC’s June policy conference.

The second transition is anything you want it to be

The second transition is anything you want it to be

For those who wish to read that land will be given to all and that the right of ownership of property will be protected; that the broken education system will be repaired and that teachers’ unions will not be challenged; that the moribund economy will be invigorated and that all workers will be given decent work without their having to work very much; that a free press in South Africa is sacrosanct and that the state’s ‘secrets’ will be protected; that nationalisation of mines and banks  is being discussed and that foreign fixed investment is safe; that corruption will be rooted out and that government officials who inadvertantly had their fingers in the till will be given a second chance… just look for it in the second transition. The picture from the Mail & Guardian of 20 March 2012 is an example of what I mean. Green? Of course, everything is green in the second transition. What colour would you like it to be? (This already government policy after all, so no problems there.)

In summary, the purpose of the second transition is to play the role of a promised “Great leap forward”. So, for some real insight into the goings-on inside the ANC over the next few months, don’t look for what is or is not written in the second transition document, look for the way in which the political ambiguities are incorporated.



Iraq war: What was it all about?

(Written 19 Dec 2011)

Dear All,

Now that America has officially called an end to their war in Iraq, it may be a good time to revisit the question, “What was it was all about?”

Here is what I had written on 19 Aug 2003:

The overwhelming opinion developed around the world over the last few weeks is that the American war in Iraq is in order to secure Iraqi oil. On January 26th, a local (American) newspaper commented on a report published in Britain’s Mirror newspaper, quoting a Deutsche Bank document which recommended the purchase of Texas-based ExxonMobil shares. The reason was that “(ExxonMobil) has been tipped to get new reserves from a post-Saddam Iraq”.

While this seems a little simplistic I am reminded of an article entitled “The dark heart of the American dream” published in the Observer in June last year (2002).,11913,738196,00.html

In the article, the writer makes the point that the Bush administration derives its political organisation almost entirely from a group of people attached to the Texas oil industry. The implication being that even if Iraqi oil is not foremost on the agenda of the Whitehouse, it is top of the agenda of an extremely powerful lobby around the US President. If this is so, then the American administration’s pretext for war against Iraq may be no different from the British pretext for the Zulu war of 1878, and the South African (Anglo-Boer) war of 1899.

In both of those cases the British used ‘moral outrage’ and a ‘threat to British citizens’ as the reason for going to war. History has shown that while the stated political reasons had some minor validity; the actual cause was the manipulation by a group of powerful industrialists and lobbyists who were advising, and in some cases running, the British government. The upshot was that the vanquished – and the British people for that matter – paid a very high price, while the instigating individuals lived well off the proceeds of South African mineral wealth.

So, almost nine years later, along with Little Peterkin* we ask, “But what good came of it at last?” And as with Old Kaspar we reply, “Why, that I cannot tell.”



*THE BATTLE OF BLENHEIM  by Robert Southey (1774-1843)


T’was a summer evening,
Old Kaspar’s work was done,
And he before his cottage door
Was sitting in the sun,
And by him sported on the green
His little grandchild Wilhelmine.
She saw her brother Peterkin
Roll something large and round
Which he beside the rivulet
In playing there had found;
He came to ask what he had found,
That was so large, and smooth, and round.
Old Kaspar took it from the boy,
Who stood expectant by;
And then the old man shook his head,
And with a natural sigh,
“‘Tis some poor fellow’s skull,” said he,
“Who fell in the great victory.
“I find them in the garden,
For there’s many here about;
And often when I go to plough,
The ploughshare turns them out!
For many thousand men,” said he,
“Were slain in that great victory.”
“Now tell us what ’twas all about,”
Young Peterkin, he cries;
And little Wilhelmine looks up
With wonder-waiting eyes;
“Now tell us all about the war,
And what they fought each other for.”
“It was the English,” Kaspar cried,
“Who put the French to rout;
But what they fought each other for
I could not well make out;
But everybody said,” quoth he,
“That ’twas a famous victory.
“My father lived at Blenheim then,
Yon little stream hard by;
They burnt his dwelling to the ground,
And he was forced to fly;
So with his wife and child he fled,
Nor had he where to rest his head.
“With fire and sword the country round
Was wasted far and wide,
And many a childing mother then,
And new-born baby died;
But things like that, you know, must be
At every famous victory.
“They said it was a shocking sight
After the field was won;
For many thousand bodies here
Lay rotting in the sun;
But things like that, you know, must be
After a famous victory.
“Great praise the Duke of Marlbro’ won,
And our good Prince Eugene.”
“Why, ’twas a very wicked thing!”
Said little Wilhelmine.
“Nay … nay … my little girl,” quoth he,
“It was a famous victory.”
“And everybody praised the Duke
Who this great fight did win.”
“But what good came of it at last?”
Quoth little Peterkin.
“Why, that I cannot tell,” said he,
“But ’twas a famous victory.”

(Written 5 Sept 2010 in response to the discussion on the collapse of social systems.)

Dear All,

Bernard Levin (Times of London, 1969), in reference to his predicting the collapse of the Soviet Union, is quoted as saying something to the effect that “Oppressive societies cannot survive the urge for freedom once (that freedom) has been expressed.” Something that appears to be generally true, but it certainly does not automatically follow that a society, once having achieved personal freedom for its citizens, will go on to be develop into flourishing nation. Nor will the acquisition of personal freedoms make it possible for a society to escape an impending collapse if such a collapse is imminent. At the same time, it also does not automatically follow that autocratic societies cannot flourish without granting their citizens personal freedoms, although this case seems to be considerably less likely. (China is an interesting case in point.)

A sense of personal freedom, particularly in an age where ‘rights’ are all the rage, certainly plays a role in the mix that allows societies to flourish, but I think for a society to prosper it needs more than that; sometimes it may even need that citizens be prepared to forego what they see as their personal freedoms for what appears to be a greater good. Kenneth Clark, in Civilisation (1969), when illustrating what he calls the Hellenistic imagination by contrasting the art in the sculpture of the Apollo of the Belvedere with that of an African mask, puts it like this. “At certain (civilising) epochs, man has felt conscious of something about himself – body and spirit – which was outside the day-to-day struggle for existence and the night-to-night struggle with fear; and he has felt the need to develop these qualities of thought and feeling so that they might approach as nearly as possible to the ideal of perfection.”

It is when people in a community have this sense ‘about themselves’ of a purpose (not necessarily religious), coupled with the notion that the purpose is achievable, then their confidence may ignite their collective imagination, and the society is able to flourish. To quote Clark again, “Civilisation requires a modicum of material prosperity – enough to provide a little leisure. But far more, it requires confidence – confidence in the society in which one lives, belief in its philosophy, belief in its laws, and confidence in its own mental powers.”

In returning to Levin’s prediction about the timeline in the collapse of societies, I would suggest that the wrong question has been asked. The important indicator is not whether people are free or oppressed, as good an indicator as that may be, but whether they are confident of the society ‘about themselves’. Confident in a way that prompted C. J. Rhodes (South Africa’s very own 19th century robber-baron) to say, “You are an Englishman, and have consequently won first place in the lottery of life,” a view I imagine very few Englishmen now a’bed would still believe to be true.

Certainly white South African society is failing because of a lack of confidence, not because of a lack of freedom. By and large, white South Africa does not appear to have confidence in the South African Nation as it is represented by its government and its smiling president. As an aside, may I suggest that this is not just a minority thing; the Nazi party never won a majority vote prior to Hitler becoming the German Chancellor in 1933 and they certainly weren’t peddling freedom. Wherever and whenever they set out their stall they displayed one unambiguous message, total confidence in their purpose.

Sadly I have a suspicion that the confidence acquired by black South Africa, along with personal freedom, when the rainbow nation started out 16 years ago is evaporating. If that is true, then it suggests that the whole of South Africa will eventually fail. There was a time just a few years ago when, despite the negative press, the relatively naïve leadership of the ANC had so much confidence that they did not overly bother themselves with the sniping by the fourth estate. They believed that they would fix the education system, that they could get the economy to grow, that they could provide jobs. They believed that millions of houses could be built within a year or two and that they could ensure the functioning of hospitals and the provision of health care. They believed that they could give dignity to people who for many years were considered by others and possibly even themselves to be inferior.

But now the ANC leadership no longer has that confidence – so the negative press must be silenced by other means (Protection of Information Bill in 2011) – and it remains to be seen whether the South African people will sink into an aimless malaise, like Zimbabweans, to be abused by a despot and his cronies. Or will some new miracle come about that will change the confidence of the Nation, that will replace the deployed but entirely self-serving  officials in government, and, if not actually change the structure of government, will make it accountable to the people who pay for it. And that will allow the country to rejuvenated itself; in the way that China seems to have done.

(Written 19 Apr 2011)
Dear All,
After last weekend’s rant about the possible motives for our fascination for watching physical contests like rugby – and my suggesting that sexual motivations lying deep in the primitive reptilian brain were at play here – it was quite by chance (there are no accidents?) that this week I came across the writings of a fascinating eccentric by the name of Thorstein Veblen (1857 – 1929).
I had suggested that at the very core of the need to ‘bash heads’ – and to watch to the exclusion of all else, our gladiators “bashing heads’ – there is a sexual underpinning, but Robert Heilbroner in The Worldly Philosophers (Penguin, 1995, pg. 232) adds a new dimension when he quotes Veblen, “In order to stand well in the eyes of the community, it is necessary to come up to a certain, somewhat indefinite conventional standard of wealth; just as in an earlier predatory stage it was necessary for the barbarian man to come up to his tribe’s standard of physical endurance, cunning, and skill at arms.” Social acceptance may well be a more fundamental need than simply ‘getting the girl’. So, while the schoolboys are competing at a basic level on the rugby pitch, their parents are engaged in an even more primal struggle in the car park, seeing who drives what.
Incidentally, Heilbroner’s context for this Veblen quote has to do with the roles and interaction of the predatory and non-predatory sections of our society (e.g. businessmen and workers, politicians and voters) and the discussion finally goes on to illustrate the rational and irrational aspects of human economic activity as described by Veblen. Incidentally the main idea here is that classical economic theory rests heavily on the notion that humans are ration beings, but clearly we are only partly rational; as can easliy be seen in the expression of conspicuous consumption shown on Top Billing on SABC3 each week. See .
So dear readers, may I recommend Veblen, even if only to read his biography or a summary thereof. What particularly endeared him to me was his reply to a student who once asked him, “Tell me professor, do you take anything seriously?” “Yes”, he replied in a conspiratorial whisper, “but don’t tell anyone.”

A simple lesson in Economics

(Written 17 Nov 2011)

Dear All,

The following is a brilliant presentation of the 9 challenges facing South Africa.

Whether there will ever be any workable solutions to the challenges remains to be seen.