PRESIDENT ZUMA'S SONA RESPONSE

Many South Africans were charmed by the more conciliatory tone that President Zuma adopted in his response last week during to the State of the Nation (SONA) Debate.

He was witty, affable and full of good humour - even toward his bitterest critics.

However, although his tone was conciliatory, the content of his speech was not.

The basis for apprehension appears early in his reply where he refers to the 21 years that have elapsed "since we started the radical transition from Colonialism of a Special Type to a National Democratic Society, founded on the strategic vision of the Freedom Charter."

"Colonialism of a Special Type" and the "Freedom Charter" are both ideological constructions of the SACP. The "National Democratic Society" is the millenarian goal of the National Democratic Revolution (another SACP construction), which will be characterised by demographic representivity at all levels of control, ownership, management and employment in the private and public sectors. 

The SACP acknowledges that, since the ANC's 2007 Conference in Polokwane, there has been a "considerable strengthening of the left's ideological positions on government economic and social policies and programmes." It lists among the "major paradigm shifts" that it has achieved, the adoption of the New Growth Path and the Industrial Policy Action Programme and the rejection of "willing-seller, willing-buyer" approach to land reform. 

President Zuma's response is entirely in alignment with this paradigm shift.

Firstly, there is the repetition of the ANC's current leitmotif of the need for "radical economic transformation". South Africa is "still grappling with poverty, inequality and unemployment" - not because of any failures of the government's own policies - but because "we have not fundamentally touched the structure of the economy in order to effect true economic transformation."

According to President Zuma, radical economic transformation will involve:

More rigid implementation of BBBEE in accordance with the 2014 Act and regulations that are now being finalised;

New SACP-inspired industrialisation initiatives to beneficiate local minerals - apparently at prices dictated to mining companies by the State; 

A state-led industrialisation policy that will "create" and support black industrialists;

"ongoing" expansion of (public/black) ownership of the economy through the "dismantling cartels and monopolies";

Further entrenchment of COSATU's control of labour policy by banning all temporary employment exceeding three months and opening a dialogue at NEDLAC "relating to a national minimum wage;" and

Pressing ahead with plans to limit farm sizes to less than 12 000 ha - despite the fact that about 100 such farms produce 70% of South Africa's food - and proceeding with "the principle of 50/50, where farm workers and farmers share ownership of the farm".

President Zuma justifies these radical initiatives by claiming that "inequality is still staring us in the face"... "The income of white households is still six times more than that of black households. In addition, the black majority still owns only three percent of the Johannesburg Stock Exchange."

In fact, the structure of the economy has changed enormously during the past 21 years: 

The ANC government controls 36% of the economy - including parastals - and determines economic, fiscal and labour policy;

Black South Africans own 23% (and not 3%) of shares on the JSE; 22% are owned by whites and 39% by foreigners (the racial ownership of the remaining 16% cannot be determined); and

They now comprise more than 60% of the top income decile. Continuing black/white household differentials are due to much higher black unemployment rates and lower education qualifications - and not primarily to race (there are similar income differentials between black middle class households and black households in the bottom deciles).

The President concedes that the economy is not growing fast enough - but says that this is, in a way, also a reflection of South Africa's success: it "reflects the relative level of development of the South African economy compared to the regional economies... Less developed countries tend to grow faster than more developed countries."  How then, one wonders, did President Mbeki's administration achieve growth rates of 5% before he and his GEAR policies were ousted at Polokwane in 2007? What about China and India?

The President also admits load shedding "is indeed a serious challenge and an impediment to economic growth".  However, he assures us that there is an "extensive short, medium and long term plan to deal with the energy challenge".

Nevertheless, "South Africa is a success story".  According to the President:

"All our democratic institutions, including government agencies are strong and functional" (Parliament? The SAPS? Eskom? SAA? SABC? NPA? The Post Office? Home Affairs? Basic Education? Provinces? Municipalities?); 

"Progress is being made to steadily improve outcomes in the basic education sector" (with only one-eighth of our children leaving school with a decent matric - and with SADTU maintaining its stranglehold on most schools?); 

"...instability at the top echelons of the crime busting institutions is being attended to" (by replacing Anwar Dramat of the Hawks and Mxolisi Nxasana of the NPA?).

"...we have prioritised the fight against crime and corruption" (by deploying one inexperienced cadre after another as Police Commissioner - and by undermining the Public Protector?);

"The economy possesses the necessary dynamism to position the country as a competitive player in a difficult global economic environment" (with economic growth of only 1.4% - accompanied by the systematic alienation of foreign and domestic investors?).

Do not be fooled by the bonhomie and the chuckles: President Zuma's sub-text was a chilling message that the ANC/SACP is determined to press ahead, at any cost, with the radical implementation of the second phase of the NDR.

However, the "second phase" approach has been designed by SACP ideologists and not by rational economists. It cannot be reconciled with either the National Development Plan - or with the nine-point programme that President Zuma himself announced during his SONA - and particularly not with "revitalising agriculture"; "adding value to our mineral wealth"; "reducing workplace conflict"; "unlocking the potential of small enterprises"; and, in particular, "encouragement of private investment."  

It is difficult to understate the harm that will be done to the economy, to national unity and to the constitutional foundations of our new society by the approach that President Zuma once again repeated in his SONA response. We cannot say that we have not been warned.

Dave Steward is Executive Director of the FW de Klerk Foundation

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