Hlengani Mathebula | Dear ANC, here’s how to avoid our own Arab Spring

Dear Commander Paul Mashatile,

Revolutionary greetings

I write as a member in good standing of our movement. My branch is Ike Maphoto General Branch, Polokwane. I’ve been a cadre for decades since our movement was banned in South Africa. In addition, I was also a member, in good standing, of the South African Communist Party.

As a loyal and committed executive, I have to write to you today because of the serious economic crisis that our country is going through. I write to you not to point out the many flaws of our movement, but to offer some humble insights that hopefully can be taken into account when the National Policy Conference convenes this week. The weight of expectations for this conference is enormous and we dare not disappoint.

South Africa’s political case is decorated with numerous diagnoses of the ills of that country’s economy and the prescriptions offered for those ills.

So I’m not going to bore you with the details of the economic diagnoses. Nor will I bombard you with political prescriptions. However, I cannot avoid the temptation to repeat that our country is facing the deepest economic crisis since the end of the Second World War.

READ: Mbeki slams ANC leadership, warns of Arab Spring

The situation is so dire that one of the party’s elders, Thabo Mbeki, has warned that South Africa is ripe for an Arab Spring, a reference to the wave of unrest that toppled governments in Arab countries in 2011. the country’s triple challenge of unemployment, poverty and inequality. On two of them – unemployment and inequality – South Africa ranks in the top five globally.

I focus on the “how” to do the things that are necessary to reverse the declining performance of our economy, and therefore face the triple challenge of unemployment, poverty and inequality. In this regard, I will highlight what has worked elsewhere. In particular, I draw on the work of the World Bank’s Growth Commission headed by Nobel Laureate Michael Spence and the words of Fernando Henrique Cardoso, Brazil’s former finance minister and “accidental president.”

I know that most comrades would, for obvious reasons, have preferred Lula da Silva. However, our economic situation is such that it is Cardoso that we should seek to emulate.

My main lessons from both Cardoso and the work of the World Bank’s Growth Commission can be summed up in the following sentences: instilling hope in citizens; accurately assess what is possible in a society; confidence is as important as technical competence; make credible promises; reassure people; effective government; and an experimental approach to the implementation of economic policy.

Let me start with Cardoso. He was recruited to become Brazil’s finance minister during that country’s most difficult period of hyperinflation.

People had abandoned all faith in the local currency and government policies. Government finances were a mess. Cardoso’s task was to restore the health of public finances and slay the dragon of inflation – while instilling hope in the people that a better future awaited them.

He has since reduced the reasons for his success to two words: reason and emotion.

In a lecture, Cardoso would later explain:

Practicing politics required an ability to clearly diagnose Brazil’s problems, understand the structures that were available to bring about change, and accurately assess what was possible in our society. It was the work of a sociologist. In this sense, the academic and the political – reason and emotion – were not only complementary, they were both essential. If ever there was a situation that demanded the skills of a sociologist, perhaps it was the chaos Brazil faced in the early and mid-1990s.

Cardoso’s battle plan against inflation involved the launch of a new currency, the Brazilian real. Several attempts have been made to launch new currencies in Brazil, but they have all failed. And Cardoso explains why: They were all shrouded in secrecy and depended on public surprise.

As a sociologist, I knew that in open societies, trust is just as important as technical competence. Communication between leaders and society is just as essential as the quality of the policies implemented. Therefore, I took great pains to explain our logic, and our plans, to the Brazilian public for months in advance before the launch of the real. I sincerely believe that this transparency has been the determining factor in our success.

By success, Cardoso aims to lower inflation from 2,500% in 1993 to 5% in 1995, a feat which he says had an immediate and profound impact on Brazilians.

People who lived in abject poverty could now keep their money’s worth and buy staples like yogurt and chicken. Others with higher incomes might now be saving to buy TVs and cars for the first time. It was the very definition of a policy that would both create wealth and reduce inequality. This is why I was elected president in October 1994 by majority vote in the first round.

As president, he would lead a government that would implement some of the social policies that Lula would reinforce and demand. These include progressive policies on HIV prevention and land distribution targeting the poorest.

His government also dismantled monopolies and privatized some public enterprises “without ever abdicating the necessary role of the state as an economic agent, both to promote development and to play a direct role in certain strategic areas, such as oil and finance”.

Cardoso achieved all of this because the nation was with him on the journey – they trusted him. And that brings me to the Growth Commission, whose takeaways dovetail with some of Cardoso.

The commission stressed the importance of communication with the public in convincing the population and instilling hope that “the future rewards are worth the effort, the savings and the economic upheaval”. He added that policymakers can only succeed in their efforts if “their promises are credible and inclusive, reassuring people that they or their children will enjoy their full share of the fruits of growth.”

The commission also stressed the need for effective government which it recognizes takes time to build and requires constant attention.

A culture of honest public service must be encouraged and maintained. The administration must also attract and retain talented people by offering better salaries and promotions, and by recognizing public servants who can measurably improve the performance of the public sector.

My third conclusion from the commission’s report is that government is not the immediate cause of growth. This is the role of the private sector which, in South Africa, represents up to 75% of economic production. “But a stable, honest and efficient government is essential in the long run.”

The fourth point concerns the need for an experimental approach to the implementation of economic policy. This should not be confused with political paralysis – that is, sitting around doing nothing.

An experimental approach is best exemplified by the words of the late Chinese leader Deng Xiaoping, whom the commission quotes as speaking of the need to “cross the river looking for the stones”.

And the commission agrees:

Governments sometimes need to proceed step by step, avoiding sudden changes in policy when the potential risks outweigh the benefits. This will limit the potential damage from any policy missteps, making it easier for the government and the economy to recover. Likewise, each step should represent a small trial or experiment, a “feeling” for the best way forward.

The choice and implementation of government policies influence the lives of millions of South Africans. In Spence’s words, government policies influence job prospects, health, education, and access to basic amenities such as water, public transportation, and light in their homes; the quality of their daily life; and the lives and opportunities enjoyed by their children.

It is therefore crucial that our political leaders mobilize our people behind public policy proposals. Without the buy-in of our people, without the masses having hope that tomorrow will be better than yesterday, South Africa will remain stuck on a path of low economic growth, or even continue its decline. Solving the country’s economic problems will cause pain, and the millions of poor South Africans will not, and indeed they have already demonstrated that they are not, ready to bear the pain because they have no no hope for the future. And when the majority of our people have lost hope for a better future, that’s when spring will come.

Amanda!

Sincerely,

Hlengani Mathebula

member of the ANC