BLACK POWER VS WHITE CAPITAL?
On 3 June 2020, the Daily Maverick journal published an article by former Deputy Minister of Finance, Mr. Mcebisi Jonas, headed “WE NEED TO RETHINK (JUST ABOUT) EVERYTHING”. Among others he wrote:
“…we remain trapped in a bubble economy in which a developed (white) South Africa thrives side by side with a country of the (black) poor living close to the breadline…
“Since 1994, we have lived with a strange dichotomy. Structurally, the problem is that (white) big business wields economic power but has no political power; and the (black) political elite don’t necessarily have a stake in the economy.
“Clearly, as we enter the new world, we need a new social compact that brings the two kingdoms into one federation…
“This should be the moment for us to unite, instead of fragmenting into old predictable tribal ideologies.”
In his comments, for reasons of political correctness, Mr Jonas omits the words ‘black’ and ‘white’.
We have inserted these words in brackets because it seems obvious that Mr Jonas is arguing, at least in part, that those who control capital, who are white, do not share the outlook of those who control political power, who are black, concerning such matters as the eradication of poverty, which essentially affects the black majority.
If Mr. Jonas is right, the question would arise – does this mean that the white owners of capital behaved differently during Ages One and Two? If that is so, why?
WHAT IS THE PRIVATE SECTOR UP TO?
The alert sounded by Mr Jonas finds an echo in what some have said in our country about an ‘investment strike’.
In this context, on 22 September 2019 Business Times published an article entitled “Have the courage to invest the cash”. It said:
“The private sector must stop waiting for the government to create optimal conditions for it to invest the more than R4-trillion it is sitting on, says Elias Masilela, former CEO of the Public Investment Corporation (PIC), who heads the global impact investing initiative in SA…
“The South African private sector needs to understand they should not invest for narrow profit only but for broader economic gain,” says Masilela.
“Whatever they do has to have a broader impact than just influencing the bottom line. And the investments have to be visible so that the poor understand that they’re not just being made to benefit the owners of capital, but to benefit them as well.”
Mr Brian Kantor, then Head of the Research Institute at Investec Wealth and Investment, writing in his personal capacity, also said that:
‘The SA banking system is hunkering down, not gearing up… The banks are building balance sheet strength and raising deposits, and are cautious about lending more…hence adding to their reserves of equity capital. All of this is growth depressing.’
In this context, about four years ago, a US economist and Nobel Prize winner also expressed serious concern about the levels of risk aversion among the South African banks.
He said that at that point, the debt-to-equity ratio in the Euro banks was 20:1. In the US banks it was 12:1 and in the South African banks 2:1!
The senior businessman, Mr. Johann Rupert, spoke with his usual honesty when he participated in a ‘Power FM’ radio programme in December 2018. During this programme he said:
“We let President [Thabo] Mbeki down because he created a perfect scenario for business to invest. But you know what – I think we could not believe our luck, we should have invested more from the private sector during that period… Before foreigners invest, they look at us,”
Rupert said about SA’s investment environment.” [fin24, 06/12/2018].
Unfortunately, the Programme Host did not ask Mr Rupert what it was that resulted in the private sector not investing. His response would have helped our country a great deal, honestly to respond to its objective challenges.
OTHER MATTERS CONCERNING CAPITAL
In its ‘Report 1. State of Illicit Financial Flows in South Africa: A Scoping Exercise’, the African Monitor said:
“South Africa is heavily affected by illicit financial outflows, according to data released by Global Financial Integrity. Between 2002 and 2011, South Africa lost a cumulative 1,007 billion rands to illicit outflows. South Africa has a long history of financial outflows. An earlier report shows that South Africa has been experiencing huge illicit outflows starting from the last years of the apartheid period and political transition. It is interesting to see post 1994 the trend continued.”
There are persistent reports that businesspeople in South Africa, both black and white, continue to export capital from our country, including through illicit ways.
We raise this matter of the export of capital from our country for two main reasons. These are mainly that:
● all indications are that the sums involved are quite considerable, signifying that the country is losing sizeable resources which would help greatly to meet its large shortfalls; and,
● such deliberate outflows raise serious questions about the confidence of the owners of capital in the future of our country and therefore their confidence to invest in it.
Concerns in this regard are reinforced by such reports as carried by such outlets as the Daily Investor, among others.
On 2 April 2025, this journal published an article by Shaun Jacobs entitled ‘SOUTH AFRICA’s ECONOMY HEADING FOR DISASTER’.
The article said:
“The (South African Reserve Bank) data showed that real gross fixed capital formation, an indication of fixed investment, declined across the board in 2024.
“This is despite renewed optimism surrounding the country’s economy following the formation of the Government of National Unity (GNU) in June last year.
“After the formation of the GNU, business confidence rebounded strongly as it was widely viewed to be the most business-friendly government South Africa has ever had.
“However, on an annual basis, real capital spending by private businesses decreased by 4.1% in 2024, following an increase of 3% in 2023. “As a result, the private sector’s share of total nominal gross fixed capital formation decreased from 72.4% to 72.1%.”
As we have said concerning the important matter of the seepage of capital out of the country, such reports raise serious questions and concerns about the confidence of the owners of capital and therefore their willingness to invest in it.
The then Deputy Managing Director of the International Monetary Fund, IMF, Mr. David Lipton, visited our country in 2016 and spoke at the Wits University on 19 July 2016 on the subject, ‘Bridging South Africa’s Economic Divide’.
Among other things he made this important observation:
“Some government policies may make sense in a truly advanced economy. But in South Africa they create a situation in which the developed economy is not lifting up and absorbing those excluded from the economy.”
Unfortunately, Mr Lipton did not elaborate on this important observation.
However, as we strive to imagine South African renewal after 30 years of democracy, we must make every effort to discover what Mr. Lipton meant and not repeat the error of imposing mistaken policies on our country which only serve to perpetuate the inequalities of the colonial and apartheid years.
CAPITAL AND AGE TWO?
What we originally set out to do was to assess whether the behaviour of capital had anything to do with the differences between Ages One and Two.
We believe that so far we have not found anything which would suggest that capital did anything to cause the differences between the two Ages. However, as would be expected, undoubtedly capital responded to the changes as they manifested themselves during the two Ages.
Nevertheless, and of the greatest importance, any document which discusses what should be done to achieve the socio-economic renewal of South Africa, 30 years after the democratic transition, must reflect seriously on all the matters we have raised concerning the behaviour of capital in our country.
Regrettably, none of this serious reflection appears in any of the Government documents we mentioned!
In the attempt to unravel the mystery between Ages One and Two, we said we would proceed from the simple to the complex.
We then postulated that the simple might be defined by considerations of race and race relations. We then discussed capital in South Africa in that context.
PROCEEDING FROM THE SIMPLE TO THE COMPLEX
As we promised, we must proceed to the complex in terms of seeking to answer the question, as we said – what happened such that, almost overnight, Age Two emerged seemingly as a direct contradiction of Age One?
Properly to understand the answer to this question, one must have some familiarity with the politics of South Africa, especially during the apartheid years.
In addition to the vile racism which defined the politics of the apartheid regime, in all its echelons, was its rabid anti-communism, and therefore the related hatred of the Soviet Union!
Many of us in the liberation movement understood this anti-communism as but a propaganda posture the apartheid enemy desperately needed to denounce our movement as the very representative of the anti-Christ.
We understood that the anti-communism was but one of the weapons in the armoury of what the apartheid regime called its total strategy to defeat the liberation movement and successfully defend the apartheid system.
We gave it no weight further than that.
However, developments have shown that we failed properly to understand the fact that this anti-communism was as deeply entrenched in the mind and psychology of the apartheid adherents as was racism.
It was therefore not a mere propaganda weapon, but was a deeply held, internalised belief which helped to inform all the actions and activities of the apartheid practitioners.
Critically, this included the generalised understanding of what our liberation movement truly and actually stands for.
Earlier we quoted the CEO of the Institute of Race Relations, Dr Endres. We will now quote one of his colleagues at the Institute, Dr Anthea Jeffery, Head of Policy Research.
Speaking in 2023, she said:
“With growth stalling, joblessness at crisis levels, and governance unravelling, most South Africans cannot fathom why the ANC does not embark on meaningful reform.
“The answer lies in what is seldom raised: the ruling party’s unwavering determination to take the country by incremental steps from capitalism to socialism.
“As I explain in my new book, ‘Countdown to Socialism: The National Democratic Revolution in South Africa since 1994’, this transformation is being implemented via a Moscow-inspired ‘national democratic revolution’ (NDR) dating back many decades. Despite the Soviet Union’s collapse in 1991, the ANC/SACP alliance still sees the NDR as offering the ‘most direct route’ to socialism in South Africa – and hence as its bedrock strategy.”
Supporting her explanation of the NDR, one Andrew Kenny, described as writer, an engineer and a classical liberal, writes:
“The NDR is a plan to turn South Africa into a purely socialist state – with 100% state control and no private property – in which all power will be held and kept in the hands of the ruling party, and in which ‘the motive forces of the revolution’ who will benefit from it are ‘Black people in general and Africans in particular’
(This quote is from one of the ANC’s Strategy and Tactics documents, all of which continually focus on the NDR.)
“The NDR is a two-part plan: the first part is to take power, which they have
already done through the 1994 election. The second part is to turn South Africa into a full-on socialist state, or communist state. The inspiration for the NDR, which they are quite open about. Comes from Vladimir Lenin and Communism in Russia…”
This is exactly how many within the apartheid regime understood the ANC.
THE REAL NATIONAL DEMOCRATIC REVOLUTION
Of course, all elements of the definition of the National Democratic Revolution (NDR) advanced by Dr Jeffery and others are a complete distortion of the NDR pursued by the ANC, its allies and the broad democratic movement.
The true NDR is about the liberation of the historically black oppressed from the centuries-old white minority political domination.
It is about building a truly democratic South Africa, consistent with the principle that the people shall govern.
It is committed to the eradication of the legacy of colonialism and apartheid in all its elements.
It considers itself bound by the Constitution of 1996 to help build the kind of South Africa spelt out in that document which is a binding national contract among all the people of our country, black and white.
Nevertheless, when they fought against the Movement during the years of protracted struggle against colonialism and apartheid, the soldiers of apartheid knew it as a matter of fact that they had to stop the victory of the ANC as this would mean the communist take-over of South Africa.
When the ANC emerged as the unquestioned victor in the 1994 elections, these apartheid adherents saw this as a temporary defeat which had to be reversed at all costs.
As confirmed by the then leaders of the Broederbond, there was a ‘Plan B’ in the event of an ANC victory in 1994.
The aim of that ‘Plan B’ was to make certain that whereas the ANC had won a battle in 1994, ultimately it would lose the war, defeated by its historic enemy. The latter were the members of the apartheid old order who had taken on the strategic task to ensure the victory of the counter-revolution against the National Democratic Revolution.
In the view of the Counter-Revolution, so strategic and historic would its victory over the ANC be, because it would mean the defeat of a communist takeover, that it was of the greatest importance that it would have to prepare for the victory it sought meticulously.
END PART 2
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