“Everyone is gloomy and unhappy about what’s going on in our country,” said analyst, author, and businessman Moeletsi Mbeki. “Almost 50% of the economically active are unemployed. Nearly 50% of South Africans go to bed hungry. We have the highest murder rate for a country not at war.”
Mbeki was speaking about “South Africa in a dire situation” at the Rabbi Cyril Harris Community Centre in Oaklands, Johannesburg, on 26 April.
He maintains that though the country is governed by a black middle class (essentially the African National Congress – ANC) that doesn’t own any property or industry, it uses its political power to enrich itself from the state through consumption. It milks the productive economy, and threatens to take away assets.
“They can do this if they want with the stroke of a pen. The ‘expropriation without compensation’ debate is part of the ANC’s programme,” Mbeki said.
South Africa had been dominated by nationalism for the past 100 years, Mbeki said. First it was Afrikaner nationalism under the National Party, and later African nationalism under the ANC.
He characterised this as “a grievance-driven movement. It’s angry people blaming someone else, and it’s not constructive. People want reparations and compensation. Black economic empowerment is one of the manifestations of grievance. Nationalists, therefore, don’t fight to change the socio-economic structure of the colonial system. They fight to be included in it.”
Mbeki showed a graph indicating that South Africa had the most expensive civil service in the world – at more than 14% of gross national product. He said 30 000 public servants earn more than R1 million a year. “Backbenchers in parliament are paid R1 million to sleep, and get told how to vote. The more committees they sit on, the more they earn. President Cyril Ramaphosa earns more than the German chancellor! There’s no money left to invest in hospitals, roads, railways, or electricity.”
Mbeki argued that the nationalist elite looked after itself and not the people. He showed how South Korea and South Africa were on the same economic level in 1960, but now South Korea’s economy is five times larger than South Africa’s. “Why? Because they invest in the skills of people.
“We don’t invest in people, we have one of the lowest levels of human capital in the world,” Mbeki said. Singapore leads the Human Capital Index, Israel is 28th, South Africa is 135th. “We are consumption-driven and lack the human capital to build the economy, to set up new enterprises. Only about 40% of high school students graduate in South Africa. In Russia and Japan, it’s nearly 100%.”
He showed a graph he had constructed with the statistician general in 2014, which mapped the social structure of South Africa. Those earning above R60 000 made up just 0.44% – about 105 000 people at the time. The middle class – earning R11 550 to R60 000 – comprised just below 10%, and blue-collar workers made up 38%. The unemployed underclass made up a full 50% of the economically active population. “Inequality is very real,” Mbeki said. “This partially explains upheaval and crime. We’re sitting on a powder keg.”
Mbeki described the almost two weeks of violence, looting, and killing in July 2021 that ensued after the arrest of former President Jacob Zuma as “the edge of the abyss”. He said security enforcement agencies were “incompetent”, and “The rioters were ANC voters, especially those on social welfare. The poor are the main voters of the ANC; when they riot, the state sits back. R50 billion was destroyed in eight days. About 350 people were killed. The ANC won’t antagonise its voters to protect other people’s property.”
A commission of investigation had attributed the violence to a combination of the hollowing out of already weak state institutions; high unemployment; inherited high levels of poverty; poor special planning; rampant corruption; sponsored state capture; and despair brought on by COVID-19 restrictions. Warnings of this explosive mixture were given to government, but were consistently ignored.
Mbeki’s solutions start with reforming the proportional representation electoral system to include constituencies to enhance accountability. He said the ANC opposed anything which would promote greater transparency. The country needed to redesign its education, health, transport, and electricity systems, and halve the cost of the public service. South Africa also needs to restructure its relations with its neighbours as well as institute throughgoing reforms to the economy.
“But as long as the ANC is in power, there’s no chance of this reform,” Mbeki said. “If the ANC doesn’t get 50% in the 2024 elections, the opposition could unite and form a government. Five years after that, there will be no ANC – it will collapse like long-time ruling parties in Kenya and Zambia. All it has to offer is patronage, and it won’t have access to this if it’s not in government.”
“The problem is opposition parties fighting themselves. If they could be persuaded to work together, we’d have a very different South Africa in two years’ time.”
