I have been sickly and trying to pay the bills.
All my ‘paid for’ commentary on the NGC is done and I can finally get back to home ground where I feel more comfortable to make some wild accusations – and I will, finally, be more explicit in this post about who I think the bad guys are and who I think the less bad guys are.
At the outset, forgive me; this is long and requires a degree of effort to plough through. I believe your efforts will be rewarded in the end – but I would think that, wouldn’t I?
The NGC, just like the world itself, becomes a cacophony, impossible to follow and impossible to interpret, without a guiding theory or a framing shape to look through.
The “theory” I am going to use here is that the NGC was the terrain on which two broad factions in the ruling alliance clashed. How you slice-and-dice a thing, conceptually, is always important for what you conclude, so much of what appears below is an attempt to unpick what and who those ‘factions’ consist of.
To think that what was happening at the NGC was “about” the nationalisation of mines call will lead to ‘error’ (you can see Lenin in my heritage when I use terms like that). Instead the NGC was “about” a more fundamental and complex power struggle.
The picture is additionally complicated when we consider that there were over 2000 delegates at the NGC (1500 from branches, 500 from the leagues/Cosatu/SACP/SANCO/PECs and 800 deployees/non-NEC ministers/DGs/premiers/CEO’s of SOE’s) and the interplay was vast and varied.
So instead of trying to cover everything I am going to look through the prism of an alleged power struggle between two broad factions or groups of interest. This will ultimately be another attempt to “follow the money”.
Here then is the prism through which I believe it is most useful to look:
- The ‘nationalisation of mines’ (NOM) call was always a “stalking horse”. The term “stalking horse” refers originally to “a horse behind which a hunter hides while stalking game” (WordNet) and is defined in Wikipedia as “a person who tests a concept with someone or mounts a challenge against them on behalf of an anonymous third-party … if the idea proves viable and/or popular, the anonymous figure can then declare their interest and advance the concept with little risk of failure … if the concept fails, the anonymous party will not be tainted by association and can either drop the idea completely or bide their time and wait until a better moment for launching an attack.” Oh yes, I love the language.
- The ‘nationalisation of mines’ call (hereafter called NOM because in fact, it has less do with policy and more to do with power) is best understood as the political platform of a particular alliance of groups and individuals and interests that has as its objective the winning to power in the commanding heights of the ANC and the South African State. The NOM is therefore something more (and less) than a policy proposal. It is a contingent strategy for winning power – and getting the ANC to nationalise the mines would be a desirable side-affect for some of the participants.
- The first part of the NOM is the Youth League’s own specific ambitions, which have most obviously been expressed as a campaign to elevate Fikile Mbalula to the position of Secretary General of the ANC – the position currently occupied by Gwede Mantashe. Mantashe is despised by the League for a number of reasons, but mainly because he is part of those who believe the ANC Youth League is part of an ambitious rent seeking agenda. The League considers itself to be a “king maker” in ANC electoral processes and the organisation has energy and mobility and time to move quickly around the country to influence decisions at a branch and provincial level – a feature it demonstrated successfully at and in the lead-up to Polokwane.
- The second part of the NOM are those mining tycoons who want their BEE deals bailed out by the taxpayer. Who could have failed to notice the unified voices of those gleaming billionaire siblings Patrice Motsepe and Bridget Radebe as well as Minister of Housing Tokyo Sexwale backing the NOM in the lead-up to the NGC or at the conference itself?
- The third part of the NOM is the election campaign of Tokyo Sexwale to succeed Jacob Zuma. Has he specifically funded and backed the ANC Youth League so that it can be deployed in its traditional role of “king-maker” on his behalf – or because he wants his BEE deals bailed out … or both? It is impossible to prove – either that he has passed money/business/tenders the way of the League or why he might have done so – but that he has done so – with the intention of becoming president – is clearly the view of most of “the left” in the tripartite alliance.
- The clearest unifying principle behind the NOM and the most distinct characteristics of its participants is that they are first in the queue to gouge a rent out of the ANC’s economic transformation agenda. The nationalisation of mines call is tailor-made for the broader agenda of the NOM: there are real material benefits for the backers, it allows the policy bereft Youth League to appear radical and pro-poor – and anti-white capitalist – to its potential supporters; it forces the current top leadership under Zuma (for the sake of investment and economic stability) to deploy itself to defend against something that would naturally appeal to the rank-and- file’s populist instincts.
- So who is the NOM challenging? Essentially “the incumbents”, which at one level just means Jacob Zuma, but at another level means everyone who has assumed a leadership role in government, party and the Tripartite Alliance as a consequence of Jacob Zuma’s elevation as well as the ideas and policies that have come to be crafted by that incumbent group.
- The “incumbents” should also be conceived of as including all those tenderprenuers, Nkandla hangers-on and Zuma family members whose fortunes are linked to the fortunes of the incumbent leadership.
- Do the members of the NOM even know who they are or what they are part of? Mostly they do – because there is an increasingly bitter conflict, for example, between the ANC Youth League and the SACP. When powerful factions clash, they strengthen themselves, make themselves more defined; they force anyone and any issue into the framework of their clash. We saw this in the Cold War, but more recently and specific to the groups here, we saw this in the struggle to stop Mbeki and elevate Zuma. eventually everyone knew whether they were “for” or “against” the motion. Attempts to stay sane, principled and above the fray are inevitably MIA in this kind of overblown factional dispute.
Given that framework, what actually happened?
Firstly, the NOM did extensive (but insufficient) spade work around the policy that fronts their agenda. Julius Malema and Floyd Shivambu have been on an extended road trip, selling the idea for over a year. They have written for newspapers and addressed conferences. Malema threatened to withdraw Youth League support from any leader who did not support the call. The Youth League attended all provincial preparation conferences for the NGC and was successful in getting its view represented in every delegation from every part of the country. There are extensive reports that members were instructed to infiltrate ANC branches and emerge later as NGC delegates. The style associated with “winning” this view at various conferences was a combination of exclusive focus on the issue and heckling, booing and threatening any opposition – in the now time-honoured traditions of the League and its members.
What the financial backers of the NOM and members of the broader NOM agenda were doing in the lead-up to the NGC should not be underestimated. Individual backers of the NOM have extremely extensive resources. Such wealth and power gives individuals the ability to reach people and process far from themselves – and snap them like a twig.
It is difficult to say how much work the incumbents did. I have made the assumption that securing the Tripartite Alliance was key to the incumbents preparing for the onslaught they knew was coming at the NGC. In this context the brokering of the ending of the public sector strike and the carefully worded apology from Cosatu to the Zuma/government for the language workers and their leaders had used during the strike was, in part, an attempt to establish the ground for a united front against the NOM agenda at the NGC. Comprises and certain concession were probably made to “the left” – but I will discuss this in the conclusion.
The NGC opening – political and organisational reports
Jacob Zuma’s Political Report and Gwede Mantashe’s organisational report were interesting for a number of important reasons but what is relevant for this post is both reports were correctly interpreted as a significant shot across the bows of the NOM. We can all delight in the fact that Winnie Mandela had to physically comfort the distraught Julius Malema after the dressing down he received during Jacob Zuma’s opening Political Report and take to heart her now immortal words ” … every parent is allowed to talk to their children … Every organisation is like a parent.”
Commission 5 victory and then plenary defeat
The sighs of relief ‘the incumbents’ might have breathed after the NOM’s early humiliation were soon replaced by anxiety when the NOM decided to put all of its eggs in one basket (this is one time that cliché is justified) by sending 45 of the Youth League’s 66 delegates to the Wednesday economic transformation commission. It appears that all supporters of the NOM including Tokyo Sexwale and several other BEE mining tycoons flooded the commission to ensure a particular outcome. The best article in the public domain I have seen about the commission is by Moipone Malefane and Caiphus Kgosana in The Sunday Times of September 26 – catch it here.
Joel Netshitezhe , Lesetja Kganyago (DG in the Treasury),Trevor Manuel, Enoch Godongwana (Deputy Minister Public Enterprises) and old stalwart on this issue, Jeremy Cronin, were amongst the key ANC intellectual and economic thinkers who tried to hold the line at the meeting. Their appeal for thoughtfulness and care around an issue likely to costs government hundreds of billions of Rand were reportedly overwhelmed with bullying, heckling and unthinking repetition of the demand: adopt the call, as we have defined it, as policy!
Without having seen the exact statement that emerged from this commission it is clear that the Youth League (and everyone else present) was under the impression that they had scored a clear victory and the inner cabal reportedly headed off to the Hilton Hotel to celebrate victory in the style to which they had become accustomed.
The ANC Youth League’s (and the NOM’s) celebration was premature. The next day at the plenary session of the NGC Minister Geoff Radebe (husband of Patrice Motsepe’s sister, Bridget, and someone who had expressed support for the basic premise of NOM earlier) delivered a watered down version of the results of Commission 5 – and the ANC Youth League leaders exploded, ultimately sealing their fate by appearing to storm the stage in an aggressive manner.
Ultimately, through the support of delegates from across the alliance at the plenary, a watered down version of Commission 5 carried – essentially calling for thorough cross-country comparison and analysis of nationalisation as part of government’s ability to influence economic growth patterns in favour of the poor and unemployed. This study was mandated to report back to the 2012 Bloemfontein/Mangaung 100th centenary elective National Conference.
In the end it was not ‘the incumbents’ that were overwhelmed by the “shock and awe” campaign of the NOM. In the end it was the NOM that lost the skirmish – they overestimated the efficacy of their own preparation and they underestimated the coherency of the opposition – as well as degree of anger that is now widespread towards the ANC YL and its leaders.
The paucity of facts in the public domain does not relieve us of the obligation to think about what may be going on and develop a view as to the potential risks involved in any situation. Wile E Coyote might have said ‘what we don’t know can’t hurt us’, as he wandered over another cliff, but in the real world what we don’t know can sometimes be deeply threatening. So the explanations I have given here are my best attempts to muster an explanation for as much of the story as possible. I am sure that at some point in the future some of the guesswork and necessary assumptions might prove misguided – but that is life in the threat analysis business.
Three final points;
Firstly, it is okay to delight in the set-back of a particularly voracious self-enrichment agenda at the ANC NGC. But it is important not forget that the conference left unscathed similar agendas in many other places in ANC and affiliated ranks, including in the Zuma family itself.
Secondly, the defeat of the NOM is a tactical, tangential issue. Like the Governator, they’ll be back.
Finally, the victory was bought at the expense of some kind of compromise with “the left”. I expect the upcoming Cabinet review of a New Growth Path to be more sympathetic to a host of issues traditionally seen as part of an SACP or Cosatu platform (including Rand policy, inflation targeting, downward pressure on interest rates, nationalisation of the SARB, tax on short-term capital flows, industrial policy, National Health Insurance and the establishment of a state-owned bank.) The consensus within “the incumbents” is inexorably moving towards a rejection of some of the basic tenants of the Growth, Employment and Redistribution Macro-Economic Policy as defined by Mbeki and Manuel.
Our future is full of as yet undefined state intervention. I wouldn’t feel so bad about this if I didn’t agree with Cosatu that this state, in this place and time, is rapidly becoming a predator.
14 thoughts on “Stalking Horses at the NGC”
Absolutely brilliant posting. Makes for a great cloak ‘n dagger novel dontcha think? Thanks Nic.
One wonders where the centre is an how long it can hold.
Thanks Mark – I worried I maybe made it too ingewikkeld(sp?) … but I feels like the right line to take – keep well
Great post. I’m not quite sure I understand what Motsepe and Sexwale have to gain by NOM. Could you please elaborate?
Will do as soon as I am back at my desk
Thanks, Nic. Looking forward to reading it.
Hi Biobot – the argument (usually advanced by the South African Communist Party) that “the real” motivation behind this particular call for the nationalisation of mines is that it is in the interest of a group of BEE beneficiaries who bought significant parts of the mining industry (particular mines or parts of global mining companies) at a huge discount because under the 2002 Mineral and Petroleum Development Act the previous owners were obliged to sell (at a discount and through helping to finance the deal) parts of the mines and the companies to “previously disadvantaged South Africans” “PDSA’s … so this was their main bite at the Black Economic Empowerment cherry. Many of these deals were structured so that the beneficiaries had to put none of the own money into the deal – it was financed through a special purpose vehicle (SPV) which ‘worked’ on the the projection of what the share price or the mineral price would be at some time in the future … i.e. these were heavily discounted deals, massively in favour of the beneficiary (quite rightly so, too) and at some point the increase in the share price would be used to finance the original purchase. BUT the deals where struck when the projections for commodity prices (and therefore the prices of the mining companies and mines concerned) where sky-rocketing as a result of apparently endless Chinese commodity appetite. Various things have changed since then and the prices of the minerals and the mining companies did not keep up with projections … although they have still not been too shabby. Thus these mine owners (who are multi-billionaires anyway, having made their money through a myriad such deals in every sector of the economy) want the government to use its stretched resources to nationalise those mines … i.e. buy them with tax payer money (money that most people would see as promised for the upliftment of the poorest) so that these multi-billionaires can walk away with even more obscene wealth than they already possess …. no wonder Trevor Manuel’s words (quoted in the post) are so spluttereringly disgusted. Thus the BEE tycoons who have become fabulously rich – beyond normal people’s imagination – now want the scarce resources of the fiscus to give them a SECOND bite at the transformation cherry … and it is not like any of these individuals would be in serious trouble if a few of their original deals went sour – these are massively powerful and rich and diversified billionaires …. the idea of referring to them as PDSA’s is slightly ridiculous – they are about as previously disadvantaged as Warren Buffet and in as much need of historical redress …. this is but one of the distortions we just have to live with as we push ahead to real redress and equality for the many millions of South Africans who need it most.
Fascinating and enlightening. Thanks Nic.
Actually … you may have posted a longer than usual article, but it certainly made the goings-on at the NGC a LOT clearer in my mind. So thank you!
A question – I am somewhat confused by the unity shown by the Alliance on the NOM issue. Would it be incorrect to assume that the nationalisation of what could be viewed as a state asset, is congruent with COSATU and SACP’s ideology(ies)? Or is this unity shown purely to present a united front and preserve the Alliance, for now …?
I left South Africa some 10 years ago now and am probably not qualified in many respects to comment, so please forgive my intrusion.
There is much detail of the political jostling and power plays, but what I see broadly is a tussle between capitalism and socialism.
A degree of Socialism is probably inevitable given the post colonial issues you have. A bigger threat I see to your stability is the amount of fracture, given the tribal element that seems to undermine all of post colonial Africa.
Your “colonial” status is different to most other examples in Africa but it is affected by the same sort of culture which is understandably intolerant to western thinking. You do have a unique constitution but it will take a strong economy to back it against the mires of tribal mentality when it comes to control of economic assets( I include all racial groups/cultures when referring to tribalism).
The posts above probably represent the “old school” capitalism in South Africa which has to be seen to be put to bed. Another element that needs to be overcome is the weighted trade union mentality which was born of insurrection rather than growth. Entrepreneurs, especially indigenous African, need to take the bull by the horns and induce growth and prosperity, all the while distancing themselves from the usual spoils of prosperity, pouring the profits into education and training, giving capitalism a socialistic edge. Only by this example you will break the shackles of tribal degeneration. You can point fingers all you like at the power seeking “militants” but you will achieve nothing unless you appease their members with real gestures.
There are positive elements of the unionised mentality which keeps negotiation on a civil platform, but you will never free yourselves from their “militancy” without brave and selfless actions of African entrepreneurs who lead by example and undermine this thinly veneered tribal mentality, which has bought Africa to its knees under post colonial culture.
Time and Education – keep your nerve, and fight corruption, never mind the corruption of others, sort your own and they will follow!
Black Economic State Owned Private Enterprise (BESOPE). Read in Afrikaans, that will be : besope, drunk on power and the stripping of assets. Thank you for your articles.