[DEBATE] : It's a return to the RDP - Cronin

[Martin Jansen]

Obfuscation is a trademark of Jeremy Cronin and being the poet that he is,
has turned it into an art form 


-----Original Message-----
From: debate-bounces at debate.kabissa.org
[mailto:debate-bounces at debate.kabissa.org] On Behalf Of David McDonald
Sent: 30 October 2008 03:11 PM
To: 'debate: SA discussion list '
Subject: RE: [DEBATE] : It's a return to the RDP - Cronin

Cronin sounds like one of those confused environmentalists that like to
argue "we are not left or right but in front".  What exactly is he talking
about here?  He's done nothing to clarify the 'new' ANC's position for me.
More obfuscation designed to convince people that there is an ideological
shift afoot.

David 


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From: debate-bounces at debate.kabissa.org
[mailto:debate-bounces at debate.kabissa.org] On Behalf Of Dominic Tweedie
Sent: October 30, 2008 1:50 AM
To: debate: SA discussion list
Subject: [DEBATE] : It's a return to the RDP - Cronin

'Leftward shift' is a return to the essence of the RDP

Jeremy Cronin, Business Day, Johannesburg, 30 October 2008


Business Day has reflected widely divergent views on what transpired
at this month' s African National Congress (ANC)-led alliance economic
summit. Beneath a front-page headline that read: "Economic policy
jerked left as SACP calls shots," Karima Brown and Amy Musgrave
reported that "a fundamental shift to the left in economic policy
emerged from the ruling ANC's economic summit" (October 20).

As examples of this shift they list proposals to set up a two-tier
cabinet, a planning commission, and industrial policy focused on job
creation. "The changes", they wrote, "will surprise, if not shock,
analysts."

Steven Friedman went to the other extreme: "This is not a leftward
shift. It is an attempt to prevent one by doing what Mbeki failed to
do — bringing the alliance partners into the discussion in the hope of
defusing tension. This is far more likely to preserve the current
policy framework than Mbeki's approach." (October 24)

Anthony Butler (October 27) agrees with Friedman. On the envisaged
planning commission, he argues "the proposed changes are consistent
with a gradual strengthening of the Presidency's policy unit
. They
are exceedingly Mbekian". On the same day, editor Peter Bruce
disagreed with his columnists: "What about the coming weakening of
Manuel's authority over spending? 
 what about the creation of a
presidium of über-ministers
?"

Let me concede the obvious. In the ANC alliance we have not helped
clarify matters by variously asserting there is and there isn't change
in economic policy. At the heart of the confusion is a radical lack of
clarity about what it is that supposedly is (or isn't) changing.

To get a better fix on this, consider Friedman's argument. "The
government's 'economic creed'", he writes, "over the past decade has
often been misunderstood by Jeremiahs on the left and wishful thinkers
on the right. It has not been purely market-driven: it has, rather,
been an attempt to address poverty and stimulate growth through a
broadly market-friendly approach, but with significant welfare
spending and regulation of economic activity."

Despite being a Jeremiah, I agree largely with this characterisation
of what has been the government's framework policy. However, it is
precisely this paradigm of market-driven growth, on the one hand, and
earnest state welfarism, on the other, that needs to change. Indeed,
it has begun to change across the government in the past years. Why?
As Finance Minister Trevor Manuel has often remarked, we cannot
sustain our current trajectory of welfare expansion. Our levels of
unemployment, poverty and inequality make this impossible. So what is
reproducing these dire levels of underdevelopment? Paradoxically, it's
the systemic features of our market-driven growth.

Restored growth over the decade has been excessively dependent on
primary commodity exports and on capital goods imports. It is
capital-intensive, not labour-intensive. Small and medium enterprises
are crowded out by corporate concentration in the minerals, energy,
agro-processing, and finance sectors. In the absence of effective
industrial policy, hasty and excessive liberalisation in the mid-1990s
wiped out critical sectors of the economy. Liberalisation also saw
major disinvestments and delistings. In a highly unequal society our
savings are low, and much recent growth has been driven by consumer
spending as the barely emergent black middle strata struggle to escape
township poverty. Low savings mean we need to attract foreign
portfolio investment through high interest rates. High rates threaten
the emergent middle strata and stifle productive investment. None of
this is sustainable.

The basic challenge is to transform the structural features of our
growth path. The state cannot be limited to the roles of an
overwhelmed welfare distributor and a macroeconomic boss-boy working
for the markets. We need to transform our productive economy and
vastly expand job creation. Is inflation-targeting effective? Should
there be a budget surplus? These are important but subordinate
questions. Macro polices must be measured according to their immediate
and longer-term contribution to getting our productive economy to work
better.

To be left wing is not a matter of being market-unfriendly. It is
about asking transformational questions of the markets we have.
Markets clearly respond more dynamically to market signals than a
Soviet-era central planning structure. But market demand is not the
same as social need. In our marketplace nearly half the population is
too poor to signal anything. Within the context of existing power
relations, markets have a dynamic allocative capacity, but are poor
structural transformers and very poor future planners.

Focusing on the transformation of our productive economy is the
paradigm shift that is required. It is a shift that has been under way
for a few years. The alliance summit helped consolidate the shift,
while setting out an array of tasks that lie ahead.

In making this shift, we are returning to the essence of the 1994
Reconstruction and Development Programme (RDP). In about 1996 the RDP
got dumbed down into welfarist targets to be redistributed out of
market-driven growth. The RDP was taken in this direction by the
government's economic assumptions of the day ("first grow the cake,
then redistribute").

But the RDP of 1994 explicitly understood that development was not
primarily a redistributive subtraction from growth. We are now once
more coming to appreciate that transformation of healthcare and
education, or rural development, are critical ingredients for baking
any sustainable growth.

This is why the summit focused on state-led industrial policy and on
improving the government's strategic co-ordination and planning
capacities. Bruce, Friedman and Butler conjure out of these concerns a
lurch towards totalitarian "über-ministers", a centralisation that is
"exceedingly Mbekian".

I was intrigued, therefore, by a recent University of Pretoria address
by Remgro chairman Johann Rupert. "The worst feature of the Mbeki
regime", he said, "was probably the paranoid reaction to any form of
criticism
. Even 'big business with government' meetings were
orchestrated 'PowerP oint exchanges'. It was not frank dialogue 
 even
business leaders were very reluctant to criticise, preferring the
lobbying route."

Factional plotting driven by a personal obsession with control is not
the same thing as publicly led strategic planning and effective
co-ordination. Lack of coherence across the state is exactly what
breeds "the lobbying route", back-room "quiet diplomacy",
elite-bargained municipal demarcations, corporate capture of line
departments, tender-award favouritism, and multibillion-rand white
elephant projects. Where there is strategic coherence across the
state, and transparent planning that is participatory (the only
effective option in a mixed economy) we enhance our democratic space.

Instead of debating abstractly whether we are moving left or not,
shouldn't we all agree (as I suspect we do) on our job-creating,
education, healthcare, crime-fighting and rural development
priorities? Then we need to plan together, implement together, and
constantly debate and evaluate progress towards addressing these
priorities.

•	Cronin is an ANC MP and a member of its national executive
committee. He is also deputy general secretary of the South African
Communist Party.

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