[Debate] (Fwd) Moeletsi Mbeki v 'complacent political elite'

[Patrick Bond]

(Letting Anglo et al take historic apartheid loot away forever was such 
a dumb move - and responsible for SA's vast balance of payments deficit 
making SA the most risky emerging market - that it had to be a corrupt 
conspiracy, eh: "BEE went on to make ANC leaders dependent upon cash 
handouts; it secured oligarchs a seat at the policy table; it gained 
them preferential access to government contracts; and it bought them 
special favours such as permission to shift their primary listings to 
London.")

Business Day

Around the table with the elite architects of African poverty
ANTHONY BUTLER
Published: 2009/06/15 06:41:38 AM

MOELETSI Mbeki’s new book, entitled Architects of Poverty, weaves 
together three themes in its 200 compelling pages. First, Mbeki 
investigates the culpability of African elites for the continent’s 
dismal postcolonial history. Such elites, on his account, have been 
content to sell their continent’s riches to the highest bidder . African 
nationalists who paraded themselves as anticolonial in reality sought 
inclusion in the colonial system. When they replaced retreating white 
elites, the exploitation of ordinary black people and the continent’s 
resources continued unabated.

The two main components of Africa’s productive sector, peasants and 
foreign multinationals, have been vulnerable to elite predation. State 
marketing boards have extracted peasants’ surpluses to finance elite 
excess and state repression. Multinationals have been obliged to pay 
unofficial taxes and backhanders to local elites to secure access to 
natural resources. The resulting flows of revenues have kept political 
elites in luxury and encouraged them to ignore institution building and 
productive work.

The second key preoccupation of the book is the descent of Zimbabwe into 
economic and political chaos . Mbeki offers a persuasive account of the 
country’s recent fall, and explains the hostility among regional elites 
to the Movement for Democratic Change, a party that threatens the very 
system of neocolonial exploitation that also sustains them.

Mbeki’s third interest is the trajectory of post-apartheid SA. Here 
there is no peasant class to exploit and the modern manufacturing and 
mining sectors are primarily domestically owned. A powerful working 
class shares with private-sector owners a desire for sustained economic 
growth, which creates an unlikely alliance against elite enrichment and 
in favour of the rule of law. The private sector is also protected by 
strong courts and an independent media. All of this means there are no 
easy targets for elite exploitation.

In the most riveting section of the book, however, Mbeki explains that 
black economic empowerment (BEE) is the elite’s alternative project “to 
siphon savings from private-sector operators”. How did BEE emerge? Mbeki 
argues it was created by SA’s “economic oligarchs” — a term he uses for 
the relative handful of white business people who control the 
interrelated mining, chemicals and financial sectors of the economy. The 
object of BEE from beginnings he traces to the early 1990s was to 
“co-opt leaders of the black resistance movement by literally buying 
them off with what looked like massive assets at no cost”. Initially, 
BEE was “the bribe offered by the economic oligarchy to the black middle 
class for it to drop its demand for nationalisation”. BEE went on to 
make ANC leaders dependent upon cash handouts; it secured oligarchs a 
seat at the policy table; it gained them preferential access to 
government contracts; and it bought them special favours such as 
permission to shift their primary listings to London.

Big business also elaborated an ideology of “reparations” for 
“previously disadvantaged individuals” that was designed to create a 
dependent class. Benefactors extracted mostly symbolic handouts from 
private companies — and much more significant ones from the state, whose 
assets were henceforth seen as “fair game”. Mbeki bracingly describes 
the resulting empowerment elite as, “at best”, a “small class of 
unproductive but wealthy black crony capitalists made up of ANC 
politicians”.

The broader capitalist class, and manufacturing industry in particular, 
has been left out of this grand post-apartheid accord. One consequence 
has been a policy environment that has favoured resources groups and big 
business “without taking into account the ability of the country’s 
manufacturing industries to survive”. This, according to Mbeki, has 
resulted in a decade of deindustrialisation and rampant unemployment, 
ameliorated only by the introduction of a vast social grants system. 
This has been designed, he argues, “to placate the poor so that they do 
not rebel” and to secure their votes in national elections.

Even readers not fully persuaded by Mbeki’s overall assessment of the 
character of post-apartheid SA should be concerned by his visions of the 
future. In Mbeki’s gloomy view, a “complacent political elite” spouting 
liberation struggle and reparation mythologies may simply continue to 
pad its own pockets while feeding a seething “underclass” with social 
grants.

Predatory elites, moreover, have not given up their fight to loot the 
state and private sector. “These are early days.... Time will tell who 
will emerge best from what could be a titanic struggle by the political 
elite.... to confiscate the wealth of SA’s current private-sector owners”.

Butler teaches public policy at UCT.