South Africa has bucked the international trend towards neo-liberalism. But this important challenge can only be carried through if the country’s social democrats make themselves heard, argues Eddie Webster
In a recent article in the London Review of Books, RW Johnson rightly points to the fact that the Government of National Unity has accepted the macro-economic constraints of the liberal international economic order.
He cites the signing of Gatt which, he says, “will send a wave of anti-protectionism and deregulation rippling through one industry after another”; the abolition of the old financial rand; and a sharp cut in real wages in the public sector.
Johnson welcomes this realism but finds it odd that Cosatu is willing to accept a policy where it is likely to be the “chief potential victim”. He attributes this to “discipline born of years of struggle” and the cohesion created by its alliance with the African National Congress.
It is an insightful and persuasive argument written with wit and elegance. But, in his eagerness to demonstrate that “normal politics has at last begun” in South Africa, Johnson misses the innovative part of South Africa’s response; the multi-layered institutionalised negotiation process between classes created through Nedlac, workplace forums and the industry-wide statutory councils in the new Labour Relations Bill. These tripartite and bipartite arrangements are not part of neo-liberalism– they are a creative challenge to the global agenda of neo-
This was brought home to me sharply while on a recent research visit to Brazil. Like South Africa, Brazil is a semi-industrialised country with an authoritarian past, opening up its economy to international competition. In the early 1990s, employers, unions and government created “sectoral chambers” where they negotiated pacts that restrained wages, cut taxes and reduced profits. In the auto “sectoral chamber” they introduced the “popular car”, creating a mini-boom.
Yet, since the election of Fernando Cardosa’s government last year, the need to reduce hyper- inflation in Brazil (running at 400 to 1 000 percent at times) has overtaken growth as an economic strategy. The “sectoral chambers” have been put in abeyance while Cardosa’s centre-right government downplays tripartite arrangements. Co-operation between unions, employers and government is not part of the neo-liberal agenda in
In South Africa the opposite is the case. The launch of Nedlac in February this year is the key to this innovative strategy. It provides labour with a central role in the negotiation process. Through creating a statutory body designed to create consensus between labour, government and employers on economic and social policy, Nedlac institutionalises the power of labour in the heart of decision-making. Through the creation of industry-wide statutory councils designed to jointly negotiate training and industry policy, the draft Labour Relations Bill creates the basis for long-term industrial policy.
Above all, through the proposed Workplace Forums, workers are potentially drawn into decision-making at an early stage, challenging management’s prerogative to unilaterally make and implement decisions on the shop floor.
It is a decisive and bold step in the direction of co-
These three innovations go against the global neo- liberal trend that stresses a less interventionist role for the state, decentralised bargaining and a system of participative management designed to by-pass trade unions on the shop floor.
Johnson is right to stress the fact that the “real test lies ahead”: short-term wage restraint for long-term productivity enhancement is a part of tripartite arrangements. But here again Johnson misses the innovative part of the South African response.
Unlike the Brazilian case, South Africa has a left- centre government. This opens up the possibility that Cosatu could become a left-wing pressure group which could propel the government towards redistributive policies by mobilising pressure from civil society, communities and the workplace.
This unique combination in the Third World of a powerful and strategic labour movement in alliance with a left-centre government allows one to envisage the emergence of a social-democratic programme competing with neo-liberalism. Social democracy in a South African context refers to a commitment to equity-led growth and support for tripartite agreements between labour, management and government.
Social democracy accepts the fact of capitalist economic ownership but attempts to use democratic access to the state to improve living standards for everyone, but more for the poor than for the rest. This may necessitate alliances with the middle classes and will involve a recognition of the constraints imposed by the need to maintain international competitiveness in a capitalist world economic system.
If a coherent social democratic programme emerges in South Africa, it will have to be committed to a market economy which is also, in international terms, an open economy. This means accepting some of the recommendations of organisations like the World Bank which strongly push the need to reduce the role of the state in the economy and open up markets to international competition. In themselves, these policies have a great deal to recommend them.
Jorge Castaneda, in his recent book Utopia Unarmed : The Latin-American Left After the Cold War, has spelt out what the broad direction of such “a left social- democratic” platform could be in the Latin American context. He suggests three directions.
First, the establishment of an authentic welfare state that extends its protection to the majority of the population. The Reconstruction and Development Programme is a clear statement of such an intention.
Second, funding this goal through profound tax reform and major cuts in military spending.
Finally, laying the basis for the long-term viability of the first two objectives through a nationally devised strategy for export-led, environmentally sustainable industrialising growth. This strategy, Castaneda argues, implies deep involvement by the state in concentrating the strengths and talents of the private sector, but also entails overhauling — not privatising — state-owned enterprises.
Especially because the ANC draws on deeply felt aspirations of national liberation, it has more potential to become this kind of social-democratic party than to be a vehicle for neo-liberalism. However the explicitly social-democratic forces are likely to come from its allies in the labour movement, sections of the middle classes and the intelligentsia.
This underlines the crucial difference between South Africa and other semi-industrialised countries such as Brazil. Labour is a powerful force both on the streets and inside the centres of power. In combining social- movement protest, as it did in June (in support of its demands in the Labour Relations Bill), with strategic involvement in policy-making the labour movement strengthens its political position by drawing on its independent power base — a mobilisable constituency no other actor possesses.
In our concern to avoid the real dangers of macro- economic populism we may be losing sight of the innovativeness of the “South African experiment”. But a creative challenge to the neo-liberal agenda will only happen if “left social democrats” come out of the
Ironically, the same tensions spawned by apartheid could provide the foundations for an innovative and creative response to the global challenge.
Professor Webster teaches in the Department of Sociology at the University of the Witwatersrand