/ 2 March 2001

Invest in the piper, call the tune

Steven Friedman

worm’s eye view

Democratic governments are meant to be accountable. Ours certainly is. But to whom? The question has been raised again by signs that government policy on Zimbabwe has changed.

This followed a strong statement by Congress of South African Trade Unions general secretary Zwelinzima Vavi urging a tougher approach to that country’s regime and a meeting of the government’s investment council where members apparently sent a similar message. So who was the government listening to? Its trade union ally or the foreign business people on the council?

The evidence strongly suggests the latter.

There are few signs that the government heeds its own grassroots voters. Not only do they lack opportunities to speak: it feels no great pressure to do so, since even the stay-away by many African National Congress voters at last year’s local elections left it with a comfortable majority.

Nor does it seem to pay much attention to alternative voices in the ANC alliance. Party discipline has been tightened the Andrew Feinstein affair is a case in point while its allies’ views on macroeconomic policy make little impact. Despite minor shifts here and there, it remains firmly on a course that its union allies reject.

That part of civil society that supports the ANC also seems to lack influence witness the relegation to the margins of Aids activist organisations. The ANC leadership seems confident that its alliance will hold together even if allies are ignored on key issues because the bonds that unite it are strong enough to prevent break-aways of any significance.

In any event, most of the time ANC- supporting civil society is reluctant to give the government too hard a time for fear of being branded an ally of its white opponents.

The parliamentary opposition is largely ignored, either because it is white-led or very small or both. And that part of civil society that comprises racial minorities lacks muscle for the same reason that parties run by whites do.

So there is reason to wonder how much incentive or need the government feels to listen to other voices at home.

At the same time, we do know that there is one group to whom it shows a strong inclination to listen international business. Concern about the views of people who drive world markets is clear in many government actions and statements. That President Thabo Mbeki has established an investment council that provides a vehicle for foreign business people to engage with him and his government is itself evidence of this interest.

In contrast to domestic interest groups, foreign business people have considerable leverage over the government. It wants investment from abroad and they influence whether we get it. So, as long as the government continues to believe that foreign investment is a greater priority than the local variety, foreign business is likely to enjoy influence beyond that of most South African interests. And so we may have arrived at a situation in which the most effective check on a democratically elected government is not the voters who chose it but foreigners who own wealth.

It should hardly need saying that, if the government is indeed showing a respect for foreign business interests that is largely denied locals, this is a problem for democracy. Not because of a nationalist sentiment that says governments should only listen to their own nationals. Or a simplistic anti-business view that implies that democratic governments should ignore people who own assets.

But democratic governments are meant to be accountable to their electorate and we have a problem if ours feels a need to account mainly to a group which did not choose it.

Some “pragmatists” might argue that, while in an ideal world it would be nice if elected governments took their voters seriously, an undemocratic check on government actions is better than none at all.

Certainly, even the most democratic government needs to be checked. Governments do not remain accountable for long if voters simply make a choice every few years and then leave it to those they elect to govern.

First, few of us vote for a party because we agree with all its policies we do so if it broadly speaks for us. On any given issue, then, the majority may disagree with a government that it elected. Second, no party contesting an election can anticipate everything that will happen during a term of office and so elected officials will have to take decisions on issues on which they have no clear mandate from voters (such as assaults on democracy in Zimbabwe). Their decisions may not be those that most voters want.

Third, representatives have little incentive to work for voters unless those who choose them continually hold them to their promises and commitments. For all these reasons, democracy requires that even the most popular government be checked by forces in society.

But relying on foreign business to do this is naive. One result of the rise of crude free market ideology in recent years is that we are now encouraged to see business people as zealous defenders of democracy, good government and enlightened social values.

This is dubious, for two reasons. First, business people are good at making money. There is no reason why they should also be good at understanding the societies in which they do business. And so many very effective business people have only the faintest idea of what democracy is; their ideas of good governance may not move much beyond wanting business to be subject to as little hassle as possible. They can hardly be guarantors of something whose workings they barely understand.

Second, there are times when business interests are at variance with democracy and good governance. We know that businesses are happy to live with and at times to support undemocratic governments if they create business-friendly environments. Look at China today or the “Asian tigers” a decade ago.

And, where money is to be made, businesses are happy to put up with high levels of corruption. The leader of a country that attracted much investment for years is said to have angrily turned down a bribe because a person of his stature was entitled to double the amount offered! No one stopped investing after the incident.

If the government is checked only by international business, this may at times prompt results such as a rethink on Zimbabwe. But it is hardly guaranteed to always produce pressure for the government that is open, fair and meets the needs of citizens.

So, on pragmatic grounds as well as principle, democrats including those who favour free markets should see government willingness to lend an ear to foreign business rather than its own voters not as a solution, but as part of a serious problem.