The economic policy tickets of the major political parties reveal the extent to which there is political centralisation of ideas for the South African economy. The parties have a set of careful policies that may be perfect for keeping the markets happy, but do not seem visionary to make a serious dent in poverty.
There is very little to distinguish one party from another, as they all struggle to find ways to boost the complex South African economy while coping with the local impact of the international economy, of which it is a part.
There is the imperative to keep within the parameters of the global economy: sensible deficits; low inflation and low interest rates. Investors must be welcome, so regulation and red tape must be kept to a minimum because they add to costs.
The other imperative, and arguably the more pressing one, is South Africa’s debilitating rate of unemployment — 40% of the economically active population.
The fall-out of this is that half of all households live below the breadline. This demands a strong state hand in the form of welfare and other stimulatory measures.
All parties try to lesser and greater degrees to address these twin needs of the South African economy; none comes close to suggesting visionary ways to reach full employment and eradicate poverty.
The two major (and major here is used relatively) parties — the African National Congress and the Democratic Alliance — present policies that will reduce unemployment and alleviate poverty. ”Careful” best describes all the options facing voters, but when you have a crisis, careful is not good enough.
One good thing about the policies is that jobs are at the apex of all their manifestos, a point they’ve been pushed to rather than one they’ve arrived at through careful thought. Poll after poll shows that jobs trump all other electorate concerns.
The ANC got in first with its pledge of one million job opportunities first announced in Minister of Finance Trevor Manuel’s mini-Budget, tabled last year.
ANC shorthand has been careful to stress that these are ”job opportunities”, not ”jobs” — because public works hardly ever deliver full-time jobs at private-sector rates. Most jobs will last less than a year; some considerably less than a year; all will pay less than prescribed minimum wages at a price-tag of R45-billion. You can’t get all these qualifications on to a poster, which may be a good thing for the ruling party.
The DA has responded with its pledge of one million ”real” jobs — as opposed to the ANC’s ”opportunities”. Its pledge offers proper, more long-term work.
But the DA’s example is the jobs-through-growth model, which the ruling party tried with its Growth, Employment and Redistribution Strategy. It succeeded on certain measures, but failed miserably at creating jobs.
Still, the DA is undeterred in its quest for a 6% growth rate that will deliver the real thing. Cutting labour down to size is central to the DA’s plan and, in this, it stays true to its libertarian roots.
It will ”radically amend labour laws”, review minimum-wage legislation and introduce a two-tier labour market where the minimum wage in the second tier is pegged to the old-age pension rate, currently at R720 a month. But the party —together with the New National Party, the Inkatha Freedom Party and several smaller parties — does not consider the strength of the union movement in making these prescriptions.
It does not take a fortune-teller to see that a DA government would face unsustainable levels of labour discord if its policies were implemented. This would impact seriously on the country’s economic and political stability, as would the party’s plan for ”rapid privatisation”.
Even the most conservative commentators acknowledge that global and domestic markets are too flat for a lucrative fire-sale of state assets, while another body of opinion has cast doubt on whether the private sector will lower the cost of business by providing cheaper, more efficient transport and other services. Telkom, now partially privatised, is uncompetitive and a constant thorn in the side of business.
Patricia de Lille, the leader of the Independent Democrats, herself a former unionist, steers clear of the crush-the-unions growth model, but her perspective on work is anaemic. All the party’s manifesto does is state the obvious. It begins: ”Job creation must be our number-one priority.”
While she may have an ID, De Lille’s main problem is that she does not have policies, a point she acknowledges. The party is styled as one that opposes only that which is not working, but one that supports that which is. De Lille adopts wholesale President Thabo Mbeki’s theme of a two-economy nation to understand the economy; she also supports the government’s expanded public works programme.
Generally, her economic policies veer between the anodyne and the eclectic. One would expect that a former doyenne of the Pan Africanist Congress would have more to contribute to ideas on land reform than ”organic farming centres of excellence”.
While libertarian on many counts, on grants the DA is positively welfarist. The party will pay a R110 basic-income grant to ”every person living in poverty without access to another welfare grant”.
In addition, it will pay opportunity vouchers to about 300 000 matriculants and 200 000 young unemployed people. The plans have been immaculately costed but, like the prescriptions on the labour market, they do not show enough evidence of trouble-shooting.
The voucher idea is too idealistic and is wide open to fraud and corruption, as the vouchers can be used for everything from further education to starting a business or as an employment subsidy.
The ANC, once socialist, now social democratic, has retained in its manifesto a steadfast position against a basic income grant. The party will not countenance a basic income grant because it fears this will encourage a culture of dependence.
Yet the government’s 10-year review found that the existing grant system (old-age pension; child support and disability grants) provided the most cost-effective injection of cash from the first to the second economies.
For the ANC’s part, there is no guarantee that it (and its junior party, the NNP) will meet the goal of halving unemployment and and poverty by 2014.
Human rather than financial capacity is the largest limitation. To spend R100-billion on infrastructure and public works in the medium-term requires more engineers and project managers than the government has in its ranks. And with the bleed into the private sector, it will take some nimble footwork to achieve the goal of even making a 25% dent in joblessness and poverty.