A few weeks ago, I had the opportunity to listen to Tito Mboweni give his views on matters of economic policy to members of the Eli Weinberg branch of the ANC. Mboweni is a senior member of the ruling party’s national executive, a former governor of the South African Reserve Bank, and was the first labour minister of the post-apartheid era.
He currently sits on the advisory board of Discovery Bank, which is launching this year and is billed as a disrupter in South Africa’s concentrated and very problematic banking sector. On subjects such as banking, regulation, the economy and policy-making, his views are sought out —and taken seriously — by more than just suburban party branches.
The interaction was informal and Mboweni didn’t title his presentation, large parts of which were made up of anecdotes and off-the-cuff remarks. But if we had to write it up and give it a formal title, it would borrow heavily from ANC policy- document-speak and be something like Three Urgent Tasks Facing the National Democratic Revolution: Towards Radical Socioeconomic Transformation.
His three recommended policy moves to achieve this kind of transformation were a state-owned bank, land expropriation and its redistribution “among those with an interest to work the land” and extracting greater value from South Africa’s endowments in minerals and energy, largely by implementing a “free-carry” stake (a share in the profits) for the state in all mining operations.
The revenues extracted from these policy tools, particularly the state’s free-carry stake in mining, should be used to create a sovereign wealth fund.
The talk expanded on several policy proposals Mboweni has been making for some time, seemingly only in his Twitter account, which is replete with calls for urgent tasks that the ruling party must embark upon to reclaim the mantle of radical transformation from the Economic Freedom Fighters (EFF).
“The state must own 40% of all mining companies. This is easy to do. The state must create a sovereign wealth fund for future generations from mining dividends. A state bank must be created urgently,” Mboweni once tweeted. And so on, in similar vein, including suggestions for the taxation of religious organisations.
Two things are notable about Mboweni’s views on the economy and what the ANC needs to do.
The first is that the promoter of these views has been in senior state positions for most of the 24 years the ANC has been in power and in that time demonstrated little to no appetite for radical or even alternative economic thinking. Even now, as a senior member of the national executive committee and its subcommittee on economic transformation, Mboweni occupies among the few social positions from which one may drive this kind of radical rethinking of the economy.
It is hard to escape the conclusion that the growth and noise of the EFF since 2014 has made sudden radicals of many middle-of-the road free market adherents in the ruling party.
The second point to note — and it offers a possible explanation for the first — is that Mboweni has admitted to “getting into trouble” for his tweets about the economy.
Unnamed comrades have called him, demanding to know what he is doing. His initial Twitter burst came soon after President Cyril Ramaphosa had appointed his panel of investment envoys, with the hope of attracting $100-billion in foreign direct investment over the next five years. Mboweni was told that he was making those efforts harder, presumably by one or more of the investment champions.
Mboweni’s dilemma was that nothing he espoused was outside accepted and conference-approved ANC policy (let us ignore the proposed church taxes just for a minute). He is right, to a degree.
Since at least its 52nd national conference in Polokwane, the ruling party has embraced a policy platform that makes provision for land expropriation and reallocation, state involvement in the banking and mining sectors, set-asides for black-, youth- and female-owned enterprises in state procurement and a few other measures aimed at accelerating the redress of apartheid’s legacy.
The Polokwane conference was six years before the formation of the EFF. It is not the absence of transformative policies in the ANC that has empowered Julius Malema’s party to wear the mantle of economic justice advocates; it is the ANC’s cowardly failure — the inability even — to follow through on its own policies.
Mboweni spoke freely of ANC high-ups who have been called to boardrooms here and abroad to be asked to explain, or rethink, their public utterances whenever these have displeased powerful interests outside the state. That, ultimately, is the real difference between the ANC and the EFF (well, that and some 56 percentage points at the polls). In their respective policy stances, both unequivocally address the aspirations of a historically oppressed and still marginalised majority.
That sets them apart from, say, the Democratic Alliance or the Congress of the People. But so far in its history, the EFF merely has to say these things and not actually do them. That is why the party can chant “Occupy the land!” in the National Assembly, while propping up DA administrations in at least three municipalities, none of which is committed to expropriating land without compensation.
For its part the ANC must account — and far too often cowers — to vested interests for what it says and does. Even after the change that came with Ramaphosa’s election, the ruling party has yet to find creative ways to manage this difference.
All too often it allows itself to look as if it is being led by the EFF or is trying to outgun the latter in radical posturing. An example is the now-abandoned dalliance with a constitutional amendment to repeal or change section 25 of the Constitution.
With just a year to go until the country goes to the polls, Ramaphosa and his strategists need to find a sustainable containment strategy for the EFF — one that does not involve pandering to its reductionist thinking or aping its baser instincts but at the same time does not cede any ground on who is best placed to serve the interests of the poor majority. Such a strategy may be the difference between a comfortable majority (55%) and batting eyelashes at the opposition benches looking for a coalition partner (49%).
The EFF will still be only the third- largest party in Parliament after next year’s election but between now and then it represents the biggest challenge to the ANC.
Vukani Mde is a founder and partner at LEFTHOOK, a Johannesburg-based research and strategy consultancy