/ 12 April 2019

South Africa needs a Green New Deal

For South Africa to really contribute to the global efforts to save our planet from climate change and ecological devastation
For South Africa to really contribute to the global efforts to save our planet from climate change and ecological devastation, we first need to put our house in order. (Delwyn Verasamy/M&G)

Decades of mismanagement, corruption and incompetence have seen the economy, quite literally, fade into darkness. It is temptingly easy to blame the ANC for the disastrous load-shedding that is costing us billions of rands, or the ever-increasing national debt burden.

But a failure of government is always also a failure of the opposition to hold government to account. At the heart of this failure is the Democratic Alliance’s inability to recognise the end of the globalised liberal world order. Nationalism and totalitarianism are on the rise in South Africa and around the world, and the DA has missed the march of time. Liberal answers no longer work in a postmodern illiberal world.

Take the DA’s election manifesto. From property rights to Reserve Bank ownership, the DA’s core mantra is that strong institutions will some day lead to more growth. But today South Africa faces one of the world’s worst youth unemployment crises. We cannot afford to wait for some day. The failure to produce a coherent, immediate and realistic alternative to the ruling party has fuelled the rise of the Economic Freedom Fighters (EFF).

The EFF has released its manifesto to the usual theatrics, drawing the usual criticism from the usual corners. While the DA is stuck in the liberal world order of the 1990s, the EFF is stuck in the class rhetoric of the 1890s. And this, more than its strongly ideological slant or disregard for economic history,is the problem with its policies.

The world the EFF espouses, in which every township is a self-sufficient producer of food, clothes, and all other necessities, is long gone. The EFF’s nationalist industrialisation agenda cannot be squared with what South Africans buy because we import most amenities of modern life, from refrigerators to televisions.

Both of our main opposition parties are stuck in the past. The DA, for example, mentions the fourth industrial revolution (4IR) only once in its manifesto and thinks it is an ANC talking point to garner votes. The DA has no concrete plan to deal with the millions of jobs that are at risk because artificial intelligence and robotics will cut through our workforce like a hot knife cuts through butter.

Even the backward-focused EFF has understood that we need to prepare for 4IR — maybe because jobs are lost in Khayelitsha and Alexandra, while capital gains from increased “efficiency” accrue in Bantry Bay and Sandton.

South Africa can no longer afford to be stuck in the past. We need a radically new policy that squares the challenges of the future with the lessons from the past.

For more thana decade now, a Green New Deal has been discussed among the European Greens. It is no accident that the left in the United States, mobilising around Democrat Congresswoman Alexandria Ocasio-Cortez, has now adopted this idea as their hallmark framework. A Green New Deal combines the sense of urgency necessary to combat the totalitarian nationalist threat with a focus on future-oriented policies necessary to face 4IR.

So, what would a Green New Deal for South Africa look like?

First, we need to fix education. It might be surprising that a South African Green New Deal would not start with the usual focus on renewable energies and climate change. Make no mistake, we urgently need to change the structure of our energy sector, decommission our coal plants and eventually replace them with renewable energies sourced through our world-class independent power producer programme. Eventually, we probably will have to break up Eskom to get rid of the Zuma-erarot. And, yes, we do need to protect our fragile ecosystems much more aggressively.

But for South Africa to really contribute to the global efforts to save our planet from climate change and ecological devastation, we first need to put our house in order.

This means fixing our education system. And although all parties commit to this issue on paper, none of them is radical enough in their efforts. It must be a national priority to have not only good schools everywhere in the country, but to have the world’s best schools. Education must be free, from preschool to postgrad. And our education system must be free from the devastating influence of unions such as the South African Democratic Teachers’ Union and proto-fascist movements such as#FeesMustFall.

In a world where the economy changes rapidly, it is not enough to have only one career. We must embrace a world of second and even third careers. For this to happen, we need to create not only places of higher education, but also of lifelong learning. It will no longer be sufficient for the University of Cape Town to educate 25000 students; we must prepare to educate 250000 students, most of whom will learn online or through a blended study programme. The current discussion about transformation at our universities is necessary to remedy the ills of the past, but it falls short of addressing the challenges of the future.

Second, we need to answer the uncomfortable question of where new jobs should come from. Lofty promises of “a job in every home” are worthless unless you have a clear idea of exactly what job you are putting in every home. We can no longer rely on our national mineral wealth, and automation poses an existential threat to our emerging services sector. And despite the unanimous political support for small, micro and medium enterprises, they simply do not create enough jobs.

At this point, the only sustainable way forward is to create a vast knowledge economy that focuses on big data, medi- and biotech, as well as green industries. But even this will not be enough, and we need to strengthen our agricultural sector. For example, South Africa should massively grow its organic food industry. This shift will require active industrial policy and a strategic focus on industries that are more resilient to automation.

Health and retirement care, for example, provide a unique opportunity for South Africa. We have renowned private healthcare facilities and life expectancy is continually increasing in rich countries. So why not try to attract half a million retirees to spend their golden years in the most beautiful country on Earth?

And, third, all of the above must be financed. This is where both the DA and the EFF truly fall short. It is not enough to assume we’ll magically save the necessary billions through better governance, as the DA does. Or that the money will fall like manna from heaven, as the EFF does.

Instead, we need to talk about the distribution of wealth in the country.

When Germany was reunified in 1990, a special levy was introduced to pay for infrastructure investment in East Germany, to level the playing field. If writer Ta-Nehisi Coates can make a convincing case for reparations in the United States, we most certainly can make one for reparations in South Africa. And, yes, we will also have to talk about higher taxes because we are facing a generational challenge, and it is high time that we get serious about solving it.

This is why we need a Green New Deal for South Africa. And, perhaps, a new opposition to push for it. — Co-Pierre Georg is an associate professor of finance at the University of Cape Town and the director of UCT’s Financial Innovation Lab. These are his own views