South Africa: The triumph of capitalism in a country too big to fail

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Sandton City, Johannesburg. (Foto: Jolame Chirwa op Unsplash)

“I see only one hope for our country, and that is when white men and black men … desiring only the good of their country, come together to work for it. … I have one great fear in my heart, that one day when they are turned to loving, they will find we are turned to hating.”

– Msimangu, in Alan Paton’s Cry, the beloved country, warning that power can corrupt black people as much as it corrupts white people

The lockdown having put the kibosh on travel to South Africa for a few years, I was a little apprehensive as to what I would find on a recent family visit, having relied on the usual echo-room-distorted internet reporting and sundry communications with relatives and friends to keep me posted. The omens were not propitious. A lot of what I heard and read was negative: crime, homicide, potholes, open sewers, loadshedding, corruption. So far, so bad, but this list is the norm for plenty of other countries.

The first impression for someone coming from the cleaner city air of London and other parts of the UK (owing to the massive proliferation of electric vehicles, including buses, delivery lorries, taxis and motorbikes, as well as the so-called “ultra-low emission zones”) is what London used to smell like ten years ago. If you seek a whiff of nostalgia for what was, then immerse yourself in the high levels of traffic air pollution in South Africa’s cities. Cape Town is a good example, with every road clogged with internal combustion cars and lorries, and no underground system to alleviate the pressure.

This is not meant as a negative comment, however, since I also learned something else; the paradox is that many, if not most, of those cars are driven by middle-class black South Africans, who are finally living the dream of wheels of their own in the driveway. The failure of the mostly coal-burning and heavily polluting power stations to provide consistent electricity in South Africa means that there is little point in going E-car, whereas within the next decade in the UK and the EU, the plan is to stop manufacturing new petrol and diesel cars altogether.

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The South African black middle and upper classes are beneficiaries of the most stupendous, the most energetic, the most imaginative leap forward of almost any country in Africa, with the exclusion perhaps of Kenya and Nigeria.
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The South African black middle and upper classes are beneficiaries of the most stupendous, the most energetic, the most imaginative leap forward of almost any country in Africa, with the exclusion perhaps of Kenya and Nigeria. I’m talking about a landscape in South Africa that in six years has quietly become an advertisement for a capitalist revolution that cannot fail to fire the imagination of anyone alert to the spirit of the frontier and the laissez-faire merchant buccaneer.

In Alan Paton’s Cry, the beloved country, his character Msimangu expresses the hope that Christianity can finally bring black and white together. He wasn’t wrong, only it wasn’t Christianity that brought the races together, but capitalism.

This revolution is all around you, with examples from almost any corner of my visit – the road between Oliver Tambo airport and Pretoria, littered with huge new business parks, residential estates by the score, and shopping malls that have jumped up like mushrooms. Cape Town is another story altogether – the Mother City on her way to becoming the pre-eminent hub in the country. The suburbs stretch for miles and miles. Stellenbosch, as well – my old university town, centre of South Africa’s own Silicon Valley – is groaning with wealth and new buildings.

In KZN, I gathered that shopping malls worth a billion rand are taking shape.

The only other place I have witnessed such dramatic change in just a few years is London – 270 skyscrapers over 20 storeys erected in the past ten years and, incredibly, another 600 skyscrapers set to go up in the next 10 years, making London Manhattan-on-Thames.

All this new development in South Africa is frankly breathtaking – and extremely heartening. When the great financial crash of 2008 happened, it turned out that although well-known Wall Street firms went belly up, there were nonetheless those banks like Lloyds and HSBC that were just so big that they couldn’t be allowed to fail. Suddenly, I was looking at South Africa in a new light – a frontier country still, with all the strengths that Ayn Rand, Russian-born author of Atlas shrugged and champion of capitalism, would have approved of: an emphasis on individualism, freedom and rationality. The ingredients of capitalism,  namely entrepreneur, land, capital and labour, are all available on tap in South Africa. Just like a big bank, a country too big to fail.

Broadly speaking, the land issue still remains undecided, however. Although enormous amounts of land have been handed over to black claimants by the government, the failure to farm it effectively has given Pretoria pause for thought. Private property rights are protected in the Constitution and remain so. Labour is also abundant – a 34% unemployment rate tells its own story – many workers are instantly available for most new ventures. As for capital, the Johannesburg Stock Exchange is in rude health. And if the project is really enormous, like fixing a port or building a nuclear power station, then Pretoria’s Brics allies have not been slow in coming forward. China and Russia will simply shrug off the due diligence requirements that hobble so many Western investments in Africa.

Ayn Rand was dead against government intervention in the economy, which she thought was a violation of individual rights and a hindrance to progress. The role of government should be confined to protecting individuals from fraud and intimidation, leaving them free to engage in voluntary transactions. Her eponymous hero in Atlas shrugged, Eddie Willers (no relation to me!), were he to visit today, would no doubt approvingly note that the law courts and independent judges still exist in South Africa – protected by the Constitution – and have been pretty active lately in tackling cases of corruption, with greater or lesser success.

Now, I’m not proselytising in complete favour of Ayn Rand, since it has often been said that her vision of capitalism is overly simplistic and ignores its potential pitfalls, such as income inequality and exploitation. Critics also contend that unchecked capitalism can lead to the concentration of wealth and power in the hands of a few, undermining the principles of equality and justice. But, as the not-known-to-be-Ayn Rand-supporting Economist magazine notes, Pretoria has pursued a redistribution of wealth in ways that actually hinder its creation, namely BEE, and boost the bargaining power of the unions: “The ANC’s own policies are the reason why perhaps a quarter of people live well and the rest are desperately poor” (The Economist, 9 May 2024).

Well, perhaps and perhaps not. On the evidence of factories and other buildings leaping up, the engine of capitalism – which I saw, at least – is alive and well, despite the perennial problem of loadshedding. As the French owner of a bustling coffee shop in Cape Town told me, “In France and the EU, it’s difficult to find support when you start a business; there’s too much red tape. In South Africa, everyone wants to support you.”

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Everyone can sense the raw, pulsating energy of the free market in South Africa – Adam Smith’s invisible hand at work, a rising tide that lifts all boats, so to speak.
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That’s the difference between a developed and a developing country, it struck me. Regulations in South Africa that govern labour are still largely theoretical for the small entrepreneur, the one- or two-person business, and are often more observed in the breach by other players.

Of course, the Zuma presidency hardly set a good example for business probity, certainly in Western terms, but in those strange Gupta free-for-all years, old fashioned laissez-faire capitalism (in the Guptas’ case, perhaps too much laissez and not enough faire!) seems to have continued to truck on. Everyone can sense the raw, pulsating energy of the free market in South Africa – Adam Smith’s invisible hand at work, a rising tide that lifts all boats, so to speak.

A Ugandan who was selling peanuts to feed the squirrels next to the burned-out shell of the old Parliament – one of approximately five million African refugees who have legally or illegally entered South Africa over the past 20 years – simply said he’d arrived with nothing, literally not a penny, and slept on the street, but had worked hard and now has his own small business. He seemed to embody the Protestant work ethic everyone goes on about.

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In South Africa today, capitalism, the ideology that won the Cold War and which has been adopted by China and Russia, has an unstoppable momentum.
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In South Africa today, capitalism, the ideology that won the Cold War and which has been adopted by China and Russia, has an unstoppable momentum. There may still be the odd adherent of Marxism-Leninism floating around, but that person will be found on university campuses only, and perhaps not even in the actual South African Communist Party.

My trip could have merited a travelogue, as the country remains exquisitely beautiful, but the topic du jour everyone wanted to talk about was the forthcoming elections at the end of May. Only the pollsters overconfidently seem to know what the outcome will be – and many people I spoke to are nervous. Anxieties are rooted in a perception that the ANC will lose its absolute majority and be forced into a coalition with smaller parties, with a result that could be ruinous for South Africa.

Ruinous? I somehow doubt it. True, ghosts of the past are returning to the ANC – one might say that one of those ghosts is Dr AB Xuma, pre-1946 supporter of a pan-Africanist ANC. Other ghosts are Walter Sisulu and Bram Fischer, who engineered Xuma’s departure. They brought in Nelson Mandela and persuaded him to support and lead a multiracial ANC alongside the equally multiracial South African Communist Party.

The ANC in power under Mandela after 1994 did well. But his successor, Thabo Mbeki, still thinks the Kempton Park talks for a new Constitution were rigged by the “deep state” of the old white order. Blacks were given political freedom, but not economic freedom.

That is perhaps debatable. I was at some of those talks, wearing a press badge, and everything on the table was minutely studied by delegates like Trevor Manuel, Chris Hani (until his murder) and a host of others – including Nelson Mandela himself – and signed off by them.

All one can say is that if the new government had no economic freedom, then how on earth did the ANC manage to build such a vast number of decent homes to replace the shacks, and establish a monthly benefit payment that currently supports 43% of the population? Everywhere on my road trip, I saw the new living arrangements for the poorer majority. Not all roses, mind you – the tin shacks of more recent arrivals also stretch to the horizon, emphasising the reality throughout the developing world of the migration from countryside to city.

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Probably the bigger risk in the short term will be the possibility of a failure of coalition talks, in the event that the ANC loses its absolute majority: the classic Mexican stand-off that we see from time to time, even in the EU.
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When you look broadly at the ANC of today through, say, the overlapping prism of a European political definition, then what you have are classic right-wing (Zuma’s MK), centrist (Ramaphosa) and left-wing (EFF with Malema) divisions. They may fight the election under different banners, but everyone knows that they owe their fealty to the original liberation movement – the ANC.

Not one of those factions or the largely white-supported Democratic Alliance (DA) – with a clutch of smaller fringe parties, also pro-business – are a central threat to the capitalist model. The EFF is a faction resembling the UK Labour Party, bent on focusing on tax levels and contemplating various forms of wealth distribution, such as nationalisation. But this doesn’t necessarily threaten the essence of capitalism and the free market per se.

Probably the bigger risk in the short term will be the possibility of a failure of coalition talks, in the event that the ANC loses its absolute majority: the classic Mexican stand-off that we see from time to time, even in the EU. Belgium had a period of 15 months without a government that the parties could agree on. South Africa can be edgy, and street demonstrations are commonplace – they can arrive without warning like a brief summer storm. But that said, there is a resilience in the population at large from having weathered such disturbances in the past. I would put money on any coalition talks taking place peacefully, since they are within the same broad ANC church.

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As for the ANC, in its broadest sense – a political movement going back to 1912 – it seems clear that some fresh blood is called for if it is to recover its “elan – its liveliness, its panache.
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As for the ANC, in its broadest sense – a political movement going back to 1912 – it seems clear that some fresh blood is called for if it is to recover its “elan – its liveliness, its panache. For a parallel, we should look to a now neglected and almost forgotten, but excellent, South African writer, William Plomer, who wrote a book called Curious relations (1946), in which he painted a startling allegorical picture of a dying Edwardian world, through the lives of two exhausted upper-class English families.

In many ways, the ANC of today is also exhausted, like those families, and for the same reasons. Its desires have been fulfilled across a century of political activity and struggle, and now it is left with a will, but no vital spark, no elan. As Plomer says: “Does inherited experience accumulate, as it were, in the transmitted bloodstream at last clogging the veins with ambitions that have been accomplished and are dead? As the stock of a fruit tree will gradually become sterile and stunted if it is not crossed with new wood, so perhaps in old families, the spirit shrinks and withers, unless the parent stock is renewed.”

Maybe a coalition’s rejigging of the ANC’s chairs – and who is left sitting on them when the music stops is just what the movement needs, to regalvanise. New wood. It’s a necessary part of the dynamic. Perhaps there even needs to be another debate about the Constitution. Is proportional representation the right system for South Africa? Is it even still fit for purpose? It has drawbacks. There’s no constituency MP help available for locals, no “surgeries” with your elected representative. The UK doesn’t have a written constitution, while France has had several over the years. Governments shouldn’t be stuck in a rut.

Other things I noticed on my visit struck me as most important. The first was the extraordinary network of volunteers putting their shoulder to the wheel in many towns to help their local municipality – fixing potholes, finding a way around electricity cuts, and so on. Many ratepayers are no longer simply leaving it to the council to fix.

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Thirty years of democracy has eased the strained relations between the races of the apartheid years. There is a spontaneity, humour and verve in public life, in the shops and eateries, which is very refreshing to any outside visitor.
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This countrywide initiative seems to go hand in glove with a statement put out by a group of concerned Afrikaners, reasserting their determination to stay in South Africa and build, thus contributing to the well-being of the entire country. At the same time, a network of Afrikaans cultural organisations has suggested that the time has come for a “cultural agreement” with the government in order to guarantee “cultural freedom”. Thabo Mbeki has surprisingly come out in support of this initiative, to correct the damage done by what he has called the “counter revolution” set up by Jacob Zuma – “a wolf in sheep’s clothing”, in his words (Die Burger, 1 May 2024).

Strong words. We shall have to see what transpires, but then again, South African politics has never been a peaceful haven at election time!

Socially, the visitor to these shores detects a street confidence. Thirty years of democracy has eased the strained relations between the races of the apartheid years. There is a spontaneity, humour and verve in public life, in the shops and eateries, which is very refreshing to any outside visitor. It is one of the key reasons tourism flourishes. Occasionally, apartheid is still blamed for some want or other, but in general, the divisions one sees today are those of any society where there are big differences between the very rich and the very poor.

The past really has become another country, to paraphrase Karel Schoeman, and it’s not before time.

Also read:

The diary of an election year: The junction of desperation

A year of elections, multiple challenges and choices

Tinnitus: my near north (on The near north by Ivan Vladislavic)

Manifesto: A new vision for South Africa by Songezo Zibi: a review

Is daar nog ’n wonderwerk in die reënboognasie se toekoms?

Who can save us from political demagogues? 

Countdown to socialism by Anthea Jeffery: The ANC’s road to Karl Marx

South Africa, Russia and ten days that shook the world: Pretoria’s love affair with Moscow

 

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