President Cyril Ramaphosa finally released his government’s anti-Covid19 economic response plan which promises to ‘forge a new economy in a new global reality’. Two weeks after Ramaphosa’s statement, Finance Minister Tito Mboweni amplified the response plan’s austerity dictates in the Medium-Term Budget Policy Statement (MTBPS).
The Finance Minister advertised their response to the socio-economic slump (or stagnation as they define it) as a consensus-driven Plan, a product of a ‘social compact and consulting the social partners through NEDLAC’. Rooted in this devotion to class compromise, these ANC functionaries of the neoliberal state appeal to every member of society to ‘do everything in our power to implement it’. But the 30-odd page ‘Economic Reconstruction and Recovery Plan’ was not written for workers and peasants to uproot the capitalist exploitation of human labour and destruction of our planet. On the contrary, versions of the Plan aimed at a mass audience propagandise the mysticism that envelops bourgeois Economics clichés. Its jargon is aimed at fostering faith in capitalism, an outmoded way of organising our societies.
Normalising an Abnormal System
State technocrats and consultants who wrote this Plan, sprinkled the word “new” on almost every page – similar to ‘recovery’ and ‘reconstruction’. These functionaries peddle the myth of restoring a “new normality” coupled with a “permanent and decisive break with our past”. This rhetoric about old and new normal is fallacious because it is premised on the falsehood that capitalism is a normal type of society. Capitalism violates all the principles of a normal society. An increasingly anachronistic mode of organising society, capitalism normalises an abnormal concentration of society’s productive means and barbaric social relations. These systemic abnormalities manifest in peasant land dispossession, placing profits before human needs, a wealthy minority legally stealing the benefits of social labour, faster ecological devastation and so on.
Despite the deeply flawed claims of apologists for capitalism, it is impossible to hide the irrationality and waste of economic activities undertaken for profit accumulation. The system is not only addicted to carbon-intensive growth but also a lucrative war-industry-complex. Anarchic and generalised overproduction multiply this waste, drowning the world in longer recessions and depressions more frequently at irreversible costs to the labouring majority.
Superficial comparisons of their anti-Covid19 economic responses with older government plans (like GEAR and NDP-2030) reveal the repetition of clichés and state bureaucratic speak. In fact, the ‘Economic Reconstruction and Recovery Plan’ abuse the Covid19 disaster to recycle and repackage old (and failed) schemes to safeguard capitalism. But this obfuscating optimism is unable to hide the sprawling socio-economic wasteland that the coronavirus pandemic has unmasked and aggravated.
The rising squalor and inequalities in South Africa predate the coronavirus pandemic. Covid19 multiplied the misery and highlighted its naked brutality. Authors of the Plan register these glaring symptoms of the socio-economic disaster, but their subservience to bourgeois economic ideology render them impotent to uproot the real causes of this widespread devastation, human suffering and death. Pinpointing the root causes would logically compel them to demand nothing but the end of the capitalist mode of production; a logic which negates the Plan’s ‘there-is-no-alternative’ intent and mantra. Such are the insoluble contradictions that plague their latest anti-recession response promises. These contradictions, coupled with the savage ideology on which it is premised, condemn the Plan to the fate of the Reconstruction and Development Programme (RDP), that fraud from the Mandela-era which is now buried and forgotten.
An Anti-Capitalist Socio-Economic Plan is Urgent
Ramaphosa’s anti-Covid19 economic responses repeat, for the umpteenth time over more than a quarter century, ‘priority interventions’ against mounting sovereign debt, infrastructure and energy crises. These crises are not new, but they have grown more acute in the last 20-odd years as expert advisers to the ANC government readily concede. But neither the parliamentary parties nor their bourgeois experts have any solution that serve the interests of the labouring majority. Nothing but an anti-capitalist socio-economic plan that places the interests of the workers and landless peasants first, is needed.
It is clear that the ANC and dominant parties in government reject the urgency for socialising infrastructure construction under an anti-capitalist economic plan. This is not only crucial to overcome the dire shortages of hospitals and public schools but also for safe and efficient rail transit for mass public commuting (particularly metro rail systems) and so forth. An anti-capitalist infrastructure expansion plan must include a progressive public works programme with full representation of the unemployed in its management. With costs of the ambitious infrastructure development programme in the order of R2,3 trillion and total budget at R1,5 trillion, where will the money for constructing the needed infrastructure come from? Yearly public sector infrastructure spending has in fact fallen from R250 billion to R183 billion, excluding infrastructure cost inflation. As it was in the case of world cup stadiums, a handful of big construction corporations will be the chief beneficiaries – probably with a few BEE deals as sweeteners – of this infrastructure development scheme.
Similar to the case of water, society’s quality of life depends upon reliable sources of clean and safe energy. Renewable energy under the democratic control and management of workers offer the best solution for South Africa’s energy crisis. By contrast, the latest crisis response Plan firmly believes and boldly advocates that South Africa’s future energy security cannot be realised but through nuclear power, privatisation and commodification. Eskom operates under the leadership of corporate bosses from the private sector to announce blackouts (“load-shedding”) and fast-track this state-owned entity’s legal and functional unbundling (a euphemism for privatisation).
Scrapping the debt coupled with charging lenders and debt-rating corporations for defrauding poor countries and liquidating these fraudsters are absent from the ‘Economic Recovery and Reconstruction’ plan. Successive downgrades to junk-debt status have inflated the cost of borrowing for South Africa, shoving the country to the cliff-edge of a ‘sovereign debt crisis’. Collusion among looters that control the debt industry is rampant and is aimed at squeezing wealth from poor countries for the enrichment of finance capitalists. Total state debt as a share of GDP already stands at 63% and is expected to leap to 82% next year. The cost of servicing the debt (interest payments) is the third largest spending item on the books of the state, consuming 5% of the budget. This debt burden has emerged as the fastest growing expenditure item in the national budget, growing more than 3 times faster than state investment in economic development.
The dispossessed, exploited and oppressed have paid and continue to be saddled with irreversible costs for not ridding humanity of capitalism. Replacing capitalism with a democratic eco-socialist way of organising society is long overdue. We have nothing to lose from realising this historical necessity.