04 Jun 2013 | Tony Leon | Original
Publication: BDlive
The recent spate of gloomy
economic data suggest that South Africa’s political economy is entering a
‘winter of discontent’, writes Tony Leon
WITH winter storms encasing the Western Cape in an icy grip and cold
fronts moving across the country, it is tempting to suggest that, parallel to
the weather, South Africa’s political economy is entering a "winter of
discontent". There is plenty of gloomy supporting evidence from the
economic data: according to Reuters, the beleaguered rand’s breaching of the
R10 barrier against the dollar on Friday made our currency the worst-performing
currency after the Venezuelan bolivar fuerte and the Syrian pound. The
currencies of two failed states, one of which is in the midst of full-scale
civil war, is not the sort of association or benchmark South Africa needs.
More galling, no doubt, for the Presidency is that the rand’s plunge
came after a media conference by President Jacob Zuma last Thursday that was
intended to reassure investors that the government had a plan to bolster
economic confidence, particularly in the mining sector. "Markets defy
Zuma" was the next day’s headline, proving that the political weather is
often as impervious to outside intervention as the Cape storms.
It will doubtless offer scant comfort to local leadership to know that
the political update of the Shakespearean-originating "winter of our
discontent" arose in the UK during the 1978-79 industrial unrest. It was
the coldest winter for 16 years and the trade-union-acquiescing Labour
government of James Callaghan was confronted with the unravelling of its pay
and wage constraints and the postwar consensus that unions, government and
business could keep the peace through "consensus politics". Militant
unions had other ideas, however, and the spectre created by images of striking
gravediggers refusing to bury the dead and uncollected garbage spilling onto
the streets would not only haunt the government, it would destroy it. Within
months, Callaghan and Labour would be driven from office by a resurgent
Conservative Party with Margaret Thatcher at its helm. She had very different
ideas from Callaghan about the unions, the postwar consensus and how to fix the
economy.
Interestingly, and of cold consolation to Zuma after his own attempt to
use the presidential podium to douse the flames incinerating our economy,
Callaghan, before his defeat and at the height of the crisis caused in part by
his own policies, also decided on a press conference intended to reassure
voters and calm the markets. He also cracked a few jokes — and was then asked
about his view of the mounting chaos in the country.
Fresh from a Group of Seven retreat in the French Caribbean, he gave a
complacent reply: "Please don’t run down your country by talking about
mounting chaos. I do not feel that there is mounting chaos." The next day,
The Sun newspaper immortalised his nonchalance in a famous headline:
"Crisis? What Crisis?" Its editor was knighted after Thatcher won the
election.
In fact, Zuma also sounded far less complacent last Thursday than he did
recently in a Financial Times interview, in which he blamed our economic
travails on outside factors and awarded himself 70% for governance. But aside
from announcing a high-level ministerial intervention to settle the tumult in
the mining sector, there was little of substance in his pronouncements.
Far more recently than the UK’s winter of discontent, another European
voice was heard on the dilemma politicians face when it comes to prescribing
the harsh medicine of unpopular economic fixes. Luxembourg Prime Minister
Jean-Claude Juncker candidly admitted of the economic reforms required to fix
the sclerotic eurozone: "We all know what to do, we just don’t know how to
get re-elected after we have done it." Zuma’s government is cushioned by a
far greater electoral margin than any of his European counterparts. Even on the
most positive estimates of the opposition, next year’s election will not lead
to a change in government and only two, at best three, provinces are going to
be competitive.
Zuma and his government do not have to really announce new measures.
That would be a bonus. They could start by implementing what they have already
undertaken to do: implement the youth wage subsidy, declare education an
essential service and stare down the tripartite alliance and Cabinet opponents
of the National Development Plan. He could also reprimand his land reform
minister, who announced the day after Zuma’s press conference that it was
"an honour" to have South Africa’s land reform process compared to
what happened in Zimbabwe.
It might also help if the minister of trade and industry took his foot
off the throat of the business sector he is meant to be helping and if
Communications Minister Dina Pule was relieved of her duties. Shelving plans
for a new presidential jet would also assist in marrying deed to word.
The advantage of the bleakest winter is that you can dream of a mythical
summer. At the very least you can, more realistically perhaps, hope for a break
in the clouds
• Leon is the author of The Accidental
Ambassador (Pan Macmillan). Follow him on Twitter: @TonyLeonSA OR on Facebook: facebook.com/TonyLeonSA
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