NAOMI KLEIN: South African Democracy Born in Economic Chains

[yurbud]

This is excerpted from what looks like most of chapter on South Africa in Naomi Klein's THE SHOCK DOCTRINE.

It is not just about the tragedy of the stolen dreams of South Africans, but a lesson for us about what part of the system needs to be attacked to get the results in our daily lives we want.

It also explains why no matter which party we vote into power, we get mostly the same economic policy--just as South Africa did when they trade the Apartheid government for the ANC.

Banks and the economic sector should be subordinate to democracy or we don't have a democracy at all.

What happened in those negotiations is that the ANC found itself caught in a new kind of web, one made of arcane rules and regulations, all designed to confine and constrain the power of elected leaders. As the web descended on the country, only a few people even noticed it was there, but when the new government came to power and tried to move freely, to give its voters the tangible benefits of liberation they expected and thought they had voted for, the strands of the web tightened and the administration discovered that its powers were tightly bound. Patrick Bond, who worked as an economic adviser in Mandela’s office during the first years of ANC rule, recalls that the in-house quip was "Hey, we’ve got the state, where’s the power?" As the new government attempted to make tangible the dreams of the Freedom Charter, it discovered that the power was elsewhere.

Want to redistribute land? Impossible—at the last minute, the negotiators agreed to add a clause to the new constitution that protects all private property, making land reform virtually impossible. Want to create jobs for millions of unemployed workers? Can’t—hundreds of factories were actually about to close because the ANC had signed on to the GATT, the precursor to the World Trade Organization, which made it illegal to subsidize the auto plants and textile factories. Want to get free AIDS drugs to the townships, where the disease is spreading with terrifying speed? That violates an intellectual property rights commitment under the WTO, which the ANC joined with no public debate as a continuation of the GATT. Need money to build more and larger houses for the poor and to bring free electricity to the townships? Sorry—the budget is being eaten up servicing the massive debt, passed on quietly by the apartheid government. Print more money? Tell that to the apartheid-era head of the central bank. Free water for all? Not likely. The World Bank, with its large in-country contingent of economists, researchers and trainers (a self-proclaimed "Knowledge Bank&quot , is making private-sector partnerships the service norm. Want to impose currency controls to guard against wild speculation? That would violate the $850 million IMF deal, signed, conveniently enough, right before the elections. Raise the minimum wage to close the apartheid income gap? Nope. The IMF deal promises "wage restraint."12 And don’t even think about ignoring these commitments— any change will be regarded as evidence of dangerous national untrustworthiness, a lack of commitment to “reform,” an absence of a "rules-based system." All of which will lead to currency crashes, aid cuts and capital flight. The bottom line was that South Africa was free but simultaneously captured; each one of these arcane acronyms represented a different thread in the web that pinned down the limbs of the new government.

A long-time anti-apartheid activist, Rassool Snyman, described the trap to me in stark terms. "They never freed us. They only took the chain from around our neck and put it on our ankles." Yasmin Sooka, a prominent South African human rights activist, told me that the transition "was business saying, ‘We’ll keep everything and you [the ANC] will rule in name. . . . You can have political power, you can have the façade of governing, but the real governance will take place somewhere else.’" †, 13 It was a process of infantilization that is common to so-called transitional countries—new governments are, in effect, given the keys to the house but not the combination to the safe.


***

Not only did the volatile market not like the idea of a liberated Mandela, but just a few misplaced words from him or his fellow ANC leaders could lead to an earth-shaking stampede by what the New York Times columnist Thomas Friedman has aptly termed "the electronic herd."23 The stampede that greeted Mandela’s release was just the start of what became a call-and-response between the ANC leadership and the financial markets—a shock dialogue that trained the party in the new rules of the game. Every time a top party official said something that hinted that the ominous Freedom Charter might still become policy, the market responded with a shock, sending the rand into free fall. The rules were simple and crude, the electronic equivalent of monosyllabic grunts: justice—expensive, sell; status quo—good, buy. When, shortly after his release, Mandela once again spoke out in favour of nationalization at a private lunch with leading businessmen, "the All-Gold Index plunged by 5 per cent."24

https://www.commondreams.org/view/2011/02/14-11

[2naSalit]

1. !!!

[Igel]

2. SA was like Egypt.

A few years ago there was a revolution in Egypt. It was all about democracy.

Except on the ground, in the year or two preceeding it, it was all about the economy. There'd been protests, riots, etc. The government kept backing down, but things were getting worse.

As soon as they said, "Democracy!" the West cared a lot more. There was a revolution and many assumed the economy would turn around. It didn't happen. (In fact, it's likely that the deep state made it worse. In any event, it's highly unlikely that all the things that made the economy crappy before the revolution would suddenly all change in just the right way, all at once, to make the economy boom. In fact, few things changed in the economy. What was crappy kept on going, at a constant velocity and in a constant direction in the absence of a non-zero external net force.)


In SA the two themes of racial equality and economic equality went hand in hand. For many, they were the same. The franchise is what blacks got. It's a lot of what they wanted, but the assumption was, as in Egypt, democracy would mean massive improvement in the economy. The '70s weren't good to SA. The '80s were miserable, with the economy barely moving.

The thing is, in SA there should have been a fairly dramatic rise in GDP in 1994. Sanctions that were crippling the economy were ending. There'd be a lot of good will and economic aid. There were really high expectations. They were misplaced.

In Slovakia in '93 and '94 there were similar expectations--they had nice new equipment and should have done really well when they broke away from the Czech Republic. Except that their new industrial base was obsolete, very Soviet, when installed. Then, in Slovakia, like in the '90s in SA and this year in Egypt, people have to find a scapegoat to protect Those Who Must Be Protected.

[dougolat]

3. So the bankers run the economy, and the government is window-dressing. ..nt

[yurbud]

4. sort of like here.

[yurbud]

5. .

[TheKentuckian]

6. Very important, thank you

[yurbud]

7. you're welcome.