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This resource is hosted by the Nelson Mandela Centre of Memory, but was compiled and authored by Padraig O’Malley. It is the product of almost two decades of research and includes analyses, chronologies, historical documents, and interviews from the apartheid and post-apartheid eras.

Economic policy - the debate sharpens

In the last few months there have been many signs that the debate is heating up around the future direction of our economy. In the past weeks, both big business and the labour caucus at Nedlac have tabled major policy documents.

Both documents (Growth For All, and Social Equity and Job Creation)begin with roughly the same proposition: for the past two years we have been basking in the afterglow of the political miracle of April 1994, now is the time for some serious economic policy choices. Of course, having agreed on this, the two documents then radically part ways.

The sharp fall in the value of the Rand since mid-February may or may not be directly linked to this sharpening debate, but the fall has certainly been used as an opportunity to make all kinds of ideological pronouncements.

The reasons advanced for the fall in the Rand moved from uncertainty as to whether President Mandela would stay on until 1999for his full-term. When this was clarified, speculation around our President's health was said to be the reason for the decline. Perhaps for the first time in world history, a president was sent to a clinic for several days not by medical professionals, but by the market. When the clinic clarified that our president was in perfectly good health, we were told that the Rand was declining because of rumours that Chris Liebenberg was about to resign as Finance Minister. (This proved to be one of the few correct rumours.)

When Trevor Manuel replaced Liebenberg, this then became the new reason for the decline in the Rand. Manuel, unlike Liebenberg, was from the ANC and, so the markets whispered, he was black. Then the Rand was supposed to be falling because of COSATU's threats of a stayaway, and finally "alarm" at the NP's impending departure from cabinet was said to be the reason for the Rand's fall.

All of these alleged "moods" and "concerns" of the market are being thrust down our throats in order to create a sense of panic and hopelessness. If the ANC-alliance blinks its eyes or shrugs its shoulders, we are told, we will send the Rand plummeting. All of this heightened ideological activity around the falling Rand is designed to deliver us into the agenda of big capital.

But what is that agenda?

Soon after the April elections in 1994, the major captains of industry in SA constituted themselves into a think-tank - the so-called "Brenthurst Group" (Brenthurst is the name of the residence of the group's host, Harry Oppenheimer). The Brenthurst Group was deeply concerned that progressive forces had an "undue influence" over government economic policy. They were critical of the NP's inability to have any substantial im pact. And they were also relatively unhappy with the performance of Business SA in Nedlac. BSA included too broad a spectrum of business interests, in their view.

These concerns resulted, in the second half of 1995, in the relaunching of the old sanctions-busting SA Foundation. The SA Foundation now has a completely new character, it now represents the 53 largest corporations in SA. It also has a fresh mandate, largely focused on impacting on domestic economic policy. In February, SA Foundation launched its first major public intervention, the document called Growth For All. The mainfeatures of this document are analysed elsewhere in this issue (see the article by Vella Pillay).

What the Growth For All document represents, in essence, is the first elaborate and sustained ideological challenge to the RDP. The SA Foundation ideologues were convinced that the ANC in government was fumbling for an macro-economic policy and so they were somewhat taken aback at the less than entirely enthusiastic response their document got from the leadership of the ANC.

Deputy president Thabo Mbeki is reported to have said that, while the document was full of advice as to what everyone else should do, it was singularly lacking in any suggestions as to what the captains of industry intend doing to overcome SA's economic and social crisis.

Minister of Labour, Tito Mboweni was even more forthright and public in his criticisms. Quite correctly, he saw in the document a radical and sustained attack on all of the progressive reforms that the Labour Ministry has so carefully and successfully piloted through Nedlac. Instead of bringing more and more sectors of labour within the scope of civilised labour relations provisions, the SA Foundation document seeks to broaden the numbers of rightless workers.

For its part, COSATU has said that it will not negotiate with business at Nedlac if the SA Foundation document is on the table. "The document must be removed from the table first",

COSATU general secretary, Sam Shilowa insists. "Only then will we negotiate at Nedlac".

We agree that the SA Foundation document should be taken off the table, but we urge comrades to read the document nonetheless. Because here in plain text is the agenda of the captains of industry.

The document is the application of neo-liberalism to the South African context, and its major targets are the new democratic government and the progressive trade union movement. It argues for the radical reduction of government's role in the economy. It seeks to confine government to a largely law and order role - keeping the country safe for investors. As for the trade unions, the document is quite forthright, one of the main problems in SA, it says, is that "trade unions are too strong".

In the coming months the struggle around the economic future of our country will certainly intensify. From the side of the ANC-led alliance, the task is not to invent awhole new set of policies. We need, rather, to defend and advance the RDP mandate of our government. We need, also, to once more anchor economic issues amongst the majority of our people. If the pressures on economic policy-making are confined to those who are most articulate, to those who own and control much of the media, then we will always be at the mercy of market "sentiments" and "concerns". The great majority of our people couldn't give a hoot if Trevor Manuel is black or white. They want to see delivery, and policies that make delivery possible. The great majority of our people don't get into a panic because COSATU is calling for a stayaway or because the NP is leaving the cabinet.

We need to ensure that it is the feelings, concerns and fears of the great majority of working people in our country that impact on economic policy-making - and not the privileged prejudices of the yuppies on the Johannesburg Stock Exchange.

This resource is hosted by the Nelson Mandela Centre of Memory, but was compiled and authored by Padraig O’Malley. Return to the Nelson Mandela Centre of Memory site.