Trends, change and recovery: SA beyond Covid-19 is an attempt at sourcing a range of theories.
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The Covid-19 crisis can be a catalyst for political change that unlocks a new way of doing business in South Africa. But it requires a real and tangible change of habits, writes Daniel Silke.
The magnitude of the Covid-19 on the global political economy remains an unfolding event. We are now in ‘Covid-Time’ – a rapidly changing set of circumstances with so many variables that any rational reaction can shift and mutate on an almost-hourly basis.
While it may be far too early to write the history of the future, there is an emerging set of indicators which will act as a directional road map in the months to come. South Africa should take heed of these since more vulnerable emerging markets like ours can suffer deep dysfunction should economic hardship and political polarisation further embed itself.
This exogenous health emergency has placed significant emphasis on the way the state practices efficient and effective health care, manages economic growth and provides safety nets for its citizens.
While the real debate will occur after the pandemic, there is a likelihood of a renewed ideological discussion over the role of the state versus the private sector – especially in the health-care sector but not exclusive to it.
In the South African context, this discussion was already emerging at the onset of Covid-19 with the mooted introduction of the National Health Insurance (NHI) scheme. In the pre-coronavirus era, this was largely a domestic debate focused on the State’s past poor performance in service delivery and the chances for the repetition of this in a broader NHO environment.
Covid-19 changes this. It expands the debate well beyond our borders to global best (and worst-practice). The current crisis has each of us dissecting the virus infection curves and analysing each countries’ response – from the more centralised statist mechanisms of China to the federalist (and therefore de-centralised) approach of the United States. Systems that fall in-between like the UK’s NHS or Italy’s SSN provide alternative hybrids of models that will either work or not.
Our NHI debate will therefore change and mutate. Covid-19’s effects cuts across all racial, income and demographic groups. Yet, the population’s vulnerability to contagion is surely skewed towards those less privileged. As pathogens perhaps increase in frequency in future, a more universal (and centralised) health-care option can gain in public support.
Of course, this shift is predicated on a fundamental issue of governance in a time of crisis - that of ensuring trust in the state to deliver critical services. For sure, South Africa’s state has been weak and often entirely deficient.
The response to the current crisis will test our State to its limits. Politically, the ANC understand this well and has doubled-down on a nascent (and perhaps ruthless) efficiency in order to accomplish health security – at least in the short term.
Just how much the state should be in our lives can also be a debate that extends beyond the health-care sector. This issue was already inducing tension within the ANC as the party grappled with a SOE sector in distress. Ironically, a positive showing by state health in combating Covid-19 can extend to renewed calls for a statist approach in other sectors.
The flipside of this is the simple reality that the severe economic consequences foisted on the domestic economy will call for a re-prioritisation of expenditure items. In so doing, the sheer inability of the state to spend on its previous ideological pet-projects would have to be accepted.
Yet, one should expect a push-back from those on the more socialist left who will argue now is the time for even greater state control. And much of this argument will reflect on the ability (or inability) of both the state and or private healthcare to handle the virus pandemic using both South African and global examples.
The conundrum for the ANC will be whether South African can afford a centralised state with growth rates that simply do not support it. Only a rising GDP, competitive and market-friendly policies will allow the state to prosper. It’s something of a chicken-and-an-egg debate.
The State simply cannot assume a major role unless it is well financed. And to this end, the role of lending agencies like the World Bank can play a major role. These events will call for a major review of defunct policy. And, they will exacerbate the inherent fissures that already exist within the ANC. That the issue of an IMF bailout under consideration from Finance Minister, Tito Mboweni has already been questioned by the Ace Magashule faction is early evidence of this. The coronavirus crisis will test ideology and strategy – more so than any ANC policy conference has been able to do in recent memory.
Globally, the question remains unanswered as to whether a stronger State will be the outcome of the post-Covid-19 world. While the ANC will have to review its now-moribund pet projects, perhaps we will all have look more favourably on issues of universal health-care, rewarding lower-paid workers who labour in riskier pursuits, the dismal living conditions for millions of citizens and better safety nets within the context of a more fragile planet.
To accomplish an effective strategy to re-build our economy, the State will be compelled to act with greater integrity than before. With a deep recession that could sap the already waning public confidence, the ANC will be under pressure to act with dignity, humility and also ethical considerations that have largely been missing in the last decade.
An incumbent political party seeking societal support in tough times will need to shore up its own performance or be judged by a more demanding and sensitive electorate as they suffer extreme economic and potentially social dislocation.
While efficiencies and ethics are critical, the crisis should also forge a much healthier collaboration between the state and private sector. There were improving under President Ramaphosa, but the weakness of the state coffers, rising budget deficits and spiking debt levels will demand an increased role for the business sector in assisting government. If ever there was a time for greater collaboration across economic and institutional groupings, then the time will be now.
With the world on lockdown, both libertarian and authoritarian states have used regulation to curb individual freedoms.
For the ANC, these regulations can work in the immediate aftermath of a crisis, but will need more medium-term amelioration of the virus pandemic to sustain societal buy-in.
There remains a danger that the use of regulation gains traction beyond the issue-specific event of Covid-19 and hangs round on our statute books for narrower political and societal ends.
The unravelling of the curbs on individual liberties – including new technological surveillance methods – can be a heated political issue well into the years to come and can stretch way beyond our borders.
While the debates of the future resemble those already underway in South Africa, the extreme economic and social shock of Covid-19 can forge new partners.
A ‘moral economy’ that President Ramaphosa has spoken about can unify hitherto political opponents in a new centrist and moderate force committed to both market and social considerations.
The crisis can therefore be a catalyst for political change that unlocks a new way of doing business in South Africa. But it requires a real and tangible change of habits.
The days of looting the state coffers should be history. The theft from the poor via state capture has to be reversed. There should be no room for those who drift back to the old paradigm. And, we should not allow this crisis to distract us from the legal ramifications for those involved in the malfeasance in recent years.
Similarly, a revisiting of policy based on the economic recovery and social stabilisation of the country should forge new alliances.
Those with entrenched ideological positions should embrace a new flexibility across the board. And nation-building should return from the Mandela-era to forge a new inclusivity.
If this is not done, we will let this unprecedented crisis go to waste.
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