Mondli Makhanya: Does SA need a Thatcher moment?

Finance Minister Tito Mboweni delivered a supplementary budget to address the effects of extra expenditures to fight the Covid-19 pandemic on the national fiscus. (GCIS)
Finance Minister Tito Mboweni delivered a supplementary budget to address the effects of extra expenditures to fight the Covid-19 pandemic on the national fiscus. (GCIS)

VOICES


All young people grow up looking up to a range of idols.

Some are musical, some are sporting and others political.

These heroes might also be family members, teachers, priests or respected members of the community.

Often, they are far away, out of reach of the young person doing the hero worshipping.

This lowly newspaperman had many such idols growing up, but there was one who was far away who made an indelible impression on the young mind.

His name was Arthur Scargill, the leader of the UK’s National Union of Mineworkers (NUM).

An uncompromising socialist, Scargill built the NUM into a formidable force that had the power to make and unmake governments.

Scargill met his match during the 1984 to 1985 mine workers’ strike when he tried to take on Margaret Thatcher, a politician whose heart was as hard as a rock and as cold as arctic ice.

Calling out workers to strike against the phased shutting of coal mines – a move that was part of Thatcher’s modernising plan – Scargill gambled badly.

Although the very violent strike crippled the country, Thatcher was not one for budging.

She stared Scargill down. As weary mine workers began to voluntarily return to work, the battle was lost.

Thatcher powered the liberalisation of the economy like a demon on steroids.

The net effect of that defeat was to not only destroy the NUM as a force and lower Scargill’s standing in the eyes of the UK’s left, it also severely weakened the power of the trade union movement – exactly what Thatcher and the Tories had wanted.

The Iron Lady was then liberated to proceed with extremist free market policies that fattened the rich and sent many Britons to the margins.

She ushered in a period of unparallelled greed under the guise of modernising the economy and freeing up capitalist energy.

Thatcher powered the liberalisation of the economy like a demon on steroids.

There were many casualties along the way, mostly working class individuals who could not cope in the dog-eat-dog world.

But it did transform the UK’s economy, turning it into a powerhouse and a destination for the ambitious in other parts of Europe and beyond.

As wicked and heartless as she was, her legacy was turning a moribund economy into a purring engine.

The key to this was that victory over Scargill and, by extension, the trade union movement.

As unpalatable as this may sound, this lowly newspaperman wonders whether South Africa needs a Thatcher moment.

Watching an irritable and visibly exhausted Finance Minister Tito Mboweni present his supplementary budget and address the press conference immediately after that, it is clear that there is a major boulder in the way that needs to be shifted if South Africa is to move forward.

Read: Mondli Makhanya | So what’s Cyril Ramaphosa’s tone?

Even before Mboweni spoke, we knew the situation was dire.

But it is only when the facts are presented in a direct fashion and the price of inaction is starkly laid out that the sweat beads flood the forehead and the underarms get drenched.

Mboweni pointed out that if we do not do something urgently about economic growth, the national debt – which is already wildly out of control – “will spiral inexorably upwards”, accompanied by all the attendant dangers that come with that.

“Debt service costs will crowd out public spending on education and other policy priorities. We already spend as much on debt service costs as we do on health in this financial year. Eventually, the gains of the democratic dispensation would be lost,” said Mboweni.

Mark those words: The democratic gains would be lost.

He continued: “The results are devastating. Interest rates skyrocket. Spending has to stop. Inflation takes hold and people grow much poorer. This is what happened to Germany in the 1920s; to Argentina and Zimbabwe in the early 2000s; and to Greece in the past few years. Argentina had its ships attached. Greek civil servants and pensioners had their salaries and pensions slashed. In short, it is doom and despair.We have been there before: in its closing days, the apartheid government had to declare a debt standstill.”

Mboweni’s warning that the democratic gains will be lost if we remain passive is apt. We lost a lot of those democratic gains during the lost decade
Mondli Makhaya

What rescued us from the debt trap that the apartheid government bequeathed the democratic order was a brave and unilateral step by Nelson Mandela’s administration to take the bull by the horns.

Against the wishes of its allies, the Mandela administration decided that it was better to take the bitter medicine to avoid costly hospitalisation later.

The much-hated Growth Employment and Redistribution Strategy put us on a path to self-sustainability.

By the time we got to the early 2000s, government was in a position to free up spending.

Growth edged upwards, ending up above 5% when the Polokwane warriors deemed it wise to bring a sex-crazed populist into power.

Mboweni’s warning that the democratic gains will be lost if we remain passive is apt.

Ramaphosa must forget about the ANC’s national general council, where the ragged lot that call themselves radical will be baying for his blood.

We lost a lot of those democratic gains during the lost decade.

They could be wiped out if the Cyril Ramaphosa government does not bulldoze much-needed reforms the way Thatcher did.

That will entail a willingness to lose friends, but it has to be done.

Ramaphosa must forget about the ANC’s national general council, where the ragged lot that call themselves radical will be baying for his blood.

They already despise him anyway.

He should heed the words of his finance minister.


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Mondli Makhanya 

Editor in chief

+27 11 713 9001
Mondli.makhanya@citypress.co.za
www.citypress.co.za
69 Kingsway Rd, Auckland Park

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