Our Winter of Discontent; Isn't it Time?

2016-05-24 07:32

If you were in the ruling echelons of political office in South Africa right now, you should be shuffling in your seat - because this could be our seminal Winter of Discontent.

This is because -

• We missed a ratings downgrade by only a whisker – and it still threatens ominously

• Our unemployment statistics are the highest in the world and have just reached their highest levels ever (refer the Economist May 14-20th, page 72)

We have been warned (by Moody’s the ratings agency) that they only held back on a junk status downgrade because of a promise from our finance minister - and on condition that business, government and labour can make it work from now on.

I chuckled when I heard that because of the implausibility of labour coming to the party and our finance minister getting the support he needs from the presidency.

The union mentality, especially in South Africa is quintessentially confrontational, coercive and anti-business – which provides the ultimate irony since it is purely on business’ success that any turnaround can be built.

Added to this are the president’s dysfunctionality, political deviousness and limited powers of abstraction - all well documented.

The British “winter of discontent” came to mind and I tried to imagine a Zuma led government managing to pull off anything similar to what Thatcher did in the early 1980s.

Again, I chuckled.

What was the British “Winter of Discontent”?

In summary, Britain’s ruling Labour Party – grappling with 26,9% inflation in 1975, and fearing that it would lose power if unemployment grew, tried for the best of both worlds by capping public sector pay rises at 5%.

It did not work.

Labour PM Calllaghan was forced to call a general election that saw the rise of Margaret Thatcher to office in 1979, and the end of the so-called “post war consensus” - a broad public policy approach promoting collectivism, a mixed economy, and welfare state.

The “winter of discontent” describes the hardships of the British people during one of the coldest winters for many years at a time when striking coal miners folded their arms in defiance and refused to produce. As a result, Mrs. Thatcher made drastic changes to trade union laws and closed many of the coal pits that had functioned unprofitably and required government subsidy.

By 1983, strikes were at their lowest level for 30 years and the Tories (Conservative Party) won that year’s general election by a landslide. The shift to the right in British politics led to the formation of a new consensus, which now dominates British politics.

Both the Conservative and Labour Parties have ever since favoured lower government spending and taxation, curtailed government sponsored housing, and privatised many industries and services that were previously publicly owned.

Britain’s leadership role in Europe and the world at large is testimony to the personal leadership qualities of this one – and at times desperately unpopular – woman. Her US kindred spirit - President Ronald Reagan - achieved similar domestic successes, turned the US economy around and helped to precipitate the end of the Cold War, leaving the US as the world’s sole superpower.

So much for leadership and success!

Now – what about South Africa in 2016?

For today’s ANC, all available alternatives are pretty grim with its situation not being dissimilar to late 1970’s Britain. It has no easy solutions and nowhere much to turn. And "strike season" is round the corner - with everybody watching.

It also seems to me that only inspirational leadership might work – as it did in Britain – but in our instance that is precisely what is lacking. It is not only in short supply but dysfunctional.

Should it (the ANC) behave uncharacteristically by contradicting all its previously articulated values and showing bold leadership to secure the nation’s financial integrity and economic future (as the finance minister has promised), it could well lose its closest friends. The trade union movement and possibly the communist party will in all probability leave it in the lurch and devoid of a good chunk of its electoral constituency.

That is very dangerous with the populist – and even more cognitively inept - EFF in the wings. Only a growing economy – or one showing imminent promise of growth – will do the trick.

But the left wing is unlikely to countenance the repeal or significant erosion of the absurd raft of worker rights that characterize South African legislation. Neither is it likely to entertain diminished labour expectations, nor major public sector staff cuts – all essential for economic recovery.

The alternative is to do nothing or go through the motions (more rhetoric and stated but essentially empty, intentions) in the knowledge that a downgrade will come anyway.

Either way the financial world has its finger on the trigger.

In a year when the party’s leadership is under scrutiny, the constitutional court has whipped the president with some damning decisions and the rumour mill within the ruling party has turned it into a shambles, the ANC is not in a good space. Not even our parliament fully functions any longer.

And yet the president survives.

Thus, when rumours fly about arresting our respected finance minister and our currency totters on the brink of an abyss, you can probably figure on our winter of discontent not coming soon enough.

And that is very sad - for it is the sole rite of passage to a decent social economy.

Instead it seems that in the short term we are faced with a tsunami of recriminations and presidentially inspired and abetted state capture, denials and barefaced lies. Add to that party intrigues and the mounting prospect of a wrecked economy and the chill draws ever closer.

Strategic thinking and smart government decisions are conspicuous by their absence and antitheses.

So in answer to my opening question, I would have to say “No”.

When the ANC’s end game in office comes – as it must - it is unlikely to still be a winter of discontent. It is more likely – should Zuma survive beyond the next six months - to be a savage heat wave of political and economic mayhem, civil unrest and anarchy.

It is not quite here - but drawing ever closer.

Hopefully there will be something to salvage afterwards.

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