Game Plan.

When the Zuma regime was installed in power in December 2007, the problems faced bySouth Africawere obvious; we were going to be ruled by unscrupulous, inept, corrupt corporate stooges. This was bad, of course, but it was not conspicuously a worse case than the case of almost any other country in the world. However, it was fairly obvious that the multinational corporations and foreign intelligence agencies who had bankrolled the operation were not going to stop there. Presumably, they had done this for a reason which went beyond simply taking revenge on Thabo Mbeki for not being their man, and displaying their power to the continent ofAfrica. Some of what they wanted was implicit in the PR guff eructated at Polokwane, but was less obvious then than it is now, when it is becoming fairly clear what the project is all about.

It’s more ambitious than it seemed in 2008 – and it’s not at all pretty.

As you might expect, the project is an economic one. The global ruling class is not particularly interested in posturing populism, so the project has little to do with politics except insofar as this facilitates economic control. It has nothing to do with morality, except insofar as this cloaks economic control. However, economic control is not going to be direct, because direct economic control leads to political responsibility and to being blamed for what’s going on, which is anathema to the global ruling class (who are quite aware of how much they are hated and how guilty they are of the crimes for which they are hated, so they remain as invisible as possible).

When ESCOM arranged its scam, to pretend thatSouth Africawas running out of electricity and thus panic the government into permitting massive tariff increases, one obvious side effect was that new energy resources were supposed to come on-line. The plan was for two huge coal-fired power-plants to be combined with three huge nuclear power-plants. This was a costly and unnecessary project at the time, most particularly because the enormous prospects of renewable energy were ignored. However, inarguably,South Africawould, if it enjoyed economic growth in the manufacturing sector, need more energy to power its metal smelting plants and its fabricating factories. So this wasn’t so bad – if only there were a plan to promote manufacturing growth.

Manufacturing growth, however, is definitely not something which the global economic elite have planned forSouth Africa.China,IndiaandBrazilare quite bad enough without starting up another one inAfricato make difficulties for market-manipulation. South Africa, in the eyes of the global economic elite, needs to be locked into a situation where its populace becomes increasingly endebted to Western banks, while its economy is dependent on the export of primary products (farming, coal and metal ores) whose cost can be manipulated to ensure that the government also becomes increasingly endebted to Western banks, and that government policies serve Western economic interests along the familiar lines of the Economic Structural Adjustment Programmes of the International Monetary Fund.

This doesn’t mean that the electricity programme has been cancelled. The cost has approximately trebled, in part because the hastily-entered-into contracts for French nukes have been abandoned to make room for fresh contracts – ones which almost certainly benefit American interests much more – in part because there are now plans for even more nukes than before, and in part because the whole issue is essentially invisible to the public. The media likes it that way. This is not an arms deal, which was going to end up in serving the defense of the country; this is a deal to make money for Western interests for no obvious reason, since there is no sign that there is going to be rapid industrialization in South Africa, and therefore there is no sign that there is going to be any rapid growth in electricity demand. Unlike the situation in South Africa in the early 1980s, when we were left with mothballed power-plants because of unexpectedly slow economic growth arising from the political crisis, our future mothballed power-plants are part of the game plan; there is going to be slow economic growth, but it is entirely expected by the business community – although the Minister of Finance lies about this for political reasons.

Notwithstanding, however, we are currently told of our country’s ten-year plan to “upgrade infrastructure”. Upgrading infrastructure is the Holy Grail, supposedly; the reason why there is no investment in manufacturing or processing plant by business, is because there is no infrastructure. If you build it, they will come. But, ten years ago, the infrastructure was ten years younger, and had not been starved of funding for five years – and yet nothing was built. Go down to Coega if you still think that building infrastructure attracts private investment; it’s an immense car-park, vacant highway and empty-construction-site zone.

However, the “infrastructure upgrade” is gathering steam. New rolling-stock for the railways and accelerated maintenance for the tracks, new roads, new telecommunications, new harbours – it sounds good. A close inspection, however, reveals that virtually all this is going to be bought from foreigners, and a respectable amount of the new construction will be contracted out to foreigners. In other words, very few jobs will be created for South Africans in the process of all this manufacture and installation of infrastructural components. They could have been created – it’s a ten-year project, and some of that time could have been used to refurbish or build from scratch the state rolling-stock factories, communications systems and repair facilities which once graced the country under the apartheid regime. But it isn’t going to be. That isn’t the plan.

Indeed, no part of the plan suggests any development programme at all. No smelters are planned. No new mines are going to be dug with state assistance. There is no “beneficiation”. Basically, the whole thing involves digging more stuff out of the ground and shipping it faster to the coast. This is a large-scale variant of the Dube Logistics Hub near the new King Shaka Airport in Durban, which is a vast pork-barrel masquerading as an economic development zone; absolutely nothing can be done there except ship stuff out of the country by air, and almost nothing is worth shipping out of the country by air except salad greens and cut flowers, so basically the government is spending ten billion rand on replicating the Senegalese model of economic development, serving the interests of the leisure classes of Europe and the United States. Just to add to the injury, another gigantic similar park is planned nearOliverTamboAirportinJohannesburg.

The whole project is going to cost more than three million million rand. How much more is unclear. Three point two trillion? Three point four trillion? What allowance does this make for cost overruns, unforeseen expenditures and just plain graft? Necessarily, costs don’t come down under opaque, corrupt and panic-stricken conditions. Hence, at the very least, we are blowing our entire gross domestic product over the next ten years, on a project which is almost guaranteed to generate very little economic growth and create essentially no long-term employment.

Why in the world do we want to do that? Our budget deficit is already cruelly high (only a month after the 2012 Budget, Pravin Gordhan’s 2011 revenue and expenditure figures have already been exposed as lies). However, now, to this, is added a budget deficit of 10% per annum for the next ten years, which will secure a massive trade deficit (all that material being imported which we could be manufacturing) over the same period. Spending all that money means that there will be little left for job creation, and therefore, no prospect of accelerated economic growth. This means that in about six years or so,South Africa’s national debt, now standing at 42% of GDP or thereabouts, will rise above 100% of GDP. Lots of people are talking aboutGreece, mostly mendaciously and rhetorically, but we are indeed heading directly into a classic debt trap.

It is true that interest rates are now unprecedentedly low – but that only applies to the “right” countries, the ones who are benefiting from the system. Observers may have noted that, one by one, the ratings agencies are coming to the conclusion thatSouth Africais a bad credit risk. This is impeccably true, of course – a country run by crooked puppets is simply a black hole for investment – but then, this is also true of virtually every country in the world. However, the point is thatSouth Africa, currently still an insignificant debtor and therefore largely unaffected by such interest rates, is careering towards a situation where a slashed credit-rating will lead to a catastrophic rise in debt servicing costs. It’s hard to believe that this is an accident. We are being set up for a situation where a future government will proclaim, hand on heart, that we (presumably, not they) have spent ourselves into a crisis, and now, regrettably, some measure of “austerity” will be necessary.

What will this “austerity” amount to? InBritain, Chancellor Osborne is talking about privatizing the highways because it was such a success with the railways. We’ve already done that with the radioactive toll gantries which dot theGautenglandscape, every one built specifically to export capital to the foreigners who now own theGautengfreeways. ESCOM is ripe for privatisation. Once the three trillion has been spent, TRANSNET will also be ripe for privatisation. The Minister of Water is boiling and bubbling with eagerness to privatise South African water resources and supply systems. We can guess that a massive sell-off is in the pipeline (and no doubt the pipeline will also be sold off).

The National Health Insurance project appears to be a project to transfer wealth from public hospitals, where it is so unhappy, to private clinics, where it belongs. This is nowhere near organised yet, but it seems certain that the recent fanfares around “NHI roll-out” of “pilot projects” where nothing is to be done yet although billions are to be spent, represents a way of keeping NHI in the public eye. Presumably a few good hospitals will be cherry-picked as examples to legitimate NHI, so that when the time comes to privatise state hospitals there will be no outcry, except from the Creator, if the Creator isn’t in jail by then. (And it would not be at all surprising if the jails are privatised too.)

There is a tremendous clamour of condemnation against state education and the social grants system. Presumably this will intensify. Possibly, as inBritain, state education is going to be gradually privatised, and quite probably the social grants system will be either radically pruned or phased out. It will, supposedly, save money. Who needs schools? Who needs money? The rich do, of course, most particularly the foreign rich. The local rich can be bribed with a few peppercorns while the foreign capitalists rake in the rutabagas.

It all seems to be converging on the end of the decade, meaning the point at which Jacob Zuma ends his second term of office. At which time, we will have a hopelessly discredited, disrupted, unpopular and intellectually bankrupt ANC, confronted with a well-funded DA facing no criticism whatsoever. The most likely consequence would be that the ANC in 2019 will have collapsed far enough to be dependent on the DA to govern, and would thus be gradually absorbed by that party which has already swallowed up virtually all its hapless competitors. In that case, foreign neoliberals would control not only the economy, but the political process and all its prospects (since they would also control the public space). AndSouth Africawould be a failed state, incapable of feeding itself, incapable of manufacture, dependent on a constant drip-feed of foreign credit which ensured that it was permanently endebted to an extent which made it incapable of taking any independent initiative.

Sounds neat! What are we waiting for? Just do it!

 

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One Response to Game Plan.

  1. Charles says:

    I have been arguing this for ages. Why cant our pundits see this?

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