PALI LEHOHLA | SA needs to escape apartheid economics

In its recent macroeconomic probity of the financial systems of South Africa, the National Planning Commission (NPC) appears to have undergone a “Saul to Paul” conversion.

Yet Asghar Adelzadeh of Applied Development Research Solutions (ADRS) notes correctly that the NPC, in this journey, has yet to fully see the light. He argues that global financialising systems will “eat the NPC for lunch” unless and until they reflect deeply and uproot the deep embeddedness of the National Treasury and the South African Reserve Bank (SARB) in this empire system.

It is understood that these “empire appendages” — the SARB and National Treasury — are livid, even against this mild dose of critique from the NPC.

This reaction is quite unsurprising. Six years ago, when Adelzadeh presented a paper probing the political economy, the sheer volume of traffic from the Treasury and SARB on the web version of the paper betrayed the unease and disdain with which they treated the contribution.

Now, when a mild dose rears its face in the full glare of a 31-year assessment by the NPC, the appendages of the empire are again displeased.

Perhaps the fear is that Adelzadeh’s work is finally gaining traction. It was in 1996 that the curtain was drawn on the macro-economic work addressing the RDP’s implementation, and GEAR emerged. The political economy debates have raged for three decades since.

It was again in October this year that Adelzadeh prepared a well-thought-through paper looking at who gained and who lost — using not just an economic lens but the motive force — the political economy of neoliberalism. The picture is ugly and the poor have gone to the wall. It showed that apartheid structures persisted and co-opted a handful of a black bourgeoisie into this financialising club of benefits, thus explaining the deepening poverty and economic stagnation that afflicts South Africa.

South Africa remains a typical “30% performance” country, accepting the mediocrity of its own Kool-Aid as analysis. In a blunt and enduring critique, Duma Gqubule cast aside the content-free analysis of Yellowwoods executive chairman Adrian Enthoven that dominated news of “green shoots” in the Daily Maverick.

Duma asks the pertinent question: if Enthoven says GDP growth remains low in spite of the spirited energy, by what measure and lens does he swear by green shoots? Einstein has a definition for a 30-year repeat of same and ever elevated conviction ― yet change dololo.

To add my own perspective and metaphor to Gqubule’s critique of Enthoven dare I say: when the grass is dry, give livestock green sunglasses and they will believe the vibe and graze. This is the “vibe analysis” that the Government of National Unity and its cohorts have acquainted themselves with.

So when a mild notion of reforming the financial system appears, the beneficiaries of this rigged system get hot under the collar, and white capital throws hallucinatory messages to a black government that gets mesmerised by noise. The NPC has seen through this lie, but unfortunately, even their mild antidote — which falls far short of addressing the political economy — raises the hackles of the SARB and the Treasury.

What is important about Adelzadeh’s input is his attempt to peel off the layers of the jaundiced lie of economic thought, as discussed at the Kgalema Motlanthe Summit of Equals at the Drakensberg.

He argues that the recent NPC report on South Africa’s “monetary and financial architecture” is one of the most pointed diagnoses of why the country remains trapped in low growth, weak investment and extreme inequality. Its key argument is that democratic South Africa has never fundamentally reconfigured the inherited financial system. Instead, the architecture of apartheid-era capital allocation — highly concentrated, externally orientated and weakly co-ordinated — largely survived the transition unscathed.

The debate on economic policy in South Africa is characterised by thought paralysis, inaction and a dead conscience. These elements must be activated in the public service. But when they are not, where does this leave us?

To illustrate, a personal memory lane is invoked. In 2010, I established the Centre for Regional and Urban Innovation and Statistical Exploration (Cruise) at the University of Stellenbosch. I had hoped that StatsSA officials would be joined by Cogta to form a formidable team, technically solid in addressing planning and execution at the municipality level with the application of statistics. Cogta failed to come to the party. StatsSA produced in excess of 100 MPhil graduates, and that has sustained the leadership role of the institution.

The question then is the depth of malnutrition of thought in these top institutions opposing NPC’s lukewarm suggestions regarding what a developmental state actually is. Only the gods of the empire know.

But my anxiety was heightened by the multiplicity of empty plans, particularly the Nine-Point Plan and the Fourteen-Point Plan. I then researched the best way to bring planning tools into government because the Cruise training was revealing the serious gaps that existed. That is when I got in touch with Adelzadeh in 2015. The Treasury tried to give me the run-around when I asked Adelzadeh to train my team; they wanted me to advertise a tender. I refused, stating that I had looked at what ADRS provides and was satisfied with the architecture of a statistical system that would interface with planning.

Since planning was not the terrain of StatsSA, I approached Tshediso Matona to nominate a number of DDGs and chief directors from the department of monitoring and evaluation (DPME) to join my deputies at ADRS in California. At first, the institutions that needed planning the most continued to resist, and the DPME followed in the footsteps of Cogta. While ultimately the DPME agreed, they brought a team too small to make an impact, often led by staff too junior to match a StatsSA team comprising DDGs and chief directors with PhDs and masters degrees.

I had also asked that the team evaluate the government’s Fourteen-Point Plan to see whether it was worth the paper it was written on. Upon their return, the StatsSA team reported back to me that the Fourteen-Point Plan was an aggregation of words, informed neither by theory nor solid econometrics. I immediately asked for a slot at Fosad (Forum of South African Directors-General) to present the findings ahead of former president Jacob Zuma’s state of the nation address. I presented at Fosad; the response was underwhelming.

Twelve months later, I was drawn into the Indlulamithi Scenarios. Armed with Adelzadeh’s ADRS capabilities, I submitted a proposal for the quantification of the scenarios. The Gwara-Gwara, Nayi le Walk and Isibujwa scenarios were policy-defined and quantified.

The verdict that South Africa was in a quantifiable, undisputed Gwara-Gwara scenario was based not only on a set of policies but on a political economy definition of neo-liberalism. This definition was repeated by Adelzadeh at Drakensberg, where he deposed an affidavit not just on the state of physical poverty afflicting South Africa, but on the poverty of thought — the prime mover of the physical features of poverty that are statistically quantifiable.

While the NPC also shows signs of this malnutrition of thought, they have at least moved the needle forward, albeit to the annoyance of the SARB and the Treasury. The question then is the depth of malnutrition of thought in these top institutions opposing NPC’s lukewarm suggestions regarding what a developmental state actually is. Only the gods of the empire know.

Perhaps the 30 years of Adelzadeh will ultimately be heeded now that there is an “uncle” in the NPC — albeit still malnourished in thought, but an uncle nonetheless. Perhaps South Africa will finally remove the veil of thought-deficient policy design, understand that political economy must be the organising frame at the centre of our trouble, and dismiss Enthoven’s barren season of hope.